Vermont Legislature SmartTranscripts:

[Wendy Harrison (Clerk)]: You're live.

[Richard Westman (Chair)]: This is Senate Transportation. It's Wednesday, January 14, and we're resuming testimony, and we're hearing from Logan Blueberry from Joint Fiscal as a precursor to the Oregon Department of Transportation.

[Logan (Joint Fiscal Office)]: Yes. For the record, I'm Logan Member with the Joint Fiscal Office. Have a very brief presentation just on some of the fiscal impacts of the organs. And then also Virginia, if we have time, I don't if I can come back to Virginia at a different date. This is really just looking at the very basics and then some of their revenue forecasts, which they might have more information on when they present. I don't know what their presentation will be, but just to give you a base to go into their presentation with. Oregon's road use discharge program is called Orgo. They currently have a rate that's set at 5% of their state's fuel tax, which is currently 2.3¢ per mile. I guess this is a question for them. Think there's maybe some variation in there, or not variation, but they passed recently a transportation funding bill, which it may be now not going to be implemented based on some things that are happening in the state. I don't know if 2.3% is still accurate or if that had been drawn back, that'd be a question for them. But last I saw it, it was 2.3¢. They have a pretty a broader program than the one we've been working on here in Vermont, at least. So they have EVs starting 01/01/2028. And then they have hybrids and plug in hybrids starting 07/01/2028. So it's a larger group of SARs that would fall under this mandatory road usage charge than what is currently being worked on in Vermont. They also have a fuel tax credit for vehicles that have to pay this per mileage charge, so you're not doing both the rough and the fuel tax. And then you're allowed to opt out of the per mile payments and you can just instead pay a flat fee of $340 Those kind of the gist. And then this is their forecast that I found. This is from October 2025. So again, this might've been updated. They're estimating that in their first year with just the, before it goes to both EVs and hybrids, dollars 16,500,000,000.0. And then once all those vehicles are in there, 91,200,000.0 in f y twenty nine is

[Andrew Perchlik (Member)]: the tax.

[Logan (Joint Fiscal Office)]: The other thing to notice about this, I guess, is just the scale. So they have the motor fuels tax that they collect up there, and then their rough per mile charge and then the or the flat fee charge there as well. The other interesting thing here is the red numbers below lines. Well, six, seven, and eight really is sort of the cost that they're forecasting out. You can see when we compare it to line six, the collection administrative cost of the fuel tax, the administrative cost of the RUC is significantly higher. It's only once you get a large plea of vehicles paying into this that the administrative costs are much smaller than the amount of revenue collected. How are they collecting? How are they collecting the revenue? I believe it's through a yearly payment during the registration. Or you can do the

[Richard Westman (Chair)]: Who verifies what the mileage is?

[Logan (Joint Fiscal Office)]: So I believe it is through You can either do the telematics or the GPS tracking through one of the vendor. And this would be a great question for them next. I'm sure they can get into all those details. It's either Oregon or Virginia, I'm getting confused now, has one where you can true up and take a picture of your odometer at the year end, that might be for genius. Would that be a great question? And then hopefully they will get into Hawaii the specific

[Richard Westman (Chair)]: did. That's the point of inspection. Yep. I don't believe Oregon has an inspection process. I I didn't think they did. I'm trying to figure out functionally how they make this work versus

[Logan (Joint Fiscal Office)]: I think they use GPS and some onboard diagnostics to do a lot of theirs. Or for people who don't wanna do that, they pay the flat fee. Mhmm. But again I like the flat

[Richard Westman (Chair)]: fee part. I don't know. It it seems in both cases that we this one and Hawaii that we heard from, there's an election that goes on amongst people. So Right. Hawaii's was $50.

[Logan (Joint Fiscal Office)]: This is 3. I think you said 3. $3.40 is the annual flat fee if you wanted to opt out of that per mile. So I guess it'd come down to how much you're driving. If you're driving a lot, maybe it makes sense to pay the flat fee if you're not part of the percent slash.

[Richard Westman (Chair)]: And do we know the company that they're

[Logan (Joint Fiscal Office)]: using? It's on their website. I don't remember the name of them. It's I think they have a couple of vendors, they use one of the same ones that Virginia is using as well. I could find all this. It's on their website. They do have it posted. Just don't remember.

[Richard Westman (Chair)]: It might be helpful to hear from that vendor on what their capabilities are.

[Wendy Harrison (Clerk)]: Ahead. I'm just wondering if their goal is just to fix or get the revenue that they lost from fuel taxes rather than get additional revenue?

[Logan (Joint Fiscal Office)]: That's a great question that you should probably ask them. Not sure of the intents behind why they set it out this way. I know Oregon has had some version of this program in platform for a very long time, and it sort of changed as the years go on. So

[Richard Westman (Chair)]: And you don't know what their timetable is. Hawaii wanted to buy I think it was 2033, have switched over so there was this Yeah. You know, you started lower and you moved to and it was eventually by 2023 swap out what they're doing now for the new system. In line. Yeah. Yeah. Yeah. That's what I Yeah. No.

[Rebecca "Becca" White (Vice Chair)]: You're a

[Logan (Joint Fiscal Office)]: 100%.

[Wendy Harrison (Clerk)]: But also be be revenue neutral toll with the toll system. It wasn't gonna increase revenue. It's like that. Can I? Yes. Here.

[Andrew Perchlik (Member)]: It doesn't look like they're doing that. Alright.

