We have to have some sort of lead in.
That's we don't need a lead in.
Yeah, no one.
No one wants to listen to a podcast without a lead in.
Welcome to County Connection, the official podcast of the Washington State
Association of Counties, where we dive into the legislative issues
shaping the future of our communities from budgets to public safety,
infrastructure to elections will break down what's happening in Olympia
and how it impacts counties from across the evergreen state.
Stay informed, stay engaged and join us as we amplify the voice
of Washington's 39 counties.
Welcome back, everyone, to episode four of the County Connection.
I'm Paul Jewell, government relations director for the Washington State
Association of Counties and your host on the County Connection.
And I'm here today with Axel Swanson, the managing director
of the Washington State Association of County Engineers.
Axel, we are right before cutoff.
It's Wednesday of Cut-Off Week, week six here in the legislative session.
How are things going for you so far?
Well, thanks, Paul. Thanks for having me back.
It is good to be here at the Wasack podcast again to talk about
transportation and transportation priorities.
And I, you know, overall feel pretty good about session so far.
It's it's very busy.
There are ups and downs and that.
But, you know, if you go into it understanding that and you have your
expectations set and so, yeah, you're right.
Friday's cutoff.
Cut-off can be good and bad, as you know, as a veteran of session.
So double edged sword, that's for sure.
Sometimes things that you really care about and have been working on very hard
don't make it out of committee and other things that you think still need to be
worked on don't make it out of committee.
Or they do make it out of committee.
Yeah, or they do.
But the good thing about cutoff is it's sort of level sets kind of where you're at.
And so it does.
It is to me a significant, I'll call it a downshift, you know, in terms of just
the sheer number of issues that you are trying to educate yourself on and talk to
the members about and just candidly not embarrass yourself about.
I mean, we're getting you're just looking at all the bills that get filed and trying
to do a good job reviewing those and understand the issues.
And it's very easy in that early session environment to miss something or make a
mistake.
Yeah, I was just looking at the number of bills that have been introduced so far in
just the first six weeks of session, including the pre filed bills.
And we're almost at 2000.
And that's just a huge number of bills to try to cover in a short period of time.
Yep, it is.
And you know, what I've noticed more this session than in my previous sessions
doing this is there's a little bit of a rhythm to it.
And those bills that are pre filed for me, at least this year, I tended to kind of
know more about them and understand them.
Or maybe they had a lot of support support or maybe they had opposition, but everybody
kind of knew where they stood.
It's these bills the last couple of weeks before cutoff where I really kind of
noticed, you know, those are maybe newer ideas that a legislator or stakeholders
are excited about, but they haven't been fully vetted.
And so you're getting a fresh look at an idea and language that's going to
potentially become law.
And you're doing it on a quick turn.
Sometimes they get dropped and the hearing is just a few days.
Yeah, especially when you approach these cutoffs, sometimes you get really
important bills kind of right before the end and you've and they can be long and
they can be complicated.
And suddenly you're faced with the proposition of having to make some
decisions on how you're going to take a position on a bill.
And it could be the chair's bill.
It could be, you know, some of leadership or it could be something that's
important to the budget.
We're going to talk about a few of those.
But before we do that, I've got a couple other questions.
If you don't mind, you know, the last couple of times you were here, we've
talked about different transportation pieces and we've talked about some
specific legislation, but we really never talked about kind of why
transportation is so important to counties.
You're the managing director of the Washington State Association of County
Engineers.
And for those who don't know, county engineers really work in our public
works departments at counties and our public works departments are the
departments that are in charge of road maintenance.
Road construction, right?
Bridge maintenance and construction.
Why are counties so interested and why is transportation so important to us
that we have a whole association separate, but affiliated with WSAC that
you manage that oversees this issue?
Yeah.
Well, you know, if you look back or study history and sort of the
development of certainly local governments, you see that transportation
that is getting folks from point A to point B was one of the original just
needs that everybody had an interest in and supported.
And so we're talking like before the rain and roads, right?
We have a little book that our association did around its hundred
year anniversary and that was in 2006.
So, you know, going back and then, as you know, we may need to do a
podcast on this or have done, but, you know, there were counties here before
the state became state 1889.
Yeah, there were territorial counties.
Yeah.
So we, you know, we had very early counties, early county government.
And again, one of those primary early functions was establishing roadways and
being able to get, you know, people around commerce and everything else.
So, so there's a long history there.
The county engineer position, as you mentioned, is part of that.
And it's kind of a very unique position for counties, but also
in statute counties are required by statute to have a county engineer.
