Over the last decade, several transition countries have experienced diminishing funding for their road infrastructure, affecting significantly the countries capacity to expand, maintain and rehabilitate their road networks. The severity varies from one country to another in terms of budget cutbacks, but in many cases, total road expenditures (including construction) has amounted to less than 0.8% of the gross domestic product (GDP). This ratio compares unfavorably to the 1% to 2% of GDP generally considered necessary to adequately maintain highway networks and to carry out a modest amount of construction. As a result of such low expenditures, networks have been fast deteriorating and vehicle operating costs increasing. In a large number of countries, more than one third of the main road network is in poor condition. The problem is further exacerbated by the rapid increase in road vehicle fleet and commensurate road usage. This serious situation has led several countries in Central and Eastern Europe (CEE) to consider establishing improved, modern road user charging (RUC) systems that would provide more funds for maintaining and expanding their road networks. Use of such systems can also help decision-makers to take advantage of more private sector involvement in financing and operating highway assets. This paper covers the most commonly used means to charge road users, such as fuel and lubricant taxes, vehicle taxes, vignettes, and tolls, as well as the mechanisms to allocate funds for roads (budget allocations or road funds). A brief survey of road user charging systems in European countries is presented. Consideration is also given to private financing of roads through public-private partnerships (PPP), an approach that has helped transition and developing economies to improve their road network without overburdening their budgets. The options provided in the paper will be helpful for those countries currently interested in exploring new sources of revenues for roads.
Abstract