Elsewhere: Salem, Oregon
Environmental Advocates Hope for Pay-As-You-Drive Road Trip
July 14th, 2008
Currently, drivers across the country are charged an insurance premium regardless of the number of miles they drive. That means that a person who drives 40,000 miles could have the same premium as a person who drives just 2,000 miles.
As part of a larger effort to reduce greenhouse gas emissions, Oregon state legislators tried to offset that disparity, creating tax incentives for insurance companies that offer "Pay-As-You-Drive" (PAYD) programs.
This option is intended to encourage drivers to rack up fewer miles by providing the incentive of lower premiums-the fewer miles driven, the lower the premium.
Several supporting studies have found that encouraging reductions in miles driven would also alleviate traffic and reduce the number of car-related accidents.
"With less driving you get a bunch of environmental and societal benefits," said Chris Hagerbaumer, deputy director of the Oregon Environmental Council, which lobbied for the bill.
The Oregon law does not compel insurance companies to offer PAYD but instead gives insurance companies a $100 tax credit for every car that is insured under the program. This lack of compulsion helped the bill pass without much opposition from insurance companies and special interest groups.
Since the structure of New York State insurance laws requires companies to take into account drivers' previous loss claims and driving history, bringing Pay-As-You-Drive to New York would pose significant problems. Only with coupled amendments to other laws would legislators be able to begin offering tax credits.
According to the Brookings Institution, a Washington-based think tank, New York would have the third largest reduction in driving if the state passed Pay-As-You-Drive, behind New Jersey and Hawaii. Driving in New York could decrease by up to 11.5 percent.
But the concept has not generated much support in the Empire State, though Assembly Member Robert Sweeney (D-Suffolk), Chair of the Assembly Environmental Conservation Committee, said he was willing to consider the proposal.
In April, the Assembly passed a bill he introduced which would authorize the Department of Environmental Conservation to set limits on greenhouse gas emissions. If signed into law, the new standards would require reductions of 2.3 percent each year starting in 2015, toward a goal of an 80-percent reduction by 2050.
Sweeney, the bill's chief sponsor, said Pay-As-You-Drive was piecemeal pollution reform, as opposed to his legislation, which he claimed would "try to reduce greenhouse gases across the board."
State Sen. Carl Marcellino (R-Nassau/Suffolk), chair of the Senate Environmental Conservation Committee, has a companion bill that, in addition to the reduction requirement, creates a task force to study the damage of global warming and to propose solutions. That bill has not been moved out of committee.
That leaves New York without a Pay-As-You-Drive law, which to those who call the bill a success in Oregon comes as a surprise.
"I don't know why other states haven't taken this up, as it's a great idea, especially with rising oil prices," said Oregon State Representative Jackie Dingfelder (D), the chief sponsor of Pay-As-You-Drive. "The key is getting the word out so folks know it's available."
As part of a larger effort to reduce greenhouse gas emissions, Oregon state legislators tried to offset that disparity, creating tax incentives for insurance companies that offer "Pay-As-You-Drive" (PAYD) programs.
This option is intended to encourage drivers to rack up fewer miles by providing the incentive of lower premiums-the fewer miles driven, the lower the premium.
Several supporting studies have found that encouraging reductions in miles driven would also alleviate traffic and reduce the number of car-related accidents.
"With less driving you get a bunch of environmental and societal benefits," said Chris Hagerbaumer, deputy director of the Oregon Environmental Council, which lobbied for the bill.
The Oregon law does not compel insurance companies to offer PAYD but instead gives insurance companies a $100 tax credit for every car that is insured under the program. This lack of compulsion helped the bill pass without much opposition from insurance companies and special interest groups.
Since the structure of New York State insurance laws requires companies to take into account drivers' previous loss claims and driving history, bringing Pay-As-You-Drive to New York would pose significant problems. Only with coupled amendments to other laws would legislators be able to begin offering tax credits.
According to the Brookings Institution, a Washington-based think tank, New York would have the third largest reduction in driving if the state passed Pay-As-You-Drive, behind New Jersey and Hawaii. Driving in New York could decrease by up to 11.5 percent.
But the concept has not generated much support in the Empire State, though Assembly Member Robert Sweeney (D-Suffolk), Chair of the Assembly Environmental Conservation Committee, said he was willing to consider the proposal.
In April, the Assembly passed a bill he introduced which would authorize the Department of Environmental Conservation to set limits on greenhouse gas emissions. If signed into law, the new standards would require reductions of 2.3 percent each year starting in 2015, toward a goal of an 80-percent reduction by 2050.
Sweeney, the bill's chief sponsor, said Pay-As-You-Drive was piecemeal pollution reform, as opposed to his legislation, which he claimed would "try to reduce greenhouse gases across the board."
State Sen. Carl Marcellino (R-Nassau/Suffolk), chair of the Senate Environmental Conservation Committee, has a companion bill that, in addition to the reduction requirement, creates a task force to study the damage of global warming and to propose solutions. That bill has not been moved out of committee.
That leaves New York without a Pay-As-You-Drive law, which to those who call the bill a success in Oregon comes as a surprise.
"I don't know why other states haven't taken this up, as it's a great idea, especially with rising oil prices," said Oregon State Representative Jackie Dingfelder (D), the chief sponsor of Pay-As-You-Drive. "The key is getting the word out so folks know it's available."
