Road Usage Charges Could Reduce Costs for Rural Drivers but Show Minimal Effect on Disadvantaged Communities

The gasoline tax, the primary source of transportation funding in California and United States, is rapidly losing effectiveness as vehicles become more fuel efficient and as electric vehicles enter the market. To address this funding shortfall, many states are exploring alternatives to the gas tax such as a road usage charge (RUC), which charge drivers based on miles traveled rather than fuel consumed. The 2021 federal Infrastructure Investment and Jobs Act (IIJA) supports this transition by funding both national and state-level RUC pilot demonstrations. Despite growing momentum, questions remain about how RUCs affect equity. Policymakers are particularly concerned about whether rural residents, who often travel longer distances, or disadvantaged communities, who already face economic and mobility barriers, would be disproportionately burdened. To better understand these impacts, my team examined how a revenue-neutral RUC in California would change the financial burden of switching from a gas tax to RUC, focusing on geographic and community differences.