EV fees double, hybrid fees increase in MN under new bill proposal
The future for electric vehicles in Minnesota
As Minnesotans consider whether to purchase an electric vehicle, lawmakers are hoping to provide funding to continue to build charging infrastructure throughout the state and nation.
ST. PAUL, Minn. (FOX 9) - A proposal before Minnesota lawmakers would double the current fee imposed on the purchase of a new all-electric vehicle in the state, while creating a new fee for hybrid and all-electric motorcycles.
New EV charges proposed for MN
Dig deeper:
Under the bill, the surcharge on an all-electric vehicle would go from $75 to $150, while creating a new charge of $75 for plug-in hybrid electric vehicles, $30 for all-electric motorcycles and $15 for a plugin-hybrid motorcycle. Revenues gained from the fees would be distributed in part to Minnesota’s highway user tax distribution fund.
Attached to each fee is an escalator that says if a gasoline tax is imposed going forward, the charge will increase or decrease by the same percentage.
"This is a parity bill to the existing gas tax for highways and bridges," said Rep. Natalie Zeleznikar (R-Fredenberg Township) during the House Transportation Finance and Policy on Monday.
Rep. Zeleznikar said she did the "straight math" when she looked at the current gas tax system, and researched the assumptions on how many miles Minnesotans drive, to come up with the increase and base fee amounts.
With more people using electric vehicles, fees will need to be increased to keep up statewide funding levels, she said.
Where revenue goes
What they're saying:
"As both an issue of fairness and practicality, having electric vehicle drivers pay for using the roads like other drivers makes sense and helps to maintain the roads and bridges we use every day. We also support having an equitable inflationary increase to the EV surcharge if other fuel taxes increase as well," said Jon Koznick in a statement on behalf of members of the transportation committee for AFSCME Council 5, while noting opposition to where the revenue would be spent.
Rep. Zeleznikar said an estimated $3 million in revenue could be gained by the roughly 55,000 electric vehicles currently registered in Minnesota.
An amendment proposed by Rep. Larry Kraft (DFL-St. Louis Park), would have reduced the fees on all-electric vehicles from $150 to $125 – noting concerns about adding charges to the cost of EVs this early in the market – and beginning on July 1, 2027, would transfer funds from the highway user tax distribution fund to a dedicated transportation impact assessment and mitigation account that began last year.
The amendment also would have reduced the fees for hybrid vehicles from $75 to $50, and removed the new fee on motorcycles, but was struck down by an 8-7 party-line vote.
What's next:
The bill was laid over by the House Transportation Finance and Policy on Feb. 17 for possible consideration for approval in a larger collection of bills, known as an omnibus bill.
The Source: The bill was discussed in the House Transportation Finance and Policy on Feb. 17, 2025.