Rep. Jim Pressel, R-Rolling Prairie, (second from left) explained his amendment to House Bill 1461 in the House Roads and Transportation Committee Monday at the Statehouse. (IBJ Photo / Cate Charron)
Indiana lawmakers advanced road-funding legislation Monday morning without a provision that would have allowed Indianapolis to pose a referendum to its residents to pay for road improvements.
Dan Parker, chief of staff for Indianapolis Mayor Joe Hogsett, told the committee during the bill’s first hearing on Jan. 27 that the measure would be “an interesting new tool” but did not say whether it would be used.
The bill attempts to address road-funding disparities through a range of funding mechanisms that put the onus on local governments to get creative. The amended bill includes an increase to the maximum rate for county wheel and vehicle excise tax and required county bonding abilities. The bill also includes new requirements for the Community Crossings Fund and surplus fund transfers.
Rep. Jim Pressel, R-Rolling Prairie, said his House Bill 1461 was a “plate full” of local government road- funding options that needed refinement. He said the bill is still a work in progress.
“Here’s 37 pages of things that may be a good idea, some things I really like and some things that probably need to go,” he said. “And that’s what amendment No. 11 is going to do.”
Pressel on Monday amended the bill to remove the Marion County property-tax funding language. He also deleted an option to tax food-delivery transactions and a prohibition on the Indiana Economic Development Corp. from providing incentives without funding for nearby roads.
The amended bill unanimously passed the House Roads and Transportation Committee, which Pressel chairs, and moved to the House Ways and Means Committee for consideration.
“The City appreciates the work of Chairman Jim Pressel and the House Roads and Transportation Committee have done to address the longstanding issue of underfunded local roads,” the Mayor’s Office said in an email to IBJ. “The City is disappointed to see that the referendum language was removed from HB 1416 but views this bill as a work in progress and will continue to engage with the legislature on the issue of road funding.”
Indianapolis leaders more so want a change to the road-funding formula, which neither the original nor amended bill makes. The state’s road-funding formula has long been criticized for being based on road miles rather than lane miles, which has been called an unsustainable funding model for Indianapolis.
The estimated price tag to improve Indiana roads and eliminate categorically poor roads could reach up to $1.9 billion, according to an August report from Purdue University’s Local Technical Assistance Program. That body estimated the state has an annual funding gap of nearly $500 million each year.
In addition, Indiana’s Department of Transportation has said it expects to progressively take in less tax money as the state’s roads host more alternative fuel and fuel-efficient vehicles. A significant portion of the state’s road-improvement funding budget hinges on fuel-tax collections.
The agency warns it would miss out on $20 million in revenue in fiscal year 2025 and between $150 million and $506 million by 2040.
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