Listen to this articleA Maryland transportation commission is considering whether the state should adopt new registration fees for electric and hybrid plug-in vehicles to help offset an expected decline in the gas tax revenues that pay for roads, bridges, sidewalks and other transportation projects.
Finding a revenue substitute for the gas tax — which, after a century of being a primary funding source for transportation projects nationwide, is expected to decline significantly with rising fuel efficiency and the surging sales of electric vehicles — is among the top priorities of the Commission on Transportation Revenue and Infrastructure Needs (TRAIN).
The number of Maryland-registered zero-emission vehicles — which includes those that are fully electric — is expected to increase from about 84,000 this year to more than 1.3 million in 2031, representing more than one in four registered passenger cars and trucks in the state.
In providing guidance to the state legislature, Chair Frank Principe Jr. said his commission will likely recommend that lawmakers either require a fee for electric or hybrid vehicles or authorize the state Department of Transportation to collect fees.
Adding pressure on the commissioners to identify new revenue streams is a looming fund gap in the state’s $21 billion transportation projects plan. The deficit is expected to reach more than $2 billion in six years.
The state’s gross gas tax revenue in Fiscal Year 2021 was more than $860 million.
“This fee alone is only gonna be making a small dent in that overall picture,” Principe said.
It’s not yet clear exactly how much a fee like this would cost Maryland drivers, whether a fee amount would vary by fuel source, vehicle weight or fuel efficiency, or to whom exactly the fee would apply.
Maryland’s total vehicle registration revenue in Fiscal Year 2025, which begins next July, is estimated to be $414 million — roughly 70% of which will be used for statewide transportation projects.
The average gross revenue for states that charge a registration fee for electric or plug-in hybrid vehicles is about $4.4 million and varies based on population and fee amount, according to the Maryland Department of Transportation.
States of a size similar to Maryland, including Missouri, Wisconsin and Indiana, saw between $1 million and $2 million in revenue.
Thirty-three states, including Virginia and West Virginia, impose registration fees for electric and/or plug-in hybrid vehicles, according to the Maryland Department of Transportation.
Eleven others, including Maryland, Pennsylvania and New Jersey, have proposed fees for registering these vehicles, but lawmakers haven’t enacted them.
The fees range from a low of $50 to a high of nearly $211 in the states that have them.
The average fee for zero-emission vehicles is about $128, while the average fee for low-emission vehicles, like plug-in hybrids, is $63.
Maryland’s current biennial registration fees for personal vehicles are $101 or $153, depending on a vehicle’s class and weight. The state also requires a biennial surcharge of $34, which supports the state’s emergency medical services system, including medevac helicopters and trauma units.
Most states with registration fees for electric and/or plug-in hybrid vehicles have adopted a flat fee.
A $200 flat fee in Maryland would generate about $40 million in Fiscal Year 2025 and increase to nearly $120 million by Fiscal Year 2029, according to projections from the Maryland Department of Transportation.
State Sen. Pamela Beidle, an Anne Arundel County Democrat and one of six state lawmakers on the commission, said it doesn’t seem fair for someone who, like her, drives a gas-powered hybrid vehicle to pay the same fee as the driver of a plug-in hybrid, which requires energy for charging.
Beidle, though, acknowledged that she doesn’t pay the same fees as someone whose car is neither a hybrid nor an electric vehicle.
“It just seems like there (are) a lot of layers to consider,” she said. “I hate to say this, but maybe one fee across the board is the way to handle it.”
