Oregon Bicyclists Could Pay Tax To Fund Bike Path Improvements

May 29, 2017

A proposed $8 billion transportation spending package in Oregon could include a tax on the sale of bicycles. It's a funding idea that's often talked about but has rarely been implemented nationwide.

Brad Welch works as an IT manager in Eugene. He's been commuting to work by bicycle for more than 30 years, rain or shine.

"It's a way to wake you up in the morning, and kind of wind down after work when you leave,” said Welch. “Then when you go out recreationally, then you can enjoy the country.”

Welch stopped in at Hutch's Bicycles in downtown Eugene for a quick fix of his brake handles. He says he wouldn't mind it if the state taxes bicycle sales, since the money would be used to improve the ride for bike commuters like him.

"Everybody winces when they have to pay a little bit more, but overall if I know it's going to a good cause, I'd certainly be willing to do it,” he said.

The bike tax is still being debated at the state capitol, but the current proposal would tack on anywhere from three to five percent to the cost of a new bike. Under the current version of the plan, the tax would only apply to adult bikes that cost more than $500.

The funding idea was the talk of the morning back in the repair shop at Hutch's. Mark Lipchick is a mechanic who also builds custom wheels for high-performance models.

"It's gonna hurt bike shops sales. It's gonna put businesses out of business that are mom and pop bicycle shops,” said Lipchick. “A lot of people are going to be out of work, as a result. It's really kind of silly.”

But Lipchick's colleague, Cary Adams, says he can see the need for better bike routes, even in a bike-friendly city like Eugene.

"Overall I think it's not a bad thing,” said Adams.

Around the corner at Wheelworks Bicycle Shop, owner Bill Cole pulls out a calculator to figure out roughly how much his shop would pay the state each year.

“So you're looking at probably $18,000, [which] we would pass on to the consumer,” hew said.

Still, Cole says as a bike shop owner, he can see the benefit to giving potential customers more places to use the product he's selling. He's just not sure he trusts lawmakers to follow through.

"The idea of having money going directly to support bicycling I think is a good idea. But once a tax gets started, it never stops. And it only increases,” said Cole.

At the capitol, Gerik Kransky is a lobbyist with The Street Trust, which until recently was called the Bicycle Transportation Alliance. His group is opposed to the bike tax.

"We feel it's not an effective way to raise revenue,” said Kransky. “There’s not a lot of money in the bike industry and so we won't be able to generate the kind of dollars from a bicycle excise tax that would really have an impact on building new transportation infrastructure.”

But, if it does happen, Kransky says he wants to make sure the money is spent on the promised upgrades to bike routes. And he says the group might end up supporting the transportation package as a whole, especially if it includes funding for public transportation upgrades and safety improvements for pedestrians.

Democratic Senator Lee Beyer helped craft the bike tax proposal. He says it came in response to a common refrain among lawmakers and the public.

"They felt that bicycles ought to contribute to the system, bicycle owners ought to contribute to the system, irrespective of the fact that most of them also own a car,” he said.

As for the cost, Beyer says the tax needs to be large enough to generate significant revenue above the cost of collecting it. But he says the fact that it's in there at all means bike riders are now among the state's transportation priorities.

"There's a pretty big commitment to bicycle commuters in the [bill], and to the extent we do that, there are certain environmental advantages to do that, and it does address congestion to some extent as well.”

If it passes, Oregon would be the only state with a statewide tax specifically for bicycles, though it's been proposed in many places. Some cities around the country do charge bicycle owners a registration fee.