[Richard Westman (Chair)]: So I'm I think I think if we've got a little basic organs waiting to come in Oh, yeah. Let's let them in and get and move right into that. Yeah. Perfect.

[Rebecca "Becca" White (Vice Chair)]: Thanks, Glenn.

[Richard Westman (Chair)]: Thank you. Mhmm. Alright. Can you stay? Yeah. He's gonna be right behind me. Or someplace. Wherever he wants.

[Logan (Joint Fiscal Office)]: Not here.

[Richard Westman (Chair)]: I think he's got three seats

[Wendy Harrison (Clerk)]: There's a chair over there. There's other

[Richard Westman (Chair)]: Are we there? Maureen in?

[Maureen Bock (Oregon DOT – OReGO Program)]: Yeah.

[Richard Westman (Chair)]: Can you hear us, Maureen?

[Maureen Bock (Oregon DOT – OReGO Program)]: I can.

[Richard Westman (Chair)]: Well, we wanna thank you very much for, being here with us today. My name is Richard Westman. I am, the state senator from Lamoille County, which is a county in North Central Vermont, and I'm chair of the Senate Transportation Committee. And I'll let my colleagues introduce themselves.

[Wendy Harrison (Clerk)]: Good morning, Wendy Harrison. I'm in

[Rebecca "Becca" White (Vice Chair)]: Windham County. Thank you. And I'm Beth Hawaii and I'm in Windsor County.

[Andrew Perchlik (Member)]: Andrew Perchlik in Washington. Pat Brennan from Grand Isle County.

[Richard Westman (Chair)]: And we are very interested in what Oregon has been doing moving forward in the changing funding of the transportation world. We have taken testimony from Hawaii who has done and you're one of the four states that is in the lead in the country. And so you're our second state with testimony around that. We have all kinds of questions. So if we shouldn't interrupt you, let us know. But there will probably be lots of questions from us because we're very interested in what you're doing.

[Maureen Bock (Oregon DOT – OReGO Program)]: That's great. Thank you for that. Then thank you for inviting me. Need, I have a hard stop at 08:50 to get ready for another meeting, But I'm happy to have you send questions my way at any time after the so if you're done and you go, wait a minute, she didn't respond to fill in the blank, just send those questions to me or have Megan send them to me and we'll get back to you.

[Richard Westman (Chair)]: Okay. All right.

[Maureen Bock (Oregon DOT – OReGO Program)]: So I sent a presentation. I'm going to run through it really quickly, and then let's get to your questions. If you want to interrupt me, that's fine too.

[Richard Westman (Chair)]: Okay.

[Maureen Bock (Oregon DOT – OReGO Program)]: Let's make this as interactive as possible. So, I'm assuming, Megan, that you will share or do you want me to?

[Rebecca "Becca" White (Vice Chair)]: Oh, I can do it if you.

[Maureen Bock (Oregon DOT – OReGO Program)]: Okay.

[Wendy Harrison (Clerk)]: I can just ask that overall question about the goal of

[Rebecca "Becca" White (Vice Chair)]: Actually, Maureen, if you're able to do it, it would be best. Okay, I

[Wendy Harrison (Clerk)]: can do You should be able to.

[Rebecca "Becca" White (Vice Chair)]: And I just posted her document. It'll take a second to screen it and I'm getting copies on it.

[Richard Westman (Chair)]: So, Maureen, the upfront question that we had, that was asked and we talked about and we weren't clear about, was this the goal of this to replace existing revenue or to increase revenue?

[Maureen Bock (Oregon DOT – OReGO Program)]: It was to basically capture revenue from highly efficient cars and put them on parity with inefficient vehicles. So our intention has not been to replace fuel tax. We think that's still a very steady state source of revenue for Oregon. And we've pledged that revenue to repay bonds. So there was a good reason not to upset the bond market by saying, we're going get rid of fuel tax and have them do a little bit of a freak out. So it was always intended to basically keep fuel tax in place and then add an additional revenue stream to fill in the gap caused by inefficient cars not paying their fair share.

[Richard Westman (Chair)]: Thank you. That's helpful.

[Maureen Bock (Oregon DOT – OReGO Program)]: Yeah. So can you see my screen?

[Richard Westman (Chair)]: Not yet. Okay.

[Maureen Bock (Oregon DOT – OReGO Program)]: Let's try this again. Share that. How about that?

[Richard Westman (Chair)]: Begin now.

