House Bill 257 To Kill $5,000 Credit Passed, Now Heads To Georgia Senate (video report)

MAR 10 2014 BY JAY COLE 48

HB 257 Would See The Sun Set On $5,000 Credits For All Electric Cars Like The Nissan LEAF

HB 257 Would See The Sun Set On $5,000 Credits For All Electric Cars Like The Nissan LEAF

Last week the rally call went out to supporters of plug-in vehicles to aid in convincing the Georgia House of Representatives to amend a bill (HB 257) to not include the removal of the state’s $5,000 credit for the purchase of all electric vehicles.

Republican Rep. Chuck Martin (via CBS46 Atlanta)

Republican Rep. Chuck Martin (via CBS46 Atlanta)

Unfortunately that did not happen, as last Monday that bill passed;  it now heads to the Senate for debate.

As for the reasoning behind the removal of the $5,000 credit, as well as a $2,500 tax credit for low-emission vehicles – the advent of cheaper and cheaper plug-in cars is to blame according to Republican Rep. Chuck Martin in an interview with CBS46 Atlanta (video below) :

“My personal view on the [current] policy is it shouldn’t be so rich for the taxpayers to allow someone to buy a car for free,” said the representation reacting to recent Nissan Leaf lease deals.

Mr. Martin figure that the liability to taxpayers by the end of this year could amount to about $30,000,000 in lost revenue.

Michael Beinenson, who penned an article here at InsideEVs asking for support in defeating HB 257 as it was originally written, was interviewed by CBS46 and said:

“I think it is extremely vital,” of tax credit that saw him get a Nissan Leaf himself last year. “It was an expensive vehicle. It had higher monthly payments than I was paying at the moment.”

The bill as it stands would remove the $5,000 credit completely.

However, it does now seem as though the national attention has perhaps softened the Republican’s position somewhat, as Mr. Martin would now like to see the credit become a temporary event that would be more slowly phased out over time – as well as now also include plug-in hybrids, such as the Chevrolet Volt and Ford Fusion Energi.

CBS46 News

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48 Comments on "House Bill 257 To Kill $5,000 Credit Passed, Now Heads To Georgia Senate (video report)"

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Today’s Republicans have lost their way… Sad. 🙁

They are now turning into the “Oops” party.

“Oopsie, I wanted to roll back the clock to the 1950s when you could discriminate against gays like a Real Americun… but wasn’t planning on the entire nation watching!”

“Oopsie, I really think 47% of the nation are moochers… but didn’t plan on everyone learning about it until after I’m elected!”

And now, the Chuck Martin anti-EV version.

Idiot. Jerk. You put together a bill – that’s a lot of work. It’s supposed to include thinking. The negative repercussions have only dawned on you now that it passed?

I disagree, a little. There is such a thing as too lavish a tax-credit. With lease deals and gas savings getting closer to proving Rep. Martin correct, we shouldn’t be surprised. You just have to hope heads cool, and they phase down.

Wind power, everywhere in the US, has a 2.2 cent/kwh tax-credit. That’s a lot when wholesale power makets, like Leaf prices, go down to 3-6 cents, from ~5-8 before the crisis. It isn’t the point to dispute what clean power and Leafs bring. It’s that markets can change, and sap policy momentum.

If they feel that it is too lavish then REDUCE IT not eliminate it.

I wonder how Chuck feels about all the other tax credits in the state of GA.

Funny how you never hear about politicians wanting to eliminate corporate welfare subsidies to the oil industry or nuclear power! The fossil fuel industry receives tens of BILLIONS of dollars in subsidies from our taxes and has for decades. Let’s eliminate those subsidies and watch gas prices go up to the fair market value well over ten dollars and electric cars will look cheap without any subsidies!

We have a serious problem here in the US where we the taxpayers pay the salaries of our so-called representatives. I sent two emails to the guy that sponsored this stupid bill weeks ago and guess what . . . that’s right, no response back! And I was very polite in my emails to him but not even a “thank you for your opinion” response.

