Cherry: Finding an effective funding solution for Indiana's roads

Posted by: Samantha Holifield  | Friday, February 3, 2017 3:42 pm

Indiana needs a long-term, sustainable solution for our transportation infrastructure needs. As vice chair of the House Committee on Ways and Means, I am working with my fellow representatives to build on years of research to create a data-driven plan that best serves Hoosiers.

Moving forward, our state faces significant road funding shortfalls. To sufficiently fund our existing roads and bridges, finish projects we have already started and build for the future, Indiana will need on average an additional $1.2 billion annually over the next 20 years. Right now, House Republicans have drafted legislation, House Bill 1002, which sets forth a plan that will fund our current and future infrastructure needs, without saddling the next generation with mountains of debt.

Two of the primary reasons we will soon experience significant road funding shortfalls is that our fuel taxes have remained stationary despite inflation and vehicles being more fuel efficient. For decades, fuel taxes have served as road user fees. Indiana’s 18-cent per gallon gas tax was last adjusted in 2003. Other fuel taxes, such as the tax on diesel have stayed at 11 cents since 1988. With the status quo, every year that passes, our road funding revenue loses buying power. Every cent of the gas tax goes toward state and local roads.

Under House Bill 1002, there would be a 10-cent increase in the gas, diesel and interstate trucking fuel user fees. To ensure every cent of tax collected at the pump is going toward roads, our plan would shift all sales tax revenue on gas toward state and local roads.

To clarify, the state sales tax on gas is not the same as the state gas tax. Currently, only 2.5 cents of the 7-cent sales tax collected for every dollar go toward roads. Under our proposal, all 7 cents per dollar of gas sales tax will be dedicated to roads. It’s important to remember that non-Hoosiers and out-of-state companies will pay a significant portion of these tax revenues as they use our highways and interstates.

Our plan also calls for a $15 annual registration fee on all vehicles and a $150 fee on all electric vehicles, which do not pay any fuel user fees. In total, the average Hoosier driver will only pay about $5 more per month under this plan. This is a small price in comparison to the $491 the average Hoosier spends annually on vehicle repairs caused by poor road conditions. Comparably, Hoosiers spend $50 or more on monthly internet, cell phone and cable bills. Additionally, Hoosier families and businesses have experienced billions of dollars in tax cut savings from the General Assembly in recent years. Now, each year, most Hoosier families pay almost $400 less in property and personal income taxes than they did 12 years ago.

The funding plan presented in House Bill 1002 comes from the recommendations of the Funding Indiana’s Roads for a Stronger Safer Tomorrow Task Force. The FIRSST Task Force is a bipartisan group, consisting of both senators and representatives, as well as transportation experts, which met during the fall and summer months to study this issue. This plan is also being supported by many businesses, local governments, industries and trades located throughout our state, including Indiana Farm Bureau.

The quality of our roads and bridges impacts the life of nearly every Indiana resident. Infrastructure is critical to connecting Hoosiers and sustaining the agriculture, manufacturing and logistics-based economy that we have built in our state. House Bill 1002 is a step forward in maintaining what we’ve created, finishing what we’ve started and accomplishing what we’ve planned. While no one is excited about raising taxes, especially me, the user fees proposed in House Bill 1002 are imperative for Indiana to continue being the Crossroads of America.

There will be plenty of discussion about this bill, and the General Assembly will be working together to implement the best solution to keep Indiana driving in the right direction. I encourage you to share your opinions with me either by phone at 317-232-9651 or email at h53@iga.in.gov.

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Rep. Cherry represents House District 53, which

includes portions of Hancock and Madison counties.

He serves as Vice Chairman of the Ways and Means Committee.

A high-resolution photo of Cherry can be downloaded by clicking here.