Launch of the OECD Economic Survey of the US


Launch of the OECD Economic Survey of the US


Road-use Pricing: How Would You Like to Spend Less Time in Traffic?

Benjamin Orr and
Benjamin Orr Research Analyst, Greater Washington Research Program
Alice M. Rivlin
Alice Rivlin
Alice M. Rivlin Former Brookings Expert

June 25, 2009

Severe congestion and underfunded public transportation systems in the Washington, D.C. region and nationwide call for a more sustainable way of pricing transportation. This brief proposes replacing state gas taxes with regional road-use pricing that takes into account the effects of vehicle travel while simultaneously providing incentives to reduce traffic congestion and pollution and improve public transportation.

To achieve this, a demonstration project should be launched in the Washington region that uses GPS transponders to categorize motorists’ travel based on distance, level of congestion, and type of vehicle. The transponder would calculate the totals for each category and drivers would be charged accordingly when they purchased gas. Tourists and other motorists lacking the GPS device would continue to pay the full gas tax. At an average price of between 9 and 15 cents per mile, such a policy could reduce congestion by 75 to 80 percent.