Oregon’s Transportation Funding Deal Might Make Bikes More Expensive

Oregon might add a new tax on bike sales as part of a transportation funding deal. Photo: TMimages PDX/Flickr
Oregon might add a new tax on bike sales as part of a transportation funding deal. Photo: TMimages PDX/Flickr

From deep blue California to Republican-controlled Indiana, states are increasingly coming to the conclusion that they need to raise revenue for transportation. Oregon is no exception. On Monday, the legislature there released a plan to raise about $8.1 billion over the next 10 years by increasing gas taxes, registration fees, and payroll taxes to spend on roads, transit, walking, and bicycling.

It also includes a new excise tax on bicycle sales.

The idea has come up before in Oregon but never been enacted. There is a feeling this time around, however, that it might become law, reports Jonathan Maus at BikePortland.

Advocates at the Transportation for Oregon’s Future coalition and The Street Trust, formerly known as the Bicycle Transportation Alliance, might not be thrilled about a bike tax, Maus reports, but they aren’t necessarily going to oppose it:

As for the bike tax, there was no mention of it in a statement released today by the Transportation for Oregon’s Future coalition. The Street Trust Policy Director Gerik Kransky said, “We are happy to see an initial transportation package that includes funding for trails and safe places to walk and bike.” Last week the Street Trust convened a meeting of local bike shop owners to discuss the idea… Sources say it was a robust discussion.

A bike tax, which could be set at 4 or 5 percent on bicycle sales, is only expected to generate $1.6 million to $2 million per year — a drop in the bucket compared to revenue from the gas tax and other fee increases. Plus, it penalizes a low-impact mode of transportation that should be encouraged, not taxed. So why have it?

Maus explained the rationale when he reported on the bike tax in March:

The reason it’s under consideration has everything to do with politics. For many years some lawmakers and agency staffers have chafed under pressure from constituents who say “Bicyclists don’t pay” and “Bicyclists need to pay their fair share.” Regardless of the facts and principles of the issue, a tax on bicycle users is seen as a way to quiet those critics. And while it might annoy you, consider this: This red meat is probably seen as necessary only because the bill will include significant funding for bicycle projects.

In addition to the existing state law requiring that 1 percent of money spent on new roads must be spent on bicycle and pedestrian infrastructure, the funding plan would create a $7 million set-aside for bike projects, plus $4 million for a linear park grant program. There would also be $10 million for Safe Routes to School, though that amount is lower than what advocates and a gubernatorial task force recommended.

While new money for bicycling and walking is to be welcomed, it’s important to put it in perspective. Road expansions are in line for sums that dwarf the bike projects. The I-205 freeway widening alone would receive a $250 million earmark under the state’s funding plan.

Hearings on the proposal are likely in June, followed by a vote in the legislature as early as mid-July.

23 thoughts on Oregon’s Transportation Funding Deal Might Make Bikes More Expensive

  1. One word-eBay. People will buy the more expensive parts (or complete bikes) online and cheap stuff like brake pads from the local bike shops. End result is many local bike shops will be out of business.

    Cyclists at bike shops already pay sales tax. Why isn’t that enough?

  2. Yep. At least I know my bike would still be there, and protected from the elements as well.

  3. Glad I moved to Oklahoma, where the cycleways are better than the highways already.

  4. I’m not an expert in taxation, but isn’t this essentially double taxation? First you pay sales tax, then you pay an excise tax? Maybe they do this with cars and I don’t know ’cause I’ve never been crazy enough to buy one, but this seems counter-productive. It will also disproportionately impact the young and the poor.

    I’m also sick of the “They don’t pay” rhetoric. We DO pay, we just don’t pay as much as you, and that’s OUR CHOICE. Don’t complain to your reps about US because YOU made bad decisions with your money.

  5. Exactly right. Riding a bike is inherently a lot less costly than driving a car. That fact seems to annoy motorists no end, which is why “they don’t pay” always comes up. The local roads which cyclists use are funded by sales, income, and property taxes. Cyclists pay all three. Moreover, they subject the roads to far less wear and tear than motorists.

  6. Sales tax is unconstitutional in Oregon. So it wouldn’t *entirely* surprise me if other excise taxes get called out on just being a sales tax.

  7. Sales tax is unconstitutional in Oregon, so no, Oregonians don’t pay sales tax in Oregon. They also don’t pay sales tax in Washington or PST in BC with Oregon ID thanks to state laws trying to encourage Oregonians to visit them on vacation.

  8. Mostly. But it also means that internet businesses based in Oregon don’t have to charge anyone anywhere sales tax. And if another state doesn’t like it, Oregon’s got their back. Oregon doesn’t want competition on who it gets to fuck over, after all (and they will, they routinely seize people’s bank accounts over taxes and charge a $30,000 fee if you want to dispute it).

  9. This is already done to gasoline in some states and a change in formulation of the excise tax has caused wild swings in revenue here in CA over the last few years.

  10. It’s worth pointing out that about a century ago, the Dutch enacted a tax on bicycles. It didn’t last long, but one of the concessions that came out of it was that the government would start building and maintaining bike infrastructure. The tax was repealed sometime in the 1920s, but the government has been building and maintaining the bikeways ever since. As noted, the tax won’t create a massive amount of revenue and there probably is more funds dedicated to biking and walking than it takes in. But, it does shut up the “bikes don’t pay their fair share” crowd and as more bikeways are built, the biking population also expands.

  11. It was actually abolished in 1941 during the war years. In France it continued until the late 1950s and in Belgium in some provinces it wasn’t abolished until 1991. In all cases lawmakers realized that the income dwarfed the expense of maintaining registration and combatting fraud.

  12. I think the most annoying thing to motorists is the steady flow of cyclists freely passing them on the right (or around them when they block passage on that side) when they’re standing in their perpetual traffic jams in dense urban areas.

  13. Yeah, in Tulsa, you’re only really having to deal with the streets for about 1-2 km before you’re on a bike boulevard, MUP or cycleway with a separate sidewalk. My commute is 17 km one way, and only about 5 is with cars, and 3 of that is due to closures on the Riverparks East Trail and Midland Valley Trail for a massive new park being built.

  14. “the income dwarfed the expense of maintaining registration and combatting [sic] fraud”

    Really? I would expect it to be the other way around.

  15. Exactly, they hate it when they aren’t moving and cyclists pass them, and also hate it when cyclists “get in their way” because they aren’t moving fast enough. Cycling is all about moving slowly but steadily, but drivers want cyclists to suffer the same stop-and-go and then get the hell out of the way when things are moving.

  16. I began my academic training at an ag & tech’ school studying fisheries and wildlife technology, and I quickly found that it wasn’t what I thought it would be as a wildlife lover. With hunters and fishermen purchasing special licenses that fund their respective programs, what we learned was to ultimately benefit the those participating in those two sports, as opposed to the animals themselves.

    My take-away was that if you want to have a say in managing wildlife, or, say transportation, you need to be part of the funding pot as a contributor. That’s why the gas tax has, in a way, proved to be so devastating to alternative transportation.

    A bike tax makes cyclists “players” in the transportation funding game.

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