Electric-car drivers don’t pay their share? Actually, no one does

The annual registration fees for electric cars implemented by several U.S. states have been the subject of much controversy.

Electric-car advocates view the fees as a form of harassment, and a hindrance to electric-car sales.

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But advocates of the fees claim they just force drivers to pay their fair share.

Since electric-car drivers don’t purchase fuel, they don’t contribute their fair share of road-maintenance costs through gas taxes.

But a new report claims it’s not just electric-car drivers that don’t pay their share. No one does.

Published jointly by the Frontier Group and the U.S. PIRG Education Fund, “Who Pays for Roads?” shows that gas taxes and road-use fees don’t even come close to paying for the cost of maintaining and expanding the public road system.

The report claims revenue from gas taxes now accounts for less than half of what’s spent on the road system. That’s down from about 70 percent in the 1960s.

The shortfall is made up by various taxes on the state and local level, paid for by both drivers and non-drivers.

Essentially subsidizing road use, the typical household pays around $1,100 per year — above costs of gas taxes, tolls, and other road-use fees.

MORE: Georgia Electric-Car Sales Plummet After Incentive Replaced By Tax

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And the report’s methodology may still underestimate the true costs of driving on public roads, argues recent analysis by The Atlantic.

That’s because the report ignores “hidden subsidies” — such as those associated with free on-street parking and off-street parking requirements in urban areas — and doesn’t examine the specific costs of roads closely enough, writer Joe Cortright argues.

“Drivers don’t value the road system,” he says, claiming they will only make use of it as long as they don’t have to pay too much directly.

The report looks at the amount of revenue for roads and the cost of maintaining them, but the cost is only discussed in terms of how much is currently being paid.

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The actual costs of maintaining roads to a high standard could be higher than what the government is paying right now, Cortright says. Inadequate maintenance could lead to larger repair bills in the future.

Not that the government would be able to cover those higher costs if they were better understood.

Gas taxes provide inadequate revenue, as do tolls. Revenue from tolls reportedly often fails to cover the cost of even collecting them.

Since taxes and tolls are visible, though, they arguably create the illusion that drivers really are paying for the roads they use.

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Because the real sources of funding the road system are hidden, policymakers are unlikely to address the situation.

But they may soon be forced to.

Improvements in fuel efficiency and the growth of electric-car sales could indeed erode gas-tax revenues, The Atlantic argues.

Ride-sharing services like Uber and Lyft also take some toll-paying drivers out of their own cars.

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Even further in the future, self-driving cars that operate in ride-sharing services may eschew daily parking to drive continuously on “free” city streets.

In Back to the Future, Doc Brown confidently claimed that “where we’re going, we don’t need roads.” Unless they’re properly funded now, we may not have a choice.

[hat tip: John C. Briggs]

This story originally appeared on Green Car Reports. Copyright 2015

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