Indianapolis officials are looking to state government for options that could help the city close a funding gap of up to $1 billion a year for roads and transportation infrastructure.
Local money for roads typically comes largely from the state, but Indiana’s road-funding formula allocates gas-tax funds and other revenue by center-lane miles rather than overall lane miles, favoring smaller communities with fewer multi-lane streets.
Indianapolis, by virtue of its position as the state’s largest city, owns numerous multi-lane thoroughfares, including every former state highway within the Interstate-465 loop.
Department of Public Works Director Dan Parker said one of the city’s strategies is to talk with state legislators about funding options, but that he’s not going after the formula.
“I’ve been around the Statehouse long enough to know that you don’t change formulas, because anytime you change a formula, there’s a winner and then there’s a loser,” Parker said. “But are there other ways that that help can come?”
It’s unclear how willing the Republican-dominated Legislature is to help the Democratic-controlled city explore new options.
House Ways and Means Vice Chair Bob Cherry, R-Greenfield, said he hadn’t heard of the need Indianapolis had identified, but noted most local governments had more money than usual because of a string of federal pandemic relief bills.
“I haven’t heard anything from Indianapolis about wanting more money,” Cherry said. “But I would be interested to hear how they spent their money from the [Coronavirus Aid, Relief, and Economic Security] Act or other federal funding.”
Ways and Means Ranking Minority Member Greg Porter, D-Indianapolis, said he didn’t believe Indianapolis was getting its “fair share” of funding, citing 2019 reports of Indiana officials discovering an error in the formula that had short-changed the city by millions of dollars.
Porter said the state’s own nest egg could be a way to benefit communities across the state.
Asked if he thought there was openness within the Legislature to exploring other funding possibilities, Porter said, “From a Democrat perspective, yes. We’re sitting on a $5 billion surplus … I think the possibilities could be there. It’s just a matter of if we have the will to help local governments with transportation.” But that shouldn’t include a tax hike, he added.
Late last year, Indiana officials projected the state’s surplus would top $5 billion by June 2022. Officials announced that month that the surplus triggered an automatic tax refund of $545 million.
For Parker, the Indiana Department of Transportation’s recently-launched Community Crossings grant program for local road projects was an example of funding that “didn’t exist forever” and could be created. But from the city’s perspective, it’s not particularly impactful.
“That helps us, but we don’t even recapture back what we put into it,” Parker said. “So, Indianapolis [taxpayers] put about $22 million a year into Community Crossings, but we only qualify for $1 million back.
He said DPW has, in the meantime, tried to reduce its long-term maintenance costs by reconstructing streets with flawed foundations instead of paving them over, and converting lanes on underutilized roads to bike lanes and sidewalks.
Indianapolis has also embarked on a massive infrastructure push under Mayor Joe Hogsett, using bonds, grants and some of the city’s federal American Rescue Plan allotment. But it’s not enough to make up the gap identified in the report by Indianapolis-based engineering firm HNTB Corp.
That gap is $70 million annually just to stay at current funding levels—which by 2025 would leave the city’s infrastructure in worse shape than it’s in now, according to the report. But the city actually needs $1.07 billion a year more to properly maintain and improve bridges, thoroughfares and residential roads, sidewalks and other assets, the report said.
The report itself was an initial step toward plugging the gap, Parker said.
“If you’re going to ask for additional help from whatever source, you’ve got to be able to say: What is your ask? What is your need?” Parker said. “… We had it based on estimates. This is now based completely on data.”