Out of Focus
Last week, the Willamette Week published an interesting take on Oregon’s hybrid tax credits—which combine with existing federal tax credits to make the purchase of hybrid automobiles more attractive to shoppers. Last year alone, the state paid out more than $5 million to those applying for the credit. When the tax credit was created, the concept was to incentivize the purchase of more fuel-efficient cars, thereby cutting down on fuel consumption and associated pollution, especially in urban areas. Yes, a very good intention, indeed.
Tucked gracefully in this well-intentioned incentive are two intriguing issues: one, enviro-messaging; the other, social inequity. First and foremost, this credit is explicitly for the purchase of hybrids; it’s not a credit simply for fuel efficient vehicles or fuel efficient transportation. The message here is that hybrids are the best choice for personal transportation. As the WillyWeek references, the tax credit is readily available to anyone ‘green’ enough to chunk down the change for such planet loving steeds as the GMC Yukon hybrid SUV ($50K price and an estimated 21 mpg in the city) and the Lexus LS 600h ($100K price and an estimated 20 mpg in the city). Nope, you chumps slumpin’ down the freeway at nearly 40mpg in your $12,000 Toyota Yaris will just have to suck it. And for you schmucks silly enough to ride a bike… suck it even more.
Sure, this credit is ripe for criticism as it relates to rewarding technology as opposed to plain old efficiency, but the WillyWeek made a point to identify what I find to be the more prescient issue: social inequity. As writer Corey Pein points out, by taking mass transit (TriMet), people simply burn less fuel than individuals in cars (any car, hybrid or otherwise). Subsequently, transit riders contribute less to global warming and other auto-associated negatives (e.g., traffic congestion, street-level pollution, multi-vehicle road dynamics). Pein references a study from the highly respected Sightline Institute, which states that a mostly full transit bus is three times more efficient than a Prius with a lone driver. I’ll take it one step further: if the bus is burning Oregon-sourced and refined biodiesel from Salem’s SeQuential BioFuel, then its impact is even less.
Pein’s perspective on the state’s failure to reward the most efficient transportation is a steaming issue. I have a difficult time with this because I understand to some degree what the legislature is attempting to accomplish with this credit: make the biggest possible positive impact without asking people to shift their behavior too far. This is exactly what they did when they offered credits this past tax year to purchasers of bio-diesel for transportation (the largest sector of diesel fuel consumption). It’s worth noting that the state also offers a reduced tax credit to purchasers of bio-diesel for home heating, of which I claimed after burning through hundreds of gallons of B99 bio-diesel (from Sequential Biofuel).
Back in 1999, the legislature likely took a look at the market and said, ‘people are buying cars and they’re going to keep buying cars, no matter how much negative impact they have. So we need to figure out a way to get them to buy the most efficient cars while still getting what they want.’ Conversely, people on the bus are more likely to be riding the bus because they have to be –or in some cases choose to be because it’s the easiest or most environmentally responsible thing to do. Unfortunately, for the majority of transit riders, they’re going to ride the bus whether you incentivize their transportation choice or not. Subsequently –in the legislature’s collective mind– why waste money trying to get people to make the most efficient transportation choice (motorized or otherwise)? If you did that, you’d be handing out checks to a lot of people who made no change at all to their lifestyle –because they didn’t have a choice.
Again, I understand this line of reasoning as it relates to the legislature, but I don’t like it. If we as a collective people want our fellow citizens to make better transportation decisions, we may need to feel the pain of making the wrong choice instead of rewarding ourselves for making a slightly less destructive choice. Yes, the hybrid credit is not fair, nor does it make sense in today’s market, where gas is hovering around $4.50/gallon. But in my opinion, the credit is also rewarding the wrong thing: a purchase. I believe we need to reward behavior that benefits us all and punish behavior that hurts us all.
But that would be too simple and the problem is far too complex. What about the citizen who can’t afford to live in the city (or near a frequent-stop TriMet bus line), and subsequently lives outside of Estacada but still holds a job in Portland? What if they have a crazy work shift and simply can’t get to work on time any other way? How do we handle other social inequities and still incentivize socially responsible behavior? Hmmm… tough question. Now I see the legislature’s issue. That being said, it’s their job to tackle tough issues that affect us all and deliver solutions that produce positive environmental impact while rewarding socially responsible behavior and making those with the means to afford any choice, pay for the selfish choice. Good luck, Oregon.




My first response to the WW piece was that we should just put this money into transit.
Hybrids are a fraud, in my opinion, especially when you consider their potential efficiencies (up to 50 mpg) are generally offset by size and performance requirements of US car buyers. With downsized power and size requirements, we could easily have 50 mpg cars without expensive hybrid technology. Remember the three cylinder Geo Metro (a.k.a. Suzuki Swift)?
(Not to mention the considerable environmental impact of buying a new car vs. maintaining an existing vehicle.)
At any rate, $5 million dollars sounds like a lot, but it’s petty cash compared to, say, TriMet’s three quarters of a billion dollar budget. Dispersing that kind of change to the state’s numerous transit agencies would be a drop in the bucket for them, and wouldn’t even cover their increasing fuel costs — much less the cost of adding service to entice new riders.
So how better to spend this $5 million? How about helping the City of Portland fund its bus pass program for students in grades 6-12?
How about a tax credit to help the working poor maintain their vehicles?
No, I’ve got it… a tax credit for vegetarians, since switching to a plant-based diet prevents more carbon emissions than buying a hybrid car.
i love your last suggestion, steve (a tax credit for vegetarians). if only it could be as easily tracked/validated as buying a car. but hey, with payd (pay as your drive) insurance making its way into the market, we will likely also see the option of payl (pay as you live) health insurance –which would then provide further opportunity to offer a funky health-based + carbon-based state tax credit. privacy concerns? hell yes, but manageable if offered as optional. fair? maybe. the whole topic intrigues the heck out of me.
Or we could just tax the hell out of meat, and use the revenue to fund health care, mass transit and a subsidy on the price of beans.
Simple, fair, and no invasion of privacy.
Now, if we could just find a way to capture all the methane produced by vegetarians…. (toot)
i’m currently working on another piece that discusses the dynamics of water usage in portland — thought you might be intrigued to know that it takes about 1,916 gallons of water to produce one pound of beef. yikes.