Vermont will be the next US state to implement RUC

Following in the footsteps of Oregon, Utah, Virginia and Hawai'i, Vermont has passed legislation implementing a distance based road user charge (PDF) (called a Mileage Based User Fee - MBUF) from 1 January 2027.  This of course makes Vermont the sixth US state to introduce a road usage charge for light electric vehicles.

It will apply to battery-electric vehicles registered in Vermont (so not vehicles visiting from other states) charging US$0.014 per mile (US$0.0087/km). The maximum payable within a 12 month period is US$178 which is around 12714 miles (a relatively high cap).  

All US states that have implemented RUC for light vehicles have implemented a cap, unlike jurisdictions in Europe and New Zealand (and unlike fuel tax!).

Vermont MBUF will be measured using odometer readings, initially. With options to pay:

• Annually, following one odometer reading (e.g., at safety inspections); 
• On a regular basis (at an interval determined by the Commissioner of Motor Vehicles) known as "pay as you go"; or
• Flat fee at the level of the cap (US$178).

Part of the programme includes a transition plan to expand beyond battery electric vehicles.

It will be expanded to PHEVs from 1 January 2029 with work to be undertaken on "additional mileage reporting options" specifically referring to location based options so that distance travelled outside Vermont could be excluded.  Indeed, the legislation indicates that there should be at least one option for motorists to distinguish between distance travelled in state and out of state when it is extended to PHEVs. 

Inclusion of PHEVs is also dependent on developing a fuel tax credit system to refund fuel taxes, based on the vehicle's fuel economy. It is unclear if this simply allows for estimations of fuel consumption or actual fuel consumption.

Furthermore, the transition plan will also investigate expanding coverage to medium and heavy duty EVs and PHEVs, although no date has been set for such a transition or decision made to actually expand beyond light EVs and PHEVs.

Earlier discussion in Vermont's legislature considered MBUF applying to all vehicles, so it is clear that there is a path by which EVs and then PHEVs are paying by distance, with future application to heavier vehicles of the same motive power and then applied to other vehicles.

What is notable for Vermont is:

• No RUC pilot was run in Vermont, rather this has followed a feasibility study and the operation of an advisory committee.
• Explicit inclusion of a location enabled option for the next phase, indicating the importance of addressing vehicle owners not being charged for out-of-state distance.

There will be clearly be more forthcoming about this in future months, as the rollout date is short, but at least at first it will be a relatively simple low-cost system.

Challenges will be:

• Not charging out-of-state vehicles to use the roads (such vehicles pay fuel tax when filling in Vermont now, but won't be included, largely because of political reluctance and legal complexities in identifying and enforcing such systems for out-of-state light vehicles (note than Oregon's Weight-Mile Tax applies to trucks regardless of the state where they are registered, for driving on public roads in Oregon.
• Selecting a suitable location based system for PHEVs (which could presumably also apply to EVs).
• Obtaining public acceptability for the final approach to credit fuel taxes to PHEV owners (noting Oregon has been doing this for some time).