[Maureen Bock (Oregon DOT – OReGO Program)]: Okay. Great. So when we started Ruck, we were only focused on having a supplemental revenue stream. But then we have been working with the state of Washington on replacing an interstate bridge on the I-five Corridor. And so we were looking at tolling and whether or not we could actually do an intersection of rock and tolling and have our citizens have one account from which they could pay for both of those things. So this presentation is geared in that direction. And in part, that's because when we set the program up, we were mindful that in our state, cities and counties have the ability to enact their own local option fuel tax. And so there's layered pricing in certain parts of the state. So we decided that we would create jurisdictional identifiers based on geofence locations. And they could also then be used for tolling. So this brings a little bit of that into the rec conversation. So I'm going to introduce the topic, talk about the basics. Then there is this really good resource that you can refer to. It was published by the National NCHRP, which it's really early here, I'm having a hard time remembering what it stands for. But it's a very good guide about how to get started about communicating with the public, legislation considerations, and those kinds of things. So I'll just introduce that, and then we can have a little bit of a discussion after that. So what's the problem? When we started this exploration in 2005, it was really clear that fuel tax would not be a reliable, equitable source of funding in the future. So we did a pilot in 2006, another one in 'twelve, and then launched the Orgo program that we have now in 2015. When we created the fuel tax back of 1919, the idea was that users should pay for for the roads. And that's been the underlying funding principle for all of our funding going forward. So when Oregon started taxing diesel in the 1940s, that was because diesel was becoming more of a prominent fuel than gasoline. So they put a tax on it that was equivalent to what gasoline powered vehicles paid. So that's really core to everything that we look at. Weight mile tax, same thing. Heavy trucks should pay more based on the amount of damage they do to the roads. And our Road User Fee Task Force, which is a bipartisan task force created by the legislature, looked at a lot of different options battery tax, tire tax, a whole bunch of things and landed on this pay by the mile scheme, if you will, as a way to fill in that gap created by efficient vehicles. And this actually is a graphic that we've used to illustrate that people are driving more in our state and using less fuel. And that's really the challenge. They're also expecting us as infrastructure owner operators to provide a very safe infrastructure, better lane striping for cars that require ADAS, stay in your lane kinds of protocols. They want more connectivity in terms of getting advanced notice that there's a crash ahead or that there's a weather event and that kind of thing. All of those things are additional things that cost money on top of just filling potholes and providing guardrails on our infrastructure. So we've seen this increased mileage being driven, less fuel being used, net decline in gas tax revenue. So that's what the gap that we're looking to fill is that gap between fuel tax and what our needs actually are. And as you know, CAFE standards have been increasing over time. The public is becoming more demanding of having an efficient vehicle to get to and from wherever they're going. And so when you look at federal gas tax not being raised for a very substantial amount of time and the difficulties in increasing fuel tax, and then in our state, the accusation that just raising fuel tax makes it increasingly regressive, we needed to do something different. So it was, we're maintaining the user pays principle. Everybody pays for use of infrastructure. And we don't care about your fuel type necessarily. So the way that plays out is I used to have an old Camry, and I got about 25 miles a gallon, which was a pretty good deal at the time given the car I'd driven before. But now with Camrys being hybrid vehicles, they get double the mileage. So if you look at use of the roads, they're paying half of what they would have paid if they drove an older Camry. So if you look at the Federal Highway Trust Fund, there's a huge shortfall that will make it very problematic for most of the states to pay for the infrastructure that is needed to move the economy, move people through to recreational opportunities and those kinds of things. So we need a way to fill that gap without necessarily relying on federal dollars. So we look at our road usage charge program as really just a modernized user pays model for paying for infrastructure, where you pay by the mile rather than the gallon. We think it's a viable long term funding solution. We are a very small voluntary program. And that honestly doesn't bother me because we have been building a market for these services to be provided by third party account managers. So if you think about a typical business cycle or development cycle for IT or anything like that, it's not uncommon to release something, figure out that user testing requires something a little different, modernize that, test it, deploy it, and keep going through a development cycle. That's what we're in here in Oregon, is a development cycle. This document here is what we prepared for the legislature last session. They would have a one pager that they could give to constituents or they could use as a guide to talk about the program. We thought it was very important to emphasize that there isn't double taxation. If someone pays fuel tax, it's treated as a prepayment of their road usage charge and it's credited back as they drive taxable miles. So that's a really key component, I think, of the program. When we went out and did a listening tour around the state with Oregonians, people said, we don't mind paying for what we use, but we don't really want to subsidize efficient vehicles. And that was particularly true in very rural parts of the state. So I was in Eastern Oregon, and I had a number of people say things like, I drive F250s and 350s on my farm to get to and from market, go do my business. I don't really want to subsidize Portland Prius drivers. And it's like, well, under this funding model, you don't have to, because they would be paying their fair share through pay by the mile program. The other thing that's really important, I think, for people to understand is that we, by law, have to provide choices for people on how they report their miles. And that means we had to provide them with technology to report miles that did not have vehicle location technology. So when we went live, we went live with the device that plugged into the onboard diagnostic port of the vehicle that would capture the miles driven and then report them through a cellular connection to the account manager so they could bill them. Some of those devices had GPS chips, some of them did not, and it was up to the participant to decide whether or not they wanted GPS or non GPS. Without GPS, then they paid for all miles driven, regardless of whether they were in state or out of state. And then we provided a mechanism for them to send us a form with an attestation that they had driven x number of miles out of state, and they were requesting a refund. And then we processed those accordingly.

[Richard Westman (Chair)]: I'm trying to understand what physically you've done to do this. So you give them a piece of equipment. Repeat again this over because I'm just functionally trying to understand how they report this.

[Maureen Bock (Oregon DOT – OReGO Program)]: Okay. So we have different ways of reporting miles. One of the ways people can report miles is by using a device that goes in the onboard diagnostic port of the vehicle. Another way to do that is to send in photographs of their odometer. It's an odometer capture protocol. We actually do not handle the devices. We contract with third party entities. We call them account managers. So people have a choice of signing up with different account managers based on whether or not they want to have a device, whether they want to use odometer capture technology, or if they want to do some other kind of reporting. So we oversee the account managers. The account managers actually are the interface with the public.

[Richard Westman (Chair)]: So the account managers, is this one company? Is this multiple companies?

[Maureen Bock (Oregon DOT – OReGO Program)]: It's multiple. That allows us to give people choice.

[Richard Westman (Chair)]: And who pays the multiple account managers?

[Maureen Bock (Oregon DOT – OReGO Program)]: We pay them. The state pays them for providing that service.

