2016-01-26 / Front Page

Discussion On Options To Increase Road Funding Dominates Recent Legislative Breakfast In Spencer

by Michael Stanley
Staff Writer


Indiana District 39 State Senator Eric Bassler (left) addresses a crowd gathered for the first Owen County Legislative Breakfast of 2016, as District 46 State Representative Bob Heaton looks on. (Staff Photo) Indiana District 39 State Senator Eric Bassler (left) addresses a crowd gathered for the first Owen County Legislative Breakfast of 2016, as District 46 State Representative Bob Heaton looks on. (Staff Photo) Indiana District 46 State Representative Bob Heaton (R-Terre Haute) and District 39 State Senator Eric Bassler (R-Washington) were in attendance for the season’s first Legislative Breakfast event, held January 16 at the Owen Valley Christian Fellowship, southeast of Spencer.

Organized by the Owen County Chamber of Commerce and sponsored by the Bloomington Board of REALTORS®, much of morning’s 90-minute discussion was devoted to various bills currently proposed to address the need for additional road funding at the county and town levels.

There are currently two options to address local road funding, including Senate Bill 67, authored by Senator Brand Hershman, which would immediately provide $430 million to local governments for road and bridge improvements across the state. The bill passed the Senate by a vote of 49-1 on January 19th.

Under current law, the state distributes local income tax revenues to the appropriate local units of government after processing Hoosiers’ tax returns to determine how much funding each locality should receive. Over time, excess balances in local governments’ accounts have accumulated to a statewide average of 25 percent of annual receipts, which led Hershman to conclude that it is reasonable to make a one-time distribution of much of the current excess balance immediately.

Senate Bill 67 would provide an immediate distribution of approximately $430 million for local governments, and require that localities direct a minimum of 75 percent of the funds toward local road and bridge needs or placed in a rainy day fund. The remaining 25 percent could be used at the localities’ discretion.

The legislation has the support of Governor Mike Pence, who, like Republican leaders in the General Assembly, has made road funding a top priority for the 2016 session of the General Assembly.

SB 67, an item on the Senate Republicans’ 2016 Legislative Agenda, now moves to the House of Representatives for further consideration.

The second bill, House Bill 1001 authored by Representative Ed Soliday (R-Indianapolis), also aims to create a long-term solution to Indiana’s insufficient funding for building and repairing roads and bridge. It would tap excess reserves, redirect gas sales tax to roads and bridges, index fuel taxes to match inflation, and establish local option taxes such as income taxes and wheel taxes and matching grants. The bill would also free up general fund money for transportation needs by increasing the state tax on a pack of cigarettes by $1 to create new revenue for Medicaid.

Governor Pence and Democrats agree in their opposition to HB 1001. Democrats at the Statehouse believe that taxes should not be raised when the state has $2 billion in reserves. Pence said in his recent State of the State address that “the last place you should look to pay for roads and bridges is the wallets and the pocketbooks of hardworking Hoosiers.”

“The one on the Senate side provides about $400 million, with stipulation that 75 percent of those dollars be used for roads, bridges and infrastructure. The other 25 percent can go into the rainy day fund,” Bassler said. “That’s sort of a short-term fix to road funding. On the House side, they’re looking at what they are hoping is more of a long-term solution to road funding. They’re looking at a gas tax within the index of inflation, the possibility of toll roads for I-65 and I-70 and some type of annual fee for electric cars.”

Heaton said it’s still too early in the session to speculate how the General Assembly will address the issue in 2016.

“It’s still in the process, as far as the governor has his plan, the House GOP has their plan, the Senate Republicans have theirs and of course the Democrats in both houses. We haven’t voted on anything, so there are still discussions going on,” Heaton said of the road funding debate. “It will be one of the big decisions of the whole session and we should know something in the next two weeks as far as where we are with the final version to come out of the House.”

Bassler said he believes the legislature will likely not reach a long-term solution for road funding until the long session in 2017, which will largely be devoted to the state’s biennial budget.

“I’m fine with the Senate bill, but it doesn’t fix the long-term problem. The problem with the gas tax is two fold; before we put our hands out to get more money from taxpayers, we have to show them we’ve done everything we can to ring out any waste in state and local government inefficiencies, and I just can’t say that we’ve done that yet. So it’s hard for me to go back to the taxpayers and say, ‘Well, there is this waste and that inefficiency, but by golly, give us some more money,” Bassler said. “Anther challenge is you can pick a number, five, 10 or 50 cents a gallon, it’s still not solving the long-term problem, because cars are going to continue to get more fuel efficient.”

Poland resident Barron Barnett touched on the proposed tax for electric cars and said as soon as government begins taxing any type of improvement to technology, the environment or anything else, the result stifles progress.

“The point is, the more (tax) you apply, the more damage it does and it doesn’t solve the shortterm fix, it just looks like it does. It’s the long haul that I think some of the people are more interested in, rather than a short-term fix,” he noted.

Commissioner Tony Voelker touched on state discretionary funding to Indiana’s various colleges and universities.

“To me, government ought to be about three primary issues; infrastructure, safety and security. Those should be our three priorities,” Voelker said. “I’m not anti-education, I love all of the different charities and organizations we help, but we still have priorities. If we have to divert some money from some of those other institutions, especially those with million dollar foundations, to repair our roads for the long-term, I think that’s important for us. Good roads and infrastructure helps economic development, no matter where we’re at and that increases the tax base, without increasing the tax rate. It’s just imperative to us, I think, to pull out all the stops and do everything we can to put money into our rural communities for roads.”

Local constituents will have another face-to-face opportunity to meet with state lawmakers on Saturday, February 20 when the Owen County Chamber of Commerce and Economic Development Corporation plays host to the season’s second “Legislative Breakfast,” beginning at 7:30 a.m. at the Owen Valley Christian Fellowship, 338 State Road 43 South. All Indiana senators and congressional representatives representing any portion of Owen County have been invited to attend.

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