WOW…so Georgia was offering a total of $7,500 in ‘credits’ with the purchase of an EV. On top of the federal credit of $7,500.

Even California didn’t go that far.

For a state searching for dollars, it does seem reasonable to remove the hefty $5,000 credit and leave the $2,500 tax credit for low emissions vehicles.

Maybe now it’s time for Nissan to offer another price drop for one of it’s top markets. Currently a comparatively equipped 2014 Focus Electric after Cash Back is about $3,000 less than a Leaf SV.

An EV wouldn’t get both. There are 2 categories of vehicles in Georgia that get the credits. Low Emission “Alternative Fuel” Vehicle (LEV) Credit or Zero Emission Vehicle (ZEV) Credit. The former gets the $2,500 and the latter gets the $5,000. What’s strange is that a CNG car gets the LEV credit but the Chevy Volt gets nothing.

The Georgia Tax Credit is $5000, not $7500, and yes it is on top of the federal amount. More importantly however it applies to leases not just purchases.

What this means, and this is what everyone is doing, is that you can get a 2 year lease and claim this credit.

The dealer takes the federal credit in a lease but the individual takes the state credit.

Here’s the math:
Total cost of the lease is about $250-300/month (including the title tax and depending on whether you get the S, SL or SV)
which works out to $6000-7200 for the entire term.
Subtract the $5000 tax credit
Subtract the gas savings ~$1250/yr. $2500
Add the cost of insurance ~500-1000/yr.

Bottom line is that if you make enough money to claim $5000 in state credits the car is basically free.

At the end of the lease, turn the car back in and if the credit is still in place – repeat and have a perpetual new car. Good for me, but good for the people of Georgia? Not so much.

My response about not getting both should have been more clearly stated. In response to Bloggin I was trying to clarify that EVs don’t get both state incentives. The $2500 incentive isn’t piled on top of the $5000 state incentive. I didn’t mean that EVs don’t get both state and federal which they do.

First a disclaimer. I live in Georgia, drive a Volt and was planning on getting a Tesla E when they arrived. So I’m pissed. Having said that if Mr. Martin feels that the incentive is too “rich for the taxpayers to allow someone to buy a car for free” then maybe they could consider lowering the incentive in line with many other states. Say $2,500 for EVs. That seems drastic and reeks slightly of ulterior motive to strike it completely.

“However, it does now seem as though the national attention has perhaps softened the Republican’s position somewhat, as Mr. Martin would now like to see the credit become a temporary event that would be more slowly phased out over time”

So does that mean proposing a new bill after the old one is gone? Once the old bill is dead it is very doubtful that any new incentives will be added back into play in this hostile environment. Mr. Martin though will politically come out ahead because he will show that he was fiscally conservative while still appearing to be reasonable by introducing a paired down incentive bill. Of course he could care less if it passes or not.

Unfortunately, I’m not sure that the “national attention” as the article describes it, is really there. At least not according to simple online news searches.

The bill passed a week ago, and we’re only hearing about it now, and only in an EV-specific blog.

I’ve got a Leaf in Georgia and take advantage of this tax credit. Basically allows me to drive a car for free for the term of a 2 year lease. As a selfish matter, it’s a pretty good deal for me. I’m pretty happy with the Leaf. Would I pay $35-40K for it outright, probably not, but it is a nice car.

From a policy perspective, doesn’t really make sense to allow somebody like myself (~ $200K/yr.) this very generous tax benefit which in reality allows me to avoid almost all GA state income tax. Also the science behind the whole idea of carbon emissions meaningfully affecting climate is very questionable. Despite what you hear in the media the scientific community is rapidly coming to that opinion. I’m more than happy to forgo this credit now and hope the federal government comes to the same conclusion once some people who are less ideologically driven come to power.

This repeal makes sense. Should we repeal other crony tax credits? sure. but you can’t really justify this one either.

