State Bills, Likely Backed By Big Oil, Take Aim At Drivers Of Electric Cars

4 months ago by Steven Loveday 70

The Chevy Bolt is only the first of an upcoming wave of affordable, long-range electric cars that will accelerate the adoption of the segment.

The Chevy Bolt is only the first of an upcoming wave of affordable, long-range electric cars that will accelerate the adoption of the segment.

The Koch Brothers are two of the most influential fossil fuel advocates of our time.

It comes as no surprise that, as electric cars begin to catch on at a more steady clip, states are imposing fees to “green-friendly” drivers. The argument is that those drivers aren’t purchasing gas, thus not paying the gas tax, and EVs are the reason that gas tax revenue is on the decline.

This information is hardly true, since gas tax revenue has been on the decline since long before electric vehicles started becoming popular. Even today, EVs make up less than one percent of vehicle market share globally, so the impact is intangible. States couldn’t pay for road projects long before electric cars. However, oil industry backed groups like the Koch Brothers and American Legislative Exchange Council (ALEC), are making sure that state lawmakers believe that EVs are to blame.

Gas cars today are much more efficient than they once were, and most states haven’t raised the gas tax in ages. It is not set today to cover the massive inflation that has taken hold since the gas tax was introduced in 1957. The money coming in only covers about 40 percent of project costs, and there is no way that the 60 percent loss is caused by a few electric vehicles. But, states are looking for a way to make up the gap, and charging fees to EV owners is part of many states’ plans.

Just this year, Montana, Indiana, Kansas, South Carolina, New Hampshire, and Tennessee, have added a fee of up to $180 per year. Idaho, Colorado, Wyoming, Washington, Virginia, Nebraska, North Carolina, Missouri, Georgia, and Michigan already have fees ranging from $50 to $300 annually. Arkansas and Arizona are working on setting fees in place.

Georgia has seen the impact of its fees. The state had the second highest EV sales in the U.S. prior to the fee. At that time, Georgia offered an EV rebate of up to $5,000. Now the rebate is gone and there is a yearly $200 fee. EV adoption has dropped by 80 percent.

Sierra Club reported that Koch Industries has spent about $10 million to advocate against electric cars, and to promote petroleum-based fuels. ALEC, which is funded by the Kochs, is working to convince states to drop EV incentives and charge drivers of electric cars. The campaign was started since the organization sees electric vehicles as a potential threat to the oil industry … not because road infrastructure needs to be paid for by EV owners. It really has little to do with bringing increased revenue to states, but instead, to get people to stop buying EVs.

There are surely other alternatives, that don’t intentionally benefit Big Oil, to help states generate the needed revenue. Some states are looking at taxes based on miles traveled. Others are considering setting up programs in such a way that those driving ICE vehicles will get a break, or at least not be penalized (because let’s face it – many people don’t and won’t have an EV for a long time and they shouldn’t be crucified either), but EV adopters will also not be steered away from the environmentally-friendly vehicles. Additional options include a carbon tax, and/or taxes based on vehicle weight.

It is only fair to argue for a more level playing field. Some will argue that EVs should not be incentivized, although the grounds for such is pushing a product that is a more positive impact on the environment and our health. We won’t get into whether or not oil has seen incentives in the past. But, at the very least, drivers of electric cars should not be punished for making a positive choice.

Source: Huffington Post

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71 responses to "State Bills, Likely Backed By Big Oil, Take Aim At Drivers Of Electric Cars"

  1. Michael Will says:

    We should get rid of EV incentives and oil and farm subsidies. The UK has been lobbied into helping shell with taxpayer money to subsidize the takedown of the outdated oil platforms, to the tune of some 25 billion. Once we stop subsidizing big oil we can take down the ev incentives because the cost of gas would adapt upwards if it wasn’t partially paid for by taxes.

    Then we can replace the gas tax and add a road infrastructure portion to the yearly registration fee for all vehicles.

    1. Dav8or says:

      A consumption tax, like the current fuel tax is a far better way to raise revenue for roads. EVs do mess up this established system. A mileage tax on all vehicles would be a better way to accomplish this, but how to do it?

      Transponders attached to each vehicle would be best, but how do we do that without huge expense to install readers everywhere in the state? Maybe a GPS based system, but how to do that without invading everyone’s privacy? Annual mileage reporting at a certified station, much like a smog inspection could work, but how to keep people from cheating?