And the county engineer has a host of duties and responsibilities that, you
know, are within their purview, not just at the local kind of county
ordinance level, but in statute.
So, so when you say counties are required by statute, that's a legal
requirement that the county has to employ an engineer on staff.
How long has that been the case in Washington?
I should know that.
Off the top of my head, but I don't, but I know that you have previously
interviewed Jane Wall, executive director of the county road administration board.
And so they're largely engaged now with this as they became an agency.
And so the county road administration board is, you know, kind of woven into
the fabric of not only county public works, but the county engineer position.
And they track that and they're part of their role is to make sure that each
county has a county engineer and, or, you know, has someone designated if
should there be a vacancy because of the, you know, the key responsibilities that they have.
You know, I gave a presentation, geez, a couple of months ago at a forestry
conference and one of the, one of the questions that I asked, because people
always ask me what counties do for, you know, what, what, what counties do for
the public and one of my opening questions was I said, who here can tell
me the eight things that counties do for you?
And a bunch of people raised their hand and I said, you're all wrong because
it's a trick question.
There are about 83 things that counties do for you.
But back when I was a county commissioner and you and I served about the same time,
I got elected in 2008 and within the first year or so, an older elderly
gentleman came to see me who was a resident of the county and he told, he
wanted to talk to me about an issue with his farm, but he started out by saying
that he used to be a county commissioner and, and I got to talk into him a little
bit about it and it had been probably 40 or 50 years since he'd been a commissioner.
And one of the things that he told me was back in those days, they called us
road commissioners.
We didn't do all the things that you guys do today.
It really was mostly about roads.
And if you look at a lot of the historical photos that we have around the office,
you know, the old black and whites, it's always the, the county commissioners
together kind of, you know, at the same types of meetings and the same types of
conventions.
So things have really changed over time, but there's a long, long history here
associated with how counties are responsible for and why transportation is
such a big deal to county government and both the members that you represent and
the members that our association wide represents.
Yeah. I think he, I think he said that well, and certainly many of the stories in
the book I mentioned capture that and they're, they're really fun to read.
And, and I should say one thing that we are looking at from an association
standpoint, the Washington state association of county engineers, as much
as we just discussed that county engineer position, our association is
working towards, you know, making sure we're representing the county
public works departments. There are many public works directors that are not
engineers. We care very deeply about, you know, all the other aspects of public
work. We do road supervisors. And you think about like that, you know, just
conversation that you were having with the constituent there, but you know, so
often that's the primary interface people are having is, you know, you come
out one morning and there's four inches of snow and you hear the sound of a
truck or a truck or a truck or a truck or a truck. And then you know, you
come out one morning and there's four inches of snow and you hear, you know,
down the driveway, there's someone's out there plowing or a tree or a branch
had fallen or something like that. I mean, that's a lot of, you know, I think
fortunately the public's interaction with counties is the good work we do
hopefully in the, in the roadway to keep them able to go where they need to go.
You know, counties have a big interest in transportation. How much of the roads,
I think you've mentioned this before, Axel, but for the listener, as we're kind
of talking about, we're going to go into some some legislation here in a
minute, but you know, how much of the roads do counties manage compared to say
cities or the state in Washington? A great deal. And so for a lot of the
history we just got into there, you know, counties have been responsible and in
charge of roads for a long time in the state, even before stated. So we, we own
the majority of, you know, road miles, whether you want to say we have 39,000
centerline miles, which would be one way and then the other way, or 78,000 total
lane miles, which would just be, you know, the amount of road we own one
direction. But just to put that in perspective, that is, you know, more than
half of all of the lane miles that are owned by the state, the cities, and the
county. So think of those three jurisdictions put together. We own, you
know, well over half of those. So the counties own more than the cities and
the state combined? Correct, yep. Okay. Now what folks need to understand, and
I've said this before, is cities are all obviously incorporated in urban and then
the state owns, you know, our large infrastructure, the highways in the
state highways. So we do not have the average daily traffic, the number of
vehicles or people going from point A to point B, that oftentimes certainly a
state route would have or a city street, but we just own a lot of infrastructure.
