State lawmakers are looking for ways to pay for more road projects, including raising gas taxes, using state sales taxes or finding other funding.
Road funding is a frequent topic at the Statehouse, with gasoline tax collections staying stagnant and construction and repair costs increasing.
But legislators are spending more time on the issue this year, with the goal of making sure the state, counties, cities and towns have the money they need for roads, a Statehouse leader said.
“There are several ideas on the table. I’m very encouraged that many people are addressing the issue in many ways. There’s a lot more talk this year. It’s at much higher levels,” said State Sen. Luke Kenley, R-Noblesville.
Ideas include increasing the state gas tax from its current rate of 18 cents or spending more of the money collected on road work, allowing counties to collect their own local gas tax for road work, and using state sales tax money for roads, said Kenley, the chairman of the Senate Appropriations Committee.
The legislative session runs through April, and Kenley said it’s too early to tell what, if anything, will be approved this year.
“We’d like to solve these things before they become a crisis,” he said.
Collections from the gas tax, which fund road work, have been decreasing. The state collected $534 million in the gas tax in 2012, which was a 6 percent drop from $568 million in 2007, according to Indiana State Auditor annual reports.
Purdue University researchers completed a study for the Indiana Department of Transportation estimating the gas tax could drop by another $100 million by 2022 if nothing is done.
The state charges 18 cents tax per gallon, which was last raised from 15 cents in 2002, and shares 45 percent of the gas tax with counties, cities and towns.
Raising the tax again isn’t getting much consideration because lawmakers expect gas consumption to continue to drop in the future, said State Sen. Rodric Bray, who represents Union, Hensley and White River townships in Johnson County.
“Ultimately we’re going to have to look at a long-term fix as the gas tax continues to drop. People are driving fewer miles, and gas mileage is better; and that’s the reason for the hole we’ve got,” he said.
Because gas prices already are high, legislators are unlikely to increase the price even more, Bray said.
State Sen. Brent Waltz wants to allow counties to collect their own gas tax for local road funding.
A local gas tax would serve as another option instead of a wheel tax, like the one Johnson County has in place, which charges a fee every time a person registers a vehicle. Waltz, a former Johnson County Council member, voted against the wheel tax in 2003 and 2005.
“It’s a user fee more than anything else. So the more road you drive, the more gasoline you would likely use, the more tax you would pay,” he said.
Johnson County Commissioner Ron West has advocated for a local gas tax for years.
He said the wheel tax is unfair because it charges a flat rate to everyone, no matter how much they drive each year. West was the only county council member to vote against renewing the county’s wheel tax when it was renewed for another five years in 2012.
Having the tax in place has weakened the county’s voice in trying to get the state to allow a local gas tax, he said.
“Once you pass the wheel tax, then the emphasis goes away on trying to secure the gas tax. I think if we don’t have the wheel tax, then we’re going to get everyone in the cities and towns and county behind (the gas tax),” West said.
Other ideas being discussed at the Statehouse include taking a part of the 7 percent sales tax charged on gasoline sales and devoting that to roads or no longer paying for Indiana State Police and Department of Motor Vehicles expenses out of the state motor vehicle fund.
Both of those idea would mean more money would be spent from the state’s general fund, Bray said.
Another option being discussed is using money not spent from the state’s budget.
Gov. Mike Pence’s budget proposal would end 2014 with a $267 million surplus of taxes collected but not spent. Pence has proposed putting half of that surplus into road funding, Kenley said.