BIC MATTERS: Urge Your Legislators and Gov. Holcomb to Support Road Funding Bill

TO: BIC Grassroots Network
FROM: Vicki Kitchin, Executive Director
DATE: April 11, 2017

BIC MATTERS: Urge Your Legislators and Governor Holcomb to Support Road Funding Bill

Within the next eleven days legislators from the House and Senate, along with Governor Eric Holcomb will need to hash out a long-term plan for additional road funding. This is a once in a generation opportunity to get it right and we believe they can do it. Yesterday’s conference committee hearing on HB 1002 provided a perfect launching point for these negotiations (see below for hearing recap).

What can you do to help? Within these next few days, make a point to reach out to your legislators. If you have a contact with Governor Holcomb or his staff, reach out there also. Your message is simple: Support long-term, dedicated, stable and adequate funding so that INDOT and local governments can provide the transportation system required to take Indiana to the next level. BIC supports the funding levels in the House-passed version of HB 1002 which would generate about $1.1 billion annually in new funding when fully implemented.

Please report to BIC any feedback you get from your legislators or the Governor’s office. It’s very important that we get a read on what legislators are telling constituents. After a deal is reached, both the House and Senate will need to vote on the agreement. You can reach BIC at (317) 439-2108.

Recap of April 10 Conference Committee Hearing
Thanks to all who attended the joint House-Senate Conference Committee meeting on HB 1002. We accomplished our goal of filling the House Chamber with road funding supporters. BIC members came from many corners of the state. We appreciate your time and effort.

Representative Ed Soliday (R-Valparaiso) chaired the meeting. He urged testifiers to limit remarks to three minutes each. Even with that guideline, the committee listened to over two hours of testimony mostly from supporters urging conferees to pass the higher funding levels contained in the House version of HB 1002.

INDOT Commissioner Joe McGuinness led testimony telling the committee that INDOT’s needs haven’t changed since he first testified earlier in session. He said INDOT’s needs have likely increased since January given the freeze/thaw cycles we’ve experienced this spring. He said INDOT needs additional funding just to preserve and maintain the existing system and the need grows from there when adding in capital projects designed for increased mobility. Chairman Soliday asked McGuinness to explain why Indiana needs to conduct a tolling study. McGuinness said there are many questions about tolling such as: what are the federal requirements; what could the state expect in revenue projections from tolls; on which interstates would tolling work best; and what are the costs of building out the system.

Several representatives from local government talked about their preference for the funding levels in the House version of HB 1002 and their grave concerns about the funding formula changes in the Senate version.

Bob McCullouch, Ph.D., P.E., Program Manager of Purdue LTAP, described the information his group analyzed from the local asset management plans submitted last year as part of the Community Crossings Grant program. He talked about local road and bridge condition ratings and the funding that would be required to maintain the system. The data is summarized in Purdue LTAP publication “12-2016 Indiana Local Road and Bridge Conditions.”

Others testifying in support included representatives from the logistics industry, mayors, state and local chambers of commerce, truckers, organized labor, engineers, commissioners, county government, farmers and Build Indiana Council. One anti-tax advocate testified in opposition, an oil company owner expressed concern with fuel pricing compared to neighboring states and one business expressed concern about increased truck registration fees.

Committee Discussion
When testimony concluded, Chairman Soliday urged committee discussion. Senator Luke Kenley (R-Noblesville) commented that it had been a good hearing. He said the Senate tried to explore new ways to provide road funding. He emphasized that tolling will be necessary to provide future revenue. He said that the legislature has never before tried to raise this level of revenue for any purpose and that they have to do it this year. He thanked Chairman Soliday for leading the charge.

Senator Karen Tallian (D-Portage) said the Senate version of HB 1002 does not provide enough funding for local roads. She is concerned about increased truck fees and if the sales tax on gas is moved from the general fund to road accounts it has to be replaced by something. She agreed the state needs to look at tolling to capture revenue from out-of-state traffic.

Chairman Soliday recessed the meeting and said conferees would continue meeting to discuss issues and reach a final agreement before the end of the legislative session (likely to be Friday, April 21).

BIC MATTERS: Action Required

Contact Your Indiana State Representative Before January 25

“Despite our standing and our ongoing momentum, we can’t afford to get complacent or take our eyes off the ball.” – Governor Eric Holcomb, during his inaugural address on taking Indiana to the next level.
“I need every one of your members to be involved!” – Speaker Brian Bosma, during remarks at an industry lunch earlier today.

