Inside the Politics, Progress, and Future of Road Use Charging

For leaders of state and local transportation agencies, navigating periodic budget challenges or taking advantage of new funding opportunities as political or economic headwinds shift is just part of the job. But one of the most significant transportation funding changes has little to do with Wall Street or Capitol Hill. Instead, it stems from a structural change in the types of cars people drive: declining gas tax revenue as electric vehicles and high-efficiency cars become more common.

Gas taxes remain a major source of transportation funding for most states. The average vehicle today, however, travels roughly 40 percent farther per gallon than it did when the federal gas tax was last increased in 1993. As vehicles consume less fuel—or none at all—this revenue stream continues to shrink. To maintain sustainable funding for roads and transit, governments in the United States and abroad are exploring a number of alternatives that could supplement or eventually replace the gas tax.

One of the most widely discussed options is Road Use Charging (RUC).

At its core, RUC charges drivers based on the number of miles they travel on public roads. The concept is simple, but the debate around RUC has centered less on technical feasibility and more on political concerns and ideological questions like: taxation, privacy, fairness between urban and rural drivers, and the long-term structure of transportation funding.

Despite these challenges, several states have begun implementing or piloting RUC programs, creating early models for what a modernized road funding system could look like. Via has supported RUC demonstrations and studies in several states—including Washington, Michigan, and Minnesota—with our Customer Account Management (CAM) platform and program management services.

Policy and Political Dynamics

If the general logic behind RUC is relatively straightforward, the details of how to implement a program and the politics surrounding it are far more complicated. Legislators typically confront three major concerns when considering RUC programs: privacy, taxation perceptions, and urban-rural equity.

Privacy concerns arise primarily from programs that rely on location data to calculate mileage. Drivers may worry about how their travel information is collected, stored, and used. As a result, some early programs have begun with simpler approaches—such as odometer reporting—before introducing more advanced data collection tools.

Another challenge is the perception that RUC represents a new tax rather than a replacement for the gas tax. Even when programs are designed to maintain existing revenue levels, opponents often frame them as additional costs for drivers. Some states have addressed this concern by first applying RUC to electric vehicles, which currently contribute little or nothing to fuel tax revenue.

Finally, rural-urban equity remains a major topic of debate. Rural residents typically drive longer distances for work and services, meaning a per-mile system could increase their costs relative to urban drivers. To address this issue, some early programs include discounts, income-based adjustments, or different rate structures.

States Leading the Way

Several states have begun experimenting with RUC through pilots or voluntary programs.

Hawai‘i became the first state to commit to a mandatory RUC transition when the legislature passed SB 1534 in 2023. The program initially applies to electric vehicles, allowing drivers as of last year to choose between a flat annual fee of $50 or a per-mile charge of $8 per $100 miles (capped at $50). Over time, the program is expected to expand to all light-duty vehicles.

Hawai‘i’s geography simplifies implementation: because it is an island state, travel to and from other jurisdictions—one of the biggest technical challenges for RUC—does not apply.

On the mainland, Oregon, Utah, and Virginia have launched voluntary programs.

Oregon has been exploring mileage-based charging for more than two decades, first establishing a legislative working group in 2001, and completing several successful voluntary pilot programs, branded as “OReGO.” Partially because of this long-track record, Oregon’s regulatory framework is one of the most well developed nationally, including a nation-first option to track and pay for only in-state miles traveled, rather than total miles driven, using an installed GPS-device option for tracking travel. The Oregon Legislature took a big step last fall when it passed a new 10 year transportation funding package (although the future of this package is murky given ballot measures aimed at repealing tax-related portions of the law), which included authorizing legislation to begin phasing in a mandatory road usage charge program for electric and hybrid vehicles by 2031. By the end of 2028, all electric and hybrid vehicle drivers will have a choice to pay a $340 flat fee or pay by the mile at a rate of 2.3 cents per mile. By 2031, all electric and hybrid vehicles, including those participating in previously existing pilot programs, would be required to participate in the RUC program.

Utah’s program initially focuses on electric vehicles. Policymakers framed the policy around ensuring that EV owners “pay their fair share” compared to drivers of gasoline vehicles. Similar to Oregon, participants can choose to pay a flat alternative fuel vehicles fee of $143.25, or pay mileage fees at a rate of 1.11 cents per mile (up to the same $143.25 flat fee), which guarantees the program is not a net negative for drivers and in particular benefits drivers who only travel short distances.

Virginia’s Mileage Choice Program, launched in 2022, also takes a similar framing to Utah as a consumer benefit instead of a tax increase. Drivers choose to register for a per mile charge rather than pay the state’s highway use fee for electric and highly efficient vehicles. The per mile charge is set by dividing a driver’s expected highway use fee by 11,600 (the average number of miles driven per year by all Virginians), and participants are required to use an installed mileage tracking device supplied by one of the state’s RUC vendors. And just like in Utah, per mile fees are capped at the cost of the highway use fee.

Beyond these operational programs, several other states—including California, Colorado, Washington, and Minnesota—have conducted federally funded pilot programs.

Minnesota’s Road Usage Charge (MnRUC) Demo, launching in March 2026, will be the first to directly involve an automaker partner to source mileage and location data. As a result, drivers will only see simulated charges for the miles they drive while at home, without any additional hardware, apps, or regular inspections.

The View From Across the Pond

The United States is not alone in confronting declining fuel tax revenue. Policymakers in the United Kingdom have periodically explored national road pricing as a replacement for traditional fuel duties.

The current UK government has proposed introducing a road usage charge for electric vehicles beginning in 2028, with EV drivers paying approximately 3 pence per mile and hybrid drivers 1.5 pence per mile on top of existing vehicle taxes.The UK government expects this to generate approximately £1.1 billion in its first year, helping to offset the loss of fuel duty revenue while ensuring that all road users contribute to infrastructure maintenance.

Because the UK’s transportation policy is highly centralized at the national level, implementation timelines can move faster than in the United States. The results of the UK program could provide valuable data on how mileage-based charging affects driver behavior and revenue stability.

As fuel tax revenue continues to decline worldwide, experiments like these may play an important role in shaping how transportation infrastructure is funded in the coming decades.