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Motor Fuel Workshop

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Highway Statistics Seminar – 2011

Federal Highway Administration
  Office of Highway Policy Information
  Presenters: Mike Dougherty & Bryant Gross

 

Workshop Highlights

  • Workshop Agenda:
Introduction Importance of
data for
Attribution
Issues – Discussion
Future – "The
Crystal Ball"?
Follow-up
and Closing
 

 

Staff Introduction

  • The Motor Fuel Staff are:
  • Mike Dougherty: Motor Fuel Tax Evasion and IFTA
  • Marsha Reynolds: Motor Fuel Data
  • Bryant Gross: Motor Fuel Data
  • Ralph Erickson: Chief, Highway Finance and Motor Fuel Division
Photo of Department of Transportation U.S. Department of Transportation
Federal Highway Adminsitration

Introduction Button

 

Motor Fuel Overview

  • Why do we collect the data?
  • Title 23, 420.105 (b) > Federally mandated
  • Motor fuel data is reported from State DOT's, DOR's, or DMV's to FHWA
  • However, DOT's are responsible for reporting and accuracy of the data
  • Data for both 551M and 556 is required under UPACS in FUELS/FASH software

Introduction Button

 

 

 

Importance of Effective Motor Fuel Data Reporting

  • Gives States an effective system (data) to use for State policy, and providing data for requests within the State.
  • Important in Attribution: Gallons of fuel used in the State is used as part of formula in the HTF distribution of funds.

Importance of data  for Attribution Button

 

FHWA Reviews

  • Motor Fuel Reviews
    • Review State reporting procedures
    • Risk assessment
  • State visits by FHWA HQ staff
    • Typically, 3 per year
    • Improves communication

Importance of data  for Attribution Button

 

FHWA Reviews

  • Motor Fuel Reviews
    • Review State reporting procedures
    • Risk assessment
  • State visits by FHWA HQ staff
    • Typically, 3 per year
    • Improves communication

Importance of data  for Attribution Button

 

The Big Picture

  • What's important about motor fuel data, attribution, and the apportionment process?
    • The amounts of funding involved
    • The distribution of those funds, or Your State's Share

Importance of data  for Attribution Button

 

Overview

  • FHWA estimates how much federal highway tax money comes from each State
  • Compared to how much each State receives from FHWA
  • Derives a "for every dollar in, how much does my State receive" or Donor-Donee ratio
  • This is extremely important
    • To Congress, FHWA, and the States
    • That the data be correct

Importance of data  for Attribution Button

 

Federal Highway Account Taxes FY 2010 – (Thousands of Dollars)

$20,337,827 Gasoline 67.40%
$7,069,769 Special Fuel 23.43%
$886,623 Federal Use Tax 67.40%
$1,562,325 Trucks and Trailers 5.18%
$318,251 Tires 1.05%
$ 30,174,795 Total 100%

Importance of data  for Attribution Button

 

The Attribution Process

  • FHWA attribution supports the apportionment process
  • How FHWA calculates attribution (Fuel, VMT, etc. in formula used by FHWA)
  • The role of State data (system for accurately reporting the data, accession planning)

Importance of data  for Attribution Button

 

Attribution I

  • State-by-State contributions to the Trust Fund were not available from the IRS (just total funds)
  • With EXSTARS, that data is coming on-line

 

Attribution II

  • Typical fuel taxpayer is an Oil company or wholesaler
  • There are over 8,000 licensed with IRS
  • IRS reports total receipts (after refunds and transfers) for each fuel type

 

Attribution III

  • HTF contributions from highway users in each State are estimated using State motor fuel data
  • States report motor fuel taxed (each State has procedure)
  • FHWA uses established methodologies to derive a consistent, compatible dataset for attribution

 

FHWA Estimation of Non-Highway Gasoline

  • Estimate off-highway uses of:
    • Agriculture
    • Construction
    • Industrial and commercial
    • Small boat
    • Aviation gasoline
  • Compare to State-reported amounts
  • Use one or the other

Importance of data for Attribution Button

 

Methodology Reasonable

  • The data is less than perfect
  • Different motor fuel laws in each State
  • Tax Systems designed for
    • Revenue collection, not data collection
  • State agency interest levels
  • Tax evasion
  • Less than perfect reporting on form FHWA-551M

Importance of data for Attribution Button

 

How Attribution Works

  • From adjusted State motor fuel data
  • Measure on-highway gallons of motor fuel (Gasoline – Special fuels)
  • Sum to derive the national total (by type)
  • Derive each State's share of the national total
  • Use those shares (based on gallons) to determine revenue shares

Importance of data for Attribution Button

 

Attribution and Data Quality

  • FHWA's goal is an accurate data-set for attribution
  • FHWA performs actions aimed at improving accuracy of State reporting

Importance of data for Attribution Button

 

Issues/Best Practice Sharing

  • Motor Fuel Reviews:
    • FHWA Division Initiates and works with State partners
    • "Meet the Players" – gives a chance to meet players from State DOT, State Revenue, and FHWA.
    • Issues/problems addressed
    • Gives a chance for FHWA to see how data is collected within the State
    • Gives momentum for better data quality, and problem solving among the agencies.