Okay. Now you got a recent study too, that talked about, you know, some of our
needs for the transportation system, some of, and I know it helps to
define some of our priorities, and this year, as you know, revenue for
transportation is a priority for WSAC. What did the recent study say that could
be relevant to our conversation today? Yeah, it doesn't paint a good picture of
our local county revenues being able to keep up with our needed
expenditures. And just before we leave the infrastructure piece and move on to
the road usage charge bill and or our revenue situation, the other thing about
all those lane miles, and I've mentioned this too, but when you have that many
lane miles of road, you got that many water crossings and bridges. And so
counties own 45% of all the bridges in Washington, so almost half, not quite half,
of all the bridges in the state are the responsibility of counties. And we must
be the envy of everyone. Those bridges are really expensive. That makes us
really valuable, doesn't it? No, it doesn't. And you know, and if you think
about when infrastructure was built and sort of things like that, we have a lot
of them that are of a similar age and starting to deteriorate. And we do a
great job of inventorying them and checking their condition, but you know,
they're just getting older and they're expensive to fix. We have roughly 4% of
the county bridges are what's considered in poor condition. And when you use
percentages, sometimes it's hard to tell, well, you're doing pretty good, but
that's 150 bridges around the state that are in poor condition. What do you do
when you have a bridge that's in poor condition and you don't have the money
to replace it? Because that's why I assume, I assume it's rated in poor
condition because if they had the money to fix it or replace it, they would have
done so already. So what do you do in that instance? Yeah, certainly we would
always hope those bridges, you know, and again, it's one of the reasons we keep
close track of this and categorize things, but it could mean a number of
things. So it always kind of depends on, you know, where the bridge is, what the
situation is, but certainly it could mean it's load rated. So it's, there's
signage saying, you know, that the bridge cannot take, you know, a load over this
number of pounds. So I've seen those signs. So that's that sign that'll, it
basically says, you know, like a gross volume weight limit and it'll say bridge
ahead is limited to, you know, 10,000 pounds or 2,000 pounds or whatever it
might be. And so what does that mean? Does that mean as I'm approaching the
bridge and I should know the weight of my vehicle and decide whether I'm going to
cross that bridge or not? Well, certainly that's, yeah, I think that's the idea. And
I'm not a complete expert on, you know, load weights and trucking routes and
things like that, but certainly the hope is that if you're carrying a load
that's a significant amount of weight, you are responsible for paying attention
to those things. And in many cases, I would think even planning your route or
knowing what route is available to take. So that really applies to people that
are hauling things. Yeah, I think in most cases, but again, going back to like if
the bridge is in poor condition, it could be any, it could be, I mean, you
might have something occur that creates a problem or it's happened over time. But
again, going back to the county engineer and other staff, part of that job was it
to make a decision and, you know, that could be closure and a detoured route, or
it could just be it's in poor condition and it's on, you know, a priority list
for repairs. So there's obviously a scale like with anything else there. So how
many did you say, well, we had that we're that rating? I'm just looking at the list
here and it just looked like of all of them, roughly 4% currently for counties
are on a, and that's 150 are on a poor condition list, you know, so we going
back, you know, we've got a lot of priorities, we have a lot of
infrastructure, which means we have a lot of priorities. The study we just
received, which you mentioned shows that. And unfortunately, what it shows is that
we're going in the wrong direction with the revenue that we have available,
especially the two primary revenue sources, which I think is what we should
talk about, maybe focus on today. The two primary revenue sources that counties
depend on for the road fund are first property tax, which probably a time for
another podcast, but also relevant to our legislative session. You know,
property tax for counties is not only complicated and controversial, but it's
been capped at 1% plus new construction since I think 2001 or so.
Well, and it's not just transportation that relies on property tax. The counties
rely on property tax for most of the general functions of the county
government. Correct. And so that puts added stress on general fund mandates
and requirements, which in some unfortunate situations can also lead to
more stress on the road fund itself. But that being said, the road fund in one
nuance here that this study does that the previous study we did didn't do the
previous study kind of looked at all counties and it did. It did break them
down urban versus rural. This one breaks them down into smaller categories. The
reason that's important is you can really see which counties kind of by
rural or size population base, those kinds of things rely on which revenue
sources more. The reason I bring that up is I kind of always assumed for a long
time that property tax was the primary revenue source for county road funds. I
knew that fluctuated dependent on kind of the county and the size of the county
character of the county, but I was wrong. And what the study shows is that the
more urban a county is. So overall, if you roll up all counties statewide, the road
fund is about 50% dependent on property tax and about 20% dependent on motor
vehicle tax. I'm sorry, gas tax, just say gas tax. If you look at what we would
label rural frontier one counties, so the kind of think the most rural counties
we have, they depend on gas tax not for 20% of revenue, but for 40% twice as
much. That's the rural counties? Rural counties. Wow. And then if you jump over
to urban counties, be our larger urban counties, they're 15%, but their property
tax is at 62%. Whereas for those rural frontier one counties, it's at 33%. So
about half as much. There's a big difference. Well, that's interesting. I
would not have intuitively thought that that was the case. I would have actually
thought exactly the opposite. Yeah, and it kind of caught me as well. And it's
one reason I like the different way that the study was done this time. And I think
some reasoning around that's got me thinking about property tax a little, and
maybe you, looking forward. But there's just, there's in our rural counties,
there's not much of a tax base, right? Also, and now we're just you and I talking
here without thinking it through, some of those rural frontier one counties,
I'm thinking to have a lot of timberlands, which I know you're a subject
matter expert in, but a lot of public timberlands potentially, which also would
limit, I think, your property tax base. So I don't know, some things to think about.