[Richard Westman (Chair)]: I

[Andrew Perchlik (Member)]: have a question about, you decided on a flat rate for the vehicles. Did you look at all about the weight of the vehicle or using something else like the impact, just that instead of miles traveled, impact on the highways, like heavier vehicles, bigger vehicles?

[Maureen Bock (Oregon DOT – OReGO Program)]: So in our state we have a weight mile program for vehicles that weigh over twenty six six thousand pounds. So they're already essentially paying by the mile. And that rate is based on the weight. This program is for passenger vehicles. Anything under 10,000 pounds is doing about the same amount of damage to the road. So we didn't differentiate between weight. There was some controversy about EVs weighing more than regular internal combustion engine vehicles. They actually don't usually exceed 10,000 pounds. So they're doing about the same amount of damage as a regular passenger vehicle. So our rate is set by the legislature at 5% of the fuel tax rate. So our fuel tax rate is currently $0.40 per gallon, and people pay $0.02 per mile.

[Andrew Perchlik (Member)]: Yeah. Think the conversation here about those vehicles under 10,000. It doesn't matter if it's 9,000 or 4,000, but you're saying Oregon had data that didn't really matter.

[Maureen Bock (Oregon DOT – OReGO Program)]: Yeah. Our roads are designed so 10,000 pounds is about I would say, the average that they feel is I've had the engineers explain it to me in e cells, and it's very complicated. But basically, they assure me that if it's 10,000 pounds or less, it's doing the same amount of damage.

[Andrew Perchlik (Member)]: Okay.

[Maureen Bock (Oregon DOT – OReGO Program)]: Okay, that's good enough for me.

[Andrew Perchlik (Member)]: Yeah, no, that's helpful, thank you.

[Richard Westman (Chair)]: So you can have a device on your vehicle, you can do the odometer, and

[Maureen Bock (Oregon DOT – OReGO Program)]: And then? Then the account manager takes care of the billing and collection from the individual payers, and they remit money to us on a quarterly basis on all of what's driven.

[Wendy Harrison (Clerk)]: Can say a quick question?

[Logan (Joint Fiscal Office)]: Go

[Wendy Harrison (Clerk)]: ahead. Thank you. So I really like how you say the data is destroyed within thirty days. That's, that probably helps people, choose that, you know, to have the odometer and the way that you say if you have an odometer or not an odometer but the GPS, what I heard was that miles outside of Oregon won't be counted if you have GPS and that's your choice to whether or not to have that. So I just think that's a great system.

[Maureen Bock (Oregon DOT – OReGO Program)]: The legislature was very uncomfortable about both the state and private companies having this travel pattern data for long periods of time. And so they were the ones who decided that thirty days after those miles were paid for or if they were contested that it was resolved, that data had to be destroyed. So we actually audit our account managers to make sure that's happening.

[Wendy Harrison (Clerk)]: That's wonderful.

[Logan (Joint Fiscal Office)]: Okay.

[Andrew Perchlik (Member)]: Right.

[Richard Westman (Chair)]: It, did my understanding this, that if you don't do all this, there's a flat rate?

[Maureen Bock (Oregon DOT – OReGO Program)]: There is what we call an enhanced registration that goes on top of the base registration. So efficient vehicles based on where they're tiered pay this additional fee, which is waived if they opt into paying by the mile. The thing that is a little different for us than from some other states that have programs is we do not cap the road usage charge payment at what people would have paid through an enhanced registration fee. Because the way I describe it is that's basically giving citizens an interest free loan to pay what they would have paid anyway. And if they drive more miles than that, then they're, again, getting a free ride on somebody else's dollar. So we do not cap the road use of charge amount.

[Logan (Joint Fiscal Office)]: Okay.

[Maureen Bock (Oregon DOT – OReGO Program)]: And I think that's something that differentiates us from some of the other programs.

[Richard Westman (Chair)]: So do you want to go through the rest of the presentation? I

[Maureen Bock (Oregon DOT – OReGO Program)]: just wanted to pause and see if anybody had any more questions on this.

[Richard Westman (Chair)]: I'm sure we're going to come back and have more questions.

[Maureen Bock (Oregon DOT – OReGO Program)]: So Okay. The NCHRP guide was put together to help people navigate this whole ambush, rock, whatever you want to call it thing. And so the Eastern Transportation Coalition has been working in this for quite some time under the guidance of Trishandran. So they've been looking at primarily impact of paying by the mile on heavy vehicles. We were focused more on light vehicles. There's some interest in should we just do this for interstates? What would this look like in a federal scheme? And so the National Academies of Science convened this program under NCHRP 1918 and decided, like, let's see if there are commonalities between all these different approaches to using a pay by the mile program. So when we launched in 2015, we were like this little black dot over here, this black hole of, you know, taxation, doing something crazy. And then by 2025, it had started to grow. There had been more conversation about ways to fill in that funding gap that is common to pretty much every state. And we were part of the founding group that set up the Rec America program. And so a lot of these states that you see here in orange in the West are Rec America states. These are the four states with an inactive programs. They were all very helpful during the NCHRP work in explaining what they did, how they did it, why they were doing it, that kind of thing. And so this National Cooperative Highway Research Program Guide, Thankfully, put it in the slide, so I know what it is. It was a way to help people look at paths and strategies for implementing RACAD at their whatever level.

