INDIANAPOLIS — Saying he was uncomfortable with funding roads via a cigarette and fuel tax increase, Sen. Luke Kenley, chairman of the Senate Appropriations Committee, stripped that language out of House Bill 1001 and set up a task force to find a sustainable revenue stream for road funding.
"The one-time indexing on the gas tax and a reliance on another dwindling resource, the cigarette tax, I just couldn't get comfortable with that," Kenley said. "We're just going to have to keep working on that."
The appropriations committee passed amended HB 1001, taking out the tax increases and establishing a task force that will be responsible for coming up with a sustainable source of income for road funding in the future and report back to the legislature next year when the state will pass a new, two-year budget.
The amended bill now also includes Gov. Mike Pence's plan for $1 billion over the next four years to maintain state highways. The money will be taken from state reserves and not bonded, as Pence originally proposed.
Kenley (R-Noblesville) liked what the House did regarding local funding options but modified the language, saying cities with a population over 10,000 (instead of 20,000) could institute their own wheel tax. The bill would also give counties more options in regards to wheel tax revenue.
While the bill gives locals more options, it does not establish any sort of permanent revenue for local roads, as Sen. Karen Tallian, D-Portage, noted.
"There are a lot of good things in here but I do have to remark on what is not in here," Tallian said. "We need a long-term solution for local road funding and we need it right now."
Kenley said Senate Bill 67, which would create more than $430 million in excess local income tax, would give the locals something while lawmakers look for a better solution next year.
The changes to HB 1001 came a day after a House committee dismantled Senate Bill 333, the Senate's road plan. The House Roads and Transportation Committee amended the bill, taking out all the original language and inserting all of HB 1001. With the major changes to both bills, the road funding matter will likely be decided in conference committee.
Rep. Ed Soliday (R-Valparaiso), the author of HB 1001, thanked Kenley for his work and said that the road funding issue was going to be a process. The main point of contention now is how to raise money for sustainable funding.
"I think the thing we need to be talking about is that basic philosophy of are we going to pay for infrastructure with the general funds or with user fees," Soliday said. "We have a minor disagreement on whether the sales tax on gasoline is a user fee."