Electric vehicles, higher-mileage cars to see fee increase

The cost to register a high mileage hybrid vehicle or an Electric Vehicle (EV) in Oregon will rise significantly on Jan. 1. The increased amount vehicle owners can expect to pay will depend on the fuel efficiency rating of the vehicle, which will now be the primary factor in determining the cost to register it. 

The new fees are part of a series of changes to the Oregon Department of Transportation (ODOT) funding plan, which was passed three years ago in the form of HB 2017, with initiation and implementation set to begin in 2020.

These increases have been approved by legislators because of the growing number of families that have chosen to purchase an EV. While sales of EVs in the U.S. numbered 361,307 in 2018 — an increase of 81 percent over 2017 — that number was still less than 2 percent of all automobile sales in the country.

Until now, virtually all ODOT repairs and maintenance projects are funded through the imposition of taxes at the gas pump. This means that cars that do not use fossil fuel are using Oregon roads without paying for the upkeep of those roads through fuel taxes. 

For many car buyers, the idea of making even a small difference in lowering carbon emissions lies at the base of the decision to buy an alternate fuel vehicle. 

While the initial purchase of EVs is higher than their gasoline powered counterparts, the savings after purchase are significant due to traditional long-term fuel costs being much higher than electrical costs. There are also tax incentives in place to encourage EV purchases.

There are more than 1.2 million EVs on American roads this year, in comparison to less than 50,000 a decade ago. It is unclear whether hikes in the cost to register an EV will diminish the growing public appetite for the cars.

“Drivers of more efficient vehicles will pay more to register and renew their tags so they contribute more for use of the roads,” ODOT said in a public statement released last month. “That’s because these drivers are contributing much less (or nothing) in fuels tax while driving just as much.”

This argument was persuasive during the debates surrounding HB 2017, with the bill passing thanks to support from members of both parties on a final vote of 39 to 20.

Oregon currently has approximately 27,000 EVs registered. All these vehicles will be eligible to join a program designed to lower the higher registration fees for 2020 — OReGo, a mileage payment and reimbursement system, approved by the legislature’s passage of HB 2018, which was designed to allow owners of EVs to pay the increase in registration fees over time.

OReGO also permits drivers to monitor their mileage and pay the 1.7 cents per mile ODOT has determined is the proper usage rate for roads and highways in the state. Participation in the OReGo program requires drivers to sign up on the website, providing a digital payment method and Vehicle Identification Numbers (VIN). There are also GPS-enabled options available through two of the vendors contracted by the state to participate in the OReGo program.

According to ODOT, “Vehicle registration fees, title fees and other motor vehicle-related fees, such as fuels taxes and motor carriers’ weight-mile taxes, are set by the legislature and help support Oregon’s transportation system — statewide and at the local levels. The increased fees are part of the major funding package to improve our state’s transportation system and to strengthen our economy.”

Beginning Jan. 1, vehicle registration fees are increasing based primarily on the combined MPG rating determined by the DMV’s VIN decoding software. This software will assign mileage rates for each vehicle registered in the state.

Passenger vehicles are eligible for two- or four-year registration. 

The new fees for registering a vehicle are:

• Passenger Registration 0-19 mpg: $122/$244

• Passenger Registration 20-39 mpg: $132/$264

• Passenger Registration 40 + mpg and not enrolled in OReGo: $152/$304

• Passenger Registration 40 + mpg and enrolled in OReGo: $86/$172

• Passenger Registration Electric and not enrolled in OReGo: $306/$612

• Passenger Registration Electric and enrolled in OReGo: $86/$172

Hybrid and electric vehicles generally fall into the following categories:

• Plug-in electric vehicles: Any car that runs at least partially on battery power and is charged using electricity.

• Battery electric vehicles: Run entirely on an electric motor and rechargeable battery. This is also referred to as an all-electric vehicle.

• Plug-in hybrid electric vehicles: Combine two propulsion modes in one vehicle. They have an electric motor and rechargeable battery but can switch to gasoline once the battery power is depleted.

• Hybrid Electric vehicles: Use a gasoline engine with an electric motor. Although these vehicles have an electric motor and battery, they don’t plug in to be recharged.

All these types of vehicles will be subject to the change in the registration fee structure that will take effect on Jan. 1.

Some increases will be due to the new mileage-based formula for registration and others will be based on the EV fee requirements of the new Transportation Funding Bill.

Oregon is not the only state to create an alternate manner to compensate for the reduction in gas tax revenues, as 20 other states have enacted a similar special electric vehicle registration fee.

For more information on the changes to the registration structure, which also includes minimal increases in other ODOT fees, see Oregon.gov.


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