Kansas electric vehicle advocates stomping brake on bill imposing new state recharge tax

GOP lawmaker argues EV owners unfairly drive around gas tax obligation

By: - February 1, 2023 11:24 am
Rep. Bill Rhiley, R-Wellington, urged the Kansas House Transportation Committee to embrace a bill imposing a new battery recharge tax on owners of electric vehicles in response to decline of state gasoline tax revenue used to repair highways. (Kansas Reflector screen capture from Kansas Legislature YouTube channel)

Rep. Bill Rhiley, R-Wellington, urged the Kansas House Transportation Committee to embrace a bill imposing a new battery recharge tax on owners of electric vehicles in response to decline of state gasoline tax revenue used to repair highways. (Kansas Reflector screen capture from Kansas Legislature YouTube channel)

TOPEKA — Joe Millikan learned of a Kansas House bill imposing a new tax on electric-vehicle charging stations just as he contemplated purchasing an automobile untethered to fossil fuels.

Millikan said the proposed state tax of 3 cents per kilowatt to support a Kansas highway repair fund reliant on fuel tax revenue would amount to “double taxation” because owners of all-electric cars and trucks paid a higher registration fee to the Kansas Department of Revenue. That $100 fee approved by the 2019 Legislature was designed to make up for EV owners avoiding the fuel tax of 24 cents per gallon earmarked for highway repairs and construction. The registration fee for gasoline-powered vehicles in Kansas is $30.

“It is disappointing to learn the Kansas House may adopt legislation hostile to EV owners and commercial EV chargers,” he told the House Transportation Committee. “It will discourage additional EV charging stations in Kansas just as the number of EVs are
growing rapidly.”

Millikan said the legislation could result in small businesses shutting down charging stations and interfere with car dealers interested in making charging stations available to owners of electric vehicles. In addition, Millikan said, the House bill would signal to EV owners traveling across the United States they ought to follow routes outside Kansas.

Rep. Pat Proctor, a Leavenworth Republican on the transportation committee, said it was important for the Legislature to tackle inequities in vehicle taxation but took a different approach. He said the owner of a Tesla electric car would pay about $3 to fully charge that vehicle if the proposed state tax became law. It currently costs approximately $5 in state fuel tax to fill his gas-fueled Chevrolet Silverado truck.

“I’m afraid that we might be accidently disincentivizing the use of fossil-fuel vehicles based on this 3 cents,” Proctor said. “Are we accidently punishing fossil-fuel vehicle drivers by not charging the EV drivers the same?”


‘Energy equity’

Under House Bill 2004, the “EV Energy Equity Road Repair Tax Act” would direct all revenue from the new kilowatt-hour tax on electricity used to recharge vehicle batteries to the state highway fund. Commercial charging station owners would be responsible for forwarding to the state taxes collected from EV owners. The charging of EVs at residential outlets wouldn’t be subject to the proposed state tax.

Failure to comply with the Kansas law would be a misdemeanor punishable by a fine of $25 per kilowatt hour of energy sold to EV consumers and a sanction of $5,000 to $50,000 or a sentence of not less than 30 days in a county jail.

The state Department of Revenue estimated the House bill would result in new tax collections of $148,000 in 2024, $179,000 in 2025 and $210,000 in 2026. The figures assumed there were 10,500 electric vehicles in Kansas, an average driving distance of 7,000 miles each year, consumer use of public charging stations for 20% of electricity consumed and the consumption of one killowatt for every three miles driven.

In addition, the revenue department estimated it would cost $640,000 for the state agency to modify computer programs to handle the EV tax and hiring of a couple employees to monitor accuracy of charging stations.

Rep. Bill Rhiley, R-Wellington, said during the House committee hearing Tuesday the Department of Revenue’s fiscal analysis was flawed because it didn’t take into account EV trucks and cars that would pass through the state on Interstate 35 and Interstate 70. Those motorists should contribute to the state highway fund for making use of Kansas roads, he said.

“We can’t just look at the 10,000 EV vehciles that are in Kansas,” Rhiley said. “We need to look at the hundreds of thousands of electric vehicles that are going to be driving through Kansas.”


‘Smiles per gallon’

Rep. Nick Hoheisel, R-Wichita, said lawmakers ought to consider elevating registration fees of EV owners to bring equity to drivers’ contributions to the state highway fund. He said the bottom line of any bill ought to be fairness to gas and electric vehicle owners.

The purchase of vehicles was result of consumer choices and individuals ought to be held accountable for their decisions, said Rep. Michael Houser, R-Columbus.

“It’s no secret I’ve got this big truck. I guarantee you I pay my fair share of the fuel excise tax,” Houser said. “I didn’t buy mine for miles per gallon. I bought mine for smiles per gallon. I get my money’s worth out of it.”

Wendi Stark, representing the League of Kansas Municipalities, said Rhiley’s bill was flawed because it directed all new revenue from EV charging stations to the state highway fund instead of dividing revenue with cities and counties for work on road projects. Under current Kansas law, the state retains 66.3% of the fuel tax revenue and cities and counties benefit from 33.6% of that revenue.

The bill surfaced in the House at the same time the Kansas Department of Transportation was engaged in a three-year study of alternative revenue sources in response to a decline in fuel tax revenue, said Joel Skelley, policy director at KDOT. That study was focused on application of a “road usage charge” rather than linkages to taxation of energy sources.

“This treats the roadways as the utility being used instead of the fuel source the vehicle operates on. Taxing fuel to pay for roadway use creates an ongoing challenge, given emerging vehicle technologies. Each new engine technology, or fuel source, will require new complicated calculations of ‘energy equivalency’ to travel a certain distance,” he said.

He said the House bill would disproportionately target EV drivers who relied on public or shared charging stations at apartment complexes, workplaces and elsewhere. The proposed tax wouldn’t apply to people recharging vehicles at their private home, he said.

Zack Pistora of the Kansas Sierra Club told House members consideration of the EV legislation on fees and taxes ought to include debate on the influence of traditional fuel-combustion vehicles on road safety, air pollution, congestion, noise and damage to roads.

National studies indicated heavy trucks were responsible for a disproportionate amount of road damage compared to lightweight vehicles and tax and fee schemes ought to take that into account, he said.

“Their data concludes that the road damage of an 80,000-pound truck would be the equivalent impact of 9,600 ordinary automobiles,” Pistora said.

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Tim Carpenter
Tim Carpenter

Tim Carpenter has reported on Kansas for 35 years. He covered the Capitol for 16 years at the Topeka Capital-Journal and previously worked for the Lawrence Journal-World and United Press International.