Lyness: Finding A Road Funding Solution That Works For Hoosiers

Posted On January 27, 2017

Letter from State Rep. Randy Lyness (R-West Harrison)


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Our shared goal as Hoosiers of maintaining Indiana’s status as the Crossroads of America is facing a dilemma. Over the next 20 years, Indiana will need on average an additional $1.2 billion annually to adequately fund our transportation infrastructure system. This is why adopting a long-term, sustainable road funding plan is one of the General Assembly’s top priorities this session. House Bill 1002 was drafted to implement a data-driven, comprehensive and sustainable plan to fund both our current and future road funding needs.

Current data shows that nearly 10 percent of Indiana roads are in poor condition. Due to this, Hoosiers spend on average almost $500 annually on road-related vehicle repairs. Without addressing funding shortfalls, this will only get worse. Comparably, the House Republican road funding plan would only cost the average driver $5 per month at the pump.

As I listen to my friends and neighbors, I hear a lot of misinformation about road funding in general, and I want to clear a few things up.

This plan proposes an increased user fee on gas, diesel and interstate fuel by 10 cents per gallon. These fees are used to pay for state and local roads.

Raising the gas tax by just 1 cent only generates about $31 million. This may seem like a lot of money, but it doesn’t go very far in terms of a sustainable funding plan for the whole state. At the same time, cars are continuously becoming more fuel efficient, meaning that less money is being generated by the stationary gas tax we currently have in place. The gas tax hasn’t been raised since 2003, and other fuel taxes haven’t been increased since 1988. Because of this, the gas tax is losing buying power due to inflation every year.

Constituents are rightly asking where the new money raised will go. All the money raised by the current gas tax goes to roads and only roads. The current plan on the table would extend this rule of thumb to the sales tax on gas, which currently directs 2.5 cents of the 7 cents per $1 collected on gas sales to the Motor Vehicle Highway (MVH) Fund. Our proposal will take the remaining 4.5 cents and dedicate it to the MVH fund over the next three years.

There would also be a $15 annual fee on all vehicles registered in Indiana. With both fees, the average Hoosier motorists will pay a little over $5 more per month. Electric cars would have a $150 fee, which is largely equal to what an average Hoosier motorist pays annually in road user fees. Both of these registration fees would provide funding exclusively to Indiana’s Community Crossings Matching Grant Fund, which finances local road projects.

Raising taxes is never an easy option. When it comes time for me to vote on this issue, I will consider how it will affect the people in our community. The General Assembly has cut billions of dollars in taxes for Hoosier families and businesses. In fact, Hoosiers pay nearly $400 less per year in taxes than they did 12 years ago. Nonetheless, the system we have to fund roads is no longer working. Under the status quo, we can no longer maintain our current infrastructure and fund future projects.

This is certainly a complex problem, and we have to find a solution that keeps Indiana driving. This is an issue that affects every Hoosier, and there will be a great deal of debate and discussion on this throughout session. I am ready and willing to listen to all sides of the conversation to find the plan that best serves Indiana.

If you have any comments or questions, please contact me by phone at 317-234-9380 or by email at h68@iga.in.gov.