INDIANAPOLIS (AP) -
Indiana House Republicans want to increase gas and cigarette taxes to pay
for improvements to the state’s poorly rated roads - a proposal they say
offers a long-term alternative to Gov. Mike Pence’s rival plan that would
boost infrastructure spending in the short-term without more taxes.
“This is a small
price to pay ... for enhanced roads, enhanced bridges and economic
infrastructure that is very critical to create jobs, to maintain jobs,”
House Speaker Brian Bosma said Monday after formally releasing the plan.
If ultimately
approved by the Legislature, the plan would pump $500 million a year into
roads spending, with the majority of it going toward maintaining existing
infrastructure, said Bosma, who estimated the average motorist would pay $25
more each year in gasoline taxes.
Smokers would be on
the hook for considerably more, paying an additional $1 in taxes on each
pack of cigarettes. The plan would also change the way lawmakers spend a
portion of current gas tax revenues, redirecting some gas tax money from
other priorities back to roads. It would give municipalities with a
population greater than 20,000 the authority to raise their own vehicle
registration taxes to help pay for local improvements.
The condition of
Indiana’s crumbling roads has emerged as a major issue not only for
lawmakers, but also on the campaign trail. There is a major division among
majority Republicans over how to do so, with Pence and the Senate leaders
signaling they are at odds with the House.
The gas tax of 18
cents a gallon has not been increased in more than a decade. Pence, who is
facing a tough re-election, has frequently touted the fact that his own
roads funding plan would not raise taxes - a statement he has reiterated in
email blasts to campaign donors. He proposed borrowing $240 million while
drawing $241 million from the state’s budget reserves to boost short-term
roads spending in 2017. 18c a gallon 4
That idea got a
frosty reception from the House GOP last October when Pence first announced
the plan - a dynamic that was reversed Monday when the governor gave a
less-than-receptive welcome to the House’s plan.
“Governor Pence
believes the last place to look when we have the best credit rating and $2
billion in reserves is in the pocketbooks of hardworking (Indiana
residents),” spokeswoman Kara Brooks said in a statement.
President Pro
Tempore David Long, a fellow Republican, declined to comment on the House
plan Monday, though he was receptive to Pence’s proposal when it was first
announced.
Tension between
Pence and Bosma has been noticeable recently, most notably over policy
differences - though both deny there’s any animosity between the two.
“Despite reports to
the contrary we have a great relationship and we’ll talk about this,” Bosma
said Monday. “There’s a lot of time yet for these discussions to transpire.”
Bosma also said
that he has established “street cred” as someone who has previously pushed a
long list of tax cuts through the Legislature.
The House plan is
supported by the Indiana Chamber of Commerce, which dismissed Pence’s idea
as “just another stop-gap proposal.”
But it drew
opposition from Americans for Prosperity - the main political advocacy group
for Charles and David Koch, billionaire brothers who spend millions on
conservative causes. The group said in a statement that lawmakers need to
“prioritize existing tax revenue for transportation funding needs rather
than hiking the gas tax and otherwise take more money from Hoosiers’
wallets.”