By Regan Turner
On January 22, 2013, the Texas Tribune reported that some Texas state legislators were proposing a higher vehicle registration fee for drivers of electric vehicles (EVs) to ensure that they pay their share of the annual expenses of building and maintaining roadways. If this measure were to pass, Texas would join Washington State where a $100 annual fee on drivers of EVs went into effect this month.
With the Texas Department of Transportation (TxDOT) holding $13 billion in debt, the state agency is looking for ways for fill revenue shortfalls. And as vehicles become more fuel-efficient or do away with the need for fuel altogether, the gas tax that accounted for 33% of the agency’s revenues of almost $7 billion in 2010 is no longer going to suffice.
Rather than addressing only the fact that EV drivers do not contribute to TxDOT revenues, Texas lawmakers should consider what sustainable cities and highways of the future will look like, and change legislation to incentivize public transportation, walkable cities, and EVs.
First, Texas should do away with its gas tax and increase annual vehicle registration fees. In 2010, vehicle registration fees in Texas that average $58 per vehicle accounted for $1.11 billion in revenues for TxDOT, while gasoline taxes brought in $2.29 billion, or roughly twice the amount generated from vehicle registration. While I am not suggesting that Texas emulate California, the Sunshine State charges drivers anywhere from $250 to $400 in annual registration fees, so there is significant capacity for Texas to increase registration fees, thereby incentivizing the use of public transportation.
Next, Texas should assess a mileage fee on vehicles due at the time of annual inspection. If the average Texan drives 12,000 miles per year, a fee of $0.01 per mile would cost a driver $120 per year, which is roughly the average amount paid per driver per year in state fuel taxes ($114). The difference here is that all drivers pay the same amount toward road maintenance depending on how many miles they drive, regardless of their vehicle’s fuel source.
Opponents of this plan will say that drivers of vehicles not registered in Texas will then not pay any surcharge for the free roads that they use to travel or conduct business in Texas. To solve this problem, either assess a toll at the time of a vehicle’s entry into Texas, or maintain the gas tax at the pump for out of state drivers by requiring drivers to swipe their driver’s license at the pump when paying.
These policies will cause drivers in Texas to recognize the costs associated with driving and therefore incentivize denser cities and the use of public transportation, biking, and walking. Otherwise, Texas is on track to spend $400 billion in roadway infrastructure by 2035 with a broken business model that does not address the issue of vehicle congestion that will only continue to get worse.