California Poised to Lose Up to $4 Billion in Gas Tax Revenue

As elec­tric vehi­cles grow in mar­ket share, states like Cal­i­for­nia that depend on gas tax rev­enue for much of their trans­porta­tion fund­ing must find oth­er ways to make up for the loss.

Accord­ing to Manola Secaira of Cap Radio, “A report from the state’s Leg­isla­tive Ana­lyst’s Office projects a net trans­porta­tion fund­ing decline of about $4.4 bil­lion — or 31% — with­in the next decade.” Cur­rent­ly, Cal­i­for­nia gets about one-third of its trans­porta­tion fund­ing from gas tax­es and vehi­cle fees.

Pro­posed replace­ments for the gas tax include mileage-based road user fees and new elec­tric vehi­cle fees. The report rec­om­mends diver­si­fy­ing trans­porta­tion fund­ing sources and con­sid­er­ing mileage fees (also known as vehi­cle miles trav­eled or VMT), which make all road users respon­si­ble for the dam­age incurred to roads by dri­ving based on how much they trav­el. “Regard­less of whether or not this approach is adopt­ed, the report makes it clear that Cal­i­for­nia offi­cials must think of solu­tions soon­er rather than lat­er.”