Indiana road funding debate continues as adjournment looms at Statehouse

The hang-up, which must be resolved before the General Assembly adjourns for the year Thursday, largely centers on the wisdom of increasing taxes in an election year.

The Republican-controlled House already has voted to fund its roads plan by boosting state cigarette and gasoline taxes, as well as giving local governments the option to increase vehicle excise and wheel taxes.

Bosma said the "revenue enhancements" create the foundation for long-term, sustainable infrastructure funding that will enable the state and local governments to maintain roads and bridges for the next generation — not just through the next gubernatorial term.

Members of the Republican-controlled Senate favor a one-time road funding boost of some $600 million, using existing state reserve money, followed by higher infrastructure appropriations in future state budgets.

Under the Senate plan, local governments also would get back approximately $490 million in local income tax revenue currently held in reserve by the state, with a mandate to spend at least 75 percent of the money on local roads.

"We don't support the tax hikes at this time," Long said. "We've done more construction in the last decade than any other state in the country, per capita, we really have. The issue is how do we sustain that going forward."

Meanwhile, the House believes local governments should get back their reserve income tax collections without any strings attached.

"I don't consider that to be road funding," Bosma said. "Those are local income taxes collected by local units of government for whatever purpose they want."

A further sticking point seems to be that Soliday and House leaders, including state Rep. Tim Brown, R-Crawfordsville, chairman of the budget-writing Ways and Means Committee, already have studied the state's road funding options for several years while the Senate and Pence are trying to catch up.

As a result, potentially attractive solutions, such as adding a tolled truck-only lane on interstate highways, still appeal to some participants in the negotiations even though House leaders have deemed them largely unworkable.

The Senate roads plan calls for a 13-member state task force to study Indiana's long-term road funding needs; essentially duplicating the past five years of work by the Soliday-led Interim Study Committee on Roads and Transportation.

"We're in the give-and-take. We always knew that this was more than a one-year process," Soliday said. "The end game is you've got to get something passed and you make some progress."

Both Bosma and Long also expressed confidence that a road funding compromise will be reached by Thursday.

"You're going to see a ton of red cones in this state over the next four years," Long said.

House Democratic Leader Scott Pelath, D-Michigan City, said the only way that happens is if the leaders of the House and Senate Republican supermajorities "set aside their competitive natures and put the state first."

Pelath said to be politically achievable and bipartisan the infrastructure investment plan should not include tax increases, or anything that requires local governments to raise taxes, especially because Indiana already is sitting on $2 billion in excess tax collections.

"We all agree that we have to do something on infrastructure, but taking more money out of people's wallets, at this particular juncture, is not something that's going to sell well with the public," Pelath said.

Pence spokeswoman Kara Brooks remarked only that "discussions are ongoing" following a Friday meeting between Pence and legislative leaders.