The Idaho legislature made a great leap in highway funding this last legislative session. It was years in the making with many failed attempts and some painful last minute compromises. But the years of discussion built an awareness of the need, so the compromises became tolerable. I have been hearing from many constituents about one of the compromises, fees on hybrid vehicles, and I am about convinced we ought to take another look. I take this opportunity to share some of my thinking and some background.
First, some may not agree that highways needed increased funding. These folks have let me know that any tax increase is unwelcome. But I was sure convinced of the need. Our governor went so far to commission a survey of likely voters. The results were pretty predictable; most agreed there was a need, few agreed on the right source of funding (toll roads were the least popular source).
So if we have a need and government is to help solve the problem, what principles do we use to frame the solution?
In my legislative discussions, mainly in the Senate, most I spoke with agreed we should keep highway revenue in a separate fund from the general fund, as it is now. The fear was that we might start taking money from schools for roads. This goal got compromised, since we finally agreed to a “surplus eliminator” that took unbudgeted moneys at the end of the fiscal year and split it between roads and reserves.
The second principle proposed that revenues should be based on a “user fee” concept. That is, if you use the roads you should help pay for the roads. If you use the roads more, you should pay more. Again, this got compromised, since we could not fully address the differences between what passenger vehicles and big trucks pay.
But the “user fee” concept fails if the only sources of revenue are fuel tax at the pump and registration fees. How does an electric car pay their fair share? So we calculated:
Electric cars might drive 10,000 miles a year. A comparable car might get 20 miles per gallon, thus buying 500 gallons per year and paying $160/ year in fuel taxes. An extra fee was added at the time of registration to electric cars of $140/ year as their fair share of a “user fee”. I have heard little gripes about this.
But we added another fee for hybrids: $75/year. Nobody can tell me what calculations were used, or if there even were calculations. If you look at what MPG hybrids get, it’s all over the place. But I’m pretty sure they buy less gas per mile traveled than the Speaker’s ¾ ton pickup.
This has been the biggest complaint I have heard from constituents, and I think they have a good point. I served on the Interim Committee on Environment and Technology when we rewrote the Idaho Energy Plan in 2012 which contains:
It is Idaho policy to promote conservation and efficiency as a means of reducing the burden of transportation fuel expenditures, improving the reliability and cost of Idaho’s transportation fuel supply, and reducing transportation-related emissions.
The hybrid fee is in direct opposition to this stated policy.
The per gallon fuel tax at the pump is going to become an unfair “user fee” as alternative energy vehicles become more prevalent and fuel efficiency increases. There are other options. But for now, we should eliminate the Hybrid vehicle fee.
There are many principles of taxation and fairness is one. But few agree on what seems fair. The one almost everyone agrees on when it comes to who should pay for a needed service goes like this:
Don’t tax him
Don’t tax me
Tax that guy behind the tree
Highways need funding and we should all be paying our fair share. Hybrids are paying more than theirs.