Indiana lawmakers’ next big push: roads

With the 2015 legislative session in the rear-view mirror, state lawmakers already are hinting at their next big undertaking: how to pay for the state’s roads.

It’s an important question for a state that calls itself “the Crossroads of America,” but it’s also a sticky one. Any answer is likely to involve new taxes — a tough sell for lawmakers in a conservative state.

But with gasoline tax revenue on the decline thanks to better fuel efficiency, and with a temporary influx of cash from the Indiana Toll Road lease used up, lawmakers are acknowledging they can no longer avoid the issue.

“We’re going to have to talk about who pays what, in what form, to support this,” said Sen. Luke Kenley, R-Noblesville, the Senate’s chief budget writer. “So that’s going to be a tough discussion.”

The state is facing a gap of at least $500 million just to maintain existing bridges and highways, said House Transportation Chairman Ed Soliday, R-Valparaiso. And that doesn’t include hundreds of millions of dollars needed to complete I-69, add lanes to I-65 and I-70, and construct a new outer-loop freeway around Indianapolis.

Lawmakers made little progress on those issues this year. They concluded the 2015 session this week with a new two-year state budget that includes more than $460 million in new spending on education — but $200 million less than lawmakers wanted on infrastructure.

“If I had one disappointment about the session, or one lowered expectation, it was what we were able to do for infrastructure,” said House Speaker Brian Bosma, R-Indianapolis. “While we set out with the goal of this being the ‘education session,’ we’re already talking that the next session needs to be the ‘infrastructure session.’”

The Indiana Department of Transportation has commissioned a study of the state’s infrastructure needs and funding options that is due to be completed in August or September.

“We can’t wait a whole a lot longer,” Soliday said. “Nationally and statewide, we have not made our infrastructure a priority, and now it’s coming back to bite us.”

A big part of the problem is dwindling revenue from the state’s traditional source of highway funding: state and federal fuel taxes of about 18 cents per gallon. Indiana’s gas tax revenue dropped from about $582 million in 2004 to about $527 million last year. The state’s share of federal gas and diesel tax also has fallen.

Soliday said the state hasn’t adjusted its fuel tax rate in more than a decade.

Potential fixes could include increasing the fuel tax rate, introducing a new tax based on mileage or dedicating gasoline sales tax for highways. But each of those solutions come with potential political problems.

“People will say we need to do more to fix the roads,” Soliday said, “but when you ask them to pay for it, they’ll say no.”

Lawmakers have eight months to gear up for that tough sales job. The 2016 session begins in January, with the next budget-writing session following in 2017.

Call Star reporter Tony Cook at (317) 444-6081. Follow him on Twitter: @indystartony.