I started reading with interest, then stopped when I got to the point you say global warming science is “questionable”.

Sorry pal…

*cough* fake.. *cough*

Concern Troll is Concerned!

Sorry, guys. I am legit. I was the second person in my company to get a Leaf and spread the word to 29 other colleagues in my office building who also purchased a Leaf based on this tax benefit. You should be thanking me. 🙂 Difference here is that I in no way think that my efforts are anything but selfish. The data is pretty clear that CO2 is nothing but a very minor contributor to global climate. Even activists climate folks struggle with the fact that the models are even approaching the observed data. I’m also a bit of a techie so wanted to check out an EV. Don’t get me wrong I like the car and the concept. It does have benefits if the cost model can be brought down, legitimately and not through govt. manipulation. The most real benefit is the effect on actual hydrocarbon pollutants (smog) which is an issue here in Atlanta. Fact is that the economies just aren’t there. Except in those cases where you have somebody who can afford having an extra car. It’s just not all that practical for the masses, but hey there are alot of cars that aren’t practical but… Read more »

Not everyone buys/leases an EV for the same reason. CO2 is way down the list of my reasons. I wanted 1) neat technology, 2) reduce my gas use (convenience, environmental, & geo-political), 3) enjoy quick, quiet and smooth driving, 4) less maintenance and very low ownership costs, 5) reduce exhaust particulates, etc. BTW, my state has no incentives but requires EV owners to pay for lost gas taxes with an annual fee.

Yup, global warming aside, driving an EV (especially an American-made one) should be considered one of the most PATRIOTIC things you can do (with regards to personal transportation). Driving one doesn’t regularly any money to the Middle East.

All the “patriotic” idiots driving around by themselves in the their F-150 quadcabs, with big giant American flags attached to the back, can suck it. They are so lost.

He might be legit, but his knowledge on global warming needs a little remedial crash course.

Global warming would have been neither “questionable” nor “controversial” in the US, if the Republican party did not choose to make it a wedge partisan issue back in the 1990s.

It really is a very simple physical process. Unfortunate and inconvenient, yes. But it can be explained to a 10-year-old in half an hour.

I’m sure you can figure it out too, Thomas, once you realize it’s not really a partisan issue and has nothing to do with self-identity or free-market slogans.

Trust me, in a 1000ppm-CO2 world, no free market will exist anymore. Likely not even in a 600ppm world. We’ve just crossed 400ppm, as you probably know, up from some 250ppm pre-industrial-era, and the rate-of-increase is still accelerating.

Please let me know if you need help on understanding this last statement.

Asaf – I know this is alot to ask, but please keep an open mind and don’t parrot slander against other scientists and knowledgeable people who question the scope of CO2’s effect on climate. It’s pretty clear that observed data is not matching predictions which puts the real impact very much in doubt. Fact is that the earth has not warmed for ~17 years and the warming that occurred from ~1980-2000 was well within climate norms of the Holocene. There have been at least 3 periods since the last ice age where temperatures were greater than the modern period. Until those temperature spikes are explained, call me unconvinced. Again, talk to people in the know who actually look at the data and they are questioning the climate models that forecast calamity. Also, this is not well known but 2/3 of the temperature increase forecast in climate models in due to positive reinforcing feedback. (i.e. oceans heat up, putting more water vapor in the air which has a much much greater warming coefficient compared to CO2. Fact is that data is showing that based on data from the past 50 years that the feedback is negligible and could be negative. (i.e.… Read more »

I still call BS on your ‘persona’. Either way, I didn’t buy a plug-in car for CO2 reasons. My reasons were selfish too, but all decisions are. People have kids for their own selfish reasons, but get tax credits and force people that don’t have kids to pay for them. People by houses and get tax credits while those who live in apartments do not. The list goes on. What is your point. This particular politician just doesn’t like the EV credit. Which is odd because most republicans are typically for less taxes. If you want to make a policy case for it, you can say $2000/year isn’t going to foreign countries for oil, or even to states outside of Georgia to non-local energy companies. The local power companies get more revenue, and the $ owners save on gas may very well get spent locally.

