Pence OKs road funds

Units of local government in Bartholomew County are expected to receive more than $6.7 million this spring, most of it to be spent on roads.

Gov. Mike Pence on Wednesday praised a statewide short-term road funding package, saying it will pump millions of dollars in additional money into needed projects without raising taxes.

The deal reached in the final days of the legislative session will put about $230 million in new money into state highways and bridges over the next two years.

The funding plan draws down the state’s $2 billion budget reserve and also gives about $580 million to city and county governments for road projects, with much of that a one-time distribution from local income taxes held in reserve by the state.

The spending measure signed Wednesday by Pence consists of funds that would have been distributed to local government anyway within a few years, Columbus Mayor Jim Lienhoop said.

Bartholomew County government is likely to receive a third of the funds that will be distributed locally, currently estimated at $2.23 million, prior to June 1.

However, county officials say the one-time distribution will provide only temporary financial relief.

“Things look good for us this year, but going forward we will have to stay on top of our expenses,” Bartholomew County Council president Bill Lentz said.

Bartholomew County Auditor Barb Hackman spent more than two hours Wednesday afternoon attempting to get a breakdown of how much money the county, as well as individual cities, towns and townships, will receive.

But by 5 p.m., all she learned was that a preliminary breakdown for Bartholomew County will be provided by the Indiana Association of Counties on Tuesday, while an exact breakdown won’t be known until the funds are dispersed, she said.

Path to compr

omiseUnder provisions included in Senate Bill 67, which passed both houses of the Indiana General Assembly earlier this month, 75 percent of the money must be spent on roads, related infrastructure or airports.“But local officials can spend the remaining 25 percent as they see fit,” said Rep. Milo Smith, R-Columbus. “Our goal was to try to get as much back to local units of government as we could.”

Smith was a sponsor and co-author of House Bill 1110, which called for lowering the amount of Local Option Income Tax receipts the state holds in escrow for local governments from 50 percent to 15 percent.

That bill was unanimously approved on third reading by the Indiana Senate on March 1, while its counterpart — Senate Bill 67 — was approved unanimously by the House on March 3.

While the House bill would have given local units of government more discretion on how to spend the money, it was the Senate that wanted most of the money tied to road construction as differences in the two bills were being hammered out, Smith said.

But part of the compromise was raising the total amount to be released to 90 of Indiana’s 92 counties to $1.2 billion from multiple money sources, the state representative said.

Those changes will provide Bartholomew County with at least $700,000 more than what was anticipated in his original bill, Smith said.

After compromises were placed into the Senate version, the measure was signed off by both House and Senate leaders.

Plans premature

Since city and county officials weren’t certain they would receive the money until Wednesday, no specific plans have been made on how to spend it, Lentz and Lienhoop said.While it will be up to the three county commissioners to determine where the road money is spent, Lentz anticipates the commissioners will choose to address the fact that they diverted $1.2 million originally earmarked for roads into the county’s 2016 general fund.

“Bridges are the big expense now,” Lentz said. “I need to sit down with the commissioners and get a game plan.”

The council president said a salary raise for the county’s more than 400 county employees has not been ruled out.

On Nov. 10, a one-time payment of $750 was approved by the county council for an estimated 366 benefit-eligible full-time county employees to help offset higher health insurance deductibles and premiums.

Meanwhile, the city will want to examine all strings state lawmakers have attached to the money before making determinations of how it will be spent, Lienhoop said.

After the money is wired to the county in one lump sum, the city will likely place the money into either a general or reserve fund before making spending decisions, he said.

“There are a number of projects under discussion, ranging from State Street improvements to developing riverfront areas,” Lienhoop said.

But the city council might also choose to spend the money catching up on a backlog of approved projects — or even investing all of it into street repairs.

The only use Lienhoop said he would rule out at this time is spending the money on programs that will require ongoing investments.

“This is a one-time shot,” Lentz said in agreement with Lienhoop.

“I’m cautiously optimistic, but we still have to watch our p’s and q’s.”

Republican House Speaker Brian Bosma and other GOP legislative leaders joined Pence for a ceremonial signing of the roads package in the Indianapolis suburb of Westfield. Pence formally signed it into law during a Fort Wayne event later in the day.

Bosma said he expects lawmakers to debate a longer-term road funding plan during their work next year on a new state budget.

The debate over highway conditions has become a major early theme in Pence’s re-election campaign against Democratic candidate John Gregg, gaining prominence last summer during a month-long emergency closure of an Interstate 65 bridge near Lafayette.

The Associated Press contributed to this report.

Senate Bill 67

Provides for a supplemental distribution of local income taxes when the balance in a county’s local income tax trust account exceeds 15 percent (rather than 50 percent) of the certified distributions to be made to the county. Specifies the accounting, allocation method and distribution requirements for supplemental distributions. Requires a one-time special allocation of the balance in a county’s trust account. Provides that at least 75 percent of the distributions made to a county, city, or town must be: 1) used exclusively for local road construction, maintenance, or repair, or capital projects for aviation, including capital projects of an airport authority; or 2) deposited in a rainy day fund and later used for those purposes. Provides that any remaining distribution to a county, city, or town may be used for any purposes of the county, city, or town. Requires the allocation amount for other taxing units to be deposited in the taxing unit’s rainy day fund.

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Mark Webber is a reporter for The Republic. He can be reached at mwebber@therepublic.com or 812-379-5636.