      It’s tough problem and why the politicians and technocrats just throw down a flat tax and it’s not very fair. While the author of this post feels it’s unfair to pick on the itsy-bitsy, teenie weenie little EV population, if EVs do catch on like people here all seem to want them too and predict they will, it will be a real problem. I see no problem with tackling the problem now.

      1. Ken Sherman says:

        Put the tax on the tire. They have a load rating and we should be able to calculate the damage done over the life of that tire. It moves the tax to the source, kind of.

        1. Spider-Dan says:

          While initially I like the idea of a tire tax, that will just encourage people to get more mileage out of every tire, which is a safety risk.

          I think we’ll probably have to replace smog checks with mileage checks. There should be at least three GVWR classifications for non-commercial passenger vehicles, with a rate-per-mile for each.

          1. Dav8or says:

            The problem with that is, there are ways to hack the odometer. On older cars it’s real easy. There would be YouTube videos on how to hack your car’s odometer almost overnight. Only the honest people would pay full taxes. The current fuel tax makes it impossible to cheat… except buy an electric car.

            1. Pushmi-Pullyu says:

              In most if not all States, it’s a felony to falsify odometer readings. There are already strong legal prohibitions due to how odometer readings affect the value of a used car.

              There may be good reasons to argue against using odometer readings for road use taxes, but that ain’t one of ’em. How many people would risk a felony charge every year just to save $100 or so? Sure, there will be a few, but likely not enough to affect total revenue much.

              1. Spider-Dan says:

                Exactly. The used car market represents an opportunity to instantly make many thousands of dollars by hacking your odometer, and yet we do not have widespread odometer hacking on used cars.

              2. PHEVfan says:

                It happens all the time. A boss of mine did it to get a service done on a vehicle just after is passed the max mileage of the warranty. Completely corrupt? Yes. Does it happen? you bet it does.

                People cheat on taxes all the time. many are caught, but many are not or cheat on things that are never checked, which brings up the next challenge… who is going to police the cheaters? The DMV in my state is so under-funded they can’t afford to have people to check for cheaters.

        2. Dav8or says:

          Can you imagine the lines of cars “going on vacation” to Canada and Mexico? LOL

      2. Amy K says:

        I can’t speak to other states, but in Massachusetts we have an annual safety inspection and the mileage is noted. It’s also reported to insurance companies, which is how one gets a low mileage discount. I’m sure the state could be looped in easily, and we could pay by the mile. Or have everyone play a flat fee, and getting the inspection can verify/authorize a low mileage discount – incentivizing going in every year.

      3. Sascha says:

        easy fix if you think about it for more than half a second… we already tax gas effectively (arguable) so how do we tax the new EVs? duh, they all fill up at chargers so tax it there… we could invent an “electric meter” maybe???

  2. (⌐■_■) Trollnonymous says:

    We shouldn’t be subsidizing gasoline/petroleum so let’s make it a fair playing field and eliminate both EV and all US gasoline/petroleum subsidies.

    1. speculawyer says:

      Complaining about US gasoline/oil subsidies is not a great attack angle. Per unit of energy, they receive very little subsidies in the USA (hugely subsidized in many other countries though). It is not a good attack angle that holds up.

      Gasoline/oil needs to be attacked on toxic pollution problems, climate change problems, and the cost of our military defending oil exporting regions & trade routes.

      1. pjwood1 says:

        I think you refute your own argument.

        The Rand study was the one citing 60 billion a year being the cost of carrier groups in the Persian Gulf, specifically to secure oil tankers. That’s a subsidy to every one who gases up. I doubt the other half trillion in defense spending is made up only for the use of “defense”. But I still get the bill for a car that runs purely on domestic energy.

        Trump needs to square his isolationism with opportunity, but he’s becoming fodder for the establishment.

      2. jim stack says:

        just search for the REAL COST OF OIL and you will see a gallon of gas should be $10-15 in the USA. In Europe gas and Diesel is over $6-8 a gallon since they don’t subsidies.

        1. silversod says:

          Petrol is the cheapest it’s been in quite a few years over here in the UK, I filled up this morning and it was £5.51/$6.85 UK gallon.

