INDIANAPOLIS — The House Republican plan for targeted tax increases to pay for state and local road improvements cleared its first hurdle at the Statehouse Wednesday.
House Bill 1001, sponsored by state Rep. Ed Soliday, R-Valparaiso, was approved, 8-5, by the Roads and Transportation Committee. The four committee Democrats and state Rep. Curt Nisly, R-Goshen voted "no."
The proposal, which next goes for review by the House Ways and Means Committee, increases the gasoline tax by five cents to restore its 2002 buying power, adds an extra $1 per pack to the state's cigarette tax to free up money now spent on treatment of smoking-related illnesses and provides local governments additional tools to pay for roads.
It also dedicates an increasing share of the state's 7 percent sales tax on gasoline to road and bridge rehabilitation, and requires a study of the potential for turning Interstates 65, 70 and 80-94 into toll roads, subject to federal approval.
"What we tried to do is have a stable, sustainable funding source for the intermediate and long term to take care of what we have," Soliday said. "(There's) enough money in this bill, through multiple sources, to stop the decline of Indiana's roads."
State Rep. Dan Forestal, D-Indianapolis, unsuccessfully urged the committee to instead adopt the road funding strategy proposed by House Democratic Leader Scott Pelath, D-Michigan City.
The Democratic plan would spend a portion of the state's $2 billion budget reserve and dedicate more money toward roads in future budgets, without raising taxes.
"We should use what we have first — the surplus — before we consider raising taxes on Hoosiers," Forestal said.
Similarly, Nisly said he could not go along with a tax increase, despite House Speaker Brian Bosma, R-Indianapolis, declaring Soliday's road funding plan the top priority this year for House Republicans.
Republican Gov. Mike Pence also has signaled he's unlikely to support tax increases in an election year.
Pence is backing Senate proposals to spend one-time reserve funds and borrow $240 million to pay for state and local road work.
Soliday said most House Republicans oppose the governor's borrowing strategy because they don't want to mortgage the futures of Hoosier children when most motorists will pay just an extra $30-50 a year under his plan.