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Oregon EV Owners Will Soon See Higher Registration Fees

The new fees are necessary to comply with Oregon's constitution that requires everyone who uses the roads to pay their fair share, and electric car owners can avoid costs by allowing the state to track their mileage.

(TNS) — Oregonians will have to pay $18 to $110 more per year to register their vehicles come Jan. 1 as the state implements a new tiered fee structure with higher rates for vehicles with better gas mileage.

The change will add the most front-end cost to owners of fuel-efficient hybrids and electric cars, which contribute less money to Oregon's fuel tax revenues than gas-guzzler vehicles such as sports cars or pickup trucks.

The state said the new fees are necessary to comply with Oregon's constitution that requires everyone who uses the roads to pay their fair share, and electric car owners can avoid costs by allowing the state to track their mileage.

But while some owners support the change, others say the increases contradict the state's efforts to reduce emissions and have at least 50,000 electric cars registered by the end of 2020.

"As far as the principle is concerned, the people that use the roads should be paying for that," said Bill Griffiths, a Eugene electric car owner who agrees with the need to pay fees. "But I don't think the way (the state is) doing it is really appropriate. I think (calculating) it by mileage is the right thing to do, but to charge more for cars that get better gas mileage is counterproductive."

About the fees

The increased registration fees were written into House Bill 2017, which was a large transportation bill passed during the 2017 legislative session.

Starting next year, the method for calculating vehicle registration costs will be based on the miles per gallon of the vehicle.

For vehicles that get zero to 19 miles per gallon, the increase is $18 a year, bringing the registration cost of a passenger vehicle from $86 to $122 for two years. Vehicles with a rating between 20 and 39 miles per gallon would have a $23 annual increase, bringing the fee to $132 for two years. For vehicles that get 40 or more miles per gallon, the cost would be $33 more a year for a total of $152 for two years.

Electric vehicles would have the largest increase — $110 a year — with a registration cost of $306 for that same two-year period.

The increased fees comply with requirements in Section 3a of Oregon's Constitution, said Oregon Department of Transportation spokesman David House, which is why lawmakers approved it. The section states that the taxes imposed by the state must be drawn in a way that ensures the share paid for all vehicles "is fair and proportionate to the costs incurred for the highway system."

"For decades, the fuels tax was a pretty fair way for people to pay their fair share of use: The more you drive the more gas you burn," House said. "But the last 25, 30 years, that has really skewed."

An F-150 truck has about as much impact on the roads as a hybrid, House said, because major deterioration comes from vehicles, such as commercial trucks or 18-wheelers, that weigh much more than about 30,000 pounds. With more people transitioning to cars that are electric or that get better gas mileage instead of vehicles such as SUVs and pickups, the state faced an issue with upholding the "fair share" mandate.

"There's a huge difference in fuel economy, so they pay a huge difference in fuel tax," House said about various vehicles. "That doesn't jive with the Constitution's fair share requirement. So that's why this tiered structure is in place to make that align with the constitutional requirement."

The state has faced this dilemma for "ages," he said. There was a higher registration fee for electric cars about 20 years ago but that has since changed, House said. Now it's switching back as the contribution gap for the gas tax grows — but seemingly in conflict for some owners with the state's climate change initiatives.

Conflicting messages

Gov. Kate Brown issued an executive order Nov. 6, 2017, months after the transportation bill was approved by lawmakers, to boost access for Oregonians to zero emission (or electric) vehicles. It cited climate change as the main driver behind the order, and noted Oregon's commitment to reducing emissions by 26% to 28% by 2025 as urged in the Paris Agreement.

The state's goal is to have 50,000 electric cars registered by the end of 2020. In August, ODOT reported 26,218 registered electric vehicles in the state, representing less than 1% of the 3.6 million passenger vehicles registered in Oregon at the end of 2018.

Lane County had 328,000 passenger vehicles at the end of 2018, and 1,989 registered electric vehicles at the beginning of August, ODOT reported.

As the state pushes toward its goal of 50,000 electric vehicles with just over a year left, higher registration fees appear to be a cause of confusion for some electric car owners.

"You think they'd be encouraging electric cars and you think they'd be encouraging higher mileage cars and producing less pollution and so on, but this does just the opposite: the higher mileage cars, the more you pay and the higher the tax rate is," Griffiths said.

Griffiths and his wife own two electric cars, as she has been interested in them since the 1980s. The registration increase, while a small dollar amount compared to the cost of a new car, is just one added cost that could dissuade people from going electric, he said.

The governor's executive order also included some purchase incentives for people buying battery electric vehicles, plug-in hybrid electric vehicles and electric motorcycles, including a rebate up to $2,500, according to the Oregon Department of Environmental Quality.

Griffiths said the rebates are the right way to go, but again conflict with the message being sent with increased registration fees for fuel-efficient cars.

"To charge more for (electric vehicles) — they have these two policies that are working against each other rather than with each other," he said.

However, other electric vehicle owners believe the benefits of their cars won't be outweighed by increased costs or derail the state's goal of 50,000 electric cars.

Phil Barnhart, president of the Emerald Valley Electric Vehicle Association, said more automotive manufacturers are stepping into the electric car market, so there soon will be more models available at prices comparable to gas-powered cars

"They are much cheaper to operate than a gas-powered car," said Barnhart, who purchased his first electric vehicle in 2012. "There are vastly fewer moving parts in an electric car — imagine no oil change, no lube. The only thing you have to do is refill the windshield wiper fluid and you have to buy tires."

Barnhart, a Democrat who represented District 11 in the Oregon House of Representatives from 2003-2019, said what electric vehicle owners will pay upfront in registration fees is comparable to what they would pay in the gas tax. He also said the fee increase was a worthy trade-off for the Democratic party in 2017 as it tried to pass other aspects of the session's large transportation bill, such as additional public transit for rural areas.

"It really does even out," Barnhart said. "Now, does that mean that my members of (the association) like this registration fee? Of course not. But they don't know anything about the compromises that were necessary to get this bill."

Barnhart said oil companies and large corporations that benefit from gas sales will use the increased costs on electric cars to drive conversations discouraging their use.

"Anybody who is actually paying attention will realize that if they switch to an electric vehicle they will still end up paying less for the roads than they pay now for the gas tax," he said. "I would have loved if they didn't pass the additional registration fee, but we needed the bill. We've got to repair those bridges and highways and establish transit where we didn't have any."

Electric car owners do have an opportunity to avoid that registration fee increase by signing up for Oregon's new road usage tracker, OReGo, which was signed into law during the 2019 legislative session. Drivers who sign up for OReGo must install a device in their car that tracks their mileage, and it charges them at a rate of 1.7 cents per mile.

"We really encourage people who are in those fuel-efficient or electric cars to consider joining OReGo," said House, the ODOT spokesman. "Essentially, the attempt is to replace the fuel tax entirely with a pay-per-mile system that is easily integrated into modern cars."

Griffiths supports mileage-tracking as a better way to ensure people are paying their fair share. He would prefer the state require every vehicle be charged at the flat rate per mile and rebrand the gas tax as a carbon tax to encourage people to be more conscious of their emissions.

"Electrification is really the way the world has to go," Griffiths said. "I'm happy to live in Oregon and I'm willing to pay whatever taxes are necessary, but it seems like they've just managed to introduce more confusion, more doubt and conflict among their own policies. Bureaucracy is bad enough — if you have some nice clear way to cut through all this and really align with the goals of the state, you ought to be doing it."

©2019 The Register-Guard (Eugene, Ore.) Distributed by Tribune Content Agency, LLC.