    2. realistic says:

      I’d take that and add to it a tax based on vehicle weight. EVs at this point would be modestly penalized, but you could make it a step-value that discourages giant SUVs.

  3. Mister G says:

    As an EV driver in Florida I don’t mind contributing money to build and maintain transportation infrastructure. It costs around $19 million per mile for new roads. Join the EV REBELLION drive an EV today. It is more effective than shouting, hanging banners, marching, beating drums, dancing, blocking oil rigs, etc… Hit BIG OIL where it hurts, in the wallet.

  4. Ron says:

    Yeah

    Koch said about the Excise Tax Exemption for Crude Oil Derived from Tar Sands.

    Well if you donate 300 million to the Republicans you should get something

    1. Independent Lense says:

      Koch bro’s were on the Hillary train this election cycle. Bernie never had a chance.

      1. speculawyer says:

        Wrong. They didn’t back any presidential candidate. They clearly lean HEAVILY to the GOP but declined to back Trump because he’s a protectionist and a nut.

        1. MM says:

          What do you think Pence was about?
          Along with reassurance to the Evangelicals, Pence is a wholly owned subsidiary of Koch Industries.

  5. Independent Lense says:

    It is a bit disingenuous to connect Georgia’s $5,000 rebate elimination and $200 yearly fee to a drop in EV sales. If one is to believe the low total cost of ownership touted by EV advocate, the small yearly fee and $5,000 “extra” to purchase should not be a factor.

    No matter what state is putting fees or taxes in place, an intelligent individual would be able to clearly ignore short term costs. Low maintenance cost and much lower cost electric vs. fuel negate any fees.

    1. no comment says:

      the importance of the rebate is that it comes at the time of purchase and serves as an offset to reduce the effective price of the *EV. this makes the *EV look more favorable in comparison to ICEV alternatives. without the rebate, the effective price of the car goes up and makes the *EV look less attractive. thus, it is no surprise that the sales of *EVs would decline in georgia. indeed, i considered the rebate that i got in my state when tallying the total cost of purchase when i bought a Volt.

      1. ffbj says:

        Right. Since it directly correlated to the decline in ev purchases, completely ignoring that fact does give one pause as to the validity of the entire argument.

    2. Pushmi-Pullyu says:

      “If one is to believe the low total cost of ownership touted by EV advocate, the small yearly fee and $5,000 ‘extra’ to purchase should not be a factor.”

      Perhaps, logically, the $5000 (I’m guessing that’s a State tax rebate of up to $5000, which wouldn’t actually be $5000 for most people?) shouldn’t make that much difference.

      But really, what this shows is that a car buying decision is influenced by emotion at least as much as logic, and perhaps more so. It’s amazing just how difference a few thousand dollars in rebates makes in EV sales, when you consider how low a fraction that is of the total sale price including taxes and fees.

      I do agree it’s silly to assert the mere $180 fine tax on EVs is the primary factor in the drop in EV sales in Georgia. I don’t think there is any question that the elimination of the State rebate is a much, much bigger factor.

    3. TwoVolts says:

      “If one is to believe the low total cost of ownership touted by EV advocate, the small yearly fee and $5,000 “extra” to purchase should not be a factor. ”

      IL: You are kidding- right? $5000 buys a lot of gasoline, and most people look at that EV purchase price premium over its ICE counterpart – typically greater than $5000 – and opt to not dig the upfront hole. The EV owner eventually emerges from the hole – but the payback period can be very long and is a strong function of the tax credit amount.

    4. Bret says:

      It’s not disingenuous at all.

      Killing off the $5,000 rebate in Georgia absolutely caused Leaf sales to plummet. The cause and effect are statistically impossible to ignore.

      I was talking to our salesman from Georgia last week about our Leafs and he told me they were selling like crazy there, while there was a rebate. Now, there is a robust used market, but new Leafs aren’t selling.

      The $2,500 California rebate was a big factor in my Leaf purchase, because it covered the down payment.

  6. WARREN says:

    Perhaps big oil should help subsidize the huge health costs due to lung cancer?

    1. zzzzzzzzzz says:

      Yes, they certainly should. The same as plugin owners should stop this disgusting whining about gas cars suddenly becoming very “efficient” and start paying their share for road maintenance like everybody else.

