Oklahoma House powers down electric car incentive

Mar 10, 2010 — The Daily Oklahoman

Michael McNutt

Mar. 10, 2010 (McClatchy-Tribune Regional News delivered by Newstex) -- Members of the House of Representatives passed a measure Tuesday to prevent a recurrence of last year's run on electric cars when a federal tax credit was added on top of an existing state tax incentive. They also mowed down an attempt to honor state tax credits for everyone who bought the vehicles.

House Bill 2641 would lower any future state credit to equal the credit offered by the federal government on any tangible goods. The measure passed 87-12 and now goes to the Senate.

Rep. Steve Martin, the bill's author, said the measure was in response to last year's events. Oklahoma's tax credit was for half the purchase price of an electric-powered vehicle and, when combined with federal incentives offered in 2009, resulted in little cost to the buyer.

The combined incentives resulted in more electric cars being bought than the state Tax Commission anticipated, said Martin, R-Bartlesville. The federal incentive was reduced Dec. 31; the state credit is scheduled to remain in effect through at least 2014.

Low-speed electric vehicle sales were brisk until the Tax Commission said in September it would exclude certain models, electric car dealers have said. Some buyers canceled their orders after the Tax Commission said the state tax credit didn't apply to vehicles known as "golf carts," "go-carts" or vehicles made for off-road use.

Eligible, not eligible

A Garfield County judge ruled in October that any Oklahoma taxpayer who bought an electric vehicle is eligible to receive the credits. The state Supreme Court in December said the court lacked jurisdiction. Another suit was filed in Oklahoma County District Court.

It's estimated the credits would cost the state about $40 million.

Rep. Joe Dorman, D-Rush Springs, filed an amendment to Martin's bill that would allow the Public Safety Department to determine which electric vehicles were road-worthy and eligible for the tax credit.

Another portion of the bill would have the state honor tax credits on road-worthy electric vehicles purchased since 2008. The money would not be paid until Oklahoma's general fund increased by at least 3 percent.

"That was the promise made by the state of Oklahoma," Dorman said.

Dorman said he filed an amendment instead of a bill so the entire House could consider it. House members voted to table it 41-38. The tabling motion basically killed the amendment.

Martin objected to the amendment.

"You are going back in time," he told Dorman. "My bill is looking forward. This is not intended to go back in time and fix the problem we've had with the electric-car tax credit. This is a bill for the future."

A measure that would require a House committee or subcommittee to annually review all tax credits won unanimous approval, passing 95-0.

HB 3166 by Rep. Jeff Hickman, R-Fairview, would require the panel to make recommendations on which state tax credits should be continued or eliminated.

The measure now goes to the Senate.

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