If the price of your favorite latte suddenly went up 5,614 percent – say, from $3 to $171.42 – would you still buy it? Probably not. Unless you really like lattes.
Keep that in mind as you ponder state Sen. Martin Sandoval’s plan to raise money for transportation funding in Illinois. The Chicago Democrat’s bill includes proposals to more than double the gas tax to 44 cents a gallon, raise the driver’s license fee to $60 and the standard vehicle registration fee to $148 ... and raise the yearly registration fee for electric vehicles from the current $17.50 to $1,000.
That’s right, $1,000. That’s a 5,614 percent increase. And it’s nearly seven times more than the proposed fee for gas-powered vehicles. Sandoval’s thinking: Electric vehicle owners don’t pay a gas tax, so his stratospheric jump in the electric vehicle registration would make those car owners pay their fair share.
What Sandoval’s not thinking about: The massive broadside that his fee would deliver to the electric vehicle market and electric vehicle owners. Far fewer people likely would buy electric vehicles in this state, and people who own them likely would want to unload their EVs.
What he’s also not thinking about: The rise in popularity of electric vehicles represents a movement away from our reliance on petroleum – a movement toward a cleaner, more environment-friendly way of getting around. Yes, we understand that electricity comes from power plants, and as a rule coal-fired plants aren’t environment-friendly. But in comparative terms, nuclear, natural gas, wind and solar power are.
Electric vehicles remain just a sliver of the overall U.S. auto market – last year, EV sales represented just 2 percent of total American auto sales. But the market’s growing; JPMorgan projects that by 2025, electric vehicle sales will make up 38 percent of all vehicle sales in the U.S. The advent of electric vehicles is something to embrace, not discourage.
Sandoval is right to seek new ways to pay for Illinois’ crumbling transportation infrastructure. We also like his user-fee orientation: People who heavily use roads should pay for their upkeep accordingly.
But he’s way off course when it comes to finding new revenue sources for transportation funding. Raising the gasoline tax makes sense. Charging electric vehicle owners a yearly $1,000 doesn’t.