More Highways or More Telework?

Paying by the mile for our car insurance may be attractive to many Americans, particularly those who carpool or use mass transit. U.S. Rep. John Mica, who chairs the U.S. House of Representatives transportation committee, recently spoke in favor of funding roads and transportation infrastructure not with a gas tax, the method used for many decades, but possibly through a mileage-based tax system.

A system to make that type of taxation scheme possible was demonstrated during the 18th World Congress on Intelligent Transportation Systems in Orlando, Fla., Oct. 16-20 by scientists from Battelle, who based it on smart phone technology. They are testing it with 500 volunteer drivers who live in Wright County, Minn., and said their Minnesota Road Fee Test is the most extensive road user fee demonstration currently under way in the United States. The test is a project undertaken in parallel with other Connected Vehicle Programs, with Battelle's contributions including designing, building, and testing three new proprietary software applications that combine safety and mobility applications.

"Mileage-based user fees won't happen tomorrow, but at Battelle, we're at the forefront of researching major technological advances that may help raise the money that's necessary to keep up America's roads," said Ben Pierce, research leader in Battelle's National Security Global Business.

At the same time, Travelers Companies Inc. on Oct. 17 announced a mileage-based auto insurance product named IntelliDrive™, saying customers can receive an immediate discount up to 5 percent when they enroll and as much as an additional 20 percent at renewal, depending on how many miles they have driven. It is currently available in Illinois, Ohio, Oregon, and Virginia.

Mileage-based auto insurance will appeal to Americans who are trying to lower their annual vehicle expenses, said Elaine Baisden, vice president of Travelers Personal Insurance. "Mileage-based auto insurance is something we’ve been monitoring for some time, and IntelliDrive fits with the growing demand for an auto insurance product that is more personalized than ever," she said.

Both of these mileage-based approaches also should be powerful inducements to increase telework. If both take hold nationwide, solving the nation's transportation funding challenge might be easier and less costly than expected.

Posted by Jerry Laws on Oct 21, 2011