Oregon Tracks Biodiesel Users

Monday, September 01, 2014

Shelby Sebens, GoLocalPDX Reporter

Tax Free Fuel

Biodiesel drivers get a free ride on taxes but the state tracks their license plates.

Drivers of biodiesel-fueled vehicles are getting a free ride on Oregon roads.

Thanks to a new state law that took effect in January, drivers who fill up with a biodiesel blend are exempt from paying the state’s 30-cents-a-gallon gas tax. The fuel mixture has to contain at least 20 percent used cooking oil.

But gas station attendants also record drivers’ license plate numbers.

The goal of the program is to generate interest and demand for cleaner fuels, but some see it as an unfair advantage for the biodiesel industry.

“We wonder when the appetite for tax subsidy will end,” Jody Wiser of Tax Fairness Oregon said in her testimony to the Oregon House Committee on Revenue last year.

And while it might be nice for diesel drivers to get a break from the gas tax, the state has already lost $245,000 in gas-tax revenue to the state highway fund since the start of the program.

when he testified before the legislature.

Proponents, however, said offering the tax exemption is good for Oregon’s economy and the environment.

“Biodiesel will benefit from it,” said Rachel Shaver, marketing manager for SeQuential-Pacific Biodiesel. “I think we’re just pleased to see continued discussion about support for cleaner burning fuels.”

Tracking Drivers

State officials said the purpose of tracking license-plate data is to ensure that only vehicles under 26,000 pounds are getting the gas-tax exemption.

“We use license plate data to verify that the vehicles fall within the exemption requirements set up by the law,” said ODOT spokesman Kevin Beckstrom. “The license plates are checked against the DMV database to determine the classification of the vehicle. The vehicle weight is the only information that we’re interested in.”

Beckstrom added the state keeps the license plate data for six years.

The state is running the program in house.

“As the program is only a few months old, it’s too early to tell what the actual costs might be,” Beckstrom said.

The exemption is set to last until 2020 and mimics similar programs in California and Rhode Island.

Shaver said demand for biodiesel has been holding steady.

“Of course we will benefit, because it is making biodiesel a little bit more accessible to people than it was before,” she added.

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