Last November, California voters defeated Proposition 6, which would have repealed a recently enacted law that increased gasoline and diesel taxes in the state. Those taxes rose 12 cents per gallon for gas and 20 cents per gallon for diesel, and levied an additional registration fee based on the market value of the vehicle.
Naturally, this was unpopular with people who drive expensive cars and big trucks that get terrible mileage, while owners of 10-year-old Priuses just shrugged.
According to the Los Angeles Times, the law will provide generate $54 billion to fund road maintenance, repair, and construction projects through 2028. More than a year after the taxes went into effect, when you take a drive in the Golden State it is clear that the money is being used to repair California’s aging infrastructure and to reduce traffic choke points.
But what about electric vehicle (EV) owners? What skin do they have in this game? After all, California is home to more EVs than any other state, and they shouldn’t get a free pass when it comes to funding road improvements.
Well, starting in 2020, they’ll pay an annual fee of $100 in lieu of paying gasoline taxes. But a new report by the Institute of Transportation Studies at the University of California, Davis, says that won’t be enough based on previous Gov. Jerry Brown’s plan to have 5 million zero-emission vehicles (ZEV) on California’s roads by 2030.
California Must Find a Way to Level the Playing Field
First, unlike with gas taxes, the flat-rate fee has nothing to do with actual road use. A gas tax is a consumption tax. Use lots of gas to drive lots of miles and use lots of roads, and you pay more to help fund repairs. That makes sense. But an EV driver could cover the same amount of ground, contributing just as much traffic congestion and doing as much damage to the road, for just $100.
Second, the annual fee penalizes people who drive plug-in hybrid vehicles. They pay the $100 and they pay gasoline taxes. And while that may sound logical, it sure seems unfair when compared to EV drivers.
Third, the report says that given the number of EVs that will be on California’s roads by 2030, the annual fee simply doesn’t pencil. It won’t provide a commensurate amount of revenue for the road use by the expected 5 million vehicles.
What’s the solution? Report author Alan Jenn has an idea.
“California now has the opportunity to support alternative funding mechanisms,” Jenn said. “Our study finds that a per-mile road charge, designed specifically for zero-emission vehicles, is a relatively low-cost and sustainable solution to funding our roads.”
California lawmakers requested this report, and right now it is unclear what they will do with the findings. Transforming every alley, street, road, highway, and freeway into EV tollways certainly would solve the revenue issue, but would such a change stall adoption of electric cars?
We’ll have to wait and see.