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For those of us in Texas, here is an article in today's Austin paper (I've cut and pasted it since it's behind a firewall)...since the State won't allow those of us who didn't buy our electric vehicles through a "franchised dealership" to qualify for the $2500 state EV rebate, maybe these new proposed fees should only be for those who DID buy through a dealership! 
In Texas, momentum builds for more fees on electric vehicles
The satisfaction of cruising past gas stations without needing to pull in for a fill-up is among the joys of driving an electric vehicle.
It comes with a downside for the state's finances, however, because taxes on the sale of gasoline foot a big portion of the tab for road maintenance and expansion projects in Texas.
The Texas Legislature has noticed.
The number of "alternatively fueled vehicles" in the state — including electric vehicles and all types of hybrids — constitutes only about 1.3% of the 25.2 million vehicles registered here.
But lawmakers are looking to enact new fees on them to make up for the dearth of gas taxes their drivers pay. Similar efforts have failed during previous legislative sessions, but momentum appears to have reached a tipping point.
“This is one of the top issues Texas must address this upcoming session (in 2023), and we will pass a bill" this time, state Rep. Terry Canales said during a recent meeting of the House Transportation Committee, which he chairs.
"At this point the amount of electric vehicles is somewhat minimal, but it is growing exponentially every year," said Canales, D-Edinburg.
According to the Texas Department of Motor Vehicles, conventionally powered light-duty vehicles pay an average of $103 in state gas taxes annually and $95 in federal gas taxes, based on typical driving of about 11,500 miles. A portion of the money collected from federal gas taxes also helps fund state transportation projects.
What is a fair fee?
With both Canales' House committee and a Senate committee studying the issue of fees for electric vehicles and hybrids in advance of next year's legislative session, the debate is boiling down to how much — not if — they should chip in.
Manufacturers of electric vehicles — including Austin-based Tesla, the best-known makes of electric vehicles — appear resigned that their Texas customers eventually will face such fees, which 30 other states already charge.
Instead of opposing them, representatives of Tesla and Rivian, a California-based EV maker, turned out for the recent Texas House committee meeting to urge that the Texas fees be as low and as fair as possible, possibly by calculating them according to annual miles driven, rather than by assessing a flat amount.
They also said the state's struggles to find funds for transportation projects isn't the result of the relatively small number of electric vehicles and hybrids in operation, because Texas hasn't raised its gas tax over the past few decades as conventionally powered cars and trucks have gotten much more fuel-efficient.
Neither the state's gas tax of 20 cents per gallon nor the federal gas tax of 18.4 cents per gallon has been increased since the early 1990s.
Zach Kahn, a Tesla senior policy advisor, cited Ford's F-150 pickup as an example, saying its fuel efficiency has doubled over the past 30 years, to about 25 miles per gallon for the newest versions.
"Given the number of Ford F-150s on the road in Texas, (their increased fuel efficiency) far outstrips the Teslas — the 68,000 or so Teslas on the road (in Texas) — in terms of the deficits to the transportation funding," Kahn told the committee.
Tesla "has consistently said we’re not opposed to (fees on electric vehicles) to compensate for lost gas-tax revenue," he said. "We are opposed to punitive or unfair fees that will disincentivize the purchase of an EV by making it more expensive to own."
The company says an annual charge in the neighborhood of $80 to $82 would be reasonable, Kahn said, based on average gas taxes paid by drivers of the 10 most fuel-efficient vehicles that are conventionally powered.
According to the Texas Department of Motor Vehicles, the 30 states that already assess such fees charge an average of $120 annually for electric vehicles.
Texas collected about $2.8 billion in gas-tax revenue in its 2019 fiscal year — the last that wasn't impacted by the coronavirus pandemic.
The figure was up 1.7% from the 2018 fiscal year, according to the state comptroller's office. But it has been declining as a percentage of all state tax collections despite the state's booming economy and population growth, coming in at under 5% in recent years compared to closer to 10% two decades ago.
