Indiana Lawmakers: Gas Tax Increase Might Get Reduced In Senate
A final hike in Indiana’s gas tax may not be as high as a measure passed out of the Indiana House of Representatives last week, some Wabash Valley legislators say.
The Indiana House of Representatives, in a 61-36 vote, passed a bill to increase the state gas tax 10 cents per gallon in a move to raise $1.2 billion a year for road maintenance and construction. It would make the state’s gas tax 28 cents per gallon, up from 18 cents.
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Additionally, the gas tax can be increased up to 1 cent a year until July 1, 2024, under the House bill.
The bill also tacks on a $15 fee to all vehicle registrations and a $150 fee for electric vehicles.
That bill now moves to the Indiana Senate.
Sen. Jon Ford, (R-Terre Haute), could not be reached Feb. 20 for comment.
In the House, two Wabash Valley legislators — Reps. Bruce Borders and Clyde Kersey — opposed the bill, while Reps. Alan Morrison, Robert Heaton and James Baird voted yes.
For Borders (R-Jasonville), the biggest concern is adding toll roads to Indiana. Borders was one of seven House Republicans to vote against the gas-tax bill.
“The bill would allow the designation of certain roads as toll roads,” Borders said, citing Interstate 70 and I-65. “I have heard numbers as high as 20 cents a mile for toll fees. There are many of my constituents who drive to Indianapolis on I-70,” he said.
Rounding to an even number, Borders said driving 70 miles from Terre Haute to Indianapolis at 20 cents a mile is $14 one way and $28 roundtrip. “That is almost $150 a week and is nearly $7,500 a year, and that is after tax dollars,” Borders said.
That, Borders said, will increase the use of alternative routes, such as U.S. 40, but deter motorists from the benefit of the higher-speed interstate.
“I am also not sure on all the gas fees. We are in such a rush to do this, maybe because we have a super majority, but we may not after this,” Borders said. “Let’s slow this down and hold meetings in the state and get public input.”
Americans for Prosperity, affiliated with industrialists/political activists Charles and David Koch, has criticized the bill as a “massive increase” in gas tax and also urged a slowing down of the tax measure.
Americans for Tax Reform reports 21 of 22 House Republicans broke the organization’s pledge against tax hikes. Grover Norquist, president of Americans for Tax Reform, said the pledge is taken for the duration of service in public office, whether a state representative or U.S. president.
“They were all explained that at the time they signed up,” Norquist said of the pledge, which started in 1986.
“When Mike Pence was governor, he put an end to a tax increase. We hope the current governor is as committed,” said Norquist, who blames House leadership for seeking a vote in a nonelection year.
“At the end of the day, everyone is responsible for their own vote. They promised their constituents they would govern. You raise taxes when you are not capable of governing,” Norquist said, adding governing involves reallocating budget funds to meet priorities. “When politicians screw up, taxpayers pay for it. They are cutting taxes in Florida, North Carolina and Texas. Indiana wants to be Illinois” with increased taxes and fees, Norquist charged.
Rep. Heaton (R-Terre Haute) said the state, known as the Crossroad of America, needs to address its deteriorating road system.
“I think we need this funding on a long-term basis for roads and bridges. I voted for a similar measure last year,” Heaton said, when a House proposal called for indexing the state’s 18 cents-a-gallon gasoline tax to the Consumer Price Index and the rise in construction costs dating to 2002, which was the last time the gas tax was increased. That measure, which failed, likely would have resulted in a 5-cent gas-tax increase.
Heaton was among Republicans who signed the Americans for Tax Reform pledge.
Baird (R-Greencastle) also signed the pledge and also voted for the higher gas tax. Baird could not be reached for comment Feb. 20.
Heaton acknowledged he voted contrary to the earlier pledge, “but on the other hand, a lot of people at town halls, such as in Cory, are okay with it, generally speaking, because it goes toward maintenance of roads at all levels,” Heaton said.
“Indiana Farm Bureau supported it as they know something needs to be done with roads,” Heaton said. “We will see how this plays out in the Senate, if they take it apart. It could possibly change, it could be lowered, but I don’t know for sure,” he said.
Rep. Morrison, (R-Terre Haute) declined comment.
All House Democrats voted against the bill, including Rep. Kersey, (D-Terre Haute).
“I voted against it as there is a better road-funding mechanism,” Kersey said. “We do need to do something, and we need $1 billion a year for the next 10 years to address” road and bridge repairs and upkeep, he said.
Kersey said Democrats seek to freeze a state corporate income tax break, which still has five years to completely phase in.
“If we freeze that tax break now, it would be $200 million,” a year, he said. Then, an another $300 million can be found annually through the governor requesting all departments return 5 % of budgets, Kersey said.
Additionally, Kersey supports placing state sales tax into a dedicated road fund. “Right now, about 4.7% goes into the state budget. Our plan puts all of that into road funding, which is another $300 million,” Kersey said.
Kersey said he thinks the gas-tax bill will not remain as passed in the Indiana House.
“There will be a lot of compromising. As proposed, it would be the highest tax increase in Indiana history. House Bill 1002 will not look anything like it does today by the time we get to April,” Kersey said. “I think it will look at lot different, possibly down to a 5 cent tax increase.”
Whatever the outcome, Jacob Bean, who lives in Montezuma but works in Terre Haute and attends Ivy Tech Community College, said he still has to commute about 30 miles every day. “The gas tax won’t impact how much I drive because I have to drive as much as I do every day. It’ll just cost me more,” he said.
