Gas tax in Oregon

A few days ago, I was reminded of Johnny Carson’s quip, “I did not know that,” when I read that February 25^th was a special 90th anniversary for Oregon—in 1919, Oregon became the first state in the union to implement a tax on gasoline sold at the pump.

The tax of one cent per gallon was based on a simple and straightforward idea that those who use the roadways ought to pay for their construction and maintenance. Oregonians did not implement a general tax on the population but, instead, and correctly, directed it only at the users of the service. What a novel idea for that time period, when automobiles were still being thought of as horseless carriages by many in this country and elsewhere!

As automobile usage increased, other states and the federal government also followed up with gas taxes. And, yes, taxes have gone up, largely to keep up with inflation. Now, when we purchase gas in Oregon, the price for every gallon at the pump includes a statewide tax of 43.4 cents, and a federal tax of 18.4 cents. Local governments have the authority to charge additional taxes as well. Of course, there is a comparable tax on other types of fuel too.

It was also in 1919 that Dwight Eisenhower participated in the army’s exercise to study the logistical issues in moving military vehicles and equipment from coast to coast, along the Lincoln Highway. It was this, together with his war-time experiences in Europe, which led Eisenhower to call for a national system of highways when he was elected to the presidency.

The two unrelated events of 1919 continue their influence on us even today, through gas taxes and a complex network of federal and state highways. At the same time, we are also in the middle of intense public policy discussions related to gas taxes, and the conditions of the roadways, which seem to be regressing.

According to the National Surface Transportation Infrastructure Financing Commission, America’s transportation infrastructure is falling apart—sometimes literally. In its report to Congress on February 26^th, the Commission noted that “over half of the miles that Americans travel on the federal-aid highway system are on roads that are in less than good condition, more than one-quarter of the nation’s bridges are structurally deficient or functionally obsolete, and roughly one-quarter of the nation’s bus and rail assets are in marginal or poor condition.”

The report recommends implementing a mileage-based fee system by 2020, with modest increases in federal fuel taxes in the meanwhile in order to get out of “the hole we have dug for ourselves.”

Well, the forward thinking public policy pioneers that Oregonians are, we have engaged in an interesting discussion over the last couple of years on precisely this same idea of charging road users not by the gallons of gas bought but by the miles travelled in the state. Yet again, Oregonians are a few years ahead of the federal government. While that is being debated, our lawmakers are exploring the merits of increasing the gas tax—proposals range from an additional two cents per gallon, to as high as six cents.

However, to a large extent, such discussions are not entirely new. Almost 15 years ago, I was a junior participant in similar policy discussions in my earlier career as a transportation planner in Southern California. Even then, there was very little disagreement on the state of roads and bridges—this was years before the catastrophic bridge collapse in Minneapolis in the summer of 2007, which served as a tragic reminder to those who were in denial about the state of the transport infrastructure in the country.

The intense disagreements were related to the challenging questions of appropriate user fees, while recognizing the need for fairness and the impacts that fossil-fuel based transportation have on air quality and global warming. These are issues that have become a lot more serious over the 15 years.

Thus, after years of deliberations, I am ready for action. Perhaps there could not be a better time than the 90^th anniversaries of the first gas tax and Eisenhower’s transcontinental trip to advance this item as a part of the overall strategies related to the depressed state of the economy. We certainly do not want to wait until the 100^th anniversary of the gas tax!