Resources

Highway Trust Fund Accounts – CBO’s May 2019 Baseline

Congressional Budget Office

The federal government’s surface transportation programs are financed mostly through the Highway Trust Fund, which has two accounts, one for highways and one for mass transit. The fund records inflows from revenues collected through excise taxes on the sale of motor fuels, trucks and trailers, and truck tires; taxes on the use of certain kinds of vehicles; and interest credited to the fund. It records cash outflows for spending on designated highway and mass transit projects, mostly in the form of grants to state and local governments. Most of the authority to spend is controlled by limitations on obligations contained in appropriation acts.

Intergovernmental Challenges in Surface Transportation Funding

Ingrid Schroeder, Anne Stauffer, et al.
Pew Charitable Trusts

The United States is facing major challenges in maintaining investments in the country’s highways and transit systems, which will require policymakers to make difficult choices in the years ahead. These decisions will be made not just at the federal level, but also at the state and local levels. This analysis examines the role that each level of government plays in paying for highway and transit infrastructure (referred to here as “surface transportation” or “transportation”), the key problems facing this multilayered system of funding, and their causes. In addition, it identifies central principles that policymakers need to consider as they weigh options and consider solutions.

2018 Report on the Impact of Electric Vehicles to the Road Use Tax Fund

Iowa Department of Transportation
December 2018

The primary source of funding to improve and maintain Iowa’s public roadways comes from Iowa’s Road Use Tax Fund (RUTF). Transportation revenues deposited into the RUTF are distributed to state and local governments through several different processes and programs. Primary sources of funding deposited in the RUTF include state excise taxes on motor fuel, annual vehicle registration fees, and the fee for new registration. Over time, increases in construction costs and changes in vehicle technology impact the ability of RUTF to adequately meet the needs of Iowa’s public roadways. One such change in vehicle technology which has the potential to significantly impact the RUTF is the emergence of electric vehicle (EV) technology.

In recognition of that challenge, the legislature passed a bill (section 3 of House File 2256, Eighty-seventh general assembly), signed by Governor Reynolds on April 4, 2018, that requires the Iowa Department of Transportation (DOT) to develop a report that includes estimates of the impact of increased usage of electric, hybrid, and other high-efficiency motor vehicles on future revenues to the State’s RUTF. …

This report explores and presents a range of estimated impacts and a review of possible mitigation strategies to address revenue losses. The possible mitigation strategies are examined based on factors including ease of implementation, applicability to out-of-state drivers, ability to levy upon commercial trucks, and equity, among others.

 

The Revenue Failure of the Highway Trust Fund

Alliance for Innovation and Infrastructure
February 2020

As the leading revenue source for the [Highway Trust] Fund, the per-gallon fuel tax has long been viewed as a proxy for road use, and therefore directly related to wear and tear. Even if originally accurate, this is no longer the case, thanks in part to today’s highly fuel-efficient vehicles, including hybrids and electric vehicles (EVs) temporarily innovating around the tax.

Due mainly to innovation, but also poor governance, roads and bridges are in unprecedented disrepair, and the Highway Trust Fund is ill-equipped to address it. In fact, it is slated to be entirely insolvent within two years.

 

Rural Connections: Challenges and Opportunities in America’s Heartland

TRIP
May 22, 2019

The life cycle of America’s rural roads is greatly affected by the ability of the transportation agency responsible for their upkeep to perform timely maintenance and upgrades to ensure that road and highway surfaces last as long as possible. The pavement condition of the nation’s major roads is evaluated and classified as being in poor, mediocre, fair or good condition.

In 2017, 15 percent of the nation’s major rural roads were rated in poor condition, 21 percent were rated in mediocre condition, 17 percent were rated in fair condition and 47 percent were rated in good condition. …

A desirable goal for state and local organizations that are responsible for road maintenance is to keep 75 percent of major roads in good condition.65 Only 47 percent of major rural roads had pavements that were in good condition in 2017.

Virginia Transportation By The Numbers: Meeting the State’s Needs for Safe, Smooth and Efficient Mobility

TRIP
February 2020

The life cycle of America’s rural roads is greatly affected by the ability of the transportation agency responsible for their upkeep to perform timely maintenance and upgrades to ensure that road and highway surfaces last as long as possible. The pavement condition of the nation’s major roads is evaluated and classified as being in poor, mediocre, fair or good condition.

In 2017, 15 percent of the nation’s major rural roads were rated in poor condition, 21 percent were rated in mediocre condition, 17 percent were rated in fair condition and 47 percent were rated in good condition. …

A desirable goal for state and local organizations that are responsible for road maintenance is to keep 75 percent of major roads in good condition.65 Only 47 percent of major rural roads had pavements that were in good condition in 2017.

The Plug-In Electric Vehicle Tax Credit

Congressional Research Service
May 2019

In 2016, 57,066 individual taxpayers claimed $375 million in plug-in EV tax credits. EV tax credits are disproportionately claimed by higher-income taxpayers. Most of the tax credits (78%) are claimed by filers with adjusted gross income (AGI) of $50,000 or more, and those filers receive an even higher proportion (83%) of the amount of credits claimed.

Millions of Dollars in Potentially Erroneous Qualified Plug-In Electric Drive Motor Vehicle Credits Continue to Be Claimed Using Ineligible Vehicles

Treasury Inspect General for Tax Administration
September 2019

WHY TIGTA DID THE AUDIT: This audit was initiated to assess whether the IRS is adequately considering returns with the Plug-In Credit for examination. WHAT TIGTA FOUND: The IRS does not have effective processes to identify and prevent erroneous claims for the Plug-In Credit. As a result, taxpayers received millions of dollars in potentially erroneous Plug-In Credits. Based on our analysis of Plug-In Credits claimed and received during Processing Years 2014 through 2018, TIGTA identified:

• 16,510 tax returns for which taxpayers received approximately $73.8 million in Plug-In Credits

• 1,509 tax returns for which taxpayers received more than $8 million in Plug-In Credits

• 68 tax returns for which taxpayers received approximately $1 million Plug-In Credits

Additionally, IRS examiners are generally not reviewing questionable claims for the Plug-In Credit during examination when IRS filtering does not identify the credit.

