Street Improvement Fees

The League of Minnesota Cities writes:

Briefing paper—2013
Minnesota cities and street improvement districts
League position
The League supports HF 745 (Erhardt, DFL-Edina) and SF 607 (Carlson, DFL-Eagan), legislation that would allow cities to create street improvement districts. This authority would allow cities to collect fees from property owners within a district to fund municipal street maintenance, construction, reconstruction, and facility upgrades. If enacted, this legislation would provide cities with an additional tool to build and maintain city streets.

Sounds like a good idea to me. To be fair, there are opponents. The stated opposition seems odd. They oppose this tool because it is not voter approved, yet I don’t ever recall voting on property tax hikes, or sales taxes for stadia which are imposed on me. The real opposition is because it shifts the burden from one class of taxpayers to another, hopefully so that it is more closely aligned with benefits.
At any rate, our research on the similar Transportation Utility Fees is:

Drew Kerr has a pay-walled article at Finance & Commerce here.

Evaluation of the Minnesota Road Fee Test

MnDOT has posted the evaluation of the recent Mileage Based User Fee test: Connected Vehicles for Safety, Mobility, and User Fees: Evaluation of the Minnesota Road Fee Test:

“In 2007 Minnesota legislature approved a $5,000,000 project in order to demonstrate technologies which will allow for the future replacement of the gas tax with a fuel-neutral mileage charge. The Minnesota Department of Transportation (MnDOT) organized a study to examine the implementation and operation of a mileage based user fee program (MBUF), which might allow for the supplementation or replacement of traditional gas taxes. The primary objectives of the study were to: assess the feasibility of using consumer devices for implementing Connected Vehicle and MBUF applications. These applications included localized in-vehicle signing for improving safety, especially for rural areas, and the demonstration of the proposed Connected Vehicle approach for providing location-specific traveler information and collecting vehicle probe data. The study consisted of 500 voluntary participants, equipped with an in-vehicle system comprised of entirely commercially available components, primarily a smartphone using an application capable of tracking participant vehicle trips. Successfully meeting its primary objectives, the system was capable of assigning variable mileage fees determined by user location or time of day, as well as presenting in-vehicle safety notifications which had measureable effect on the participants driving habits. MnDOT contracted Science Applications International Corporation (SAIC) to perform research for the project and an evaluation of its findings. This document is the final report from SAIC, providing a summary of the study, its findings and an evaluation of the project as a whole.”

The rates tested were:
1. Outside Minnesota miles – $0.00 per mile;
2. Inside Minnesota miles – $0.01 per mile;
3. Twin Cities (“Metro Zone”) – Peak miles – $0.03 per mile; and
4. “Non-Technology” miles – $0.03 per mile.
It looks like there were some technology problems in the experiment (having worked with GPS and in-vehicle devices for research, I believe this is still emerging technology with imperfect reliability, insufficient for mainstream application):

As mentioned previously, trip data was only available for 57 percent of trips generated by the system. Of the 43 percent of trips where trip data was not available, 69 percent of the trip data loss was due to a vehicle detection failure. Trip data was only recorded if the system could both detect the device was in the correct vehicle and a valid GPS signal was found. Therefore, the remaining 31 percent of the trip data loss can likely be attributed to poor GPS signal during trips. Although the log messages associated with GPS availability cannot be extrapolated to measure the number of trips or miles impacted, the loss of trip data resulting from vehicle detection failures or lack of GPS signal during trips clearly identifies GPS availability as a significant system issue. The deployment team’s report provides additional insight into the accuracy of the system as it relates to GPS connectivity and accuracy. Intermittent GPS signal was reported as a contributing factor to lower device miles compared to odometer miles collected.

Just as a random statistic, which probably doesn’t mean a lot, the report includes the word “success*” 27 times and “fail*” 33 times.
I believe MBUF or an equivalent will come eventually, but here and now the gas tax (or wholesale fuel tax, if we want to hide it), properly indexed to inflation and fuel economy, is where we need to be focusing for the revenue required to operate road systems in the US.