The Seattle Times, which has recently editorialized against nearly every single state tax increase, no matter the size, and no matter the purpose, even to save uninsured children from death and disease, because now is not the time to burden families and businesses with new taxes… has finally had a change of heart:
ELECTRIC-car owners should pay an annual fee in lieu of gasoline taxes to help maintain Washington roads and highways.
Legislation in Olympia would levy a $100 fee when an electric car is registered, and collect it again when car tabs are renewed.
Because, you know, if we’re going to use our state tax code to disincentivize any economic activity, it might as well be the looming shift to all-electric vehicles. In fact, they appear to be so gung-ho in favor of this “fee,” that the same editors who warned against appeals to “class warfare” when railing against both the estate tax and the high-earners income tax, subtly resort to exactly that tactic in advocating that we stick it to the EV elite.
A $100 fee is not onerous and hardly a credible deterrent to buying a $40,000 car, before the federal tax incentives.
Get that? Business taxes drive businesses out of state. A high-earners income tax would drive the wealthy out of state. But a tax on electric cars couldn’t possibly have any impact on the sale of electric cars. And besides, it’s only wealthy, tree-hugging fat cats who can afford to blow their cash on a $40,000 electric vehicle, so they can afford the extra hundred bucks a year.
Except, for the life of me, I can’t figure out where they get that $40,000 figure….
As rhetorically useful as that $40,000 threshold might be, the actual bill, SB 5252, applies the $100 fee to vehicles that use “propulsion units powered solely by electricity,” and the only remotely mass market vehicle that meets that definition today is the $32,780 MSRP Nissan Leaf (the much touted Chevy Volt utilizes a backup gasoline engine, which appears to exempt it from the fee). Throw in the $7,500 federal tax credit, and the cost of buying a new Leaf drops to an affordable $25,280. That’s actually $4,000 less than the $29,217 average, US new-car purchase price in 2010.
Yeah… stick it to the man!
Furthermore, the bill’s fiscal note estimates only about 5,000 total registrations during the entire 2011-13 biennium netting less than $500,000 for state coffers. And even that estimate seems optimistic, considering Nissan is struggling to meet its goal of delivering 25,000 vehicles to the entire US market by the end of 2011.
So here’s a better idea: if we really need additional highway funds, and if the Seattle Times is truly sincere when it argues that “a $100 fee is not onerous and hardly a credible deterrent to buying a $40,000 car,” then how about we levy a flat $100 fee on all cars valued over $40,000? After all, many of these pricier vehicles tend to be bigger and heavier than the lightweight, small-wheeled Leaf, and thus do more damage per mile to our roads.
Wouldn’t that make a lot more sense than punishing eco-conscious consumers for choosing to emit less carbon? The Seattle Times editors make a big point of looking to Victoria, B.C., Texas and Oregon for “brainstorming” on the issue. In that spirit, it might be informative to point out that, rather than penalizing early EV adaptors, some states actually offer tax incentives—up to $5,000 in Georgia and California, $1,500 in neighboring Oregon.
At some point in the future, when electric vehicles eventually gain significant market share, state lawmakers will have to find alternatives to the gas tax to help fund highway construction and maintenance. But according to OFM, that point is way in the future, with the EV fee only projected to bring in a paltry $1.9 million in the 2021 fiscal year.
But for now, my suggestion to the Seattle Times‘ editorial board is, “in the middle of a tough recession,” rather than wasting precious time on a bill that can’t pass and won’t bring in much money, you should be urging lawmakers to “stick to serious business” and “stop dithering.”
The Nissan Leaf causes a huge amount of damage to roads-have you ever seen what a polar bear does to tarmac? They tear shit up.
Goldy, you should publish a chronology of their declining sales numbers and circulation. May as well go for the jugular.
If you really want to both raise money and discourage behavior that damages the roads you should be lobbying for a $100 fee for studded tires. Those things are completely outdated and outperformed by modern studless snow tires and cause massive damage to our roads.
You think that’s bad, did you read the puff-piece editorial today in the Suburban Times where they try to install their Army VP to replace our Mayor.
This is Seattle. We revel in our Freedom.
@3 technically true, but it would be far more effective to just triple the GVW license fees above 10,000 if you really want to have those who damage the roads pay for it.
If it’s for road maintenance, all vehicles should be taxed by weight.
So, the corollary of what we’re saying is that, were there a “roads license fee” for a bike, it would be about 1 or 2 pennies per year, in terms of impact.
I think this tax makes sense down the road (so to speak), but right now, when we’re at the threshold of electric car use after so many false starts and so much corporate/government foot-dragging and other assorted backwards-thinking stupidity, we should be doing EVERYTHING possible to encourage ownership. How about just a 1-2 year moratorium? Would that really break the bank?
And yeah, the hypocricy from the Times is a joke…I plan on wiping my ass with that editorial as soon as possible.
It’s not just the cost of the car. There’s the cost of the charger to consider, plus installation and permitting. If you don’t have enough capacity in your circuit panel you have to get a service upgrade, which involves utility connection charges.
