Electric vehicles topic of Pennsylvania road funding bill

Many electric vehicle owners in Pennsylvania could soon be paying into the state’s road fund.

The House Transportation Committee voted 22-3 on Monday to advance a Senate-approved bill that would replace the alternative fuel tax collected on noncommercial electric vehicle owners with a flat fee.

The state now requires affected vehicle owners to file monthly statements with the Department of Revenue and to remit the alternative fuel tax on how much electricity their vehicle uses.

Sen. Greg Rothman, R- Mechanicsburg, has said that most owners of electric vehicles do not pay the tax or are “inconsistent at doing so.” He has cited “the cumbersome process or simply being unaware.”

His bill, SB656, would exempt owners of noncommercial electric vehicles up to 14,000 pounds from the tax and replace it with a flat annual fee of $290. The flat fee would be the highest in the nation for electric vehicle owners.

All hybrid vehicles and commercial electric vehicles are not included in the bill.

House Transportation Chairman Ed Neilson, D-Philadelphia, said he has concerns that the bill would result in Pennsylvania having the highest electric vehicle fee in the country.

“Two hundred ninety is way too high,” Neilson said. “Additionally, the bill does not provide for plug-in hybrid vehicles. It does not provide for any automatic adjustment to the EV fee based on inflation.”

He voted in favor of the bill, however, to allow the full chamber to take up the concerns.

A fiscal note attached to the bill reports that as of March 2023, there were 43,725 electric vehicles registered in Pennsylvania – up from 9,784 in 2019.

Rothman said those figures will continue to climb.

Revenue from electric vehicles estimated at $9.2 million annually would be sent to the state’s Motor License Fund for highway maintenance and construction. Fuel tax revenues already go into the fund.

SB656 awaits further consideration on the House floor. If approved there, it would head to the governor’s desk.

Nearly 60% of states have already acted

Multiple states have turned to owners of electric and hybrid vehicles this year to capture needed transportation revenue.

Thirty-three states impose a special registration fee for plug-in electric vehicles, according to the National Conference of State Legislatures. Most of those states also assess a fee on plug-in hybrid vehicles.

Fees range from about $50 annually for plug-in personal electric vehicles in Colorado, Hawaii and South Dakota to $225 annually for plug-in personal electric vehicles in Washington.

At least a half dozen states structure registration fees for electric vehicles and/or hybrid vehicles to grow over time by linking the fees to the consumer price index or another inflation-related metric.

Preparing for 2024

Legislative pursuits are underway in Florida and Wyoming to jump on the bandwagon to collect additional revenue from affected vehicle owners.

The Florida bill would impose a yearly registration fee of $200 on electric vehicles. Hybrid vehicle owners would be charged $50.

The amounts would increase by $50 in 2029. Both fees would be in addition to regular registration fees.

An exemption is included for vehicles that use a battery storage system of up to 5 kilowatt hours.

In Wyoming, a proposal calls for out-of-state electric vehicles to supplement transportation funding. Specifically, legislators agreed to pursue a plan to collect a tax on out-of-state vehicles at Level 3 direct current (DC) fast-charging stations.

The tax rate would be set at 4 cents per kilowatt-hour.

Both pursuits can be considered during their respective state’s upcoming regular session. LL

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