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Electric Cars and the Future of the Gas Tax
Posted By Elana Schor On August 12, 2009 @ 2:30 pm In Cars,Gas Tax,Streetsblog Capitol Hill | 4 Comments
GM's highly publicized claim to  triple-digit fuel efficiency for its new Chevy Volt has sparked a debate over the solidity  of the estimate as well as the lack of  charging stations where those without garages could charge a Volt. But another byproduct of the electric-car boom is getting less attention: its effect on the nation's transportation funding impasse .
The Obama administration remains opposed to increasing the 18.4-cent per-gallon federal gas tax, leaving legislators rudderless  as they aim for hundreds of billions of dollars in new infrastructure investments.
Yet if electric cars become the phenomenon that the White House  and GM are hoping for, the gas tax's already waning power to raise revenue would wither even more rapidly.
The question would then be, as University of Minnesota transportation expert Lee Munnich  put it this week, "If everybody is driving electric cars, who would pay for the system?"
A research team from the university tackled that question in a report  to the Minnesota legislature last month that pinpointed eight possible ways to fund transportation based on the theory of "value capture" -- namely, that building new roads and transit tends to increase the value of nearby land, providing an economic opportunity to leverage that increased wealth for the benefit of the whole system.
The Minnesota report did not endorse any one of the eight, nor did it ignore the potential political and social shortcomings of "value capture." But the report's authors noted that their approach could provide a middle ground between directly charging users of transportation networks and imposing across-the-board taxes on non-users:
["Value capture" methods] target a restricted set of indirect beneficiaries: landowners and developers who benefit from the increased land value that follows a transportation improvement.
If the Obama administration's electric-vehicle push forces policymakers to quickly look to a vehicle-miles-traveled tax or "value capture," would the gas tax then slide into limbo? Auto industry CEOs hope not; several have openly called for higher gas taxes to help push consumers into new electric cars.
Mike Jackson, CEO of the car-sales site AutoNation, told CNBC  earlier this year that the Volt and other electric vehicles could not be viable without higher gas taxes. Similar sentiments have come from the chiefs of Hyundai  and Ford  as well as the former head of GM .
It remains to be seen whether electric cars' pressure on the gas tax becomes a political factor as lawmakers debate the next long-term transportation bill. To some degree, that pressure is already being exerted by Americans' move toward  less driving and more fuel-efficient vehicles.
But if electric transportation stays top-of-mind at the White House -- which threw its weight  behind a "cash for clunkers" plan that one of its own officials admitted  looked more like "clunkers for clunkers" -- the next challenge may be how to generate reliable new revenue for infrastructure.
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URL to article: http://dc.streetsblog.org/2009/08/12/electric-cars-the-gastax/
URLs in this post:
 claim to: http://dc.streetsblog.org/2009/08/11/gm-claims-a-230-mpg-volt-is-it-for-real/
 the solidity: http://www.greencarreports.com/blog/1034125_how-does-the-2011-chevy-volt-get-230-mpg-by-making-assumptions
 lack of: http://online.wsj.com/article/SB124951586679909365.html
 impasse: http://dc.streetsblog.org/2009/08/03/letting-highway-trust-fund-earn-interest-how-much-would-it-help/
 Earth2Tech: http://earth2tech.com/2008/08/07/plug-it-in-plug-it-in-say-west-coast-utilities/
 rudderless: http://dc.streetsblog.org/2009/06/23/staa-tuned/
 White House: http://dc.streetsblog.org/2009/08/07/electrified-transportations-big-week-in-washington/
 Lee Munnich: http://www.hhh.umn.edu/people/lmunnich/index.html
 a report: http://www.cts.umn.edu/Research/Featured/ValueCapture/index.html
 told CNBC: http://www.cnbc.com/id/28637383
 Hyundai: http://www.thedeal.com/corporatedealmaker/2009/06/another_auto_exec_calls_for_ga.php
 Ford: http://www.msnbc.msn.com/id/4684207/
 GM: http://www.washingtontimes.com/news/2009/mar/18/gm-chief-says-gas-tax-hike-worth-considering/
 move toward: http://www.esquire.com/features/data/nate-silver-car-culture-stats-0609
 its weight: http://dc.streetsblog.org/2009/07/31/house-quickly-sends-2-billion-more-to-cash-for-clunkers/
 admitted: http://www.nytimes.com/2009/08/12/us/politics/12sanger.html?hp
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