Those things definitely would. And I have to tell you, talking about things on the
podcast without fully thinking them through is my specialty. So we
should not hesitate to do that. In fact, I think our listeners expect us to do
that. But no, I think you make some really interesting points there. You're
right, in general rural counties will have a lower property tax
base. It's because their property values are lower. That's one case, because they
have less urban areas, right? Less commercial and industrial property, etc.
Generally more agricultural land. Or it could be other types of resource lands
that you mentioned, like timberland, which are taxed at much lower rates, both
agriculture and timber. And then if you throw in a fairly good
percentage of public lands that don't pay any taxes at all, I guess it kind of
makes sense. But I thought at the same time, because they're smaller, more rural
in nature, and don't have as many residents, they also wouldn't have as
many fuel sales, you know, sales of motor vehicle fuel that they would also be
getting taxes from. And so I thought that might even it out a little bit, but it
doesn't seem to be the case. They're actually more reliant on the fuel
sales than they are on the property tax as a revenue source. Correct, that's what
the study is showing. I think that goes to the model for how we distribute motor
vehicle, just let's just say gas tax, for how we distribute fuel tax or gas tax
around the state. And it's a combination of factors. And the first factor is 10%
of fuel tax in Washington State is distributed kind of on just a even or
equal share basis, which, you know, again, depends on where you're coming from. But
that is helpful to a, I don't know, maybe a Wacayacum County or a, you know, a very
tiny county in terms of population, you know, and even size that... So
they're getting an inordinate share in that particular case. Yeah, I can't
remember what year, but a while back there was, you know, that this was studied
and it was kind of looked at for gas tax distributions and kind of, you know, how
that works. And I think we touched on that previously in one of the other podcasts.
We may have, yeah. So the other things, gas tax distribution looks at, there is
population and that's important, obviously, for our urban counties. So it
takes into account like equal share and then there's a population percentage, I
think it's 30% based on sort of population. And then it also takes into
account sort of the number of roads, that infrastructure component, because you,
you could have a very low population county, but a lot of roadways or road
miles, not the best example, but like Spokane County, I just know off the top of my head,
they have a lot of infrastructure and road miles. So they would do better in
that category because of the amount of infrastructure they have. And then there's
another one that actually associates costs. I don't know if it's cost of
replacement or cost to maintain that system, because you could have, you could
have a different infrastructure that costs different amounts. Sure. I mean,
the narrower roads aren't going to cost as much as say wider roads with paved
shoulders or sidewalks in some cases, more some of them were urban counties. So
you're saying the money gets split up all those ways it considers, you know,
some of it gets just evenly split between all 39 counties. Then there's a
population percentage, then there's a road miles or road mileage percentage,
and then there's a cost of maintenance percentage. Yeah, I think that's close
enough. Yeah, interesting. And again, you know, these things are out there and so
we could touch on that in the future. But yeah, I think that the takeaway for gas
tax, which is kind of primarily a good segue to what we're going to be talking
about with the road usage charge, it does have a distribution model. And actually
the current proposal that we'll get into, one of the things we like about it is it
maintains that distribution model. Okay, so this is the second time you've
mentioned the road usage charge, which is a little bit of a spoiler alert because
I know we didn't really start the podcast saying that that's what we're
going to talk about today. But I know that is the legislative proposal that you
wanted to get a little bit into. And but you wanted to give some of this, you
know, foundational or pre information first. Yep. Why don't we start? Why don't
we get into the road usage charge? Let me argue with you on that a little bit.
