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GOP leaders says some type of tax hike needed for Indiana roads

December 14, 2016

Key Republican leaders said Wednesday that Indiana lawmakers must consider some kind of tax increase if they're going to move forward on plans to improve the state's infrastructure.

Indiana's roads and bridges have been rated in the bottom third of U.S. states, officials say. Lawmakers have batted around ideas, hired consultants and studied the issue for several years.

But many in the Legislature's Republican majority have been squeamish when it comes to acting because the consistent takeaway from those efforts has been that taxes or fees need to be raised to pay for the improvements.

Now, even those who have resisted the idea are signaling that they are ready to move forward with an increase during the session that begins in January.

State Sen. Luke Kenley, the Senate's chief budget writer, said lawmakers need to "face up to the fact" that more money is needed. Last session, he opposed a tax increase.

"I think we all recognize that we don't have enough revenue to even sustain our maintenance program," said Kenley, who suggested a gasoline tax increase or adding tolls on the state's highways.

GOP House Speaker Brian Bosma said he's looking to the gas, excise and cigarette taxes. Other Republicans, including Senate leader David Long, have concurred with the general proposition.

Last session, Bosma and House Republicans put forward a road-funding plan that would have raised Indiana's cigarette tax by $1 a pack and tacked 4 cents onto the state's 18 cents-a-gallon gas tax, which hasn't been increased since 2002. But GOP Senate leaders and Gov. Mike Pence opposed the plan and didn't want to vote on a tax increase in an election year.

Incoming Gov. Eric Holcomb has said he wants to develop an infrastructure plan that could cover the next 20 years. But he has yet to weigh in on specifics and hasn't indicated his stance on a tax increase.

State consultants have said Indiana needs to spend a $1 billion or more a year on roads.

Democrats opposed the tax increase last session. On Wednesday, House Democratic Minority leader Scott Pelath wouldn't say whether he would support it this time.

"One thing we don't know yet is what the governor-elect thinks," Pelath said. "I'm still searching from the new governor-elect."

Gov.-elect Eric Holcomb said he won't discuss his plans before January.

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