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An unfair tax?: Drivers take issue with hybrid/electric car fees; lawmakers claim they are reasonable in face of road, bridge crisis

 

Julie Carpenter of Columbus stands with the Toyota hybrid she has owned for two years. She learned last month she must pay an additional $75 annual fee to the state for owning the car to help fund an Emergency Road and Bridge measure the Legislature passed in the August special session. Owners of fully electric vehicles will pay $150 each year.

Julie Carpenter of Columbus stands with the Toyota hybrid she has owned for two years. She learned last month she must pay an additional $75 annual fee to the state for owning the car to help fund an Emergency Road and Bridge measure the Legislature passed in the August special session. Owners of fully electric vehicles will pay $150 each year. Photo by: Chris Jenkins/Special to The Dispatch

 

Mike Buehler

Mike Buehler

 

Angela Turner Ford

Angela Turner Ford

 

Chuck Younger

Chuck Younger

 

Jeff Smith

Jeff Smith

 

 

Slim Smith

 

 

When Mike Buehler received a notice from the Mississippi Department of Revenue a week ago that he would be required to pay a fee for driving his 2014 Tesla each year, he bit his lip and did a little research before forming an opinion. 

 

The verdict? 

 

"It's unfair," the Starkville radiologist said. 

 

That opinion is likely shared by many of the 15,281 people who received similar notices last week informing them of the new fees assessed to drivers of electric and hybrid cars. For hybrids that use both fuel and electric power, the fee is $75 annually. For electric cars that use no fuel, it's $150. 

 

Owners of hybrid or electric cars will pay the fees at their county tax collector's office each year when they renew their license plate tag. 

 

Unlike tag renewal fees, which go to fund city and county governments and local schools, all of the fees from the hybrid/electric car tax will go to the state's Emergency Road and Bridge Fund, which the Legislature established during a special session in August. The fees were included with that legislation. 

 

The measure earned near unanimous support, passing 110-4 in the House and 48-3 in the Senate. Every member of the Golden Triangle's legislative delegation favored the bill. 

 

"I did receive some emails and text messages expressing dissatisfaction with the fees, but given the dire needs of our roads and bridges, the fees seem reasonable to me," said state Sen. Angela Turner Ford (D-West Point). 

 

Hybrid/electric car fees will make up a minute portion of the Emergency Road and Bridge Fund, which lawmakers hope will produce an extra $110 million for the state's roads and bridges each year. The bulk of that will come from bonded debt and revenue from a state lottery -- both of which also passed during the special session. 

 

The new fund will supplement road and bridge money the state already receives from an 18-percent fuel tax drivers in the state pay at the pump. The hybrid/electric fees served as an alternative to increasing the fuel tax. 

 

"I'll be honest, some of these hybrids get such good gas mileage that something was needed for them to pay their fair share," said state Sen. Chuck Younger (R-Columbus). "My preference all along was to raise the fuel tax, so really, as far as this part of it went, I could take it or leave it. I think it's fair. Overall, we had to get something done and I don't think anybody was going to let the (hybrid/electric fee) get in the way of that." 

 

 

 

'It's definitely punitive' 

 

Although the legislation was passed in August, many of those affected by the fees weren't aware until they received their notice from the Department of Revenue in September. 

 

Columbus Realtor Julie Carpenter was among that group. 

 

"I had no idea," said Carpenter, who has been driving her Toyota hybrid for two years. "I was shocked that I was going to be taxed for trying to be environmentally friendly. I hope they don't find out I'm buying broccoli and cauliflower and spinach. I might get taxed for trying to eat healthy, too." 

 

Buehler said while he understands the stated purpose of the fee -- to ensure that hybrid and electric car drivers pay their share for maintaining roads and bridges -- he feels it is too high for those who drive electric cars. 

 

"I understand that electric car drivers don't pay the fuel tax that other people pay," Buehler said. "So I wanted to do the numbers and see what they told me." 

 

Buehler estimated that his 2014 Tesla, if converted to gasoline, would average 50 miles per gallon. Based on his driving habits, he said he drives 12,000 miles per year, which would be 240 gallons per year. The state's 18.2 percent fuel tax would mean he would pay $43.68 in fuel taxes. 

 

"But instead of that, I'll be paying $150 a year," Buehler said. "That's about $100 more than I would pay if I were driving a gasoline car. It's definitely punitive." 

 

Carpenter agrees. 

 

"I don't think people should be punished for trying to be fuel efficient," she said. "I drive a lot, so for me, buying a hybrid was a way to save money. But the other part is that I did want to be environmentally friendly. I don't feel like the state should be discouraging that. I'm disappointed." 

 

 

 

'Not enough revenue to make much of a difference' 

 

Buehler said he wonders why hybrid and electric car owners were singled out in the special session, especially when Kathy Waterbury, associate commissioner for the Mississippi Department of Revenue, said the hybrid/electric car fees will produce a little more than $1 million in revenue annually. 

 

"That's not even 1 percent of the funding they set up," Buehler said. "I don't understand how this even came up." 

 

He's not alone. 

 

State Rep. Jeff Smith (R-Columbus) chairs the House Ways and Means Committee that helps tailor funding bills as they pass through the Legislature. 

 

In the case of the hybrid/electric fees, Smith said, Gov. Phil Bryant was adamant they be part of the Emergency Road and Bridge Fund bill. 

 

"Normally, any bill that comes through my committee, I've had some hand in putting together," Smith said. "It wasn't that way with this bill. Gov. Bryant, the speaker (of the House Phillip Gunn) and the lieutenant governor (Tate Reeves) put this bill together and gave it to us at the start of the special session. 

 

"I hadn't heard anybody talking about that idea," he added. "It was totally the governor's idea. I love the governor to death, but I'm not sure why he wanted these fees. It doesn't really raise enough revenue to make much of a difference." 

 

Smith said Bryant originally wanted the state to charge $150 for hybrids and $300 for electric cars. 

 

"We did get him to come off that number, but something else that we failed to do was provide an exemption for disabled veterans, which is what we do for regular license fees," Smith said. "That's something we'll have to fix in January." 

 

Buehler said he believes the fees only reinforce the state's reluctance to support alternate forms of energy, noting that Mississippi rarely offers incentives for solar, wind and other emerging forms of energy. 

 

"Let's face it, we're a small group of people who own electric cars, so we're a pretty easy target," he said. "There's not much of anything we can do about it. I think they know that."

 

Slim Smith is a columnist and feature writer for The Dispatch. His email address is [email protected]

 

 

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