A Waterloo-based company is helping the state of Oregon implement a new voluntary program that will tax drivers based on distance driven, instead of a flat gas tax.
Waterloo's Intelligent Mechatronic Systems plays an integral part in the new program. The company created DriveSync, a platform that essentially can connect a car to the internet or other devices such as smartphones.
DriveSync makes it possible for insurance companies to assess customers based on usage, for example.
"It's a very interesting approach to change one form of taxation on the gas pump to a fair usage fee on the road," said Ben Miners, the vice president for innovation at IMS, in an interview with Craig Norris on The Morning Edition Monday.
"Having a usage fee on the road provides people with transparency in terms of how much it's actually costing to be on the road," he said. "So hopefully, people will make informed decisions before they take their car out to drive to the corner store."
Drivers won't need to do anything special to their vehicles to take part in the program, but they do have to register and get a DriveSync device, which can be plugged into their vehicles.
"It's a standard port in every vehicle built after 1996. The port's just below the steering wheel, you reach down and plug it in and you can drive and not need to worry about it ever again," said Miners.
The program will start for Oregon drivers on July 1.
Drivers can choose how much to share
For the privacy-minded, participants can choose how much information they want to reveal to the state of Oregon. Drivers can choose to only share the distance the vehicle travels, and avoid location information. However, if they do share location information, they won't be taxed when they drive on private roads or head out of state, for example.
The billing itself is handled by another company, Sanef ITS, which has partnered with IMS and the state of Oregon. Every quarter drivers will get an invoice showing how much fuel they've consumed and how far they've travelled. Participants will get a gas tax refund, and then pay their usage tax at a rate of 1.5 cents per mile driven.
"Now people can see that when they're driving, when their cars are actually causing impact to the road, the funds or the fees that they're paying are directly being applied to help maintain those roads, maintain the infrastructure and repair those potholes," said Miners.
According to Miners, as people switch to vehicles that consume less gas, governments need to find new ways to raise funds.
"The revenue shortfall from traditional gas tax-based approaches is only increasing in its magnitude, with the prevalence of highly fuel efficient vehicles, electric vehicles and hybrid vehicles," he said.