BIC NOTE: As highway funding advocates, we must heed the advice from Governor Holcomb and Speaker Bosma. The stars are aligning as never before, but we cannot take the outcome for granted. As we begin this legislative session, we ask you to take action when the need arises. We seek long-term, dedicated, stable and adequate funding for Indiana’s state and local highways, roads, streets and bridges. Your contacts to legislators during the next four months will be critical to our industry’s success. Please watch for BIC MATTERS alerts and take action. We will only ask for action when we truly believe it’s warranted. And now for this week’s update…

In the last two weeks, leaders in both the Indiana House and Senate and Indiana’s newly elected Governor, Eric Holcomb, have announced long-term road funding as a top priority for the 2017 legislative session.

Indiana House Republican Leadership Announces Road Funding Plan (HB 1002)
Republican leaders in the Indiana House of Representatives have introduced a comprehensive and bold road funding bill (HB 1002) that would provide new annual road funding of at least $1.2 billion per year. HB 1002 includes new revenue as follows:

  • increases the gasoline tax, special fuels tax and motor carrier surcharge tax each by 10 cents to restore lost buying power since the taxes were last raised,
  • indexes all fuel tax rates annually using a formula that incorporates CPI-U and Indiana personal income growth,
  • transfers, over three years, the remaining 4.5 pennies of the sales tax on gasoline from the General Fund to the State Highway Fund,
  • implements a $15 annual statewide infrastructure improvement fee on all vehicles registered in Indiana,
    implements a $150 annual statewide infrastructure improvement fee on all electric vehicles registered in Indiana and increases the current alternative fuel vehicle fee to $150,
  • requires INDOT to further study tolling and submit a waiver to the federal government to allow tolling on existing interstates,
  • lowers the minimum population threshold applicable to the municipal wheel tax/surtax from 10,000 to 5,000.

You can access a fiscal summary of HB 1002 here, including how the bill allocates funds to INDOT and local governments.

The Ways and Means Committee, chaired by Representative Tim Brown (R-Crawfordsville) and the Roads and Transportation Committee, chaired by Representative Ed Soliday (R-Valparaiso) will hear the bill in a joint committee meeting on Wednesday, January 25 at 9:00 a.m. in the House Chamber. BIC is working with our road funding partners to coordinate testimony in support of the bill.

ACTION REQUIRED: BIC strongly supports HB 1002. House members in both the Republican and Democrat caucuses are discussing this bill in private meetings. House members have various concerns. Anti-tax groups that oppose the bill have already been contacting legislators. It is important that ALL House members receive a phone call or email from supporters of this bill before it is heard in Committee on January 25. Obviously, members of the two committees are very important to this first step, and you can see the lists of committee members at these links: Ways and Means Committee and Roads and Transportation Committee. However, ALL House members need to receive a contact from supporters of HB 1002. Please contact your State Representative, regardless of political affiliation, by January 25 and express your strong support for HB 1002. Also, send me an email if you get a response from your legislator. For a link to your State Representative, click here. Remember, we will focus on House members only at this time; we will focus on Senate contacts later in the session.

Governor Eric Holcomb’s Priorities Include 20-year Plan to Fund Roads and Bridges
At a press conference last week, Governor Eric Holcomb announced that his legislative agenda for the 2017 session includes creation of a 20-year plan to fund roads and bridges (click here). He noted the importance of funding for both state and local roads and bridges. He said that funding options include fuel taxes, indexing, P3s, new tolling options and fees for alternative vehicles.

Senate Leaders Say It’s Time to Address Long-Term Road Funding
In a press conference on Tuesday, Senate Republican leaders said that their priorities for the 2017 session include implementing a long-term road funding plan. President Pro Tem David Long (R-Fort Wayne) and Senator Mike Crider (R-Greenfield) spoke about the issue. Senator Long acknowledged that while it’s hard for his caucus to talk about increasing taxes, they cannot continue to fund roads from the state general fund. He noted that U.S. House Speaker Paul Ryan has said the same about the federal budget, and that states are going to have to implement solutions to address road funding shortfalls. Senator Long said Indiana is $1 billion short annually and that he wants to find a solution for 20 years. He expects the final plan will include a mix of new revenue and fees. He also said that gas tax is the accepted method to pay for road improvements and that he could support tolling for new roads or new lanes.

Bottom Line
We are thankful and encouraged that our state leaders have made this a priority. However, we cannot be complacent. Everyone must engage during this legislative session. Please take the action requested above. Call me or send an email if you have any questions, and with any feedback you get from your legislator. Thank you.