Issue Position: Roads

Issue Position

As you drive on Indiana's roads this winter, you can't help but notice their condition. Some are in surprisingly good condition while others are littered with potholes and downright dangerous to drive on. We take the good roads for granted, and complain about those in need of repair. The same can be said for our bridges. Some are surprisingly good, and others are scarily unsafe.

The bottom line is that it takes a lot of money to repair our roads and bridges. The question is, from where does the money come?

We have a tax on every gallon of gas purchased in our state at the point of sale, or the gas pump. That tax is collected by the feds and is then distributed back to the states. Indiana unfortunately, is a donor state. For every dollar we collect and send to the feds we receive less than a dollar in return. A portion of money collected in Indiana is distributed to other states that may be larger in geographic size, with a smaller population. Montana and Wyoming are examples of such states. For every dollar in gas taxes those states collect they receive back from the feds more than a dollar in return.

Another dynamic is that we all want our cars to be more fuel efficient. We buy cars today based on an increase in MPG. A car that gets 35 miles per gallon is more desirable than my old Expedition that averaged 19 miles per gallon. We also encourage the development of hybrids and electric cars. Electric cars purchase no gasoline and pay no fuel tax, but still use our roads and bridges.

The bottom line is that it takes a lot of money to fund road and bridge repair. The options are to either raise the tax per gallon on gasoline, or find some creative ways to move other money currently in the state budget to fund road repair.

I want to use an example of creative thinking to channel current taxes to local governments for road repair. If you purchase a new car today for $30,000, the state will collect $2,100 is sales tax on that transaction. This sales tax goes directly into the general fund, and currently we have roughly a $2 Billion surplus. Option #1 might divert all taxes collected on new car purchases to road and bridge repair. After all, new cars are using roads and bridges everyday. Option #2 might be to allow the state to keep the sales tax from the purchase of a new car, but divert the tax collected on every subsequent sale of that same car to local road and bridge repair. Sales tax is collected every time a car is sold. The tax is based on the sale price of the vehicle. Give me some ideas. Be creative and think outside the box.

Our local governments deserve praise for doing the best job possible with the meager funding they receive.

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