Not going down that rabbit hole. Sorry.

It’s really simple. I don’t wish a 600ppm world on my grandchildren, and you shouldn’t wish one on yours.

“Even activists climate folks struggle with the fact that the models are even approaching the observed data”

Yes . . . it turns out that the polar ice is melting much FASTER than the models predicted.

I really wish people would actually study the data from NOAA and the NSDIC. It will show yes, the arctic sea ice is down but the antarctic ice is close to record levels. Net-Net the global ice area extent is about the same that it was 30 years ago.

Sorry Thomas, as long as you deny that there’s an overwhelming scientific consensus among climate scientists that our CO2 emissions *are* causing climate change, you cannot really throw “scientific”-sounding arguments and factoids around.

Again, things are really simple on this front too:

You are *not* a climate scientist.

Nearly all climate scientists, and their consensus opinion as expressed via multiple reports including of course the IPCC, are saying that rising CO2 levels are causing global warming on a scale that will very likely become catastrophic soon.

You deny the basic fact that this is indeed the consensus.

Hence you cannot be engaged in serious conversation about the topic.

But why REPEAL it? Why not just REDUCE it. Make it $2000. This is a good local historical analogy of what is happening now globally. It follows the same false premise that nature is something other than and beyond our touch. The continuing pollution of the Thames was ignored for so long because it was mostly out of site and mind for the average person and the lack of will and conflict of interest on the part of the powers that be. This quote sums up our fate as well: ‘In 1855 the condition of the Thames appalled the eminent scientist but three years later, in 1858, the hottest summer on record reduced it to a state in which it offended a more influential body: the politicians whose recently rebuilt hoses of Parliament stood upon its banks. This proximity to the source of the stench concentrated their attention on its causes in a way that many years of argument and campaigning had failed to do and prompted them to authorize actions which they had previously shunned.’ So until it begins to affect those that can do something about it nothing will be done about it. Unfortunately what we are dealing with now isn’t a simple river and the damage can’t be… Read more »

Oh, and I kinda wonder now whether you

– Really drive a Leaf
– Really make $200k/year
– Or even really live in Georgia (that last part is the most probable of your statements).

More likely, this is a sock-puppet comment of some sort. It fits Rep. Martin’s talking points *way* too well. You need to put a little “noise” in it next time.

No EV tax credit should be permanent. Its a temporary thing to get EVs/Plug-ins into the affordable/Positive-ROI area for most individuals.

The goal of the credits should be to keep the break-even at 5 years. Adjust credits as necessary.

I would love to feel some self-righteous outrage at them ending their state EV incentive. But since they were one of only a tiny minority of states that ever offered any incentive, it is hard to single them out, when so many states have never done anything at all.

Georgia was a complete stand-out state for offering this in the first place, so I have to applaud what they have done for EV’s already.

If they actually change it to a phase-out, that would be very cool. It would certainly keep them at the top of the list of stand-out states.

You make a good point about Georgia currently being a stand-out.

The outrage is at the abrupt, zero-prior-thinking, disruptive nature of this bill.

It is rare to see at any level, any bill eliminating tax any sort of tax break within a few weeks. To my knowledge, the State of Georgia is not collapsing tomorrow, and signing this bill would have not saved her from such a collapse anyway.

In short, this bill has almost zero to do with good finances or fairness. This is just red-state Republicans deciding to toe the culture war party line. In that culture war, EVs have been defined as “Librul Toys” pushed by an Obama administration that’s “Picking Winners and Losers”, and therefore should be banished.

See also next door in South Carolina, where the (pitifully small number of) BEV drivers are now slapped with an annual “fairness” fee that’s equivalent to the state gas tax levied on 750 gallons of gas per year.

Atlanta smog is among the worst in the nation? Who cares? We’re not here to help run the state better, we’re here to fight culture wars.

