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Minutes for HB2004 - Committee on Transportation
Short Title
Establishing the EV energy equity road repair tax act and providing for a road repair tax on electricity distributed from a public charging station for electric vehicles.
Minutes Content for Tue, Jan 31, 2023
Chairperson Francis opened the hearing on HB2004.
Chris Waggoner, Office of Revisor of Statutes, provided an overview of the bill and addressed questions from the committee. (Attachment 2)
Adam Sievers, Office of Revisor of Statutes addressed questions from the committee.
Kathleen Smith, Department of Revenue, provided an overview of the fiscal note and addressed questions from the committee.
Representative Bill Rhiley, Kansas Legislature, District 80 appeared in support of the bill. He described the charging station infrastructure currently being put in place throughout the state by Governor Laura Kelly and the need to have legislation by which to levy a tax on the per kilowatt hours (kWh) of electricity used at these stations to charge electric vehicles in a way that is equitable to the motor fuels tax in order to ensure people traveling through the state continue to pay taxes for the use and subsequent maintenance of our roads. (Attachment 3)
Representative Rhiley responded to questions from committee members.
Kevin Gregg, Associate Director, Fuel True testified in support of the bill. Mr. Gregg described the importance of finding a way to collect and offset the lost motor fuels tax revenue that will come with the rise in adoption of electric vehicles. (Attachment 4)
Written testimony in support of the bill was submitted by:
Jay Hall, Deputy Director and General Counsel, Kansas Association of Counties (Attachment 5)
Emily Wolfe, Senior Program Analyst and Policy Analyst, Metropolitan Energy Center testified in opposition to the bill stating that no legislation should be passed prior to completion of the Kansas Department of Transportation's Midwest Road Usage Charge (RUC) Study. She explained that the results of the study will better ensure a system that helps to fund current and future transportation investments while making sense for Kansans. Ms. Wolfe further stipulated that aside from electric vehicles, the motor fuels tax needs to be revamped due to it's having remained at 18.4 cents per gallon for nearly 30 years while vehicles of all types are using less fuel due to their being made more efficient. She stated that the current legislation does not address the decrease in revenue caused by more efficient vehicles yet it adds to the already existing annual registration fee required for drivers of electric vehicles ($100) and hybrid electric vehicles ($50). She described how the proposed tax structure would prohibit business owners from installing non-network chargers by making them more expensive to install. (Attachment 6)
Zack Pistora, Legislative Director and State Lobbyist, Kansas Chapter of Sierra Club spoke in opposition to the bill stating that electric and hybrid vehicles comprise a preferred set of vehicle traits as they are lightweight and quiet, and often travel a shorter amount of miles due to range limits while at the same time producing much less noise than diesel motors, emitting significantly less air pollution, and being better overall for road safety in comparison to larger vehicles. (Attachment 7)
Kent W. Rowe of Wichita, Kansas appeared in opposition to the bill by asserting that even free, renewable-energy supplied charging services will be subject to penalty and imprisonment with this legislation. Mr. Rowe described how his church which generates its own solar energy would not be allowed to charge their members' vehicles without mindless & burdensome record keeping and tax payments. (Attachment 8)
Tad Kramar of Big Springs, Kansas offered testimony in opposition to the bill. Mr. Kramar described this legislation as an unjustified double penalty on electric vehicle owners that is both unnecessary and redundant due to the fact that electric vehicle owners already pay an annual registration fee that is more than three times greater than what is imposed on gas powered vehicles. (Attachment 9)
Written testimony in opposition to the bill was submitted by:
Jason Carmichael, Kansas Resident (Attachment 10)
Darrel Hart, Kansas Resident (Attachment 11)
Joe A. Millikan (Attachment 12)
Jesse C. Moore, Kansas Resident (Attachment 13)
Lori Lawrence, Kansas Resident (Attachment 14)
Anthony A. Schmidt, Citizens Climate Lobby (Attachment 15)
Bruce Blank, Kansas Resident (Attachment 16)
Joel Skelley, Director of Policy, Kansas Department of Transportation (KDOT) testified as a neutral conferee. Mr. Skelley described a 3-year study currently being conducted on alternative revenue sources to address the decline of important revenue streams. The study is focused on a road usage charge (RUC) system of revenue collection that would regard the roadway as the utility being used rather than a particular fuel source that a vehicle operates on. He further explained that taxing fuel to pay for roadway use creates ongoing challenges and that with each new engine technology or fuel source it will necessitate a new complicated calculation of “energy equivalency” to travel a certain distance which will then require new legislation. Mr. Skelley provided detailed analysis regarding the bill and explained that a kWh tax as proposed would disproportionately impacts ~25% of Kansas EV drivers. The EV industry estimates that 75-80% of all EV charging takes place at a person’s residence. By taxing only “public charging,” people who must rely on shared charging stations (i.e., multi-family apartment complexes, workplaces, or other public-access charging stations) would be taxed while the other 80% of EV (residence) would not be taxed. Mr. Skelley further explained that there are 3 states (Iowa, Kentucky, and Oklahoma) that have enacted legislation like this bill proposes and all three have yet to implement their laws and in some cases are wrestling with implementation issues. (Attachment 17)
Justin Cobb, Government Relations Manager, The Nature Conservancy in Kansas appeared neutral to the bill. Mr. Cobb explained that owners of electric vehicles (EV) currently pay higher annual registration fees than owners of gas vehicles in order to subsidize the fuel taxes they would otherwise pay. He recommended that the elevated registration fee be suspended if a new tax is implemented so as not to discourage Kansans from investing in electric vehicles. (Attachment 18)
Wendi Stark, Research Associate, The League of Kansas Municipalities provided neutral testimony to the bill stating that while they support efforts to fund road construction and repairs by supplementing losses to gas tax revenue by capturing revenue from public electric vehicle charging stations they are concerned that the bill indicates all taxes collected shall be deposited in their entirety into the state highway fund whereas currently the distribution of vehicle fuel taxes are split between the state (66.37%) and the special city and county highway fund (33.63%). (Attachment 19)
Written testimony neutral to the bill was submitted by:
Nick Steingart, Director of State Affairs, Alliance for Automotive Innovation (Attachment 20)
There being no further conferees, Chairperson Francis closed the hearing on HB2004.
The next scheduled meeting is February 01, 2023.
The meeting was adjourned at 3:09 PM.
