1667119 - Novel Highway Financing Alternatives and Their Impacts on User Equity

Emerging vehicle technologies, such as automation, electric propulsion, and connectivity are expected to reap enormous benefits for the transportation sector. However, their impacts on highway financing are an important aspect of the adoption that is yet to be extensively studied. Because of their impacts on vehicle ownership, travel demand, and the need to retrofit traditional infrastructure with new features to support their operation, these technologies are expected to incur a significant increase in highway expenditures. Simultaneously, increased adoption of electrically propelled vehicles is expected to lead to loss of revenues derived from fuel taxes. This study aims to examine the impacts of emerging vehicle technologies on highway financing, infrastructure policy, and user equity.

Previous studies have explored infrastructure consumption and highway financing in the era of electric, connected, and automated vehicles. Results have shown that along with the need to retrofit existing infrastructure to accommodate ECAV operations, these changes are expected to increase highway expenditures significantly. At the same time, increased adoption of electrically propelled vehicles is expected to significantly reduce highway revenues, due to the loss of fuel tax revenues. Along with these findings, various alternative financing mechanisms have been proposed to address these impending challenges, including distance-based user fee structures, differential tax schemes, and pay-as-you charge fee schemes.

While previous studies have explored the impacts of emerging vehicle technologies on highway financing, these discussions have been focused on governments and transportation agencies. This study explores the impacts of emerging vehicle technologies on highway users. Alternative highway financing mechanisms and user fee structures that have been proposed are expected to have varying impacts on highway users depending on their socio-economic characteristics. This study therefore examines user equity in the context of emerging vehicle technologies and various proposed user fee structures. For example, urban users have different transportation needs than rural users, and therefore the costs they incur under each fee structure varies accordingly. Similarly, low-income users cannot afford to buy the latest, and thus more efficient vehicles. Their cost responsibility will therefore be different from higher-income users with more efficient vehicles. These disparities in cost responsibility between users of different socioeconomic characteristics give rise to issues of equity that need to be extensively explored in order to create a more inclusive transportation system. There is, therefore, a need to examine and quantify these disparities, and explore measures to mitigate any negative equity impacts that may arise.