      1. Pushmi-Pullyu says:

        I guess this is what passes for “logic” in the mind of a Big Oil shill.

        By your rather questionable argument, zzzzzzzzz, shouldn’t so-called “efficient” gasmobiles — or more truthfully, less inefficient ones — also pay an added yearly fee, to make up for the gasoline tax they’re not paying while driving just as many miles?

        “Sauce for the goose is sauce for the gander.”

      2. Kdawg says:

        How is it fair that someone who drives an EV 5000 miles/year, has to pay an extra $180 registration fees.

        1. PHEVfan says:

          Because they still use the same roads that the state paid to build, and has to continually pay to maintain.

          One could argue that a fixed $180 isn’t fair, but it’s more fair than EV’s not paying anything and gassers paying everything.

      3. TwoVolts says:

        “Yes, they certainly should. The same as plugin owners should stop this disgusting whining about gas cars suddenly becoming very “efficient” and start paying their share for road maintenance like everybody else.”

        zzzzzzzzzz,
        I am paying the fees on two EVs in Michigan, and yet I agree with you. I don’t like the new fees – but the cost of maintaining roads is fairest when based on usage, i.e.,miles driven. The new fees on EVs spread the road costs more fairly.

        1. John in AA says:

          I’m confused by your comment. As you surely know, Michigan now has a flat annual surcharge, not a usage-based fee. I agree it would be “fairest when based on usage, i.e.,miles driven” but of course, the Michigan legislature didn’t choose that option.

    2. speculawyer says:

      Yeah, people need to constantly bring up all the externalities from fossil fuels such as health consequences from the toxic pollutants and the climate change disaster.

    3. no comment says:

      the externalities costs of gasoline usage are never priced into the cost of gasoline. this is one of the reasons why rebates and tax credits should be used to encourage the public to buy electric vehicles.

    4. Kevin Cowgill says:

      Warren you nailed it.

  7. speculawyer says:

    No good deed goes unpunished.

    The GOP’s irrational hatred of solar PV, wind turbines, and EVs is going to COMPLETELY backfire on them as the costs drop. They will be exposed as corrupt pols just providing protectionism for their cronies.

    1. no comment says:

      demagogues never work by turning people against issues. instead, the link issues to persons and get their followers to dislike the persons, and to thereby oppose the issues. the followers are just the useful idiots who end up opposing issues that are often to their own benefit. obamacare is a perfect example; in kentucky you had people voting for candidates based on opposition to obamacare only to find out that those very same voters were getting benefits under obamacare. after those useful idiots found out that obamacare was benefiting them directly, they were then hoping that the candidate for whom they voted would not honor his campaign promises.

  8. John says:

    They should probably charge all the bike riders too. They’re not paying anything!

  9. no comment says:

    there is some logic to these fees, but they are being imposed much too soon. at present, the objective should be to give the public incentives such that the number of *EVs increases. then, when they actually account for a substantial share of automobiles on the road it would make sense to start to phase out the incentives followed by an imposition of fees to offset the loss of gas tax revenues.

    1. Pushmi-Pullyu says:

      ^^ this.

    2. MG says:

      Totally fair. Encourage adoption but fees are coming. Let’s hope they are fair.

  10. Taser54 says:

    Ahh, more conspiracy theories. You guys make Mel Gibson look sane.

    The bottom line is your elected representatives never met a tax or a fee that they didn’t like.

    1. ffbj says:

      That’s a stretch to make Mel Gibson look sane, but the last sentence is now, has been, and will always be true.

  11. William says:

    Oil revenue is like free money growing on trees! Can’t cut down the giving money tree, unless all you need is a stump to sit on, to take in the view of the Krotch Industries scenic wasteland. Tax the Gassers More, to offset the EV ReVoltution!

  12. energymatters says:

    The study we’ve done and seen on the benefits of localizing the spending on fuel is WAY more than the fuel taxes people are griping about.

    It works like this:
    1) Appx. 81% of every dollar spent on gasoline LEAVES the community. (See http://www.eia.gov/petroleum/gasdiesel/
    ).

    2) Local spending re-circulates into local jobs. Appx. 68% stays locals in each cycle.
    Example see:http://sfloma.org/Studies
    http://www.civiceconomics.com/SF/

    3) So by shifting 81% of the prior spoend on gas into local spending, 68% of which stays local in each spend and you have about you boost the local economy.

