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5/6/2012 8:34:00 AM
Wheel tax costly for Madison County -- one way or the other

Stephen Dick, Herald Bulletin Associate Editor

ANDERSON, Ind. — A letter to the editor this week in The Herald Bulletin was noticed for its irony. The Madison County Chamber of Commerce made a plea to reinstate the wheel tax, rescinded in February in a controversial move by the Madison County Council.

Chambers of commerce all over the nation are generally against tax increases because, they argue, businesses suffer. But this one is different.

“I didn’t think it was the right choice at the right time,” said Marcy DeShong, a member of the Chamber’s board of directors. “(Rescinding the tax) does more damage at a time when we need businesses and jobs.”

She’s not alone in her thinking. Greg Winkler, the city’s interim economic development director, agreed.

“Losing the wheel tax took $1 million out of the city budget,” he said. “That money went straight to roads. From an economic development standpoint, that’s critical.”

The wheel tax — which generates $3 million annually countywide — is a secure fund, meaning it can only be used for infrastructure, such as roads, bridges, ditches and storm water drains. The money is divided among the county, towns and cities.

In late February, the Madison County Council rescinded the tax, effective in 2013, with tea party Republicans Mike Gaskill, Mike Phipps, Rick Gardner and David McCartney leading the charge. In Tuesday’s primary election, Gaskill and Phipps are up for re-election to the council, while McCartney is running for county commissioner. In each case, their primary opponents either support the wheel tax or are opposed to the way in which the tax was rescinded without public discourse.

“(Rescinding the tax) literally took our ability to resurface roads away,” said Winkler.

Dennis Faulkenberg works out of Indianapolis for APIAN, which consults on transportation and infrastructure matters. He sees the wheel tax as a boost to counties facing a wide array of repairs.

“That $3 million, that’s a chunk of change, a lot of road maintenance” he said.

The Motor Vehicle Highway Fund collects the state’s gasoline tax, which is passed out to counties for road repair, Faulkenberg explained.

“That fund has dwindled because of less travel, shipping less freight and fuel-efficient cars,” he said. Plus, the state gets 18 cents a gallon regardless of the price of gas.

“Four-dollar gas doesn’t help road funds,” Faulkenberg said, adding that the current level of gas tax funds is the same as 1992 dollars.

Part of Faulkenberg’s job is to work with local governments in seeking road funding.

“When we go to the legislature and say local governments need help, the first thing they ask is, ‘Do they have a wheel tax? If not, don’t talk to us.’ ”

The Legislature, he said, doesn’t want to raise taxes if the counties won’t help themselves.

The Local Technical Assistance Program is assigned to the School of Civil Engineering at Purdue University. John Haberman, a program manager at LTAP, gives seminars to counties on the wheel tax, as he did in Madison County three years ago.

He’s dispassionate in his approach.

“I tell them what it is and what it isn’t,” he said. “It’s up to them whether they pass it or not.”

Part of the seminar includes software that calculates revenue from the wheel tax.

“Then they can decide what they want to do,” Haberman said.

In 2009, the county decided a wheel tax was needed, which, at $25 per car, amounts to about 50 cents a week. Now that it’s gone, people like DeShong don’t think it’s too much to pay.

“Infrastructure leads to economic development,” she said. “(Officials) know potential employers look at infrastructure. If we let our streets and roads go, that’s a huge flag to potential employers.”

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Editor, John C. DePrez Jr.; Executive Editor, Carol Rogers; Publishers: IBRC and IAR

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