Indiana plans to pay for state, local roads advance

By Keith Goble, Land Line state legislative editor | 1/26/2016

The pursuit of funds at the Indiana statehouse to pay for improvements to roads and bridges is moving forward.

A report commissioned by the state found that lawmakers need to approve about $1.5 billion annually to keep the state’s existing infrastructure in “good or fair” condition. The state now spends less than half that amount per year.

The Senate voted 49-1 to advance a bill to return $430 million to local governments.

Sponsored by Sen. Brandt Hershman, R-Buck Creek, the bill would provide a one-time allotment to aid counties, cities and towns via a reserve balance from local income tax revenues.

Specifically, about $171 million would go to counties, and $246 million would be made available to cities and towns. Localities would be required to direct at least 75 percent of the funds toward local road and bridge needs or a rainy day fund. The remaining 25 percent could be used at the localities’ discretion.

Hershman said the bill, SB67, would immediately provide resources to make improvements to local infrastructure, which local governments have identified as a top priority.

“This plan provides $430 million in road funding now, without tapping into Indiana’s budget reserves, raising taxes, or creating debt,” Hershman said in prepared remarks. He added that the bill is designed to provide a bridge as legislators continue to debate a long-term solution for transportation funding.

Sen. Tim Lanane, D-Anderson, said he is “relieved” that Republican leaders at the statehouse are working to resolve the state’s transportation funding problems. However, he said the House-approved plan is likely a “mirage.”

“Sadly it won’t solve our state’s long-term infrastructure needs,” Lanane stated. “Hoosiers are not looking for Band-Aids, they are looking for a long-term solution and this is not that.”

Republican Gov. Mike Pence has endorsed SB67, as well as a separate Senate bill to reroute more than $240 million from the state’s reserve fund for transportation as long as the amount available at the end of the state fiscal year is more than 11.5 percent. The surplus state revenue now is earmarked for automatic taxpayer refunds.

Also included in the bill from Sen. Carlin Yoder, R-Middlebury, is $240 million in borrowing and $450 million in budget appropriations for roads and bridges through 2021.

Yoder said the bill, SB333, buys the state time to work out a deal for long-term transportation funding. The bill awaits a Senate floor vote.

Hershman’s bill awaits further consideration in the House, where Republicans are calling for a long-term solution to transportation funding needs.

The House Roads and Transportation Committee voted to advance a bill that includes fuel tax increases and the possibility of tolls.

Sponsored by Rep. Ed Soliday, R-Valparaiso, the bill would raise the 18-cent-per-gallon gas tax and the 16-cent-per-gallon diesel tax by 4 cents and index the taxes to inflation.

HB1001 would also greenlight the state to seek a federal waiver to toll lanes on Interstates 65, 70 and 80/94.

Currently, the only toll road in the state is Interstate 80/90. Indiana also plans to charge users to the I-65 bridge over the Ohio River into Kentucky.

The bill also calls for reducing local income tax revenue held by the state, but unlike SB67 the excess would not be limited to use only for roads and bridges.

Soliday’s bill now moves to the House Ways and Means Committee before it can be sent to the full House for a vote.

To view other legislative activities of interest for Indiana, click here.

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