Two plans promising to improve and maintain roads and bridges across the state over the next four years will fight to become law in 2016 as Gov. Mike Pence’s $1 billion 21st Century Crossroads plan squares off against a $2 billion Crossroads Tomorrow plan proposed by Democrats in Indiana’s House of Representatives.
Three key factors differentiate the two plans: dollar amount, funding model and the types of infrastructure prioritized, specifically state versus local infrastructure.
Pence’s plan pledges to provide $1 billion between 2017 and 2020 to make sure Indiana’s roads and bridges remain in fair or better condition. Nearly $240 million would be taken from reserves at the end of the budget year, which would put reserves down to 11.5 percent of the state’s budget. Pence will ask the Legislature to approve $450 million in new spending through 2020 while also taking an accelerated distribution from the Next Generation Trust Fund of about $50 million of interest in 2019. The plan would also acquire an additional $240 million through bonding.
“(The governor) has taken a diversified approach and is using (various) sources to fund his plan to improve Indiana’s roads and bridges,” said Brain Bailey, Indiana’s state budget director. “It’s a good time to rely on the state’s triple-A rating from the three largest credit rating agencies, which is kind of a Good Housekeeping seal of approval on Indiana’s credit processes and fiscal management policies.”
While Pence’s plan touts itself as “responsible,” it still doesn’t appropriate any money for local roads or special projects like the Midstate Corridor/I-67 project that business leaders and local members of Indiana’s Statehouse have pushed for over the past several years and with renewed vigor in the last six months. Pence’s plan doesn’t appropriate for the completion of I-69 either. It’s a project he vowed to finish by the end of his tenure, which could come as early as January 2017, at a recent town hall meeting in Santa Claus.
The plan concocted by Indiana House Democratic Caucus would look to spend twice as much as Pence’s 21st Century Crossroads and with a much different method for appropriating those dollars. Crossroads Tomorrow, led by Indiana House Democratic Leader Scott Pelath (D-Michigan City), would use existing tax collected on gasoline and special fuels to directly fund road and bridge repair and maintenance, which in 2015 estimates would amount to nearly $525 million. Currently only 1 percent of that the taxes collected on gasoline go toward roads, according to information from Indiana House Democratic Caucus, where another 6 percent goes to the general fund. The Democrats’ plan would seek 7 percent, the estimated $525 million, to go back into infrastructure.
“(Pence’s) plan uses a portion of the reserves but also relies on bonding. Our concern is that bonding places additional burden for taxpayers down the road. That price tag always falls back on taxpayers. What we’d like to see is the money collected from taxes on your gasoline going toward the roads you drive on,” said John Schorg, spokesperson for Indiana House Democratic Caucus.
Schorg highlighted another key factor that differentiates their plan from Pence’s idea in the fact that the Democrats’ plan will use a distribution model already put in place by Indiana Department of Transportation Highway Motor Vehicle Fund to distribute 53 percent to state roads and 47 percent to local roads. If the estimates laid out by the Indiana Department of Revenue hold true, that means nearly $279 million would be allocated for state roads and $246 million for local roads annually through between 2017 and ’20.
“Is that enough? No, everyone realizes that. The problems with roads and bridges go way beyond that,” Schorg said, “but at least our plan acknowledge the problems local officials like those in Dubois County are facing.”
While the Democrats’ plan wouldn’t help install a four-lane highway through Dubois County, nor ensure the timely completion of segments five and six of I-69 between Bloomington and Indianapolis, it would give a chunk of money — the size of which is unknown at this point — to help with roads here in Dubois County whereas Pence’s plan focuses only on INDOT roads.
Dubois County Highway Superintendent Steve Berg said of the approximately 659 miles of road in Dubois County, INDOT maintains only about 90 miles worth or roughly 10 percent of roads in the county.
“It’s my understanding that the Pence plan is for INDOT roads only. That would cut all the local roads out. The only benefit Dubois County would see is on U.S. 231, and there’s no guarantee we’d benefit,” Berg said. “The bigger percentage of roads in Indiana are governed by the locals.”
Berg said that the way INDOT’s distribution of funds through the Highway Motor Vehicle Fund works is ambiguous, but it uses a formula which counts miles of road and population. He believes that while however much Dubois County could potentially receive from the Democrats’ plan isn’t enough, it’s still better than Pence’s plan.
State Representative Mike Braun (R-Jasper) said the issues being presented by both Democrats and Pence have been a huge power play since he was first elected in 2013, but he hasn’t heard any viable options come from either side of aisle until now.
“It’s so important for economic development that our roads be, in general, in good repair, and it’s considered the critical issue of the next few years and decade,” Braun said. “I think it’s going to take more rather than less, and I think both plans are throwing something out there to acknowledge the issues.”
While Braun agrees that Pence’s plan is “sustainable and responsible,” he doesn’t believe it would do nearly enough to address the issues Indiana’s infrastructure faces and will continue to face over the next 10 years. Braun also thinks the Democrats’ plan could potentially affect the state budget in a negative way, drawing down reserves by diverting those dollars on gas taxes from the general fund directly toward roads.
“The biggest complaint I hear about taxes going up for funding of any sort is that taxpayers don’t feel it’s distributed fairly across the state. My district would epitomize that; look at the local road projects we’re trying to get off the ground. We send so much economic benefit to the state, and we would like to see dollars spent across the state, not just central Indiana,” Braun said.
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