    How much? Well take a $300/mo spend on gasoline * 81% shift to local* 3.06 net factor on local spending per year based on 68% local impact you get ~$10,000 per year per EV driver in new local economic activity.

    So now how much SALES TAX does this create for your local community? You have to look at that yourself for your region BUT for California this works out to ~$495.70 in State general fund revenues and for a county appx. $346.99 per year PER VEHICLE PER YEAR.
    Source: http://www.boe.ca.gov/pdf/pub71.pdf

    In other words, appx. $842/year in new sales tax revenues to the local state and community per year per vehicle.

    Seems like ICE should be charged more as they are EXTRACTING $$ from the local community while an EV is BRINGING value…

  13. ffbj says:

    I think can be argued that due to their fuel mix, none, pure ev’s should be deemed less damaging to roads. Big rigs pay more road taxes, naturally since they damage the road bed more, but since evs have no oil or gas, they aren’t leaking these fluids, which degrade the roadway. ICE/EVS: they are not directly equivalent. Less damage to the environment could also be argued as pointed out above, but that is not specifically related to roads.

    The states must also show that every dime of road tax is used for roads. It can’t be put into a general slush fund or the like. Many ways in which these bills could be and probably should be challenged.

    1. Djoni says:

      I think it’s a valid point.
      Leaking gas, toxic acid fume, polluting exhaust, VOC, nitrogen oxide and fine particulate is known to destroy and age all infrastructures.
      So the more you burn, the more you destroy.
      Not counting health, noise stress, and other externalities.
      Everyone has to pay for the road its fair share, but not every vehicle is having the same wear on it.
      EV is a lot friendlier for our road.

  14. unlucky says:

    An argument that charging road tax to EVs cannot be valid because the road tax doesn’t cover all roads is fallacious. If they suggest to raise the gas tax but not enough To cover all roads would you argue that isn’t a valid increase? Would you argue that since it thus isn’t valid it must be ‘big EV’ behind the increase?

    If you make specious arguments for your side you weaken your side. Don’t be tempted to say silly and fallacious things to support positions just because they align with your other beliefs.

  15. Brian says:

    How is it constitutional to fine someone for not purchasing a commercial product? It’s like imposing a tax for not buying fanny-packs.

  16. Ray says:

    This is a poor article. Living in Colorado and paying an extra $50 a year for each of my two Volts makes sense. I’m not using much gas, but I drive on the public roads, so a bit each year is necessary to help keep the roads drivable. Part of the tax goes to adding public charging stations around the state, I support this tax. I would have to guess Colorado isn’t alone in this endeavor.

  17. BraveLilToaster says:

    “It is not set today to cover the massive inflation that has taken hold since the gas tax was introduced in 1957.”

    And hell will freeze over before the gas tax is reformed and increased. Both because ALEC will campaign against that too, and because the public will start throwing rocks through state legislature windows.

    Welp, I would say it’s time to say hello to crumbling interstates, but that’s already been happening for decades. Oh well.

  18. TP says:

    @Steven Loveday, Tennessee has not passed an EV tax, yet. A flat tax/fee of $100 on EV’s has been proposed as part of $0.07 gas tax increase. That said it has not been voted on yet (unless it was done so today).

    As a resident of TN, I am happy to contribute to better roads. I do however, wish that the proposed EV tax would be linked to mileage or some other method of usage, instead of a flat fee.

  19. needa says:

    One inaccuracy that I can see is Tennessee being put in there for increases ‘just this year’. From what I can tell that is false. Last year SB1841 ($75 hybrid/$150 EV) was shot down and this year there has only been talk from some professors at UT as to whether or not we need one.

  20. Four Electrics says:

    EV drivers should pay for their share of the roads.

    And what’s with this “likely” in the headline? Spreading rumors again?

  21. Pushmi-Pullyu says:

    On the one hand, the Federal govt. and various States are offering tax incentives to promote buying EVs. But on the other hand, some States are now imposing road use fees on EVs only.

    This is stupid, wasteful, and inefficient, not to mention sending mixed signals to the public, undercutting the value of tax rebates promoting EVs. How much money is wasted on the bureaucracy involved in collecting these fees?