Okay, do I love a good argument? No, here we go. No, I am I am messing with
duck or razor clam. That's all I need to know. Yeah, I am messing up the segue a
little bit because I didn't get into some of the so just to close the loop
on the study. So we talked a little bit about we jumped right into the which
revenues are most important to county road funds, property tax, gas tax. We
didn't talk about sort of some of the other conclusions in the study that I
think are important. Those being and I'll just I'll keep it brief. But when
you look at the revenues that we can generate statewide versus what we're
what we need, we are going behind. And so what the what the group found that put
the study out was that we're falling behind now somewhere between 800 million
and 1.5 billion dollars a year, 1.5 billion with a B. Yeah, and that's up. So
we did the original study in 2020. And that number was about 720 million to 1.2
billion. So you can you know, that's been adjusted now. And you can see it's not
going in a better direction. A lot of the reason that's increased too is with this
study, we were able to do a better job of accounting for some things that we
weren't able to do in the 2020 study. Those would include costs associated
with fish passage barriers, which we have a lot for that reason. I said we own all
those lane miles. We have a lot of water crossings. Unfortunately, we have a lot
of fish passage barriers that we need to replace. Right. There's a lot of safety
projects we were able to kind of look at for this. ADA compliance, planning and
transitioning. I feel like we could do a whole podcast just on fish passage
barrier. We could and we probably should. There's a lot going on with that. And so
anyway, the good the good news, I guess about the bad news is we were able to
pull in some costs that we have a better handle on now than we did in 2020. And so
you see that number go up. And we also estimate that we're somewhere between
3.4 and 4.3 billion dollars kind of total in total behind on deferred
maintenance. So it's a it's a growing problem. The gas tax and its structural
decline and we'll get into that with the road usage charge talk is a is a part of
that as well as the sort of the flat revenue growth. I guess you can't call it
revenue growth. It's flat, but the property tax not growing as fast as
inflation is creating that issue too. And so the the the study had a number
of recommendations and I'll I'll save those for another another show. But but
yeah, we are definitely going the wrong direction and the road usage charge has
been an idea around for a long time and it's been a bill before and it's come
back this session and I will I'll leave it to you to ask me some questions about
it. But I will say it's one component I think of a transportation revenue
solution. Well, you know, most people just let me have a conversation but you're
like cracking the whip over there and saying, hey interviewer, do your job. Okay
let's let's let's get into it then. So the road usage charge so we've
established let's go back a little bit. So we've established why transportation
is important to counties. We kind of talked about some of the recent
information that you got on the updated study around you know the costs for
maintenance and how our revenues are keeping up or in most cases not keeping
up with that preservation and preservation. Wow I'm having a hard time
with that word today. Preservation and maintenance kind of agenda. But here we
are now and the legislature is looking at it a whole other way potentially to
fund the transportation system and that's what's called that's what you've
referred to a couple of times as the Ruck or the road usage charge. In like 10
seconds or less why is this new proposal where did it come from and why is it
even necessary to think about? It's necessary to think about because we've
known for a long time I won't say decades but probably decades that the
gas tax as our primary funding source is going to decline and not keep up with
the need to maintain our transportation system. So we've been looking at this
understanding the problem is coming and trying to come up with a solution and
studying solutions for quite a while because we are also working
towards environmental goals and those are important policy initiatives and
when you do that we're looking at trying to get away from gas-powered vehicles so
we are there we're seeing many many more hybrid and electric vehicles on
the road being purchased and driving and so those vehicles are not paying
gas tax. So that's a you asked for a short version that was a long version
but yeah the short version is fuel economy is unfortunately leading us to
a situation where we can't pay for our transportation system. So we established
just a few minutes ago when we were talking about how counties pay for
transportation that property tax is a big piece and that fuel that gas tax is
another another big piece and what you're saying is we've known for a while
that gas tax revenues are actually going to decline if they're not already
declining and it's a function of fuel efficiency in vehicles and you also
mentioned some of our broader environmental goals around greenhouse
gas emissions and reductions and less reliance on fossil fuels which is
fueling the, for lack of a better word, the transition to more electrical
vehicles. So is this new road usage charge first of all is it what it sounds
like and secondly is it meant to provide new revenue or is it meant to replace
the revenue that we currently get from gas tax? Yeah so great question and
that's why I kind of let in with saying we feel that a road usage charge is a
component of a solution because the way that this has been studied and again
this has been studied by our Washington State Transportation Commission for well
over a decade. I think they've been working on this since 2012 and so for
any listener who wants to look into this I highly recommend going to the
Washington State Transportation Commission website. They have an entire
page and volumes of information that they have made available there and it's
really interesting. Sounds like exciting stuff. Well it is and I think but
you know I am engaged in this and there's been two hearings about this and
