Indiana House Democrats on Monday released a road funding plan, which they say is a “credible alternative” to the plan favored by Republicans that would raise gas taxes and other fees to pay for infrastructure updates.
The House Democrats’ plan calls for converting the $500 million Next Generation Trust Fund into a loan fund for local governments, where local units could get zero- or low-interest loans to fund local projects. That fund was set up years ago from proceeds of the Indiana Toll Road Lease.
Republican Gov. Eric Holcomb has called to convert that fund into one that would invest in early and mid-stage Indiana companies and entrepreneurship.
The House Democratic road funding plan would also get $300 million annually by “cutting waste, fraud and abuse” by the state government, net about $300 million annually by converting the sales tax on gasoline to pay for roads, and by “freezing tax cuts for those at the top.”
“It is not necessary to have new taxes or tolls in order to reinvest in our roads and bridges,” said House Democratic Leader Scott Pelath. “It has been a problem of priorities."
The House Democrats estimate that they could get $350 million over four years by freezing tax cuts that are still to go into effect.
Republican leaders panned the plan.
The plans "is missing responsible, sustainable, long-term funding. They do not fully understand our current and future infrastructure needs, and they have a plan that is lacking in data to back up their proposal," said Rep. Ed Soliday (R-Valparaiso), chair of the House committee on roads and transportation.
House Speaker Brian Bosma said the Dems' strategy would raise taxes, result in cuts to education and jeopardize the state's AAA credit rating.
Democrats are in the super-minority in the House, meaning that the plan is unlikely to garnish enough support to outright compete with House Republicans’ vision.
Rather, Pelath said he hopes Republicans use some of the ideas to influence their own plan.
“If they want to take credit for these things, God love them,” Pelath said. “I applaud them. We have a lot of work to do to get this thing right."
The House Republicans’ road plan has already cleared its first hurdle, passing out of the House Roads and Transportation Committee in late January.
The plan would increase the gasoline tax by 10 cents per gallon, as well as the tax on diesel and other fuels. Fuel taxes would also be indexed to account for inflation.
Hoosier drivers also would pay an extra $15 for registration.