Chamber: Ind. lawmakers may look to add tax to alternative fuel vehicles

2013-01-07T13:00:00Z 2013-01-07T15:54:03Z Chamber: Ind. lawmakers may look to add tax to alternative fuel vehiclesLauri Harvey Keagle, (219) 852-4311

The Indiana Chamber of Commerce, local industries and alternative fuel advocacy groups are keeping a close eye on the Statehouse this session with concerns about legislation being introduced to place a tax on compressed natural gas for vehicles.

Vince Griffin, environmental director for the Indiana Chamber of Commerce, addressed the Northwestern Indiana Regional Planning Commission's environmental management policy committee last week about the chamber's legislative agenda.

Griffin said he expects the Legislature to consider a highway tax on compressed natural gas when it is used to fuel vehicles. Currently, highway taxes are paid in part through taxes collected on each gallon of gasoline sold in Indiana.

Griffin said the increased popularity of compressed natural gas to fuel large fleets is pushing the issue among lawmakers. Compressed natural gas tends to sell for about 60 percent of the cost of gasoline per gallon.

Debera Backhus is senior environmental scientist and engineer for South Shore Clean Cities in Crown Point, a government/industry partnership focused on reducing dependence on petroleum and increasing the use of alternative fuel vehicles.

Backhus said the road tax issue is one her organization is watching closely.

"It would have big implications on on returns on investments for companies moving forward," Backhus said.

Backhus noted there is a fee imposed by the state for alternative fuel vehicles. Alternative fuels vehicle owners are required to buy a decal from the state and place it on the windshield in order to legally add an alternative fuel to their vehicles. Prices for the decals vary based on vehicle type and range from $100 to $500.

Mark Stoerman, project manager for Fair Oaks Farms, said his company is concerned about any potential taxes on compressed natural gas as well. Last year, Fair Oaks Farms switched its fleet of dairy trucks to compressed natural gas and built two compressed natural gas fueling stations in partnership with Clean Energy to fuel them.

The gas is captured from cow manure generated at the farm's operations.

Stoerman said he believes the decal program is a simple way to generate revenue for the state and is opposed to a per gallon tax.

"We would like to see the current program continue where you do pay a fee and are not paying on a per-gallon basis," Stoermann said. "It's easier on the trucking companies and the fueling companies to manage than a per-gallon program. We believe there is already a system in place to generate some revenue while allowing this industry to grow."

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