I want to acknowledge and respect the fact that I'm hearing a lot of questions
about it and concerns and we've worked through those you know not all of them
in fact we're still kind of thinking through some of these but I think it's
important to point people in the direction of the Transportation
Commission because they've done a lot of this work and they're really good at
answering some of these questions. So the road usage charge or a per mile charge
it's not a new concept. I think I'm looking at some information the
Commission's provided. There's four states that have adopted some version
of a program and then there's another 40 states that are researching it and we
you know we're included in that. Okay but you said so this says this is called a
road usage charge but you just call it a per mile charge. What's the
difference and what do you mean by a per mile charge? Am I gonna pay for every
mile of road that I use? Do I pay for all the you know miles of roads that exist
in some sort of new program? How does it actually work? Yeah so at the most
fundamental level I think it's important for folks here too that I think one of
the biggest questions we get as well you know so am I gonna continue to pay gas
tax and then have a road usage charge and we'll get into that. When I say
per mile charge it is in the road usage charge is intended to kind of replicate
or look a lot and feel like a gas tax. Right now you know depending on your
car's fuel efficiency you go and you fill up your tank and as part of
that charge for the gas you're paying tax that comes and pays for the road
that you're gonna drive on. So depending on your vehicle's fuel economy you're
paying some amount per mile right? Per mile to get there already. Yeah if I've got a
more fuel efficient car I'm probably paying less if I'm driving a 1975 GMC
you know power wagon or was it Dodge that met I think it was Dodge that made
the power wagon excuse me Dodge I'm probably paying a lot more per mile. You
are under the current gas tax system correct so the road usage charge would
have an impact on that but you this what this tries to do is tie your amount
owed directly to how many miles you're driving. Now I want to slow down on this
a little bit the bit because we're talking about a specific bill we're kind
of talking about a concept but then we can't go too slow we'll be here all day. Yeah we
will but well I just want to pause here to say the bill that's being considered
House Bill 1921 and there's a Senate version it starts off in phases and and
it starts off voluntary so that's that's an important thing because I think the
sponsors would kind of be the first to admit we don't have every question
worked completely out. How it's set to start is that electric vehicles would
could would and could volunteer in first. Why would they? I mean well how do you
have a new tax or a charge that's voluntary? Because currently electric
vehicles do pay an EV registration fee and the road usage charge while it's a
per mile charge which is different than a flat fee will be paid similarly at
the time of registration and so the idea is to get electric vehicles and I think
the bill I should know this but the previous bill that I I think this is
included in the current legislation to incentivize or to get the electric
vehicle owners to to move over to the program and to begin voluntary
voluntarily utilizing it I think their initial RUC charges are capped at their
current EV fee right so they're so basically saying we're trying to move
folks over and get get an idea for this and implement it we're not gonna make
you initially pay more than your current EV fee I think that was at least a piece
of the previous legislation. How are hybrid vehicles included? Are they the same as EVs?
They will come in next because there is also a $75 hybrid vehicle fee
currently so that fee for someone volunteering would go away now it gets a
little trickier so right now obviously EVs no gas tax right right because they
don't use gas that's pretty straightforward right I'm paying a per
mile charge we're gonna keep track of how many miles I've driven and the rate
is 2.6 cents per mile and there's a reasoning for that calculation if we have
time for we can get into but that will that will calculate the rate and then I
think like I said at least initially it's capped at your current EV okay
that's a key that's a key piece that you just mentioned 2.6 cents per mile
that's the rate for the road usage charge that's the road usage charge is
that the same rate for everybody or is it just for electrical vehicles it is
the same rate for everybody okay now let's get back to the high oil go ahead
well but you also mentioned another thing is you have to keep track of how
many miles you've driven so you can pay that rate I have a couple questions
first of all do you pay it at the end of the year let me just say I hope I can
answer your question okay do you pay it at the end of the year do you pay it at
every month do you know is it a quarterly thing based on how many miles
you've driven number one number two how do you keep track of it and number three
what if you drive out of state or even out of country for a significant portion
of you know your your mileage for instance how is that taken care of yes
or considered so thank you for all those really technical challenging questions
hey now listen inquiring minds want to know yes and for the listening public I
am going to take a shot at answering those but I am going to reserve the
right to be wrong and also I already said this the Transportation Commission
has done a great job studying these questions and I have also said some of
these were I think gonna kind of work out and and tweet it should the bill
pass again that's why it's phased in involuntary is to see how the mechanics
of this will work so let's try to remember your first question hey just
for just for just for everyone's information though this is the County
Connection podcast we're talking about political issues here the right to be
wrong it's written in the fine print right when you subscribe to the podcast
so everybody knows that going in okay just make sure all right so I think your
