Andy Stahl
Dear Representative Holvey,
Three Republicans (Esquivel, Krieger, and Garrard) and one Democrat
(Schaufler) have proposed a biannual $54/bicycle license fee in HB
3008. Fee revenue, net of collection costs, would be deposited in a
Bicycle Transportation Improvement Fund (BTIF) to finance bicycle
lanes. The bill's supporters believe that the users of bicycle
lanes ought to pay the costs. I expect a companion bill from these
legislators requiring a pedestrian license for everyone who walks
(toddlers exempted, of course) to pay for sidewalks.
There is no question that Oregon faces tough transportation funding
policy choices. Per capita gas consumption is declining modestly as
fuel efficiency increases slowly and, more significantly, due to the
recession/depression. Some sort of weight/mileage scheme that taxes
as a function of miles driven and weight of vehicle (a surrogate for road
damage caused) is likely to be the long-term solution for highway
funding. In addition, at the federal and/or state level there is
likely to be a carbon tax, encouraging high-mileage vehicles.
Although a carbon tax is good for the environment, it is unlikely to be a
source of transportation infrastructure funding as legislators will
choose to spend carbon tax money in other ways (i.e., per capita rebates,
green energy investments).
There are 2.9 million adults in Oregon potentially subject to the
proposed bicycle license fee (bicycles owned by those under 18 would be
exempt from licensing under HB 3008). Let's assume that half own
bicycles (I'll bet it's actually higher than that). Annual license
revenue would be $78 million, but the bill allows for a one-third
collection cost, netting $52 million annually to the BTIF. The
existing 1% state highway fund dedicated to bicycle/pedestrian
transportation has spent an average of $11.6 million a year since 1990,
and not more than $24 million in a single year. Thus HB 3008 would
more than quadruple the existing state revenue spent on bicycle
infrastructure. Thus, if HB 3008 passes, the legislature would
likely repeal the 1% fund enacted in 1971, which may be precisely what HB
3008's sponsors seek through this bill.
HB 3008 is an excellent example of two diametrically opposing views on
the purpose of taxes. In one camp are those who believe that tax
policy should be used to change behavior, either be rewarding good
behavior or by punishing bad behavior (e.g., sin taxes). In the
other camp are those who believe that tax policy should ensure that the
beneficiaries of government spending pay the freight. (Most tax
policies do some of each.) The first camp are called
"liberals." The second camp are called
"conservatives." By this definition, HB 3008 falls
squarely in the conservative camp -- it is based on beneficiary-pays
principles and punishes environmentally good behavior by making bicycling
more expensive. Like all sales and license taxes, it is also
regressive, taxing low-income people at a higher rate than higher-income
earners.
Unlike motor vehicle registration fees, which serve multiple purposes
(e.g., government regulation, law enforcement, and taxation), HB 3008
seeks only to raise revenue. There are no complementary government
regulatory programs benefitted by bicycle licensing and no law enforcment
issues at stake, e.g., hit-and-run prosecution (the license of bicycles
used in the commission of crimes would not be visible to
witnesses). The question for the legislature is whether the
bicycling benefits from the revenue raised by HB 3008 are worth the
negative incentive to bicycling from taxation. In other words, does
it make sense to raise money to build more bicycle infrastructure using a
taxing method that is likely to decrease bicycle participation?
Best regards,
Andy Stahl
82787 Jackson-Marlow Road
Eugene, OR 97405