New license fees confusing but needed
Expect some confusion at the DMV when you go to renew your vehicle license next year. That’s because Oregon is shifting to a mileage-based fee schedule.
If you think you’ll pay more if you drive a gas-guzzler, think again. The lowest-mileage vehicles will pay the least, and owners of high-mileage hybrids and electric vehicles will pay the most.
That might sound counter-intuitive, especially with all the talk about reducing emissions to combat climate change, but it actually makes sense, as in dollars and cents.
For many years, the state has relied on gasoline taxes to pay for highway construction and road maintenance. And for years, that worked out fine. Those who drove the most miles, burning the most gas and putting the most wear and tear on the roads, paid the most in gas taxes. Heavy trucks — the hardest on the roads — pay a weight-mile tax to reflect that.
But as cars and light trucks have steadily gotten more fuel-efficient, culminating most recently in zero-emission electric vehicles that also use zero gallons of gas, the money flowing into the state’s highway fund has slowed. Owners of high-mileage vehicles aren’t paying their fair share of the cost of maintaining the roads we all use.
Starting Jan. 1, 2020, vehicle license fees will get more expensive. The 2017 Legislature passed the biggest transportation package in state history, worth more than $5 billion over 10 years, and increasing license fees will help to pay for it. That bill also increased gas taxes to raise a large portion of the money.
Starting Jan. 1, owners of vehicles with mileage ratings of 19 miles per gallon or less will pay $244 for four years or $122 for two years. If your vehicle gets 20 to 39 mpg, you’ll pay $264 for four years ($66 a year). If your car gets 40-plus mpg, the four-year fee is $304. Electric-vehicle owners will pay $612 for four years.
But wait — before you have a road-rage moment, there is an option for owners of high-mileage vehicles. If you enroll in the OReGo program that charges you based on the miles you drive rather than the gas you buy, your tabs will cost just $172 for four years, whether you drive a 40-plus mpg car or an electric.
Participants in OReGo who do buy gas get the gas taxes rebated.
The mileage-based system isn’t perfect, and the state is encouraging more people to buy fuel-efficient cars while charging more to those who do. But the new fees are an attempt to make sure everyone who uses public roads contributes to their construction and maintenance.