Issues - Discussion Button

 

Who proposed the Turkey as the national bird?
  (Trivia 1)

Turkey

 

Benjamin Franklin

He felt the bird was smart, majestic, and independent.

Winner gets a free chocolate Turkey!

 

Issues / Best Practice Sharing (2)

  • Documentation (the process / the Job):
  • Provides new State staff resources for quickly filling Motor Fuel Reporting positions Can be shared and stored for easy access
  • Provides for: 1) Resources 2) Contacts, 3) Data procedure, etc.

Clipart: Man with bull horn

Issues - Discussion Button

 

Issues / Best Practice Sharing (3)

  • Data Accuracy:
    • Gasoline gallons reported on 551M, times the tax rate, should fall within +/- 5% of reported receipts off form 556 (fuel tax receipts). Special fuel with +/- 10%. (See the form EVAL in your packets)
    • IFTA data (motor carrier fuel use) within the State, needs to reported accurately

 

EVAL – Sample

Eval - Sample

 

State Issues:

  • Issues from the States will go here >
    • Funding (lack of)
    • Staff Rollover
    • Need for Documentation
    • Communication between agencies
    • Multiple tasks (FHWA reporting only part of job)

Issues - Discussion Button

 

Verification of the Data

  • February: First Verification memo sent out to Divisions/States to review previous year data (i.e. in Feb. 2012, review of 2010 data)
  • Tables MF-33GA (gasoline use), MF-33SF (SF use), MF-20 (On Highway/Off Highway Use) and FE-9 (funds attributed to States from HTF)
  • As States resubmit, data is updated at FHWA
  • Final Verification memo sent out April/May
  • Data is complied for final attribution –August

Issues - Discussion Button

 

What President first granted pardon to the White House Thanksgiving Turkey? (Trivia 2)

Bush with Turkey

 

Abraham Lincoln and boy view a book

President Abraham Lincoln

  • Tad Lincoln loved the Thanksgiving Turkey sent to the White House. He named him "Jack". When he found out Jack was for Thanksgiving Dinner, he ran into a Cabinet Meeting crying, and asking the President Pardon for the Turkey. The President signed a pardon, and give it to Tad, who rushed to give it to the "Executioner". Thus started the annual "Thanksgiving Turkey Pardon" at the White House!

 

 

IFTA

  • International Fuel Tax Agreement
  • Vehicles over 26,000 lbs.
  • Quarterly reporting requirement
  • 48 US States and 10 Canadian Provinces
  • Carriers report to 1 base jurisdiction
  • Distance traveled and volumes of fuel are used to arrive at amount of tax owed in each jurisdiction
  • Jurisdictions either receive funds from or transmit funds to other jurisdictions

Issues - Discussion Button

 

IFTA Example

IFTA Example: Freedonia, Sylvania

  • Very Simplified Example – Quarterly report is activity for entire quarter for all vehicles in fleet
  • Vehicle travels 100 miles in Freedonia, 150 miles in Sylvania
  • Purchased 50 gallons of fuel in Freedonia for average 5.0 MPG
  • Computed 20 gallons of fuel used in Freedonia (100 miles/5.0 MPG)
  • Computed 30 gallons of fuel used in Sylvania (150 miles/5.0 MPG)
  • Tax due to Sylvania is 30 gallons times local tax rate (25 cents per gallon) = $ 7.50
  • Credit due from Freedonia – 20 gallons of liability, minus 50 gallons of tax already paid at the pump (30 gallons credit) at (20 cents per gallon) = $ 6.00 credit
  • Carrier pays net amount of $ 1.50 to Freedonia
  • Freedonia revenue agency then transmits $ 6.00 to Sylvania

 

The Future

  • Highway Trust Fund? Will it still be around in next Authorization
  • Federal Motor Fuel Tax?
  • States may increase their State fuel tax in the amount of the Federal Tax used previously? (i.e. increase of 18.4 and 24.4 cents)
  • Transportation Infrastructure Bank?
  • More tolls, VMT tax?

Clipart: Crystal Ball
Future - "The Crystal Ball"? Button

 

Recap and Closing

  • Accuracy of data in monthly 551M and yearly 556 is crucial
  • Communication between State agencies, and FHWA important
  • Changing political landscape my change way of transportation funding.
  • If in doubt, ask.

Fllow-up and Closing Button

 

Resources:

books with a computer mouse