Minnesota Distance-Based Fee Project: Charting a Path Forward

This paper summarizes an innovative demonstration by the Minnesota Department of Transportation (MnDOT) of the distance-based fee (DBF) concept. Fees based on actual road usage, as opposed to fuel consumption, have been explored by numerous states as an alternative transportation revenue source to the motor fuel tax. These approaches rely on the collection of road usage data, and most states have pilot tested approaches reliant on aftermarket devices installed within individually owned vehicles. Private-sector vendors are responsible for managing data collection, fee assessment, and account management. In the near term, the most feasible and scalable option for DBF deployment may be to leverage embedded telematics technologies under a fleet-based reporting and collection approach. MnDOT worked with two shared mobility (SM) providers offering carsharing services in the Minneapolis-St. Paul region. A connected and automated vehicle (C/AV) partner was also included to demonstrate the collection of road usage information from emerging C/AV technologies. The demonstration successfully collected the required information for DBF assessment from the SM and C/AV providers including information necessary to support audits by the Minnesota Department of Revenue. The demonstration showed that the information necessary for assessing and collecting DBF could be obtained from embedded telematics systems and reported by a fleet provider on behalf of all users in that fleet. Although the specific architecture demonstrated would probably need significant adaption for scaling to a national system, it nonetheless provides insights that support development of a broader ecosystem of usage-based charging strategies.