The Herald Bulletin

Morning Update

State News

April 26, 2013

New state budget paves way for better roads

$215 million in new funds is first increase in decade

INDIANAPOLIS — After begging for more infrastructure funding for years, local governments in Indiana are finally getting their wish: Millions of more dollars from the state to repair the crumbling roads and bridges in their communities.

The $30 billion budget deal reached by House and Senate leaders with Gov. Mike Pence earmarks more than $215 million in new road funding annually for the next two fiscal years, with about $100 million of that projected for counties, cities and towns.

It marks the first increase in road funding for local communities in more than a decade.

Matt Groeller, head of the Indiana Association of Cities and Towns called it the best news to come out of the 2013 legislative session.

“It’s something cities and towns have been asking for, for many years,” Groeller said. “It’s desperately needed for economic development. Without good roads, communities suffer, schools suffer, the local economy suffers. We don’t have anything if we don’t have good roads.”

Officials with the Indiana Association of Counties were just as celebratory. The final budget deal reached late Thursday makes all counties eligible for the extra road money as soon as July 1. It deletes language added by the Senate that required counties to have an excise surtax or wheel tax to tap into the new road funding.

“This was our No. 1 priority this year,” said association head David Bortoff. “There was nothing more important.”

The additional road funding is significant, given a decade of decline: Between 2000 and 2010, the major sources of road repair money collected by the state and doled out to local governments dropped by about $100 million.

During that time, good roads went bad and bad roads went to pot. Both Bortoff and Groeller said there are small and rural communities around the state that let their paved roads turn back into gravel because they could no afford to repair them.

In 2009, studies done by Purdue University’s Local Technical Assistance Center and by the American Society of Civil Engineers estimated it would take more $800 million to fix about half of all county paved roads in Indiana that are badly need of repair.

The budget bill only allocates a fraction of that. It projects there will be $136 million more in road funding for counties over the next two fiscal years, and $64 million more for cities and towns.

But the budget bill also makes some changes that could lead to a continuing source of road repair dollars. It rejects the Pence plan to beef up road funding with money now going to pay off the state’s pension obligations, and instead takes about $135 million in fuel taxes now going to the Indiana State Police and the Bureau of Motor Vehicles and shifts that money into road repair.

It also reallocates 1 percent of the current sales tax into the state’s motor vehicle highway fund, from which state and local road repair money is doled out.

The budget bill also sets aside $200 million a year to go into the new Major Moves 2020 Fund to pay for future major road projects, such as expanding Interstate 65 and Interstate 70.

Bortoff predicts local communities will start to see the extra road money be put to work by late summer, when communities can start accessing those extra dollars.

“We’re encouraging our members not to pull back on what they’re currently spending and use that money to spend on something else,” Bortoff said. “This is money that should be used to supplement existing road dollars, not supplant them.”

Maureen Hayden covers the Statehouse for the CNHI newspapers in Indiana. She can be reached at maureen.hayden@indianamediagroup.com.

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