There seem to be two speeds at which the NJ Legislature acts: Snail pace for legislation that actually is good for the state, such as our Electric School Bus Law that took four years to crawl through the process (plus another year to actually fund it); and lightning speed for special interest legislation that the political establishment doesn’t want you to know about. These latter bills get introduced without any advance notice, are quickly shepherded through Assembly and Senate committees, and then are voted on and signed in a matter of two months.
Examples of such bills include the Paul Fireman–backed Liberty State Park Conservation, Recreation, and Community Inclusion Act, the bill gutting the Open Public Records Act, and a recent bill (signed March 26) to overhaul the way the Transportation Trust Fund is managed. This included a new registration fee that will tack over $1,000 onto the cost of electric vehicles purchased in New Jersey.
Despite lots of press to the contrary, electric car sales are growing exponentially in New Jersey. Year-over-year sales of light duty (passenger cars) and medium/heavy duty vans and trucks increased 130% from 2022 to 2023. New Jersey added 62,638 plug-in electric vehicles (PEVs) in 2023 compared with 27,208 in 2022 (this number includes plug-in hybrids), and as of December 31, 2023, there were 154,153 PEVs registered in New Jersey. EV sales in 2023 represented 14% of total car and light truck sales in the state, double the percentage from 2022.
So, instead of maintaining the incentives that have helped push electric vehicle sales to all-time highs, the state is imposing major new costs on potential EV buyers that are likely to impede sales.
These include:
· Gov. Murphy’s budget eliminates the sales tax exemption over three years, a savings worth between $2,000 to $3,300 on new car sales between $30,000 to 50,000.
· The state keeps underbudgeting for the EV incentive program (worth $4,000 per car). Available money for this program ran out five months into the fiscal year in 2023, compared to nine months in 2022.
· The Transportation Trust Fund bill mentioned above included a new annual “registration fee” for EVs of $250, rising to $290 in five years. However, the kicker is that EV owners will have to pay four years’ worth of fees up front when they purchase a new vehicle, adding $1,060 to the cost of a new EV. This is supposed to make up for the fact that EVs don’t pay gasoline taxes that fund the Transportation Trust Fund. In contrast, the registration fee for a regular internal combustion car is $59. (The NJ Chapter is lobbying to replace this “registration fee” with a small per kWh surcharge on electricity dispensed at the EV charging station.)
In total, it may cost an additional $8,000 to purchase a new EV in New Jersey. The NJ Chapter is actively lobbying to restore the sales tax exemption, ensure enough money is budgeted for a full year of EV incentives, and minimize discriminatory “road use” fees imposed on EV owners.