Funding
What's the problem with the current funding model?
Increased vehicle fuel efficiency
Declining purchasing power
Increase in population
Increased Vehicle Fuel Efficiency
New fuel economy standards mandate that new vehicles in 2016 have an average fuel economy of 35.5 mpg and by 2025 that standard increases to 54.4 mpg. While increased fuel efficiency is good for the environment, less fuel bought results in less money to maintain our roads.
In addition to these new standards, alternative fuel vehicles are becoming more prevalent. Alternative fuel vehicles include full electric, hybrid, compressed natural gas, liquid natural gas and propane—all of which pay little or no gas tax.
Since the current funding model relies on fuel consumed, these new standards and alternative fuel vehicles result in less money to fix the roads.
Declining Purchasing Power
Currently, Colorado transportation revenues come from a 22-cent-per-gallon tax on gasoline. This is a fixed amount that does not fluctuate with the price of gas (indexing). The gas tax rate was last raised in 1991. To compare, the cost of some other common items in 1991 were:
| Cost in 1991 | Cost in 2016 | |
| Cost of a New Home | $125,841 | $366,900 |
| Cost of a New Car (average size) | $9,989 | $34,846 |
| Cost of a Color Television | $660 | $1,997 |
| Cost of a Pound of Bacon | $1.95 | $4.99 |
| Cost of a Gallon of Milk | $2.80 | $3.43 |
| Colorado Gas Tax (per gallon) | $0.22 | $0.22 |
$1 in 2016 is worth approximately 56.5 percent less than it was in 1991.
Increase in Population
Vehicle miles traveled is the metric used to gauge the number of vehicles on the road and how many miles they are traveling. While the number of people in the state increases, so does the number of vehicle miles traveled—as well as wear and tear on our roads. However, with increased vehicle fuel efficiency, less gas is being purchased; therefore, the revenue is going down.
Magnitude of the Funding Problem
With increased vehicle fuel efficiency resulting in less gas tax revenues, increased population and VMT creating more wear and tear on the roads, and declining purchasing power with the value of the dollar worth half of what it was in 1991, CDOT is facing a $25 billion funding gap over the next 25 years.
How Will RUC Address the Funding Problem?
RUC charges drivers for what they use versus the gas tax, which currently charges more for less fuel-efficient vehicles and charges nothing for alternative-fuel vehicles.
Under a road usage charge, all types of vehicles pay an equal amount for the same miles traveled—which captures revenue not currently being collected under the gas tax.
