Alternative-Fuel Car Subsidies to Be Cut

The Arizona Legislature has approved dramatically reducing state subsidies for alternative-fuel vehicles that threatened to use up more than a tenth of the state’s $6-billion annual budget. Supporters said the bill would slash the subsidy program from $682.5 million to $200 million and apply to 4,000 to 6,000 vehicles. Gov. Jane Dee Hull, who called a special session in Phoenix to curtail the program. When lawmakers voted in April to make an existing but sluggish subsidy program more generous, they figured it would cost the state an additional $3 million to $10 million. But as word of the changes got out, thousands of Arizonans poured into dealerships and conversion shops to take advantage of the subsidies. More than 15,000 additional buyers initially were in line for the program, which provided an average of $20,000 in state subsidies and tax savings to purchasers of new cars fitted to use cleaner fuels.