Abstract
California’s ability to achieve its climate and mobility goals depends on addressing the growing gap between transportation infrastructure needs and the declining effectiveness of traditional fuel tax revenues. As electric vehicle adoption rises, fuel efficiency improves, and demands for resilient, multimodal systems expand, new approaches to transportation funding and demand management are required. This paper examines a range of mobility pricing strategies—including tolling, managed lanes, congestion charges, vehicle-based fees and feebates, distance-based user charges, and parking pricing—to evaluate their potential for enhancing financial sustainability, reducing congestion, and internalizing the environmental and social costs of driving. Particular attention is given to dynamic pricing, which can flexibly manage demand for both road and parking space, and to distance-based charges that offer a more equitable and efficient alternative to fuel taxes. The analysis highlights the importance of revenue allocation to ensure that pricing strategies not only generate funds but also support equitable investments in sustainable mobility options. While some approaches are well established, others require pilot testing and policy innovation. Given its policy leadership and commitment to climate action, California is well positioned to advance and integrate these strategies, shaping a comprehensive pricing framework that strengthens the state’s fiscal resilience while promoting a cleaner, more efficient, and more equitable transportation system.