[Andrew Perchlik (Member)]: And

[Maureen Bock (Oregon DOT – OReGO Program)]: so based on your role, you can look at, are you leading an effort to a DMV or a DOT or whatever to set up a rec program? Are you a communication professional? Are you a transportation professional? Are you a policymaker sitting in the legislature hearing all of these pros and cons for why to do this? And so based on where you're at in your program, are materials designed to help at every stage of development. This is the information on where you can find the guide. It's very interactive, so it's not like a report you have to read. You can actually go and take tests, and it'll give you information and take you to the resources that will help you along your way in that journey. And that's it.

[Wendy Harrison (Clerk)]: Thank you very much. On one of the slides it says revenue dedicated to highway purposes constitutionally in Oregon. Did you actually change your constitution for this or update it or was it already? It

[Maureen Bock (Oregon DOT – OReGO Program)]: was already there. So back in the 1980s, there was apparently an attempt that was before I moved to Oregon. There was an attempt to take Highway Trust Fund money from the state coffers and move it into another place that needed money. And citizens said, we don't like that. We're paying for our roads to be maintained. And we want that money to stay for highway maintenance and operations. That's been in place for a very long time. And every time we have a conversation about transportation and some kind of new funding stream, this becomes a topic. Is this highway fund money or is it something else that can go to transit, for example?

[Wendy Harrison (Clerk)]: Oh, is transit included in highway? It is not.

[Maureen Bock (Oregon DOT – OReGO Program)]: We have a transit division and they're passed through for federal transit money, but we do not fund our transit through any of the state fuel tax or anything like that.

[Wendy Harrison (Clerk)]: Okay, so you have very good clarity on that. Well,

[Richard Westman (Chair)]: we've had this conversation. We took transportation money in Vermont in 1991 and moved it out of our transportation fund to the general fund. We ended that last year. So it's a little different, but the timeframe is '91. We weren't very far behind. Did they do that by referendum?

[Maureen Bock (Oregon DOT – OReGO Program)]: Yes. It was referendum voted people, and that's what we live with now. And the other thing that is a little different in Oregon is we share our revenues with cities and counties. So every time there's a new revenue stream, the legislature determines how that's split. So for fuel tax, ODOT keeps 50% of that money, and then 30 goes to county, 20% goes to cities. The constitutional provisions on how it can be spent attaches that money. So cities and counties are also expected to abide by those constitutional limitations and how they spend it.

[Wendy Harrison (Clerk)]: So thank you. So that's the geofencing that you talked about. And so that's the mechanism to determine where the gas was spent or

[Maureen Bock (Oregon DOT – OReGO Program)]: Where the town workers. Right. So when we set the program up, because the legislation said we could only charge for in state miles, and we have states surrounding us that have a lot of cross border traffic, we decided that we would geofence every state and province of North America and create a jurisdictional identifier for those. So there's like not to go in the weeds, but I'm going to go in the weeds, unfortunately. We assigned each state and province a three digit identifier. And then we created optional subjurisdiction IDs that could be user defined. So that meant a political subdivision could say, we're a county. We want to charge an additional rec fee. We can do that through this mechanism. And then the idea would be that the account manager would have a business rules engine that would apply the rate to those different areas. That meant congestion pricing zones, pollution zones, if you were in an airship that had pollution issues. We were trying to think ahead. And of course, we were starting to look at tolling for the interstate bridge. And we actually did a pilot where we geo fenced part of the Portland Metro Area and charged a different rate. The challenge was actually defining the geofence in a granular enough way so we knew when vehicles entered that zone or left that zone. So there challenges. It worked, but there were some challenges. And that probably only gets better as the technology improves.

[Richard Westman (Chair)]: So I'm thinking back to, I got the choice between the device on the vehicle doing odometer in that reading in that world. What's the capabilities of the device? So for example, if somebody drives out of state, does it just calculate the number of miles traveled or can the device tell that you've been out of state?

[Maureen Bock (Oregon DOT – OReGO Program)]: If the device has the GPS chip enabled, it knows that you've traveled out of state.

[Richard Westman (Chair)]: So if you live on the border someplace and you're traveling a lot out of state, you would probably choose the device versus the odometer.

[Maureen Bock (Oregon DOT – OReGO Program)]: Right.

[Richard Westman (Chair)]: Okay, that's And very

[Maureen Bock (Oregon DOT – OReGO Program)]: I'll tell you an interesting story. We had a participant who wasn't actually in the legislature at the time, who took a trip from Oregon, drove through Washington into British Columbia, then drove east to Saskatchewan down into Montana and then returned to Oregon. And he was able to see how many miles he drove in each one of those jurisdictions. Interesting. On how we had geofenced things, the account manager was able to give him information about his trip by jurisdiction.

[Richard Westman (Chair)]: And I'm not sure you would the cost of the device versus the odometer with the third party companies? What's the cost to the state to operate this?

[Maureen Bock (Oregon DOT – OReGO Program)]: Well, it's very expensive right now, I'll tell you that. Because when we went live, there wasn't anybody providing services in this space. And we looked at the cost of those devices, and they were about $100 a copy at the time. So a lot of big startup costs. We ended up negotiating contracts that paid the account managers for system development as a separate line item because this is not a commercial off the shelf kind of software system at this point. And then we paid them operation to operationalize and collect all the information and the money and everything else, we paid them a percent of revenue. So that's the model we're operating under now. We have told them that going forward, we expect their cost proposals to come in with what is the fixed cost per account and what's the variable cost so we can bring down those costs and not just have this 40% of revenue number out there, which is huge. And the market, I think, is at the point where that is going to be a more palatable way for everyone to do business in this space.

