State Sen. Omar Fateh, DFL-Minneapolis, rides an e-bike through Powderhorn Park. Fateh, author of the e-bike rebate bill, says he felt “like a kid” riding an e-bike for the first time, and wants to make changes to the e-bike rebate bill pending the outcome of the November election and the state budget forecast. Photo by H. Jiahong Pan/Minnesota Reformer.
More than half of the people who received an e-bike tax rebate are tax filers with more than $100,000 in income, according to data from the state Department of Revenue, obtained by the Reformer through a public records request.
Meanwhile, just under 37% of the roughly 1,500 Minnesotans who received an e-bike tax rebate are low income, falling just short of the law’s 40% mandate, which was intended to give working people a chance at the ascendant transportation option.
The rebate, passed by the Legislature as part of the 2023 transportation package, grants e-bike purchasers a discount of between 50 and 75% of the value of an e-bike, up to $1,500.
The Legislature, which appropriated $2 million this and next year for the rebates, also mandated 40% of the rebate certificates available be set aside for people earning less than $41,000 annually, or $78,000 adjusted gross income if filing jointly.
The high-income tilt of the rebate has prompted calls for reform, including from the rebate’s bill author, state Sen. Omar Fateh, DFL-Minneapolis.
The rebate rollout was also a mess.
Applications initially opened one late June morning, with 75 people — 11 of them from rural parts of the state; another 18 of them earning less than $41,000 last year — completing an application before the website crashed.
After fixes, the application reopened one late July morning, with over 14,000 people applying in a 20-minute window. Revenue awarded 1,170 of them a rebate, including the 75 who applied in June, while placing an additional 3,829 people on a waitlist. In October, Revenue granted 349 of waitlisted applicants a rebate.
Cycling advocates such as the Bicycle Alliance of Minnesota are calling for more money for the program, as well as changes to better serve low-income people.
“It’s estimated that 1% of the state’s population was online at the same time trying to get those rebates. When you’re doing a first-come, first-serve online in the middle of a workday, it’s not going to be equitable,” said Michael Wojcik, executive director of Bicycle Alliance of Minnesota.
Fateh, who recently declared his campaign for Minneapolis mayor, rode an e-bike for the first time during a group ride in Minneapolis in late September. He said he wants to ensure the program has more funding and serves low-income people. The changes, he acknowledged, would be contingent on the November election results and the state’s annual economic forecast.
Neither bodes well for e-bike rebate champions. The 67-67 evenly divided Minnesota House gives Republicans virtual veto power over programs they don’t like, e-bike rebates among them. And, the state’s budget forecast shows a rapid decline in surplus, quickly becoming a deficit in the billions in future budget years.
E-bikes have grown in popularity in recent years: Lots of new, affordable models with more powerful batteries that can go longer distances have come on the market.
Ash Tifa, a Minneapolis resident and e-bike rebate recipient who recently lost her job, uses her e-bike as an alternative to buying a car that would be expensive to buy and maintain.
“The ability to have cargo space so we can more easily do grocery runs, and just lowering the reliance on having to borrow cars, it’s a no brainer. It makes our life so much more accessible,” Tifa said, adding she does not believe the e-bike rebate program should be first come, first serve.
Edina and the state of Colorado have also deployed similar rebate programs. In each case, program administrators have had to suspend their programs at times because of their popularity and attendant lack of funding. Colorado has since allocated more money to its rebate; e-bike purchasers can also receive a discount the moment they buy one. Meanwhile, cities have retooled their zoning codes and considered secure storage options to accommodate the influx of e-bikes.
Minnesota Revenue anticipates reopening rebate applications next year, though they did not specify when. Revenue also advises those with rebates to use it soon, as they can expire.
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