Struggling to make your car payment?
Take solace in knowing your annual $20 smog abatement fee is hard at work helping those who earn $150,000 and more to buy electric cars.
State of California data show those who typically receive the $1,000 state rebate on top of the $7,500 federal tax credit when they buy an electric car make 2.5 times the median household income in California.
In other words, they can afford to buy the cars without the government transferring money from your pocket into their pockets.
It gets worse.
•The most popular cars being bought with the rebate are Tesla vehicles that run between $70,000 and $100,000.
•Everyone pays a $20 annual smog abatement fee for the first six years they register their vehicles. That means $120 out of your pocket is going to the folks who zip by you in a sleek Telsa.
•The state survey shows many of those taking advantage of the rebate already own an electric car.
•California awarded Telsa a $10 million grant that isn’t a loan that has to be repaid to develop a SUV.
•Some 80 percent of the rebates go to the wealthy in the Bay Area, Los Angeles, and Orange County.
•The rebate demand is so big the state has run out of money. Instead of stopping it as they do with other rebates such as for working class families retrofitting homes to reduce energy consumption , the state has come up with more funds. The additional $45 million for this year alone included a $20 million “loan” from the Vehicle Inspection and Repair Fund. That’s the one funded by another smog check fee to address air pollution issues related to older cars that don’t pass smog checks that are owned primarily by low income people. To pay for the additional rebates, the legislature has extended the smog fee to 2024. It was due to lapse in 2016.
It gets better.
Sensible bureaucrats and budget analysts suggested the rebate program be tailored to geography and income. That way those who made less money and lived in areas that have severe air quality containment issues such as the San Joaquin Valley would get a larger rebate. As such, they might be tempted to buy one of the lower priced electric cars that are still out of a typical valley family’s income reach.
But the California Legislature would hear none of that.
It gets better.
Morgan Stanley reported in April that Tesla made $40.5 million thanks to tax credits for buyers in 2012. The financial analyst firm projected Telsa could collect $250 million in tax credits this year. Telsa’s filings with the Securities Exchange Commission show that without $85 million in tax credits in the first quarter it would not have made a profit. In addition, California’s controversial greenhouse credit market had polluters paying Telsa some $68 million in the first quarter.
When all is said and done, the Los Angeles Times noted that the state greenhouse credits plus federal tax credits and local rebates by various states can generate $45,000 per Telsa sold.
That means that $70,000 Telsa passing you as you commute to work is financed by $45,000 that comes out of the pocket of Californians in one way or another.
And don’t forget besides the $10 million California Energy Commission grant, Telsa received a $465 million loan guarantee from the federal government in 2009.
Robin Hood is so passé. Our state and federal government has made stealing from the poor to subsidize the rich a high art form.
It’s all being done in the name of clean air as they clean out our pockets.