Sen. Ted Ferrioli, R-John Day, on Nov. 18 called for the director of the Department of Transportation to resign.

SALEM — A panel tasked with recommending transportation finance options to Gov. Kate Brown met last week to discuss the options of a carbon tax and a pay-by-the-mile tax.

The Governor’s Transportation Vision Panel is supposed to recommend short-term and long-term options to pay for and improve the state’s transportation system by March. Members of the transportation finance subcommittee that met this week include: chair and Marion County chief administrative officer John Lattimer; state Rep. Cliff Bentz, R-Ontario; Susan Morgan, Douglas County commissioner and Oregon Transportation Commission member; Tom Potiowsky, director of the Portland State University’s Northwest Economic Research Center and a former state economist; and Rollie Wisbrock, a former state treasury official. Potiowsky was involved in producing a carbon tax issue paper under a contract with the Legislative Revenue Office.

The panel discussed the following points:

• Under the state Constitution, any tax on motor vehicle fuel and ownership and operations of vehicles must be used for construction, maintenance and operations of public roadways. As a result, any carbon tax imposed at the pump would end up in the state highway fund.

• A carbon tax would not discourage people from driving — and thus would not reduce greenhouse gas emissions from transportation — unless it is set at a high rate, according to Travis Brouwer, assistant director of the Oregon Department of Transportation. Brouwer said the relationship between a carbon tax and emissions reductions is important, “given the concerns we’ve heard around the low-carbon fuel standard, and the potential of the Legislature trying to look at alternatives to the low-carbon fuel standard.”

• A carbon tax could be more costly for rural Oregonians, who drive longer distances and have fewer transportation options. However, the state could charge different amounts in different areas of the state. “The use of fuels in the metro area, that is where you collect all the revenue, really,” Potiowsky said, and policy makers could adjust the amount of the tax in other areas to reduce the burden on rural drivers.

• Industry would oppose a carbon tax. “Oregon is already one of the lowest per capita carbon emitters in the nation, right? So we start to put ourselves at a disadvantage for industries that sell nationally … Most industry will oppose it,” said Gregg Kantor, president and CEO of NW Natural Gas and co-chair of the oversight committee of the governor’s transportation panel.

• The finance subcommittee also discussed a pay-by-the-mile tax as an option to pay for highways and other transportation infrastructure.

A state pilot project currently underway allows drivers to choose between a state-run program and two private companies — Azuga and Verizon Telematics — to track their mileage and charge the mileage tax. The private companies track mileage using GPS, while the state does not. The state is also prohibited from selling mileage data, while the private companies can sell the information if they obtain permission from the drivers.

• Brouwer said some people raised privacy concerns about the mileage tax, specifically that the government would be able to track them via GPS.

Nonetheless, Jim Whitty, manager of ODOT’s Office of Innovative Partnerships and Alternative Funding, said 28 percent of pilot project participants have so far signed up with the state program and 78 percent chose the private companies. “They’re building a business around it,” Whitty said of the companies. “They can recruit and choose volunteers. They can sell value-added services because they are building business around this.”

• Potiowsky proposed that the state replace the gas tax, as a funding source for transportation infrastructure, with the pay-by-the-mile tax. Then, the state could charge a carbon tax at the pump and would also have to find a way to tax the carbon emissions from electricity used to power electric vehicles.

• At the end of the meeting, Lattimer pitched a revenue concept that wasn’t on the agenda: could the state raise revenue by charging bicyclists registration or license fees? Brouwer said such fees would probably cost more to administer than they would bring in, but a more feasible option would be an excise tax on sales of bicycles.

“I’m interested in that,” Wisbrock said.

State Sen. Jackie Winters, R-Salem, who attended the meeting, said such a tax could generate goodwill among automobile advocates. “On the flip side, you’d get some cheers on the auto side,” Winters said.

This story first appeared in the Oregon Capital Insider newsletter. To subscribe, go to oregoncapitalinsider.com