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Fee on fuel-efficient vehicles back on the table



Monitor staff
Tuesday, February 14, 2017

New Hampshire motorists whose vehicles get more than 50 mpg could soon face a new $77 annual fee. And those who drive all-electric cars could have to pay $123 each year.

Lawmakers are again seeking to impose a fee on fuel-efficient vehicles as a way to make up for declining gas tax revenue that funds state road and bridge upkeep.

A similar measure tanked last year amid concerns it would dissuade residents from buying environmentally friendly hybrid or electric cars.

This year’s bill has so far received more support. The powerful House Ways and Means Committee voted almost unanimously last week to endorse the road usage fee, which comes up for a vote in the full House today.

Backers say the fee is needed to ensure all drivers pay a fair share to maintain roads and bridges, a cost that has traditionally been covered by the state’s gas tax. Growth in fuel efficiency, however, has contributed to losses at the pump. New Hampshire’s gas tax revenue has dropped roughly $15 million over the last decade, according to state figures.

“The same cars are doing the same damage, but they are paying less to maintain the roads,” said Rep. Susan Almy, a Lebanon Democrat and co-sponsor of the bill.

Projections show the road usage fee would raise at least $11.6 million in its first year. While less expensive than the fee proposed last year, the charge would still hit automobiles made after 1983 that get more than 22 mpg, which make up almost half the vehicles on the road, according to estimates.

The proposed fee is based on the premise that residents drive 12,500 miles a year and average 22.5 mpg. The sliding scale would start at an estimated $7.70 a year for vehicles that get between 22.5 and 25 mpg and peak at $77.08 a year for those that get more than 51 mpg. A car that uses no fuel would face a $123.33 charge under the bill.

New Hampshire is one of several states nationwide grappling with ways to make up declining gas tax revenue. At least nine other states already impose a fee on certain hybrid or electric vehicles, according to the National Conference on State Legislatures. Oregon began testing a program last year that lets drivers pay a 1.5-cent tax for each mile driven, instead of a flat per-gallon rate at the pump. The program requires drivers install a device in their car that tracks mileage data, an idea that has made some privacy-conscious New Hampshire legislators bristle.

The state’s proposed road usage fee would rely on vehicle mileage figures from the federal Environmental Protection Agency. The fee would be charged annually at registration and wouldn’t apply to motorcycles or mopeds. Republican Rep. Norm Major, who filed the bill, did not return a request for comment.

Infrastructure funding is a perennial issue at the State House.

Roughly 32 percent of state roads are in poor or very poor condition, according to the New Hampshire Department of Transportation. Secondary highways and unnumbered state roads, known as Tier 4 roads, are in the worst shape, with roughly 71 percent of pavement in poor or very poor condition. More than 150 state bridges are on the so-called “red list,” meaning they have been cited for deficiencies.

Republican Gov. Chris Sununu’s recently announced budget proposal didn’t propose any fees or tax increases to raise money for transportation costs. But Sununu did recommend putting state surplus dollars toward an Infrastructure Revitalization Fund that could cover road and bridge repair.

A Sununu spokesman didn’t respond to questions about whether the governor supports a road usage fee. While the bill has bipartisan support in the House, it lacks Republican sponsors in the Senate.

Legislators recently raised the gas tax to make up more revenue, but Republicans in control of the State House have signaled that further increases are unlikely.