House and Senate Democrats are hurtling toward an intraparty clash on one of the most contentious provisions of the new surface transportation bill: a fee on electric and hybrid vehicles.
The House Transportation and Infrastructure Committee unveiled its long-awaited transportation bill, also known as the highway bill, on Sunday. The legislation from Chair Sam Graves (R-Mo.) and ranking member Rick Larsen (D-Wash.) contains provisions on permitting reform and it repeals some Biden-era environmental initiatives.
But a disagreement over the proposed EV and hybrid fees is now poised to pit Larsen against his Senate counterparts, potentially undermining part of the Democratic negotiating position for one of Congress’ biggest legislative priorities this session.
Larsen is supporting the new road-user fees on EV and hybrid drivers that Graves worked to include in the bipartisan bill. Those drivers contribute far less to the Highway Trust Fund than gas vehicle drivers do because they pay less — or nothing at all — in federal gasoline taxes.
Across the Capitol, Senate Democrats led by Environment and Public Works ranking member Sheldon Whitehouse (D-R.I.) and Finance ranking member Ron Wyden (D-Ore.), are dead set against the fee. They are some of Congress’ most outspoken climate hawks, and they have aligned themselves with environmental groups assailing any new policies that could slow down adoption of lower-emission vehicles.
“This is another right-wing ideological trophy. They just don’t want to have renewable energy in the future, and they think these ideas up pretty regularly,” Wyden said of Graves’ proposed fees in the transportation bill.
“As far as I’m concerned,” Wyden said, “this is off the table.”
The Democratic discord comes at a crucial moment. The T&I Committee will mark up its legislation as soon as this week, as gasoline prices continue to set multiyear records and as Congress debates the merits of suspending the federal gas tax. At the same time, the American EV industry is facing major headwinds, partly at the hands of Republican policies that have cut off incentives.
The fees are one of several points of disagreement among lawmakers that could delay action on a compromise highway bill later this year. Current transportation and infrastructure program authorizations expire in September, and many members and outside observers expect that Congress will need additional time to craft a final, bipartisan bill.
Lawmakers, advocates and lobbyists have been arguing for or against new vehicle fees since Republicans included a $250 fee for EVs and a $100 fee for hybrids in an early version of what became the One Big Beautiful Bill Act. The provision was later removed due to concerns about implementation.
Now, Graves and Larsen are moving ahead with a $130 fee on EVs and a $35 fee on plug-in hybrids, placing no new fees on conventional hybrids. The Federal Highway Administration would be authorized to gradually increase the fees to up to $150 and $50, respectively. Twenty percent of the fee revenues would go toward the Department of Transportation’s mass transit account, Larsen said.
The Washington state Democrat is backing the proposal because he supports having all users of federal roads contribute to their maintenance, regardless of the kind of car they drive. The need to shore up the beleaguered Highway Trust Fund is secondary to him, he said.
“I came in in 2001 supporting the user-pays principle, and it’s 2026, and I haven’t changed my view of that,” Larsen said. He noted that past Democratic leaders of the T&I Committee have also aligned themselves with that principle.
The Senate Environment and Public Works Committee could release its own version of the transportation authorization bill later this spring or summer. The Senate Finance; Senate Commerce, Science and Transportation; and House Energy and Commerce committees also have jurisdiction over various parts of the legislation.
‘They should help pay’
Whitehouse, who is playing a leading role in crafting the upper chamber’s transportation bill, recently criticized the proposed fee structure as little more than a ploy by oil companies and their lobbyists to further suppress the EV industry.
“Fossil-fuel-backed Republicans are hell-bent on keeping Americans chained to the gas pump even as [President Donald] Trump’s war sends gas prices skyrocketing,” Whitehouse said in a statement before the House’s bill was released. “Slapping a fee on electric vehicles isn’t a solution for the Highway Trust Fund.”
Asked about Whitehouse and Wyden’s opposition last week, Larsen took a defiant tone, emphasizing that he and Graves are finalizing their bill and senators are working on their own version.
“I have nothing to say to them about that,” Larsen said. “I’m not in charge of that.”
Critics of the proposal have noted that potential revenues from EV and hybrid fees would do little to offset the Highway Trust Fund’s deficit, especially as EV uptake has slowed in recent months. Some EV advocates have assailed the proposal as unfair and instead called for a uniform fee or tax for all drivers regardless of fuel type.
Earlier this month, seven environmental groups including Earthjustice Action and the League of Conservation Voters fired off a letter to Graves and Larsen urging them to reconsider their fee plan. They framed it as a penalty on drivers who have decided to switch away from gasoline amid rising prices.
Last week, a trio of Republican senators in favor of the fee structure got into the mix with their own letter to Whitehouse, Wyden, Environment and Public Works Chair Shelley Moore Capito (R-W.Va.) and Finance Chair Mike Crapo (R-Idaho), all of whom will play a role in the bill’s development.
The letter, first reported by POLITICO, called for the imposition of the proposed fees as a matter of fairness. It was signed by Sens. Deb Fischer (R-Neb.), Kevin Cramer (R-N.D.) and Susan Collins (R-Maine).
“We gotta take a look at that,” Capito said last week about the fee idea. “They use the roads; they should help pay.”
What’s in the bill
The House’s transportation bill would authorize about $580 billion in total spending. Graves had said he wanted a “traditional” transportation bill focused on roads and bridges and not on other Biden-era priorities. In many ways he succeeded.
The scope and price tag of the legislation are just a fraction of those of the last iteration, which became the Infrastructure Investment and Jobs Act of 2021. The bill also repeals authorizations for a number of climate or pollution-related programs, such as the Carbon Reduction; Reduction of Truck Emissions at Port Facilities; and Healthy Streets programs.
Larsen was able to secure authorizations for a number of Democratic priorities such as public transit, micromobility, wildlife crossings and urban infrastructure development, even if some of those programs have been revised or scaled down.
The duo scored myriad bipartisan wins throughout the bill, including a host of provisions aimed at streamlining the environmental review process for transportation and infrastructure projects. There is also language on disaster recovery, rail safety reforms, autonomous vehicle regulations and a new focus on improving bridge conditions.