What Does an Electric Vehicle Replace

Jianwei Xing, Benjamin Leard, Shanjun Li
National Bureau of Economic Research, 4/2019

“[T]he EV subsidy program is regressive, as higher-income households benefit more from the subsidy because they are more likely to purchase EVs and thus claim the subsidy.” “The distribution impacts imply that the EV subsidy program is regressive, as higher-income households benefit more from the subsidy because they are more likely to purchase EVs and thus claim the subsidy.”

Guess Who Owns Electric Vehicles in Maryland? Hint: It’s Not Always Who You Would Think

Dr. Andrew Farkas
Morgan State University

“…We found that EV owners are white (85%), male (75%), well educated, affluent (80% >$50,000 household income), older, urban/suburban oriented, environmentally conscious, and they charge their cars at home (similar to findings in other areas of the country). “Environmental concerns” is the most important factor for purchasing and driving an EV; “price and status” is the second most important factor; “efficiency and performance” of the EV is the third most important. EV owners with lower household income (<$50,000), the remaining 20%, are younger, exurban/rural oriented, and concerned about price and status of the EV. In essence government at state and federal levels has been subsidizing mostly affluent households to purchase new EVs, which opens up a huge equity issue.”

2020 Hybrids Surge onto Greenest Car List, Joining the Greenest of EVs

American Council for an Energy-Efficient Economy (ACEEE)
2020 Report

The auto industry, despite slowing sales, labor disputes, trade wars, and regulatory unrest, is producing more of the most technologically advanced and fuel efficient vehicles ever offered. This is great news for consumers, who continue to have plenty of options to buy a greener, more efficient vehicle. While electric vehicles (EVs) get a lot of buzz, the top-scoring 2020 car reflects impressive improvements to the internal combustion engine that reduce tailpipe emissions and fuel consumption. Stronger tailpipe emission standards and lower emissions from the production and distribution of gasoline have also helped nudge hybrids to the top of the list.

 

Insights Into Future Mobility

William Green, et. al, Mobility of the Future Study
Massachusetts Institute of Technology

Lifecycle emissions for all vehicles are highly sensitive to the methods used to produce and distribute the fuels (or electricity) on which they operate. This means that a battery electric vehicle operating on green electricity will have much lower greenhouse gas emissions than a gasoline-powered hybrid vehicle, whereas a battery electric vehicle operating on carbon intensive electricity (as in most of China and in some parts of the U.S.) will have higher emissions than a gasoline-powered hybrid vehicle. Likewise, the method used to produce hydrogen—whether steam methane reforming, with or without carbon capture, or electrolysis using current average electricity versus a “greener” electricity mix—can have a substantial impact on the lifecycle emissions of fuel cell vehicles.

Global EV Outlook 2019: Scaling Up the Transition to Electric Mobility

The International Energy Agency

An average battery electric and plug-in hybrid electric cars using electricity characterised by the current global average carbon intensity (518 grammes of carbon-dioxide equivalent per kilowatt-hour [g CO2-eq/kWh]) emit less GHGs than a global average ICE vehicle using gasoline over their life cycle. But the extent ultimately depends on the power mix: CO2 emissions savings are significantly higher for electric cars used in countries where the power generation mix is dominated by low-carbon sources. In countries where the power generation mix is dominated by coal, hybrid vehicles exhibit lower emissions than EVs.

Regional Heterogeneity in the Emissions Benefits of Electrified and Lightweighted Light-Duty Vehicles

Di Wu, Fendi Guo, Frank R. Field III, et. al.
American Chemical Society

Electrification and lightweighting technologies are important components of greenhouse gas (GHG) emission reduction strategies for light-duty vehicles. Assessments of GHG emissions from light-duty vehicles should take a cradle-to-grave life cycle perspective and capture important regional effects. We report the first regionally explicit (county-level) life cycle assessment of the use of lightweighting and electrification for light-duty vehicles in the U.S. Regional differences in climate, electric grid burdens, and driving patterns compound to produce significant regional heterogeneity in the GHG benefits of electrification. We show that lightweighting further accentuates these regional differences. In fact, for the midsized cars considered in our analysis, model results suggest that aluminum lightweight vehicles with a combustion engine would have similar emissions to hybrid electric vehicles (HEVs) in about 25% of the counties in the US and lower than battery electric vehicles (BEVs) in 20% of counties. The results highlight the need for a portfolio of fuel efficient offerings to recognize the heterogeneity of regional climate, electric grid burdens, and driving patterns.

Battery Electric Vehicles vs. Internal Combustion Engine Vehicles

John W. Brennan, Timothy E. Barder, Ph.D.
Arthur D. Little

An average battery electric and plug-in hybrid electric cars using electricity characterised by the current global average carbon intensity (518 grammes of carbon-dioxide equivalent per kilowatt-hour [g CO2-eq/kWh]) emit less GHGs than a global average ICE vehicle using gasoline over their life cycle. But the extent ultimately depends on the power mix: CO2 emissions savings are significantly higher for electric cars used in countries where the power generation mix is dominated by low-carbon sources. In countries where the power generation mix is dominated by coal, hybrid vehicles exhibit lower emissions than EVs.