The Department of Motor Vehicles has estimated that annual fees of $80 for hybrids and $100 for electric vehicles — designed to compensate for forgone revenue from the state gas tax — would have brought in no more than about $26.5 million last year because of the small numbers of such vehicles registered here.
Doubling those fees to also compensate for forgone revenue from the federal gas tax, would have brought in about $53 million, according to the agency.
Canales equated the sum to "budget dust" in terms of overall state spending on transportation. Still, he said the high growth rate for EVs and hybrids means it probably won't remain that way.
'Something we've got to solve'
The number of electric vehicles registered in Texas has increased significantly over the past five years, from about 8,400 in 2016 to over 60,000 last year, according to state officials. The number of all alternatively fueled vehicles has increased by 52% over that time, to about 322,600.
"It is going to increase exponentially, and this is something we've got to solve," Canales said.
Manufacturers of electric vehicles, as well as advocates for clean energy, are hoping the strong growth continues, which is why they're not opposed to the notion of fees aimed at offsetting lost revenue from gas taxes to help pay for roadwork.
Instead, they're focusing on ensuring the charges are equitable, rather than merely a new pot of money for the state to tap.
“As cars and trucks become more fuel-efficient and electrified, gasoline taxes are simply becoming unsustainable to pay for Texas roads and needs in the future," said John Stephenson, Rivian's director of state policy.
"Rivian believes in a fair ride, not a free ride," he said. "We believe that all road users should pay their fair share.”
Tom "Smitty" Smith, executive director of the Texas Electric Transportation Resources Alliance, said he thinks that means EV drivers should have a choice of paying a flat $71 annual fee — which he said is based on the latest fuel-efficiency standards for conventional vehicles — or a fee that's calculated according to miles driven.
Smith said the state should eventually move to a system to fund transportation projects that's based on miles driven regardless of how a vehicle is powered.
“The amount of revenue we're going to make off of any new car is shrinking dramatically (because of improving fuel-efficiency), and that hole is going to get deeper, whether it's a conventional vehicle or an electric vehicle," he said during the committee meeting.
“We need to fix this," Smith said. "We want to propose, systemically, we do it on a vehicle-miles-traveled basis that basically says, 'the more you drive, the more you pay,' " which is similar to how gas taxes work.
In Texas, momentum builds for more fees on electric vehicles
The satisfaction of cruising past gas stations without needing to pull in for a fill-up is among the joys of driving an electric vehicle.
It comes with a downside for the state's finances, however, because taxes on the sale of gasoline foot a big portion of the tab for road maintenance and expansion projects in Texas.
The Texas Legislature has noticed.
The number of "alternatively fueled vehicles" in the state — including electric vehicles and all types of hybrids — constitutes only about 1.3% of the 25.2 million vehicles registered here.
But lawmakers are looking to enact new fees on them to make up for the dearth of gas taxes their drivers pay. Similar efforts have failed during previous legislative sessions, but momentum appears to have reached a tipping point.
“This is one of the top issues Texas must address this upcoming session (in 2023), and we will pass a bill" this time, state Rep. Terry Canales said during a recent meeting of the House Transportation Committee, which he chairs.
"At this point the amount of electric vehicles is somewhat minimal, but it is growing exponentially every year," said Canales, D-Edinburg.
According to the Texas Department of Motor Vehicles, conventionally powered light-duty vehicles pay an average of $103 in state gas taxes annually and $95 in federal gas taxes, based on typical driving of about 11,500 miles. A portion of the money collected from federal gas taxes also helps fund state transportation projects.
What is a fair fee?
With both Canales' House committee and a Senate committee studying the issue of fees for electric vehicles and hybrids in advance of next year's legislative session, the debate is boiling down to how much — not if — they should chip in.
Manufacturers of electric vehicles — including Austin-based Tesla, the best-known makes of electric vehicles — appear resigned that their Texas customers eventually will face such fees, which 30 other states already charge.
Instead of opposing them, representatives of Tesla and Rivian, a California-based EV maker, turned out for the recent Texas House committee meeting to urge that the Texas fees be as low and as fair as possible, possibly by calculating them according to annual miles driven, rather than by assessing a flat amount.
