Saturday, October 21, 2023

How Will States Pay for Roads When Gas Taxes Evaporate?

Oct. 19, 2023 11:14 am ET

Back in 2001, seven years before Tesla introduced its electric-powered Roadster and a dozen years before the more affordable Chevrolet Spark EV went on sale, lawmakers in Oregon recognized that the adoption of EVs and hybrids would eventually mean less revenue from the state’s gas tax, which would mean less money to pay for roads and bridges. So they formed a committee to study the problem. After considering a tire tax, a battery tax and numerous other options, the committee concluded that Oregonians should be charged based on how many miles they drive.

Twenty-two years later, the Road User Fee Task Force continues to operate small pilot programs. But like most other states that have seen gas taxes start to evaporate, Oregon still doesn’t have a mandatory alternative revenue plan in place. Legislatures are in a bind: They can no longer afford to ignore the decline in gas-tax revenue, but all proposed solutions are problematic.

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