By John Pickerill
Road funding in Indiana.
Here’s how convoluted today’s road funding process is, and how a significant portion of tax revenue from gasoline gets skimmed off and sent to the state general fund (instead of going to road maintenance):
For the 7% sales tax on gasoline,
I’m looking at IC 6-2.5-10-1 right now. Here’s how it says it gets distributed:
For FY2017,
1/7 goes to Motor Vehicle Highway Account
6/7 goes to General Fund
For FY2018,
1/7 goes to MV Hwy Acct
1/7 goes to Local Road & Bridge matching grant fund
5/7 goes to General Fund
For FY2019 and thereafter,
1/7 goes to MV Hwy Acct
1.5/7 goes to Local Road & Bridge
4.5/7 goes to General Fund
For the $0.18-per-gallon gasoline tax I’m looking at IC 6-6-1.1:
The $0.18 rate is set in 6-6-1.1-204
And then 6-6-1.1-801.5 and -802 show how the revenue from it is split up between State Hwy and local governments. None of this tax goes to General Fund. Instead, it is split up between:
1. State Highway Road Construction Fund
2. State Highway Fund
3. Motor Vehicle Highway Account
4. Local Road & Street Account
5. E85 Incentive Payments
The problem here is how little of this road funding county/municipal governments get compared to the State Highway Dept (INDOT). The State keeps 60% of it, and local governments only get 40%.
That’s despite the state only having 11,000 miles of road to maintain, but local governments have 84,000 miles. Significantly misallocated. No wonder counties, cities, and towns are struggling to maintain their roads, streets, and bridges.
But what about the Hoosier Lottery? Isn’t that supposed to be contributing to roads? It was originally intended to help with roads but isn’t any longer. The Lottery proceeds go towards:
Excise Tax Relief
Tuition Support
Teachers’ Retirement Fund
Police and Fire Pensions
Economic Development Grants
Build Indiana Fund
Indiana Technology Fund
21st Century Research and Technology Fund
Digital Television Conversion for Indiana Public Television Stations
Indiana University-Proton Therapy
Local Road and Street Account Distribution
Purdue University – Nanotechnology
Higher Education Technology
Property Tax Replacement Fund & General Fund Transfers
Unallocated Portions of Approved Funds
SOURCE (PDF)
$251.2 million came in from the lottery to the Build Indiana fund. $236.2 million went to the Motor Vehicle Excise Tax Replacement Acct. and $15.1 million went to technology/other. Nowhere is road funding listed.
(see page 295) HERE