It can be a pricey proposition to switch to an electric vehicle. But once you put all that infrastructure in you’re set. All the car chargers are pretty much the same, so if you buy a new car you don’t have to buy a new charger.
Well, maybe you can’t find one that costs $40k (depending on whether the Volt counts), but you can spend $100k for a Tesla.
bigyaz @10,
I considered Tesla, but considering their total worldwide shipments have only just topped the 1,200 mark, I don’t think they fit much into the OFM projections.
But you know, this is typical Seattle Times ed board… just pull a number out of your ass for rhetorical purposes, don’t cite our references, and go with that.
Watch the Times switch position on this when their Owner buys a Tesla.
Goldy, your consistent gutting of the ST editorial board’s hypocracy and inanity is fun and concisely parsed. I like it. Any back channel rumblings that they actually “hear” it and are trying to alter their ramblings and stumblings so that they don’t appear quite so stupid?
The other part of this equation is that since an electric car doesn’t really pollute (thanks to the mainly hydro source of NW electricity) the net gain to the environment and citizens is worth $100 per car that would otherwise come in from gas tax.
The gas tax was always intended to skew more heavily on those who chose inefficient vehicles so it’s only natural that those who choose the most efficient, as in zero, would wind up paying the least, as in zero.
The alternative is to start taxing people who own fuel efficient cars and don’t drive them much. Compare a one hour commute in a Hummer (50miles x2=100mi x5 days x50wks = 25k/8mpg =3125gal x $.357 =$1115.63tax/yr) to someone who owns a Honda Civic and works from home so only takes occasional trips to the store (10mi/wk = 520mi/40mpg = 13gal x$.357 = $4.65tax/yr)
Granted these are extreme examples with a $1000 difference, but the whole structure of the tax is intended this way, to make the people using the most pay the most and to encourage less use overall.
The whole point of a gas tax was that it’s directly linked to both pollution and to road damage.
Someone buying green energy from PSE or City Light to “fuel up” their electric car could be assumed to be not polluting, and they already pay GVW taxes in their license fees.
So it’s the GVW charge that’s too small, if one is concerned about road maintenance.
But again, the myth is that people with electric cars don’t pay state taxes on their electricity.
They do. Says right on the electric bill.
@6 – Essentially, that is already the case—gas tax helps pay for roads, and heavier vehicles use more gas.
Seems fair enough, especially since all—what,currently 30?—EVs on Washington roads won’t exactly be tilling the concrete. But don’t equate price with weight, since mid-sized SUV can be cheap, and sportier little cars can be pretty expensive (and use more gas, paying more for roads, etc.).
For what it’s worth, the MSRP of a Chevy Volt is $41,000 (which so far, stands to be the leader in the EV market), before the tax credit, which won’t last forever, and it’s probably pretty easy to tack another $5k for a non-base model.
But vehicle price isn’t even the real issue here—the Seattle Times’ logic is just asinine. If the gas tax revenue drops significantly due to the future popularity of EVs (and is considered a victim of its own success), not only should we consider that a small victory (like less smokers means less funding for anti-smoking means less smokers, kinda?), but why the fuck wouldn’t the plug-in stations be taxed? It’s not like everyone’s gonna be filling up at home paying those quadruple-priced schedule-2 power rates because their car spins their meter all night like a grow operation..
Dougsf @16,
According to the fiscal note, there are 1,277 EVs currently registered in WA that would meet the definition in the bill. And I think it’s pretty clear that the Volt would not—it is a plug in hybrid, not an EV.
To truly be equitable and Pigovian, the gas tax rate as well as the electricity tax rate should be in proportion to environmental/atmospheric damage while a road depreciation fee should be proportional to gross vehicle weight and annual miles driven for all vehicles.
It seems nonsensical to tax electric vehicle owners who hardly ever drive the same as those who drive frequently while asserting the logic that it is to cover road depreciation.
Doug, our rate schedule is quite a bit different than PG&E. At this time there is no special rate for electric cars, and our rates are quite low: First tier is 4.62 cents per KWH, and second rate is 9.58 cents per KWH. Unless you deplete your battery each and every day (and the batteries currently have about a 100 mile range) you are not going to be charging all night. Probably just a few hours.
Will, I can’t speak for PSE – Cogswell Cogs to our Spacely Sprockets – but City Light doesn’t charge sales tax. There are taxes the utility pays (revenue, B&O, etc) but those are built into the rates.
@18 you’d literally have to have the plugs for the cars be metered and taxed separately, though.
There has been discussion of lower charge rates for off-peak charging for electrics, and a tax is a tax so you can call it a B&O tax or a revenue tax but it’s still a tax on electricity users, no matter what you say it’s for.
@14,
And that’s the problem with the state using these kinds of disincentive taxes for revenue. You see the same things with cigarettes. States put so many taxes on cigarettes, people are actually starting to quit, which means that states have to increase cigarette taxes *again* to maintain revenue.