[Richard Westman (Chair)]: Well, we want to thank you for going first.

[Maureen Bock (Oregon DOT – OReGO Program)]: My life is a guinea pig, let me tell.

[Richard Westman (Chair)]: I I gotta say as we look forward and we look in to the direction, you are following the future for the rest of us and we thank you.

[Maureen Bock (Oregon DOT – OReGO Program)]: I'm happy to to share the lesson that we've learned because I have, you know, if I can save somebody in the trouble of going down a path that we tried and didn't work for us, I am happy to do that. Because honestly, I think the sooner this becomes more mainstreamed, that will bring down the cost of collection for everyone. Yes. You can start dealing with other issues like, does it make sense to only charge for in state miles? We don't do that with fuel tax. And in reading some of the case law and the Commerce Clause, I'm not sure that the Commerce Clause requires that either. I think there are just some really interesting policy questions that US policymakers get to wrestle with.

[Andrew Perchlik (Member)]: Yep,

[Richard Westman (Chair)]: we're going to have to wrestle with that. More questions? Go ahead.

[Rebecca "Becca" White (Vice Chair)]: Oh, okay. Well, just wanted to know, we, speaking of the out of state traffickers piece, we, I think, I don't know if there's a way to calculate it, like what percentage of our gas tax revenue comes from folks coming into the state traveling and not being registered in our state. I'm wondering if you did any work around that question rather than how do you capture the correct amount of person who's driving in state, but is there a way to capture those who are primarily driving in state but not in your state, but not registered or not a part of this program?

[Maureen Bock (Oregon DOT – OReGO Program)]: We did not do that in our program. So our traffic modeling people have worked on that somewhat on the number of miles driven from people who, say, fuel in California or Idaho or Washington and then drive through the state. And with highly efficient cars, it's very easy to do it in Oregon. So the traffic modeling people have done that. We did not consider that in this program.

[Richard Westman (Chair)]: Thank you. So, know, functionally, since we have you here, is there any contact people that we could contact to talk to from the device comp the company that had you with the device? Any of the third party providers that do the odometer work, if we wanted to contact some people there to talk to about how from and contact information for people like that to functionally see how this would work would be useful to us.

[Maureen Bock (Oregon DOT – OReGO Program)]: I will be happy to send Megan a list of people. For example, Nate Briar was with Azugu when they were one of our account managers. Azugu was acquired by another company. They quit doing rep work. And Nate is now a consultant with WSP. But he knows us backward and forward. He would be a good contact. We're working with Nextmove. They're one of our account managers that provides solutions in this space. They're also working with us on development of a connected vehicle ecosystem, for example. So they are looking at technology solutions, just in Oregon, but in other places. Then, So I'll provide you a list of names, a little summary about what they do for us and the kind of work they do, and then you guys can sort through who you want to talk to.

[Richard Westman (Chair)]: That would be great. That would be great. Andy.

[Andrew Perchlik (Member)]: On your slide of the four states, it has Oregon of having 900 plus people, but I assume that was on July 15, a nine hundredth number?

[Maureen Bock (Oregon DOT – OReGO Program)]: That's current.

[Andrew Perchlik (Member)]: Okay.

[Maureen Bock (Oregon DOT – OReGO Program)]: So I had this really small core group of dedicated beta testers is what I call it.

[Andrew Perchlik (Member)]: And when does it become mandatory, '28?

[Maureen Bock (Oregon DOT – OReGO Program)]: Well, that would have been the plan, but the governor just requested that the bill that made it mandatory be repealed so the legislature can go back and look at the entire transportation funding package that was passed last year. So we're continuing to work on what needs to be in place to support a mandatory program. For example, we're working with auto dealerships on what it would look like to enroll people at point of sale. The first wave would have been EVs mandated into the program. So we've been working with DMV on what it looks like to give people notice that they have to be in the program based on registration renewal date. We were working with auto dealerships on, like I said, point of sale for new and used cars that are mandated in the program. That body of work will continue because we need to do that anyway to grow the program even if a voluntary program. So we still have plenty of work to do.

[Richard Westman (Chair)]: Wendy.

[Wendy Harrison (Clerk)]: Thank you. So, thanks for your work and for your persistence and that's terrific after all this time. I'm interested to know, sounds like you have multiple contracts with folks who are collecting the data and your account managers. It sounds like those are private sector folks that you have multiple contracts as opposed to contracting with one vendor. You have multiple, and I suspect that that was intentional.

[Maureen Bock (Oregon DOT – OReGO Program)]: That was intentional.

[Wendy Harrison (Clerk)]: So can you talk about that? Because I think that sounds smart.

