Road Usage Fees
New Hampshire assesses a surcharge of $100 for battery-electric vehicles, and $50 for plug-in hybrid vehicles, at annual registration. The money goes to fund road infrastructure around the state, just like the gas tax does.
About road usage charges
In general, there are two types of road usage charges – pay-per-mile taxes or graduated vehicle registration fees.
- Under a pay-per-mile program, vehicles are charged for every mile they drive. This can be measured in a variety of ways, from odometer readings to GPS technology.
- Graduated vehicle registration fees usually involve a sliding scale based on a vehicle’s average miles-per-gallon, with more fuel efficient cars paying a higher fee than those which burn more gas. As mentioned, New Hampshire distinguishes battery-electric vehicles vs. plug-in hybrids.
Revenues from road usage charges are usually allocated to the upkeep of state roads and bridges.
Road usage fees in other states
States including California, Virginia, and Colorado, have addressed the problem of falling gas tax revenues by imposing some form of a road usage charge.
So far, nearly all of those programs have taken the form of higher vehicle registration fees for alternative fuel or more fuel efficient vehicles. See a map of states with higher fees.
However, several states have conducted pilot programs looking to the feasibility of creating a pay-per-mile program. This has gone furthest in Oregon, where car owners can now opt to pay a tax on every mile traveled within state lines and have their gas taxes refunded. Participation in that program was capped at 5,000 cars.
“NH should supplement the gas tax with a road usage charge.”
- The average weighted miles-per-gallon of cars sold in the U.S. has been steadily rising. That increased fuel efficiency means less gas is used per mile traveled, resulting in less revenue to maintain roads. New Hampshire must do something to make up for that loss in funding.
- If New Hampshire relied on gas tax revenues for road maintenance, it would mean drivers of alternative fuel vehicles are essentially using the roads for free. This is unfair to the rest of New Hampshire’s drivers, who are left to pick up the tab.
- With the gas tax, drivers can’t see exactly how much of what they pay at the pump goes to maintaining roads versus the actual cost of their fuel. Registration fees or a per-mile charge are therefore more transparent, since drivers can clearly see how much they’re spending on road taxes.
- The number of miles people drive can vary greatly from year to year, particularly during periods of economic downturn. Vehicle fuel efficiency is also expected to rise steadily over the next decade. This makes gas tax revenues an unreliable source of income. New Hampshire needs to shift to a more predictable model to fund its transportation infrastructure.
“NH should not implement a road usage charge.”
- Road use fees particularly impact fuel efficient or alternative fuel vehicles, which emit less carbon than vehicles with a lower average miles-per-gallon. The state should be encouraging people to adopt these more environmentally-friendly forms of transportation, not weighing them with a new tax.
- Gas tax rates in New Hampshire have not risen in line with inflation. It’s unrealistic for lawmakers to expect revenues to stay level with expenses when they do not update rates on a regular basis. Instead of imposing new taxes that particularly penalize alternative fuel vehicles, lawmakers should ensure that gas tax rates keep pace with inflation.
- New Hampshire could find more money to fund road maintenance if it changed how current funds are allocated, for example limiting the percentage of gas tax revenue that goes to line items other than road and bridge maintenance, or by changing how turnpike revenues are allocated.
- Per-mile charges rely on tracking how many miles someone is driving using some sort of device or technology. This raises important concerns about privacy.