Lawmakers look at new ways to fund future, existing roads

2014-03-16T00:00:00Z 2014-03-16T00:50:08Z Lawmakers look at new ways to fund future, existing roadsBy Dan Carden dan.carden@nwi.com, (317) 637-9078 nwitimes.com
March 16, 2014 12:00 am  • 

With demand for gasoline at historic lows due to consistently high prices and greater declines ahead under a new federal requirement that cars and light trucks have double the fuel efficiency by 2025, Indiana lawmakers have begun looking at alternatives to the gasoline tax for funding construction and maintenance of the state’s highways.

Legislation sponsored by state Rep. Ed Soliday, R-Valparaiso, that appeared headed for passage at press time, requires the Indiana Department of Transportation oversee a two-year, independent study of six possible road-funding options to replace or supplement the gas tax.

They are: a charge based on how much damage a vehicle causes to the state’s transportation infrastructure, a flat fee for all vehicles, increases to existing vehicle and fuel taxes, tolls, a fee based on a vehicle’s weight and the number of annual miles traveled in the state and any other funding mechanism INDOT believes is appropriate.

“Across America the infrastructure is declining. Since the 1950s, when the interstate system was built, our bridges and highways have been struggling,” Soliday said. “Every state is struggling with how we pay for this, and the task is large.”

State gas taxes and other vehicle fees bring in about $515 million a year. Hoosier lawmakers agreed in 2013 to supplement that with an additional $210 million a year by diverting 1 percent of state sales revenue to state and local road projects, reducing the money available for other state spending, primarily education.

The federal government kicks in about $900 million annually for Indiana road work, but that revenue also is declining each year as federal gas tax receipts drop due to improved vehicle fuel efficiency and high gas prices.

State Rep. Rick Niemeyer, R-Lowell, said studying the different options available to replace or grow those revenues is a “far-reaching” idea “that will show us where we should go in the future.”

Oregon is leading the way in road-use charging. Starting next year, up to 5,000 Oregon motorists participating in a pilot program will be exempt from that state’s 30 cents per gallon gas tax and instead pay a 1.5 cent charge for every mile they drive.

If that per-mile rate were applied to Indiana, where the gas tax only is 18 cents per gallon, a driver who travels 12,000 miles a year in a vehicle that gets 20 mpg would pay $180 in mileage charges, instead of $108 in gas taxes.

Soliday said he is concerned about the cost of collecting a per-mile charge, which could require GPS devices in every vehicle, equipment to assess charges — perhaps located at gas stations, online accounts for payment processing and other unforeseen expenses.

The Oregon program offers motorists multiple ways to participate in the mileage-charging program. The low-tech option is purchasing a sticker that allows a driver to travel a certain number of miles, over a particular period of time in a specific vehicle. Most motorists are expected to opt for a privately purchased device — not government-owned — that tracks in-state mileage via satellite and charges accordingly.

Indiana’s study of alternative road funding ideas requires an assessment of the impact of each option on privacy, ease of use, compliance and revenue collection costs – as well as how to ensure hybrid, electric, propane and natural gas-fueled vehicles pay their fair share.

Soliday thinks the best course may be to look at more accurately passing along the costs of truck traffic, which generally tears up roads much more than passenger cars.

“Being the Crossroads of America a lot of our heavy truck traffic is not from Indiana,” Soliday said. “When we have this heavy use by people who don’t even stop here for a snack. We’ve got to find a way to pay for this heavy use.”

When the INDOT-supervised alternatives study is concluded, likely in 2016 or 2017, the transportation agency is required to develop a pilot program testing the option it determined is best suited to meet Indiana’s future transportation funding needs.

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