Letters and Opinion

Conexus supports governor's Major Moves

June 16, 2012

We appreciate the [June 4] attention given to the Conexus Indiana Logistics Council and our work to address Indiana’s long-term infrastructure gap.

To clarify our positions portrayed in this article: First, Major Moves: We strongly support the governor’s infrastructure program, which has allowed nearly $4 billion in new highway and bridge construction and has put Indiana at a competitive advantage relative to other states.

We don’t subscribe to the idea that Major Moves was a long-term deal generating short-term gain. It created value from an underperforming asset, leaving a lasting physical legacy in new and enhanced infrastructure. And the remaining $500 million trust fund will support future transportation needs.

But this doesn’t mean we can afford to stop being innovative and looking for new ways to invest in our roads and highways. Every mile of our interstate system is driven by more than 10,000 heavy trucks daily, and Indiana’s share of federal highway funds are constantly threatened by congressional gridlock and diversions.

Our Indiana Logistics Council is made up of employers from across the state. They desire a pro-growth, low-tax business climate. But pragmatically, they realize that funding for infrastructure investment has to come from somewhere. So among the options being considered by the council are indexing fuel taxes to inflation (and exploring a mileage tax as a long-term substitute).

Given that logistics is a $10 billion industry for Indiana, and is critical to the success of manufacturing and other industries, we believe these merit consideration.

However, we aren’t simply suggesting a collection of tax increases. There are other strategies that should be explored to optimize existing revenues.

For example, most infrastructure is funded through dedicated taxes; i.e. a gasoline tax for highways. Unfortunately, these revenues are run through federal and state general funds, leaving them vulnerable to legislative whims. Federal and state lockbox policies must be enacted to end these diversions.

As much as practical, the federal government should also devolve funding and control over projects to the states. Being closer to issues “on the ground,” states can better target infrastructure funds and maximize value per dollar spent.

As a state and a nation, we’ve invested untold billions in a world-class transportation infrastructure; allowing it to degrade through fiscal negligence would be economic malpractice. We welcome a healthy debate on how to achieve this goal.

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David Holt
vice president of operations/businessdevelopment, Conexus

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