Task Force Announces Road Funding Recommendations

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A legislative task force has announced its recommendations for generating revenue to be used to improve Indiana's transportation infrastructure. Funding Indiana's Roads for a Stronger Safer Tomorrow, or FIRSST, has identified several potential funding options, including a gasoline tax increase, tolling and vehicle fees.

After several meetings throughout 2016, the task force concluded that "current funding levels are insufficient to meet the critical transportation infrastructure needs of the state" and additional revenue sources need to be identified. The list of funding recommendations includes:

  • Immediately increase the gasoline tax to recover some or all of the purchasing power lost since the gasoline tax was last increased in 2003.
  • Immediately increase the special fuel tax to recover some or all of the purchasing power lost since the special fuel tax was last increased in 1988.
  • Immediately increase the motor carrier surcharge tax to recover some or all of the purchasing power lost since the motor carrier surcharge tax was last increased in 1988.
  • Index the rates for the gasoline tax, special fuel tax, and motor carrier surcharge tax on an annual basis to ensure funding stability.
  • Implement road usage fees on alternative fuel vehicles, electric vehicles, and other vehicles which pay little or no fuel tax in support of their use of the roads.
  • Explore options to implement equitable and modern tolling systems on state-controlled highways and interstates to fund major highway and interstate improvement projects.
  • Implement a per vehicle fee on all vehicles registered in Indiana.
  • Increase the tire disposal fee.
  • Shift additional revenue generated from the use tax on gasoline from the state general fund to dedicated transportation funds.
  • Improve over-weight truck enforcement through electronic monitoring of truck weight and permits.
  • Increase fees that are subject to the International Registration Plan.
  • Consider a limited restoration of the Indiana Finance Authority’s ability to provide funding through smart debt financing—including highway revenue bonds, grant anticipation revenue vehicle bonds (GARVEE bonds), and transportation infrastructure and innovation act (TIFIA) bonds, provided that the expected life of the project to be financed exceeds the length of the debt repayment.

"We know that the revenue sources we are using right now are not keeping up with our current and future transportation infrastructure needs," said State Senator Luke Kenley (R-20). "FIRSST has identified plenty of options that will be on the table as we move into the upcoming budget session. I am confident that through additional deliberative conversations, we will be able to identify a fiscally responsible plan to fund our infrastructure for years to come."

The task force's report says additional funding needs may still exist at the local level and work is underway to determine a more accurate understanding of local infrastructure needs. It also states that the public must be assured that any additional fees will go directly toward improving Indiana's roads and bridges.

The FIRSST task force was co-chaired by Kenley and State Representative Tim Brown (R-41). The recommendations will be considered by the General Assembly after the 2017 legislative session begins in January.

You can view the draft of FIRSST task force's report below:

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