By Shelby Shank
Field Editor

The Texas Legislature passed a bill that would impose an annual registration fee for electric vehicles in the state. SB 505 now heads to Gov. Greg Abbott’s desk for his signature.

The bill, authored by Sen. Robert Nichols (R-Jacksonville), amends the transportation code by creating an additional fee for electric vehicles at registration.

“As more of these vehicles drive on Texas roads, there are concerns about how they contribute to the funding of the roads which they use,” said Nichols, who also chairs the Senate Committee on Transportation. “Currently, Texas uses the gasoline/diesel fuel tax to fund transportation projects. However, with the growing use of EVs, the revenue from the fuel tax is decreasing, which diminishes our ability to fund road improvements for all drivers.”

Funding of road and transportation projects in Texas is heavily derived from the gasoline and diesel fuel tax. With the continuous increase of alternatively fueled vehicles, such as electric vehicles, there is a loss in revenue. Electric vehicles use the same roads as conventionally fueled vehicles and should share in the cost of transportation funding, according to proponents of SB 505.

Proposed fees include a $400 registration fee for the initial two-year inspection on new vehicles and $200 for an annual registration renewal.

Both fees will be deposited to the credit of the state highway fund to maintain roads.

“When someone puts gas or diesel in their vehicle, they are paying a tax that helps maintain and improve roads. Electric vehicles are not contributing to this fund but are utilizing those roads,” Joy Davis, Texas Farm Bureau associate legislative director, said. “The proposed tax would place fees on electric vehicle owners at registration that would go directly to the state highway fund for those repairs and maintenance.”

SB 505 also defines an electric vehicle as a motor vehicle with a gross weight of 10,000 pounds or less and uses electricity as its only source of motor power.

“Each time an all-electric vehicle gets on the road and displaces a gas-powered vehicle, the state highway fund loses money,” Nichols said. “This cost adjustment equalizes road use consumption between electric vehicles and gas-powered vehicles.”

Texas Farm Bureau supports SB 505.