[Maureen Bock (Oregon DOT – OReGO Program)]: So in part, when we launched back in so it was an interesting journey. I'm going tell you a little wandering story to get to the multiple account managers. I I had left the Department of Transportation, gone to Department of Energy. I came back in 2014 to, you know, stand this program up. And we were supposed to go live 07/01/2015. October 2014, we still have not signed contracts with anybody to do this. We've developed a system in house to capture whatever we need to capture to interface with DMV for eligibility purposes. So we got all these proposals in, and we looked at them, and we did our own we signed contracts then with two companies and then ultimately a third. But we had to certify their services. So we needed to test their equipment to make sure that those devices they were going to give to the public actually worked. So my team would take devices from the account managers, plug them in their vehicle, drive, and record what the odometer showed versus what the device was showing was the miles traveled. They drove in through Portland into Vancouver, Washington and back to make sure that the geofencing worked. They did all kinds of certification testing. Some of them were better than others, candidly. New market, new services, there were some glitches along the way. But we worked through that, and we went live July 1. We punched list some items that needed to be fine tuned a little bit after the fact, but we made the July 1 cut off. Competition is good because it actually forced people to bring their best product to market. That was really important to us. We wanted the public to have the best user experience they could in what was a new emerging market. So that user experience piece is really key to acceptance. As a tax program, we want it to be easy to understand, easy to pay, because that's what makes compliance work. Compliance is all about educating the public, providing them assistance if they can't figure something out, and then capturing the money. If you have to go after and chase them down to enforce, that costs you a lot of money for not much reward. So that's always been the way we've viewed this program is let's make it easy for the public, as easy as possible. Let's make it understandable. Tell them why. What are they getting for the money they pay? And we expect the account managers who also provide the customer service, like if the device is broken or it's being unplugged repeatedly, they follow-up on that. That's part of what we pay them to do. That makes a difference. People actually talk about their experience with account managers, and they will change account managers if they don't feel that they're getting the best service possible. There's a reason to give them choices.

[Wendy Harrison (Clerk)]: That is great. So can follow? Yeah. So do you still have multiple business companies? Because you did this ten years ago initially.

[Maureen Bock (Oregon DOT – OReGO Program)]: Oddly enough, the three companies that went live with us initially are no longer in the market. And we've been able to transition to new account managers as they come in. So the way we do that is we have what I call an evergreen procurement out on our procurement system. And if someone's interested, we point them there that has all the requirements, what they need to do in terms of banking, having an SSAE 18 audit, their technology being not something they built in their garage, but something that's commercially available, those kinds of things. And then we certify them and they provide the information to the public. We share that and let people pick.

[Wendy Harrison (Clerk)]: Okay, that is going to be very useful Thank you.

[Andrew Perchlik (Member)]: Maybe you covered this, but I just was reading on your website. So they paid basically for the $02 but then they can get a savings on the registration. And it says $35 for $115 so how that? Do you decide their registration

[Maureen Bock (Oregon DOT – OReGO Program)]: discount? That registration is the enhanced registration fee I mentioned earlier. And it's tiered based on the efficiency of the

[Richard Westman (Chair)]: vehicle. Their

[Maureen Bock (Oregon DOT – OReGO Program)]: VIN is decoded and says they're in the 30 to 40 MPG bucket, this is what they're not having to pay an enhanced registration fee if they pay by the mile. If they're an EV, it's the highest amount. So that's how that is tiered.

[Andrew Perchlik (Member)]: And what is the fee? Is there a cap? I know you said there's no cap on the mileage fee. What's it on the registration?

[Maureen Bock (Oregon DOT – OReGO Program)]: The registration fee is just a flat fee. That registration surcharge is based on the efficiency of the vehicle and that's just a flat fee you pay.

[Andrew Perchlik (Member)]: Is that 150 max?

[Maureen Bock (Oregon DOT – OReGO Program)]: $115 that's a annual fee.

[Andrew Perchlik (Member)]: Right. And

[Maureen Bock (Oregon DOT – OReGO Program)]: so if you buy a new EV in our state, you would pay $460 because we do four year registrations on new vehicles. And we do two year registrations on everything else.

[Andrew Perchlik (Member)]: You can get that refunded 100% if you enroll in EVgo

[Maureen Bock (Oregon DOT – OReGO Program)]: It's forgone. You don't get it refunded, you don't pay it.

[Andrew Perchlik (Member)]: You don't pay it because you registered. Yeah, right.

[Maureen Bock (Oregon DOT – OReGO Program)]: Yep, you've enrolled. Right.

[Andrew Perchlik (Member)]: Okay.

[Maureen Bock (Oregon DOT – OReGO Program)]: Go

[Rebecca "Becca" White (Vice Chair)]: ahead. Thank you, Mr. Chair. So it seems like most of the states that have implemented this or worked on it did it in part because there was a large tranche of federal money that came our way to help move forward and implement these programs. So, I wanted to understand how federal funding impacted your rollout and how you made the decision to move towards this program. And then if you have any expectation or understanding of what's going to happen. And maybe there's other news you're getting and what we're getting, but it doesn't seem hopeful for federal funding for these programs at this moment.

[Maureen Bock (Oregon DOT – OReGO Program)]: That's an interesting question because we committed to doing this before there was any federal dollars available. NYFT?

[Logan (Joint Fiscal Office)]: Yeah.

[Maureen Bock (Oregon DOT – OReGO Program)]: So then the grant programs came into place that CITSA grants and the CERT grants, we use those sparingly. For example, we used SDSFA money to do the local area pricing pilot, which was the one where we geofence parts of Portland Metro Area and charge differential rates. For us to get a grant, though, we have to go to the legislature and get permission and show that we have the funds in our budget to pay for it because they're reimbursement grants at 50 percent. And so most of the work we did on developing the program, did without federal dollars. Oh, wow. I had not understood that.

[Rebecca "Becca" White (Vice Chair)]: That explained, I was like, they're missing the federal money part of your slides, and now it makes sense. It's because We

[Maureen Bock (Oregon DOT – OReGO Program)]: did very few grants. Rock America did a number of them. They did rural studies and the states that want to participate in that, put money in. And we oversaw the contracting here at ODOT and paid the bills and did that kind of stuff. But that was all matched funds that other states put in. But Oregon did very sparingly used any federal funds.

