[Congressional Record (Bound Edition), Volume 145 (1999), Part 3]
[Extensions of Remarks]
[Page 4472]
[From the U.S. Government Publishing Office, www.gpo.gov]




              ELECTRIC VEHICLE CONSUMER INCENTIVE TAX ACT

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                            HON. MAC COLLINS

                               of georgia

                    in the house of representatives

                         Monday, March 15, 1999

  Mr. COLLINS. Mr. Speaker, I rise today to introduce the Electric 
Vehicle Consumer Incentive Tax Act ``EVCITA'' of 1999. This legislation 
provides important tax incentives for electric vehicles. It is 
important because the widespread use of electric vehicles can result in 
significant environmental, energy security, and economic development 
opportunities in the United States.


     How Can Electric Vehicles Tax Incentives Benefit the Economy?

  Each major automobile manufacturer, domestic and foreign, has, or 
plans to offer, electric vehicles for sale or lease. As in the case 
with any new, advanced technology that is initially offered to 
consumers, the price of these early vehicles is significantly higher 
than the expected lower price for EVs when greater volumes are 
achieved. The government can play a role in making these vehicles more 
affordable by reducing the tax costs. Doing so can help increase 
consumer access and stimulate rapid growth of the industry.


  Why Are Environmentalists and State/Local Governments Interested in 
                           Electric Vehicles?

  Many metropolitan areas in the United States suffer from poor air 
quality and are falling under the definition of ``non-attainment 
zones.'' The use of electric vehicles, especially in these areas, could 
provide an effective means to reduce transportation-related pollution. 
Electric vehicles emit no hydrocarbons, volatile organic compounds, 
carbon monoxide or nitrogen oxides.


        Why Are Electric Vehicles Important to Energy Security?

  According to the Department of Energy, U.S. net imports of petroleum 
in the year 2000 are forecast to account for 52 percent of total U.S. 
petroleum demand, up from an estimated 50 percent in 1998. Making 
alternative fuel vehicles a more affordable option ensures lower 
dependency on foreign supply.


                     How the Legislation Would Work

  One key to weaning the country off of imported oil and into 
alternative fuel vehicles, like electric cars and buses, is bringing 
down the high initial purchase price of the vehicles and assuring that 
targeted, early markets are better able to take the steps necessary to 
purchase the vehicles. The provisions included in the EV Consumer 
Incentive Tax Act of 1999 are intended to do just that. The tax 
incentives included in EVCITA will make early EVs and electric buses 
more affordable to consumers, and will allow an important market 
segment--governments, universities and other non-taxpaying fleets--to 
take advantage of the savings provided through the federal tax 
incentive.


               Tax Equity for Oversized Electric Vehicles

  Under current law, electric powered buses are allowed to only take 
advantage of the existing $4,000 tax credit for electric vehicles while 
all other alternatively fueled buses are eligible for a $50,000 tax 
deduction. EVCITA equalizes the tax treatment by allowing oversized 
electric vehicles the same benefit provided oversized clean-fuel 
vehicles. Electric buses can be used by many urban transit authorities. 
According to the Electric Transit Vehicle Institute, there are 179 
electric buses in operation throughout the United States as of 
December, 1998.


       Maximizing the Benefit of the Electric Vehicle Tax Credit

  Current law provides a tax credit of the lesser of 10% or $4,000 
against the cost of a standard-size electric vehicle. This provision 
expires December 31, 2004. The investment value of this credit has 
eroded since its enactment in 1992. EVCITA will restore the value of 
the credit by making the benefit a flat $4,000 against the cost of the 
vehicle. In addition, this legislation will extend the credit through 
December 31, 2008.


  Providing Federal and Local Governments the Benefit of Reduced Costs

  Current law prohibits the use of tax credits for electric vehicles 
used by a federal, state or local government entity. Across the 
country, local municipalities are leading the charge in reducing 
environmental costs by putting electric vehicles into service. In 
instances where local governments lease electric vehicles, EVCITA will 
permit the owner of the vehicle to be eligible for the tax benefit.


                              Endorsements

  The provisions of this legislation have been endorsed by the 
following organizations: Union of Concerned Scientists, Coalition for 
Clean Air, American Methanol Institute, the Georgia Conservancy, the 
Edison Electric Institute, the Electric Transportation Coalition, Clean 
Cities--Atlanta, the Southern Coalition for Advanced Transportation, 
Georgia Power, and the Clean Air Campaign.
  The provisions of the EV Consumer Incentive Act of 1999 are 
comparatively modest in cost. According to the Joint Tax Committee 
estimate provided in 1998, the cost associated with the provisions of 
the EV Consumer Incentive Tax Act between FY 1999-2002 was $44 million. 
These tax incentives will help ensure that electric vehicles are a 
viable transportation option for consumers.

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