INDIANAPOLIS (AP) -
The speaker of the Indiana House urged new Gov. Eric Holcomb on Thursday to
make a strong push for a tax hike to pay for much-needed road and bridge
repairs, a politically tricky sell in a conservative state that has long
resisted higher taxes.
Speaker Brian Bosma
said it was “important” for his fellow Republican to vocalize his support
and convince voters that it is important for the Legislature to raise
revenues through increased gas taxes or vehicle fees.
Holcomb has made a
20-year infrastructure plan one of his top priorities for the upcoming
session and will elaborate on his concerns during his first State of the
State address next week, spokeswoman Stephanie Wilson said in an email to
The Associated Press. As for paying for it, Holcomb is “keeping all options
on the table,” she said. He previously said that he is open to raising the
gas tax, though he hasn’t indicated how much of a hike he would support. GOP
leaders in the Senate have not said what would be palatable to them.
Despite a lack of
consensus on how to go about raising the money, there’s widespread agreement
on the need to quickly improve infrastructure. Indiana has received poor
ratings for its roads and bridges, and consultants say the state hasn’t
spent enough on road maintenance or improvements.
If Holcomb actively
campaigns for a tax hike, it could go a long way in selling the idea to
voters, who have reliably voted for Republicans in recent years, creating
GOP supermajorities in both chambers. The state GOP has proudly cut taxes
over the last decade and a reversal of that trend is unusual for a party
that has long been associated with an anti-tax philosophy.
“The Governor will
continue to work with legislative leaders as the session progresses to
achieve a plan that maintains what we have, finishes projects we’ve started
and invests in new projects for the future,” Wilson said.
Thursday the difficulty of asking conservative elected officials to raise
taxes, but added he’s confident the House Republican bill contains the
“best, fairest and most conservative means of funding infrastructure.”
comfortable with it. I know it’s the right thing to do for investing in our
state’s economy,” he said.
The House plan
would increase the cost of fuel at the pump by 10 cents a gallon, while
requiring vehicle owners to pay an additional $15 a year registration fee.
It would also make it easier for local governments to raise money for
infrastructure by allowing more small towns to impose local vehicle
have agreed that new revenue and road improvements are needed, but haven’t
offered much more at this point.
In a news
conference about the caucus’ legislative priorities, Republican Senate
President David Long said he expected a final roads funding solution to be
made up of a “mix” of revenues, declining to predict the exact composition
of taxes and fees a Senate-backed bill might include.
pass, something really needs to pass,” the Fort Wayne lawmaker said. “We
cannot kick this can down the road.”
The proposed tax
increase comes as Republicans in both chambers have preached the importance
of fiscal restraint when crafting the state’s two-year budget, particularly
as the state brought in about $300 million less than expected this year.
meanwhile, note the state is sitting on about $2 billion in reserves. Some
have questioned whether tax hikes are the best avenue for raising revenues
and challenge what some call a regressive tax on gasoline, in a state that
has consistently cut or capped corporate taxes.
Legislature passed an income tax cut and also backed plans to eliminate
taxes on inheritances over $100,000, cut corporate tax rates and cut
property taxes while increasing the sales tax in recent years - moves that
experts estimate eliminated about $650 million from the state’s budget.
It’s estimated the
House Republican roads proposal would raise about $300 million in its first
year and about $480 million in 2019.