But, as usual, state government isn’t interested in responsible (but unpopular) tax policy. They’ll just stick it to people trying to help the environment.
But it’s not on the bill, Will. You should strive to be more precise. In any event, those taxes don’t go to pay for road upkeep. That’s what this is about.
The more logical approach, in my opinion, is to abandon the gas tax in favor of a mileage tax and some sort of weight tax. After all, a VW bug driven once a week causes much less wear and tear than a Hummer driven every day.
And I suppose the reverse is true: If the Hummer was owned by a little old lady who only drove it to church once a week and the bug was driven from Enumclaw to Everett for work each day, it is contributing much more to the general deterioration.
I think we need a cat tax.
Charge drivers based on how many cats they have.
That will help the environment more, and the tax-subsidized rural and suburban dog lovers will finally get their revenge.
@17 – The Chevy Volt EV isn’t and EV? Wait, now that I look it up, Chevy’s official line is simply “more than an electric car.” Fair enough. The trades are calling it an EV (my excuse!), but you’re correct.
@19, 22 – Interesting, I didn’t realize power was so cheap up there still (I remember you always had a good thing goin’ on natural gas), I thought that all ended when BPA starting selling power to CA and NV. Pour a little out for Warren Magnuson next time you toast to cheap utilities.
Taxing vehicle weight/mileage I think is still already best covered by a gas tax. For now, fuel savings (and the implicit tax savings) should remain an encouraging element toward purchasing an EV or hybrid. Should infrastructure start to suffer because of their popularity, then revenue solutions can be discussed. But at this early stage, attempting to shake a few dollars out of the few early adopters is just malicious.
If these don’t prove to be top sellers, I wonder if we’ll see the kind of push-back from the auto makers indebted to this administration that we might have seen before the auto bailout.
It will be interesting to see, if these cars really catch on, what will happen with rates. If Seattle or the BPA can’t sell surplus power to California, there goes the low rates. And if they have to go out an buy power from dirty sources, how will that effect the mandates for clean energy?
These are all considerations for people much more technically minded than I am – I am but a handmaiden of electricity – but they are still interesting to contemplate.
Oh, and utility-wise, the Volt is an “electric car” in that it can/will utilize the same 240v car residential/commerical charging station although it only draws 16 amps or so, as opposed to the Leaf’s 30 amp charge (which is supposed to get bigger in later models). I suppose it can also use the 480v charger as well, but I don’t know that it would need to.
Actually, any hybrid that uses the battery first is an electric car, if you don’t drive far enough that you kick in the gas assist engine, provided you avoid steep hills ….
The question arises – what is the Gas Tax for? Pollution? Then electrics shouldn’t pay it, or at least those participating in Green Up or Green Power programs.
If it’s for road repair, that is a function of GVW, and thus should only be the GVW license fee you pay on your renewal. Which should be jacked up as your GVW increases exponentially, since a 100,000 lb vehicle causes much much more road damage (and sidewalk – have you ever seen those giant trucks run over the sidewalks next to the stadiums?) than 10 times a 10,000 lb vehicle. A tiered GVW tax is the only response to that.
In the U.K. you pay for something called a Road Fund Licence (aka, tax disc, which you display in your windshield). While at the moment the less CO2 your vehicle emits, the less you pay, at some point they’ll probably go back to a formula based on engine displacement (or an equivalent for electric vehicles). But everybody paid it, and it raises lotsa money for transportation. Kind like the MVET did before Tim Eyman came along…
Will @27,
You can define an EV any way you want, but the bill, in its current form, defines it as a vehicles with “propulsion units powered solely by electricity.” This makes sense, as it seeks to place a fee on cars that don’t use gas. Hybrids and plug-in hybrids use gas, if sparingly, or in the case of the Volt, possibly rarely.
EPIC smackdown, Goldy. Keep. Them. Coming.
Washington state has an incentive for buying electric cars: no sales tax. Even on a $120,000 Tesla.
http://apps.leg.wa.gov/wac/default.aspx?…
Why not an odometer tax (with a weight modifier) on all vehicles?
Schmucky @32,
The problem with the odometer is that it records mileage out of state.
Oregon and other states are experimenting with a GPS based system that electronic records and transmits your mileage in state, and taxes you accordingly. Such a system could also conceivably be used to automatically charge you for tolls.
Efficient. But a little a creepy.
I don’t see the point to adding all these fancy (and expensive) GPS trackers and refiguring the system at this point. A gas tax does a pretty good job of assessing the proportional amount of tax to the amount of impact one has on the roads. Small car rarely used has a low impact and a low tax burden. Big car used constantly has a larger impact and pays a larger share of the costs by using more gas.
I guess it’s just that an EV is a loophole that really burns up the conservative anger sector of the brain. BFD. Let the EVs enjoy the loophole until they reach a certain percentage of all vehicles on the road, like 10% to 25%.
We probably lose more in gas tax revenue when people fuel up in Portland on their way back to WA. Should we start checking IDs at the OR pumps?