With your permission, allow me to paraphrase a sentence some of you older folks might remember from typing class: “Now is the time for all good men and women to have a grown up conversation about gas taxes.”
I bring this up because Indiana lawmakers are looking at indexing the current gas tax to inflation as a way to help pay for roads and infrastructure. Indiana’s gas tax hasn’t been raised since “Arrested Development” first appeared on the air. Some fuel taxes have been the same since I had a jheri curl.
And if you really want to look at the loss of purchasing power since 1970, the gas tax has lost half of its purchasing power and the sales tax on gasoline has lost 40 percent of its purchasing power since 2010.
Now with that said, I can already hear the rabid anti-tax crowd engage in the usual wailing and gnashing of teeth. With all due respect, they need to get with the program because absent major budgetary cuts, there is no way Indiana can pay for its roads needs without a tax increase.
I can make this argument because I have actually, unlike most of the rabidly irresponsible anti-tax crowd, done my homework on this. Allow me to elaborate, if you will.
To take care of all of its road funding needs over the next 20 years, Indiana is going to need about an extra $1 billion annually, give or take a few million. The state has a $32 billion biennial budget. Here’s a quick breakdown of where your money goes:
K-12 education: $16 billion (52 percent)
Higher education: $3.8 billion (12 percent)
Medicaid: $4.1 billion (13 percent)
Health and human services: $2.7 billion (9 percent)
General government: $1.8 billion (6 percent)
Corrections: $1.4 billion (5 percent)
Capital projects: $577 million (2 percent)
Public safety: $516 million (1 percent)
So for those who want to use existing dollars, please tell me where that money is going to come from if you only use existing dollars?
In the current proposal that House Republicans have offered, they shift the remaining portion of the state sales tax on gasoline from the state’s general fund to the highway fund. However, that shift will take place over a three-year period. That’s important because that shift is going to hit the general fund to the tune of a few hundred million dollars, thus the shift over three years to give lawmakers a better opportunity to plug that hole.
I’ve heard some people also say the state could pay for its infrastructure if it would end all the “giveaways” to corporation. Well, if the state of Indiana were to end those giveaways, at best you’re looking at $70 to $90 million tops because most of those giveaways are tax credits for worker retraining. The big giveaways are TIF (tax increment financing) districts and property tax abatements that occur at the local and county level to the tune of about $8 billion.
You could make an argument that Gov. Eric Holcomb’s plan to use $500 million from the Major Moves Trust Fund should go to roads instead of developing a fund to expand entrepreneurship in the state. If you were take that entire $500 million and put it towards the roads you would only meet half of that $1 billion in need, but you would only have it for half a year. Remember, that’s $1 billion annually that you need.
So, you don’t like raising taxes? Fine.
So you don’t like fees for alternate fuel vehicles? Fine.
You don’t like giving county and local governments more taxing authority to pay for their own local road projects? Cool.
Then what’s your plan? What’s your proposal?
It’s one thing to say something is a bad idea, and that’s fine. But if you can’t bring anything to the table, then I suggest you go back to the kids’ table, because as my grandmother would say, “Grown folks is talkin’ and solving problems!”
Abdul Hakim-Shabazz is an attorney and the editor and publisher of IndyPoltics.Org. Send comments to [email protected].