They also said the state's struggles to find funds for transportation projects isn't the result of the relatively small number of electric vehicles and hybrids in operation, because Texas hasn't raised its gas tax over the past few decades as conventionally powered cars and trucks have gotten much more fuel-efficient.
Neither the state's gas tax of 20 cents per gallon nor the federal gas tax of 18.4 cents per gallon has been increased since the early 1990s.
Zach Kahn, a Tesla senior policy advisor, cited Ford's F-150 pickup as an example, saying its fuel efficiency has doubled over the past 30 years, to about 25 miles per gallon for the newest versions.
"Given the number of Ford F-150s on the road in Texas, (their increased fuel efficiency) far outstrips the Teslas — the 68,000 or so Teslas on the road (in Texas) — in terms of the deficits to the transportation funding," Kahn told the committee.
Tesla "has consistently said we’re not opposed to (fees on electric vehicles) to compensate for lost gas-tax revenue," he said. "We are opposed to punitive or unfair fees that will disincentivize the purchase of an EV by making it more expensive to own."
The company says an annual charge in the neighborhood of $80 to $82 would be reasonable, Kahn said, based on average gas taxes paid by drivers of the 10 most fuel-efficient vehicles that are conventionally powered.
According to the Texas Department of Motor Vehicles, the 30 states that already assess such fees charge an average of $120 annually for electric vehicles.
Texas collected about $2.8 billion in gas-tax revenue in its 2019 fiscal year — the last that wasn't impacted by the coronavirus pandemic.
The figure was up 1.7% from the 2018 fiscal year, according to the state comptroller's office. But it has been declining as a percentage of all state tax collections despite the state's booming economy and population growth, coming in at under 5% in recent years compared to closer to 10% two decades ago.
The Department of Motor Vehicles has estimated that annual fees of $80 for hybrids and $100 for electric vehicles — designed to compensate for forgone revenue from the state gas tax — would have brought in no more than about $26.5 million last year because of the small numbers of such vehicles registered here.
Doubling those fees to also compensate for forgone revenue from the federal gas tax, would have brought in about $53 million, according to the agency.
Canales equated the sum to "budget dust" in terms of overall state spending on transportation. Still, he said the high growth rate for EVs and hybrids means it probably won't remain that way.
'Something we've got to solve'
The number of electric vehicles registered in Texas has increased significantly over the past five years, from about 8,400 in 2016 to over 60,000 last year, according to state officials. The number of all alternatively fueled vehicles has increased by 52% over that time, to about 322,600.
"It is going to increase exponentially, and this is something we've got to solve," Canales said.
Manufacturers of electric vehicles, as well as advocates for clean energy, are hoping the strong growth continues, which is why they're not opposed to the notion of fees aimed at offsetting lost revenue from gas taxes to help pay for roadwork.
Instead, they're focusing on ensuring the charges are equitable, rather than merely a new pot of money for the state to tap.
“As cars and trucks become more fuel-efficient and electrified, gasoline taxes are simply becoming unsustainable to pay for Texas roads and needs in the future," said John Stephenson, Rivian's director of state policy.
"Rivian believes in a fair ride, not a free ride," he said. "We believe that all road users should pay their fair share.”
Tom "Smitty" Smith, executive director of the Texas Electric Transportation Resources Alliance, said he thinks that means EV drivers should have a choice of paying a flat $71 annual fee — which he said is based on the latest fuel-efficiency standards for conventional vehicles — or a fee that's calculated according to miles driven.
Smith said the state should eventually move to a system to fund transportation projects that's based on miles driven regardless of how a vehicle is powered.
“The amount of revenue we're going to make off of any new car is shrinking dramatically (because of improving fuel-efficiency), and that hole is going to get deeper, whether it's a conventional vehicle or an electric vehicle," he said during the committee meeting.
“We need to fix this," Smith said. "We want to propose, systemically, we do it on a vehicle-miles-traveled basis that basically says, 'the more you drive, the more you pay,' " which is similar to how gas taxes work.
