2013-02-05 / Front Page

Indiana Lawmakers Weighing Options To Fund Local Roads

Proposed House Bills Reallocate Gas Taxes, Include Pickup Trucks
by Michael Stanley
Staff Writer

Jim Baird (R) State Representative, District 44 Jim Baird (R) State Representative, District 44 Proposed legislation discussed Wednesday (January 30) by the House Ways & Means Committee was highlighted by a trio of bills that would, if passed, provide additional funding to counties for state and local roads and street repairs. In all, the proposals could provide as much as $400 million each year for roadway and infrastructure projects throughout the state’s 92 counties.

A local voice and member of the Ways & Means Committee, District 44 State Representative Jim Baird (R-Greencastle), shared his thoughts on Friday with the Spencer Evening World.

“In a presentation from INDOT, I picked up on the fact that the state (as a whole) consumes about 10 percent less in terms of gallon usage. Our funding is based on so many cents per gallon, which we haven’t changed since 2003, so in essence we have declining revenue,” Baird explained. “We’ve gone from $500 million to $490 million in about a 10-year period. Then you have the other factor that, along with inflation, the purchasing power of those funds is even less, which is the reason we are seeing such a decline in infrastructure because it’s all they can do to keep things going.”

Currently, a seven percent sales tax charged on fuel purchases is allocated to the state’s general fund, while the 18 cent per gallon excise tax is used to help fund the Indiana State Police and Bureau of Motor Vehicles (BMV).

As a former Putnam County Commissioner, Baird says he knows all too well the impact those funds can have on a community.

“We had about 800 miles of road (in Putnam County) and about 200 miles of those were gravel; we couldn’t find the funds to work on those. Then we had about 200 bridges because of the topography with all the streams and bridges,” he said. “So by the time you paid the employees and tried to keep the equipment functional, there wasn’t much money left to purchase road material or even contract with those contractors for the work.

“I think it’s pretty evident that we’re rapidly needing to improve infrastructure, particularly in these rural areas. Typically what happens with the federal highway funds are that the state gets 75 percent and the rest, about $225 million a year, goes to the counties, cities and towns.”

House Bill 1363, authored by Todd Hutson (R-Fishers), would remove a state requirement providing the Indiana State Police with 50-percent of appropriated funds before making allocations to counties, cities and towns and the Indiana Department of Transportation. The bill also says that gas tax, special fuel tax and motor vehicle carrier fuel tax may not be used for operating expenses of the Bureau of Motor Vehicles. If passed through the House and Senate and signed by Governor Mike Pence, the law would take effect on July 1, 2013.

“That distribution formula is complicated, but the BMV and state police receive funds and then the balance goes through the funding formula. I don’t want anybody to misinterpret this, because we’re still going to fund the BMV and ISP but it’s going to probably come out of the general fund and not the highway fund.”

A separate bill proposed by Representative Tom Saunders (R-Lewisville) would add pickup truck registration to wheel and surtax collected. House Bill 1125 requires the state auditor to distribute money to each county from local road and street funds based on the ratio of passenger cars and pickup truck registrations to the total passenger car and pickup registrations in the state.

“That’s not a new discussion, but I think it probably has less of an impact now than it did a decade or so ago because more and more people in cities and towns drive pickups,” Baird said. “I agree with it, I’m just not sure how significant of an impact it would have. With all of these bills, we’re not looking to generate new funds, but simply to move funds from one place to another. It still has an impact on bringing more money down to the local highway departments, which I definitely support.”

State Representative Ed Soliday (R-Valparaiso) has proposed House Bill 1141, which provides that 50 percent of the sales tax collected on gasoline is to be allocated, distributed, and used in the same manner as a portion of the gasoline tax, as follows: (1) 30 percent to each county, city, and town eligible to receive a distribution from the local road and street account; (2) 30 percent to each county, city, and town eligible to receive a distribution from the motor vehicle highway account; and (3) 40 percent to INDOT. The bill also specifies that the money may be used only for purposes for which money distributed from the motor vehicle highway account may be used, and provides for quarterly determinations of the amount to be distributed by the department of state revenue and for the auditor of state to make the distributions in the immediately following month.

If passed, the bill would trigger initial distributions to be made in October of 2013, based on July 2013 through September 2013 figures.

“That comes somewhere close to helping those counties and meeting about half of their needs,” Baird said. “That sales tax is $6.6 billion a year, so we’re talking about taking a portion of that and sending it down to cities, towns and counties. We don’t know how complicated it would be to digest.”

Votes on the bills by the House Ways and Means were postponed until a later date.

“These are moving through the House and committees, and that’s where the local folks have an opportunity to voice their opinion,” Baird said. “You can come and testify, you just step up and get a piece of paper and say you have something to say.”

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