    If humans were rational animals (and we clearly aren’t), then we would merely reduce the incentives by some amount, and divert that money to road maintenance and improvements. Sadly, that’s much too straightforward and efficient to be implemented.

    1. bws says:

      ^^ this

      I would prefer any changes wait until EV adoption is higher, but if a change must be made, just reduce the incentive.

      The best fix imho would be a combination of a carbon tax and registration fees based on vehicle weight. (I prefer vehicle weight to miles driven because of the administration, privacy and enforcement costs of miles driven).

      Short term, I supported an increase in the fuel tax when it was proposed in CA, and I would support an increase nationwide.. but an overall carbon tax would be better.

      bws

  22. Ben Brown says:

    Anyone remember why clean air legislation came into being? It was to stop the drop in people during air inversions across the country and other industrial places in the world. By drop in people I mean several people at a time simply dropping dead in public from air pollution complications. In one area an entire herd of cows fell over dead when the wind blew the wrong way.

    Several steps down the years, along with energy independence and all that, electric cars were seen as having Value in reducing air pollution. Value. Worth something to the public. Seems we’ve forgotten history (until it is too late).

    1. Mister G says:

      Global warming resulting in sea level rise is happening today but most humans are ignoring the reality.

  23. Gadge says:

    A Federal gas tax of 1 cent/gal was introduced on June 6th with the enactment of the Revenue Act of 1932. The state of Oregon preceded that with a 1 cent/gal gas tax in 1919.

  24. Craig Capurso says:

    Simple solution GET RID OF FUEL TAX replace with a milage and weight tax.

    1. Mister G says:

      Sounds good but the cost to implement, enforce, and manage a mileage and weight tax will be expensive because Americans will find a way to cheat the tax lol

      1. John in AA says:

        Someone will find a way to cheat any tax — either literally cheat, as in committing the crime of tax fraud, or figuratively “cheat”, as in finding a tricky way to write off $916M in fake losses.

        The gas tax is far from perfect in this respect — people living near the state line between two states, one with high gas tax and one with low, may commonly cross to the lower-tax state to buy their gas even though they live in the higher-tax state and mostly drive on those roads. For that matter, driving a fuel-efficient car “cheats” the state of taxes that would have been paid by a less efficient car.

        Perfect is the enemy of good, and there’s no evidence I’m aware of that an odometer-based tax wouldn’t be good enough and probably better than the current fuel tax.

      2. bws says:

        Registration fees based on the weight of the vehicle would be immune from most of these complaints, as it would use numbers from the manufacturer. The point is not to be 100% accurate, but to make a good guess for the average.

        An average 6000lb SUV is going to be causing more wear on the roads than an average 2500lb compact car.

        I see no value getting into the details of how many miles or what cargo increased the weight for how long for an individual vehicle, particularly because of the costs of administration and enforcement of such a policy, not to mention privacy concerns.

        Having fees reflect the average weight of the vehicle will have the same net effect, which is to encourage cars that weigh less, and will increase revenue when the fleet increases in weight (which is when there is overall more wear and tear.. and the reverse).

        As the saying goes, do not let the perfect be the enemy of the good.

        Medium term, the right solution is a carbon tax. (Short term, the right solution is an increased gas tax, unless we can get the carbon tax just as quickly).

        1. PHEVfan says:

          bws – I’m not so sure on that one. Many large pickups (like mine) are 2nd vehicles used only occasionally for hauling large items or towing a trailer on occasion. A vehicle like that only doing 4-5k miles a year isn’t necessarily doing more damage than a lighter car going 12-15k miles. Weight does matter, but so does mileage.

          1. John in AA says:

            Yeah, it should be a formula based on both weight and mileage. Both of which are conveniently easy to know — all you need is a KBB (or whatever) and an annual odometer reading.

  25. Ron M says:

    It’s been over 20 years since Federal gasoline taxes have been raised. Yet Trump wants to give the corporations a one time 10% tax for bringing the offshore account money back

    These corporations used hundreds of lawyers to evade taxes while smaller corporations, businesses and citizens paid.

    These corporations need to bring the money back pay the highest rate and then get any new tax rate.

  26. Mister G says:

    Best solution is a flat EV registration fee on an annual basis that is split between state and federal to fund road construction and maintenance costs.

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