Context and Considerations of a Mileage Fee for Michigan

This report explores and explains options related to a potential mileage fee for Michigan. Mileage fees, (also called vehicle miles traveled fees or road usage charges), are distance-based fees levied on motorists for use of a defined network of roadways (U.S. Department of Transportation Federal Highway Administration, 2012). In other words, they are a simple market-based fee for service. Mileage fees can also include time, geography or congestion levels. Instead of continuing to raise fuel taxes to pay for transportation infrastructure, a mileage fee could more fairly allocate costs based on the number of miles driven, the time of day, the route taken, and the weight of the vehicle. This overview includes: potential economic, social and environmental benefits and challenges; practical options for data collection and fee collection; financing models and potential costs; and implementation and phasing options and strategies.