first question is let's talk about the 2.6 and does everybody pay the 2.6 cents
per mile right so for the road usage charge piece yes so so how do I pay it I
think was your other question right so that a huge issue with this bill
legitimate issue that gets raised is protecting privacy so the default that
the Transportation Commission has recommended for reporting your miles and
kind of working through that is an odometer reading so when it's time to
re-register your vehicle you would go in and you would report your odometer
reading at that time and that's I believe when the calculation happens so
now let's just take the most basic case electric vehicle I'm currently paying no
gas tax right I go in it's time to re-register okay what's your odometer
reading it's this amount so a number times 2.6 right okay there's your ruck
charge for this year now again in the phased-in approach I think their ruck
charge for the EVs is initially capped it they can't go over what they would
have paid for the EV fee I got to look into that and I hope I'm not passing bad
information but that's how that I'll call it the most clean version with an
electric vehicle paying no gas tax would happen now let's contrast that with your
current you drive a current gas-powered vehicle now okay I'm gonna be in the road
usage charge program I'm gonna start paying per mile but I still have to fill
my vehicle up with gas right so I'm filling my vehicle up with gas I'm going
going to work and stuff it's time to re-register my vehicle I go in same
thing I report my odometer reading so 10,000 miles or whatever mm-hmm times the
2.6 that is the road usage charge that I owe for $260 but I am credited the
amount of gas tax I paid and the way you do that math problem is the same
mileage against your vehicle you know the owner's manual and miles per gallon
okay so let's so that's where it gets a little tricky and I think my car
actually a more modern car though will actually tell you what miles per gallon
you're getting they don't use that reading they're gonna have to use
probably the manufacturers average right they got a they got to have a number
okay so that will be your credit so I think it's this is and for me admittedly
this has been a tricky part for me to understand because it's like well wait
I'm still paying gas tax I don't then I'm paying well they just get rid of the
gas tax there's a lot of again there's a lot of reasons for that there's federal
gas tax there's yeah but they can get rid of the state portion of the gas tax
so so let me let me slow down and let's work through these one at a time because
we might get into that so the amount you've paid per your vehicles miles per
gallon times the miles you've driven that's your credit on the road usage
charge so you actually could owe zero right does that make sense
yeah sure come in to register your gas tax paid credit might be more than your
road usage charge at which point you just take your registration and you're
good you might you don't get a refund no you know you might owe a little more so
you might what I'm saying is if if my road usage charge was less than the gas
tax I paid I don't get the difference back I don't believe so okay again a guy
can we're talking through this I'm not I'm not the expert I have looked pretty
hard at this stuff but okay so that that I what I tried to do there and hopefully
I did it accurately was to talk about kind of the the easiest version which is
a EV which pays no gas tax odometer reading times the 2.6 cents that's my
road usage charge for the year versus I still own a gas-powered vehicle and
again that's in the outer years I can't remember the schedule but not till you
know late 2029 or something we start to bring in gas-powered vehicles now you
are having to work through that credit situation you also asked me about out
of state miles great question a lot of people have this question you know or you
know or I'm I spent a lot of time on federal land or you know whatever maybe
it's a work truck you know and you're a farmer and it's almost correct half or
more of the miles are just on your own property so they the bill tries to
account for those and certainly the Transportation Commission has thought
about that and studied it I don't know that they believe they have a perfect
solution for every one of those situations there is I think in the bill
an automatic 200 mile deduction for what we might call out of so out-of-state
miles so right off the top everybody who would be in the road user charge program
as I understand it you get an automatic like 200 mile comes off of your per
miles that you report because it might have been on a driveway or it might have
been in Oregon or something like that that came up you know in questions and
concerns because people could have a lot of examples around like that's great but
it doesn't work you know one trip somewhere else could be more than 20
miles sure so there are other things in the bill and certainly that we would
want to work on moving forward to where you are able to account for those miles
and then report them so you know I I drove this many miles because this was
my job or whatever you know in Oregon and how does this affect private vehicles
versus publicly owned vehicles like county fleets is it exactly the same I
think so and I should have started there this is vehicles that are ten thousand
pounds and under and weight so this actually the bill primarily passenger
vehicles yeah passenger vehicles would not impact you know larger vehicles that
are subject to you know weight fees and other things so that's another piece of
this that so like for instance semi trucks and things like that they
wouldn't be part of this correct at least not initially with this bill and
again remember this bill is trying to take many many years of study and
recommendations and slowly kind of incorporate and implement the beginning
stages of those so interesting but aren't some of those larger vehicles
actually a lot harder on the roads well you certainly could argue that yeah the
more they weigh and that you know the miles driven and impact but but again
they're paying weight fees there's other things going on there and I think you
know there is study and plan to address that but this program in the bill starts