Well, sh!t.

Get used to it, EV proponents. Tax incentives for EV purchases are on the way out as the industry matures. Actually, if you think about it, you should be happy. It means that EVs are about to make a dent in the market as their prices get closer to becoming competitive with ICE cars.

There is a difference between phasing out and quickly eliminating it. This particular law is 16 years old – it is time to revise but not suddenly kill it.

So you can drive an electric car for free, but it’s really not all that practical? Yes, I suppose driving for free is pretty impractical.

As a society we pay for the benefit of others even if we receive no benefit. I have no children but I pay taxes for others children to go to school.
@Thomas you may be real as you claim, but when so many of your arguments echo right wing talking points, about ev’s not being for everyone, or impractical, the one about not paying for others benefit, like when Bush bailed out the banks to the tune of 750 billion, with our money. Picking winners and losers. Just too many buzz phrases for me. Maybe you are just a well indoctrinated right-wing ideologue, which would be my guess.

Good points, but I think it we can all agree that there is a point that a credit may be too lucrative (what exactly that amount is may be harder to agree on).

Not all citizens can take advantage of the credit. For example, people with low income or not so great credit may have a hard time financing or leasing a new vehicle even with a large credit. In this way, it makes the tax system more regressive than progressive. The credits do have an effect on total revenue. I think lawmakers have to consider this. While I think some incentives early on our worth it, I think there is a point where it can be taken to far.

You can take the credit over five years so that is the equalizer. If they can’t afford the payments then that is what it is. I can’t afford a Bentley so I don’t drive one.

I’m amazed they had such a generous tax-credit to begin with. How did someone manage to sneak that one though IN GEORGIA? Perhaps the utilities pushed for it?

The law is 16 years old, so considering how much has changed in 16 years it is time to revise it. It came before the $7500 Federal Credit was also available. It came well before the current EV models were even available. Given current model prices after last years price drops, and the current Federal credit, this $5000 credit may be so high that it causes backlash and is succecitble to getting scrapped each year. Reducing it, then gradually phasing it out makes sense.

While I do like to see state incentives for EV’s I think it is unfortunate some of them exclude PHEV’s, especially considering this:

Nate, do you have a source for the Georgia law being 16 years old? That would explain a lot, being before Republicans declared EVs to be part of The Enemy.

Its what the video said.

..also, I just goggled the year Georgia EV incentive passed and this was the 2nd link:

..which said 1998.

If it passes, it will sure put a dent in the LEAF sales this year…

We have seen Volt and Leaf drop their MSRP by $5k and $6k respectfully.

The rebate was to start helping get the industry off the ground. Things are progressing. Next gen cars will be cheaper. We have to let go of this “entitlement” that we really are not entitled to. It is an industry “kick-starter” but not meant to bev here forever.

I wouldn’t mind seeing the per-state credits go away so that state coffers can spend the money on road repairs after these tough winters like this one. PA is slowly slipping from an original $3500 to 3000 and now 2500. As it should be done.

If the federal government really wants to move EVs – skip the tax credit and move to a $5K point of sale immediate rebate. This helps people buy the cars who cannot afford full MSRP and who cannot take the federal credit. $5K rebate can reach more consumers than a 7.5K federal tax credit when people actually purchase the cars.

Mr. Martin’s next move: Repeal that tax credit we approved on round trips to Mars 20 years ago.

Georgia has this credit on the books for over 10 years. Just when there are actually viable electric vehicles being produced this schmuck tries to kill the credit? What BS! So to this guy, you should only have a credit if there are no vehicles to take advantage of it? What a forward thinker!

I told everyone I work with about this credit. Guess how many went and took advantage of it? Zero, that’s right, zero. I’m thinking it isn’t going to spread like wildfire. I bought a LEAF and while a great car, isn’t for everyone.

This guy represents everything wrong with politicians. He thought he would make a name for himself, which he did. Schmuck!