Urbanism Next
University of OregonUniversity of Oregon

Congestion, VMT Reduction & Mode Choice

Charging for road use according to usage helps better calibrate congestion and demand.

As new mobility modes emerge and competition for road space increases, taxes and fees based on personal vehicle usage may need to be adjusted. Moving away from gas taxes and flat registration fees in favor of fee and tax structures that have a more direct correlation with the per-vehicle amount of road usage allows for more accurate pricing and funding of these resources. Many options for these types of charges exist, each with their own applicability and feasibility. Since there is no one-size-fits-all problem or solution, using a combination of the following tools will help address a wider variety of issues and contexts.

Issues & approaches

Road Usage Charges (RUCs): Assessing fees based on the amount of vehicle miles or kilometers traveled (VMT/VKT) helps match infrastructure costs to the amount a vehicle is using the road. Establishing these fees creates a link between travel distance and price, creating opportunities to generate revenue for infrastructure maintenance while also impacting travel behavior. This ‘cost per mile’ approach makes travel costs more evident, can incentivize drivers to reduce total miles traveled, and can make other modes of transport more appealing. This is especially important with the growth of Transportation Network Companies (TNCs) and Mobility as a Service (MaaS) as it creates cost incentives for individuals to choose more efficient travel modes such as biking, walking and transit. Smartphones and other smart city technologies can provide the technological backbone to facilitate real-time assessment of VMT/VKT-based usage and fees.

Cordon Pricing: Charging fees for travel into areas of high congestion, such as city centers, helps ease congestion by discouraging non-essential trips into these areas. Cordon pricing can be fixed or dynamic (changing during time of day, day of week, or in relation to levels of congestion), and can be adjusted for different vehicle types to more accurately reflect their impacts on congestion in these areas.

Geometry-Based Taxes and Fees: These fees are charged based on the size of passenger vehicles divided by the number of people occupying that vehicle. Large, single occupancy, or zero-occupancy (i.e., autonomous) vehicles that take up large amounts of roadway but transport few people would pay higher fees than smaller, more space-efficient vehicles or larger vehicles that carry many passengers. This type of fee treats roadspace as a limited resource and charges individuals by how much of that resource they occupy. It incentivizes the efficient use of the road by preferencing smaller and more highly occupied vehicles.

Empty Seat Fee or Empty Vehicle Fee - The ‘Zombie Tax’: This tax or fee is charged based on the number of empty seats within a vehicle. Given that TNCs are increasing the amount of vehicle miles traveled per capita as they travel many miles with no passengers, and that AVs would seem to mimic this model, the Empty Seat Fee would incentivize higher occupancies of vehicles by charging for seats that could have been filled but were not. This fee type could be especially helpful in incentivizing the use of shared rides. The Empty Vehicle Fee or ‘Zombie Tax’ can also charge an additional amount for having completely empty vehicles. The travel of empty vehicles is an important consideration as AVs could travel without drivers or riders, creating a burden on the transportation system while not actually moving any passengers.

Cruising Caps: Cruising caps seek to limit the amount of time a ride-service vehicle can travel within congested areas without a customer onboard. Recent reports have found that the circulation of empty TNC vehicles in popular city areas have measurably added to congestion as they circulate while searching or waiting for their next customer. New York City established a cruising cap for a congested area of Manhattan in 2019, but the rule was dismissed in December 2019 after lawsuits by Uber and Lyft. Whether New York City appeals this decision and the rulings that follow will influence the feasibility of instituting cruising caps across the US.

Vehicle Caps: Vehicle caps seek to combat congestion by limiting the number of vehicles allowed within an area. Vehicle caps can be applied according to vehicle type, with for-hire and ridesharing vehicles being typical candidates for these caps due to their fleet size and amount of time spent in congested areas. Limiting the number of licenses or vehicle permits within an area is a tool aimed at addressing area-specific congestion.

Influencing Mode Choice: Encouraging people to use new transportation often requires a multifaceted approach. Funding improved and more comfortable transit systems helps make this efficient transportation mode a more attractive and viable alternative to driving. Similar techniques can be used to encourage the use of micromobility modes where these options help provide ideal transportation system solutions. Fees gathered from personal vehicle taxes, parking fees, and micromobility permits can be used to help fund these endeavors. As new mobility technologies advance and become more widespread, the real-time data associated with these services can provide users with more accurate information on usage, costs, and time. Incorporating this data along with access to multiple transportation services into unified Mobility as a Service platforms can provide further levers for influencing mode choice in real time.

Consider Equity in Fees and Taxes: When creating fee or tax structures, it is important to consider how these charges may affect those of different income levels and needs. Whereas fixed prices for all could disproportionately affect vulnerable populations and prevent them from accessing employment and services, focusing on equitable pricing structures take these differing needs into account. Tiered or income-based fee models are a potential solution to help mitigate fee impacts to low-income populations while still addressing congestion. 

Examples/case studies

Utah's Road Usage Charge Program report page

Road Usage Charge - VMT-Based User Fee

Utah’s Road Usage Charge Program

View Utah Department of Transportation

Utah’s Department of Transportation is working to instate a program that will charge users of alternative fuel vehicles for the amount of miles they travel. This program will help pay for road infrastructure costs associated with electric and hybrid vehicles that would otherwise be paid by gas taxes.

map of London congestion charging zone

Congestion Mitigation - Cordon Pricing 

London congestion charge

View - The Conversation 

This article offers an overview of evolution and impacts of cordon pricing in central London from 2006-2019.

California's "Fastrak" transponder sticker and map of tolls

Equity - Income-Based Road Charges

Metro Expresslanes Low-Income Assistance Plan

View - LA Metro 

To offset the impact of road tolls on low-income community members, LA Metro created a program that allows low-income residents to earn road toll credits when they commute by transit instead of car during peak hours. These credits can be redeemed for times when driving is required for a trip to offset the toll costs of driving.

Related topics

Light rail train passes city bus on a street


Transit is the most efficient way of moving people, but many transit systems are facing challenges. What happens when AVs arrive?

Ethnically diverse pedestrians crossing a street at a crosswalk with a subway station in the background


How will the impacts of emerging technologies impact vulnerable and low-income populations? What opportunities are there to improve services and reduce inequities?

Small tree growing on log in the middle of a forest


How can we take advantage of emerging technologies to improve sustainability and environmental outcomes?

See something that should be here that isn't? Have a suggestion to make?

Please let us know