off with vehicles ten thousand pounds in them okay so I guess we'll have to stay
tuned on that I'm sure there's a lot more here as far as details and probably
people have a ton of questions yes this is the this is the one time I'm glad we
don't have a call in line because I think we'd be here forever but I want to
get to other parts of this bill really quickly and we don't have a lot of time
left but the one piece that I'm really interested in is how do counties benefit
here how how do counties get revenue for their transportation system because the
current system with motor view you know motor view motor vehicle fuel taxes I
should just say gas tax yeah I know it you know that is shared with the
counties right the the taxes are paid and we get a percentage of that are we
gonna get a percentage of this road usage charge as well how's that gonna
work yeah and and that's one of the reasons you know we care about this so
much is from the standpoint that as the state's been looking at this decline in
gas tax we have to pay attention to that too for the reasons I mentioned earlier
we are very dependent on gas tax depending on your county will depend on
the percentage that your budget relies on that but everybody very much relies
on gas tax when it comes to county roads so with that being said our interest is
making sure well let's start here too in I think 20 let's call it 2019 was maybe
the peak of gas tax collections and so since then we've seen declines and there
is a forecast and a projected decline certainly we're thinking we're gonna
bring more electric vehicles online and that fuel efficiency through hybrids
etc is going to continue to require less gas tax so the projected structural
deficit for fuel tax is there and known and that's why we have an interest is
because we can't allow our you know number one or two transportation revenue
source to actually decline when nothing else we're seeing in terms of cost and
need is doing the same thing so that's the problem statement it's very clear
why this bill works for us is it it does it maintains the current fuel tax
distributions for counties and for cities and and that's important to us we
can continue to talk and debate whether that's enough or if that distribution is
fair so the way that the gas tax is distributed now the new road usage charge
will be distributed in the same way correct it maintains the distribution
formulas that the current gas tax does now we know if it will generate more
revenue or less revenue or the same amount of revenue it will and there's
some nuance here people will say well if it's just replacing the gas tax but I
also hear it's gonna generate more revenue you know there's a natural and
maybe fair skepticism there but if you think about a current EVs are not paying
it right so it's going to spread out and apply to more vehicles so as you add
more vehicles and more vehicles are paying I'll call it their fair share it
does increase the pool of revenue so the individual is not meant to pay more in
gas tax but it will more fairly spread out who's paying gas tax and increase
the number of people paying gas tax which will raise revenue over time now
also we should say the legislature can change things and you know could change
things in the future in terms of an increase I mentioned 2.6 cents per mile
well that was gonna be my next question is how stable is that well it's it it's
as stable as the current fuel tax right I mean they could change that if they
want to yeah it feels like every time you turn around there's a new increase
on the fuel tax so it and that hasn't been keeping up with the need so so yes
it will I think at least with the current situation we have more fairly
spread out who's paying for the road network so that was House Bill 1921 and
has that had a hearing yet it did it was heard in the house last week I believe
on Thursday and then it was just heard yesterday in Senate Transportation
Committee meeting in the afternoon the Senate version which I don't have the
bill off the top of my head all right so your prediction is this gonna pass this
year well we'll see this bill I think came up I shouldn't say this bill a
pretty different bill but a road usage charge bill came up in 2023 I believe
and that did not obviously get through but you know we'll see where this is at
I would expect House Bill 1921 will move out a committee and then you know from
where it goes there I'm not sure I think you know there's a lot there's admittedly
a lot of work to do with this idea in terms of what we're doing which is
talking about it and kicking back and forth these questions and concerns and I
think like I said the privacy issue some of the questions out-of-state travel
there's good questions with regard to this policy change and the transition
from a gas tax to a road usage charge I think where we're at is we're kind of
settling in on the fact that a change does need to happen we can't keep going
forward with a safe transportation system being funded by a declining
revenue source so I think we're there as far as a change needs to happen I think
what we like about this bill is the slow phased in voluntary approach it takes
you know the ability to make some some tweaks and changes as you go but that
being said absolutely acknowledged there are there are still questions and
concerns with this and you know so if nothing else hearing on Tuesday hearing
last week maybe some future hearings words getting out and people are having
an opportunity to engage on the idea okay well Axel fascinating topic sounds
to me like we're gonna have to be back here talking about it again it'll be
interesting to see if it actually moves forward this session or if ultimately
it's decided a lot more discussion and more analysis needs to take place I know
they've been studying it for I think you said a decade or more I think since
2012 they first got you know some direction to work on it I think people
are still gonna have a lot of questions yeah yeah I agree well thanks for the
chat today great topic very fascinating lots of in-depth analysis we look forward
to talking to you about it again to them take care thanks Paul thanks for tuning
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