VW mitigation plan encourages electric cars, while legislation would penalize them

Tilton Town Administrator Joyce Fulweiler knows the importance of funding for highway maintenance. Tilton has more state roads than town roads, and state-owned Calef Hill Road is in dire need of improvement. Yet last January, just six months before roadwork was set to begin, she learned that there was no money in the state budget to do the project.

Much of the funding for highway and bridge maintenance comes from the gasoline tax, but as more people are turning to fuel-efficient vehicles and electric cars, gas tax revenues are falling, leaving state officials wondering where to make up the money.

Rep. Norman Major (R-Plaistow) has introduced House Bill 1763, which would impose an annual fee of as much as $111 on fuel-efficient vehicles to help make up for the declining revenues.

A hearing on his bill took place on Tuesday, the same day that Gov. Chris Sununu announced a draft plan for the use of funding from the Volkswagen settlement that calls for replacing state and municipal fleets with more fuel-efficient vehicles and establishing a network of charging stations for electric cars.

Municipalities in the Lakes Region have yet to weigh in on those conflicting state priorities, according to Susan Slack of the Lakes Region Planning Commission.

The principal planner for the organization, Slack said town and city officials recognize the importance of maintaining the state’s roads and bridges, but they are at the beginning of the process of deciding what funding solution they should be advocating.

“I understand people coming from both sides,” said Slack. “On the one hand, you’re looking for incentives to drive hybrids and electric vehicles and move away from fossil fuels, but they’re not paying as much gas tax, which funds the upkeep of our roads.”

The proposed annual fee on energy-efficient vehicles was not among the items listed on a fact sheet Slack provided to members of the Transportation Advisory Committee this month, listing possible ways to pay for road and bridge improvements. It will be added for consideration in May, she said.

The fact sheet explains that the federal gasoline tax, at 18.4 cents per gallon, has remained the same since 1993. It provides revenue through the Highway Trust Fund which pays 80 percent of most transportation projects. New Hampshire’s share is $183 million.

The state gasoline tax is 24 cents per gallon, which is less than the surrounding states charge. That rate includes a 4.2-cent increase approved in 2014 that is due to expire once the bonds for work on Interstate 93 are paid. One option that might be considered is extending the current rate beyond the expiration of the I-93 bond.

The New Hampshire turnpike tolls range from 50 cents to $2, depending upon the location, but use of those funds is limited to turnpike projects. However, Slack noted, an increase in the turnpike tolls could free up other federal money that could be used elsewhere.

An option for funding work on local roads is for municipalities to add $5 to motor vehicle registration fees. Legislation to allow towns to increase that fee to $10 passed the House in 2017, but failed by one vote in the Senate.

Shared responsibility

Tilton’s Calef Hill Road project was to utilize the State Aid Highway Program. That program provided $1.7 million in general fund appropriations per year to municipalities that agreed to provide a 33 percent match, but the legislature discontinued that program in the current state budget.

Fulweiler said the Department of Transportation withdrew funding for three projects that were in the pipeline, but had not yet gotten underway, in order to meet Gov. Sununu’s directive to reduce spending.

She said that, while Calef Hill Road is a state-owned and state-maintained road — technically an unnumbered state highway — the town plows and treats the road during the winter and the state maintains it the rest of the year. However, New Hampshire had not properly maintained the road and it was in dire need of improvement, so the two parties reached an agreement to make improvements under the State Aid Highway Program.

Under the plan, the state brings a road up to current standards and turns it over to the town, which agrees to provide ongoing maintenance.

“It’s a win-win,” Fulweiler said. “If they bring it up to at least a Class V road, they have no more maintenance.”

In this case, the town was responsible for paying 20 percent, rather than the usual 33 percent portion of the cost, she said. Voters had authorized the project in 2015, with the authorization to borrow money carrying forward to 2019. The state planned to start the project at the start of its new fiscal year in July, and Tilton had put the design work out to bid so the town would be ready when the state was ready to begin.

Then, in January, she learned that the money from the state would not be available.

“Will the legislature fund it again next year?” she asked. “Who knows?”

In the meantime, she said the town is working with the state highway personnel in District 3 to have them repair two “really bad spots” for drainage on Calef Hill Road.

“We hope to get them to at least repair those two bad spots,” she said. “Every week I talk to our public works director and ask if we’ve heard from the state.”

Electric vehicles

The $15 billion settlement with Volkswagen after the company was charged with modifying vehicles to give false readings on emission tests provided $2.9 billion to a mitigation fund, with New Hampshire’s share being $31 million.

The state plan calls for using the money to replace publicly owned vehicles with models offering lower operating and maintenance costs, with priority given to economically challenged communities, areas with historical air quality problems, and areas that receive a disproportionate amount of air pollution from diesel fleets.

It also “supports the use of zero-emission or near-zero-emission vehicles by investing in electric vehicle charging infrastructure at strategic locations throughout the state, and encouraging the replacement of diesel vehicles and equipment with lower-emission alternatives, including those powered by electric and other alternative fuels.

The plan calls for using 15 percent of the state’s allocation for the charging equipment.

The Plaistow Republican’s bill to place a higher fee on those vehicles because they will be lowering gasoline tax revenue is being met with opposition from those who point out that vehicle weight has a more direct effect on the condition of the roads.

Major’s argument is that “We have more vehicles driving on the roads [but] our revenues are flat and the condition of our roads and bridges is getting worse.”

“The other side of that argument is that weight has more of an impact on the roads that require maintenance,” Slack said. “I don’t have a personal opinion one way or the other. It’s a real issue, and we’ve got to figure out something.

“None of the towns have taken a position on any of it yet,” said Slack. “We will see if we can come to some consensus on what to advocate for, if anything.”

Local communities may want to weigh in on the issue because highway aid is so important to municipalities, she said.

Slack noted that communities also rely upon state money for projects identified in the 10-year transportation plan which gets revised every two years.

“The beginning of that process is identifying the needs and priorities of the municipalities,” Slack said. “Whether they are municipal roads and bridges or state-maintained roads roads and bridges, we look at where those needs are, and then they are prioritized by the state Department of Transportation.”

Even if the fee on electric and hybrid vehicles takes effect, Slack said it will not solve the problem.

“It’s not any one person or type of vehicle that is going to bear the burden,” she said. “It will be all of us in some way.”