[Rebecca "Becca" White (Vice Chair)]: Well, that's actually a helpful thing to hear because I was very nervous when we were learning that potentially these types of programs wouldn't be getting that support. So thank you

[Wendy Harrison (Clerk)]: for And

[Maureen Bock (Oregon DOT – OReGO Program)]: I will make you the offer that I've made to everybody else. If you are interested and you decide to go forward, if you want to send staff out to Oregon, we're happy to sit down and spend time with people. That's what you did

[Andrew Perchlik (Member)]: with We

[Richard Westman (Chair)]: had that offer from Hawaii too.

[Maureen Bock (Oregon DOT – OReGO Program)]: That's a much better location. Totally understand, and I will not feel at all slightest. We invited

[Richard Westman (Chair)]: them back here to go skiing, because we talked to the person from Hawaii in the middle of a snowstorm. Oh. Go ahead, Andy.

[Andrew Perchlik (Member)]: I don't know if you can tell us why the governor is was asked for the repeal. Is it just unrelated to this as part of the whole bill, or is it specifically Great about the

[Maureen Bock (Oregon DOT – OReGO Program)]: question. So in Oregon, we have a way for citizens to ask for legislation be referred to the voters. So the big transportation bill passes, which happens about every six years in Oregon. There was a petition drive after the governor signed the bill. And the parts of the bill that were on the petition were things like the fuel tax increase, a transit tax that was part of a payroll tax that paid for transit, moving the taxation point on diesel from when it goes to the fuel tank vehicle to first distribution like gasoline. And I think it was DMV fee increases. The rough component of that bill was not part of the referendum ish drive. So petition got three times the number of signatures it needed. It was on its way to being on the ballot in November. And the government went, I don't think we can wait until that's resolved to fix transportation. So she decided to ask for legislature to repeal the entire package, go back to the drawing board and work across the aisles to see if they could come up with a bipartisan solution that was acceptable to everyone. But it was very interesting to me that the piece of that legislation was not part of the petition drive.

[Andrew Perchlik (Member)]: Okay, thank you. That's interesting.

[Richard Westman (Chair)]: So here's my final question for you, because we're almost at lunchtime. So what are we missing and what questions should we be asking that we haven't asked?

[Maureen Bock (Oregon DOT – OReGO Program)]: I actually can't think of anything. This has been a great discussion. I mean, I think the guide will be really helpful to you if you have staffers that can go through and pull out pieces. The thing that I think was most helpful for us is before we launched, we did a listening tour around the state and we went into communities and we asked the public to come and talk to us. And we did very quick presentation about how transportation is funded. We asked them the importance of transportation in their lives, explained why we were looking at this as a new funding mechanism. And then a lot of that information was compiled by the contractor that we had doing this work on our behalf. And that's what led to the Orgo brand and the logo. And the thing that I think is interesting about that is the mountain on our logo is Mount Hood, iconic Oregon piece of real estate.

[Richard Westman (Chair)]: Old Timberline.

[Maureen Bock (Oregon DOT – OReGO Program)]: Yes, exactly.

[Richard Westman (Chair)]: Old Timberline.

[Maureen Bock (Oregon DOT – OReGO Program)]: So the company went back out and they said, here's what you said was important about transportation. It took you to beautiful places where you did recreation. It took you to markets. It did all these wonderful things for you. Here's what we're thinking is the logo. And people on the eastern side of the state said, well, of course, you did Mount Hood from the Western side of the state. All about you people in the I-five Corridor. And so the company actually flipped it around. That view of Mount Hood is actually from the Eastern side of the state.

[Richard Westman (Chair)]: Oh, see.

[Logan (Joint Fiscal Office)]: And

[Maureen Bock (Oregon DOT – OReGO Program)]: when we've tried to stay in touch with the public, we've gone out periodically and talked to the public about transportation funding. And people generally don't think about roads and transportation unless they're asked specifically and they're in a forum to talk about it. And so when we did her last listening to her right before COVID, we're asking people about it. And we had just gone through horrific wildfires that had decimated the central part of the state. And people said, if your crews had not been out clearing burning debris from the roads, my family would have perished. We heard from people in rural parts of the state where we get a lot of snow that but for our transportation crews being out plowing those roads, they would not be able to get groceries and medications to their doorstep because they're elderly and they don't drive in the snow. So being able to leverage that information and hear the kinds of questions that we heard over and over and over about costs to maintain and all of that, that's what we base our message on as those conversations with the public. And that is the most helpful thing I can think of if you're going to launch a program is talk in public.

[Richard Westman (Chair)]: I think what's consistent about all of this that we've heard and any outreach that any of us have done to other places is that the outreach to the public is vital in all of this. And the connection that you can make with the public is vital.

[Maureen Bock (Oregon DOT – OReGO Program)]: So I owe you a list of names. Yep. And I will get back to Megan by the end of the week. Enjoy your call.

[Richard Westman (Chair)]: And if we have other questions, you're probably going to hear from Megan Annette, but we so appreciate you taking the time. I know it was first thing in the morning for you that I'm getting to work, and but we really, really appreciate that.

[Maureen Bock (Oregon DOT – OReGO Program)]: Well, I'm gonna go have a second cup of coffee.

[Richard Westman (Chair)]: We're glad. We're gonna go have lunch. Thank you so much. Bye now. Megan, if you would take us offline, this is

[Andrew Perchlik (Member)]: transfer