Purpose of the Bill

The purpose of this legislation is to modify the surcharge requirements for electric and plug-in hybrid electric vehicles in Minnesota. The bill intends to update the fees associated with these types of vehicles and also outlines how the funds collected will be managed and distributed for transportation-related purposes.

Main Provisions

1. Electric Vehicle Surcharges:

   • The bill increases the surcharge on all-electric vehicles from $75 to $100.
   • A new surcharge is introduced for plug-in hybrid electric vehicles, although the specific amount is not detailed in the provided text.

2. Adjustment Mechanism:

   • Starting January 15, 2028, and every three years thereafter, the surcharge on electric vehicles will be adjusted in accordance with changes to the gasoline excise tax. This ensures the surcharge remains equitable relative to traditional vehicle fuel taxes.

3. Fund Management and Transfers:

   • A Transportation Impact Assessment and Mitigation Account is established to manage funds collected under these new surcharges.
   • Starting July 1, 2027, if this account holds more than 50% of the funds deposited during the previous fiscal year, 90% of the excess funds will be transferred to the Highway User Tax Distribution Fund. This is intended to ensure funds are spent effectively on transportation improvements.

4. Fund Utilization:

   • The funds in the Transportation Impact Assessment and Mitigation Account must be used to prioritize projects that reduce traffic fatalities or severe injuries related to trunk highway projects.

Significant Changes to Existing Law

• Increased All-Electric Vehicle Surcharge: The all-electric vehicle surcharge is increased, reflecting the legislative focus on ensuring electric vehicle contributions to road maintenance are comparable to traditional vehicles.
• Adjustment Tied to Gasoline Tax: The introduction of a mechanism to adjust the surcharge in line with gasoline tax changes is new, ensuring that fee impacts are balanced as fuel tax rates change.
• New Fund Transfers Protocol: Establishing a procedure for transferring surplus funds to the Highway User Tax Distribution Fund introduces a more structured approach to managing surpluses in transportation-related funds.

Relevant Terms

• Electric vehicle
• All-electric vehicle
• Plug-in hybrid electric vehicle
• Surcharge
• Gasoline excise tax
• Transportation Impact Assessment and Mitigation Account
• Highway User Tax Distribution Fund