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Road Funding Plan Raises Gas Taxes, BMV Fees

Legislators give final approval to bill raising $1.2 billion a year for roads

Legislators have given final approval to a plan they say will fund Indiana's roads for 20 years.

The House and Senate gave overwhelming endorsement to a bill which Senate Appropriations Chairman Luke Kenley says will eventually bring in $1.2 billion a year to build new roads and maintain current ones.

The plan raises gas taxes 10 cents a gallon, with increases of up to a penny a year through 2025 to keep up with inflation. The initial increase is the first in 14 years -- legislators say it catches the tax up to inflation.

You'll also pay an extra 15 dollars to register your vehicle -- more if you drive a hybrid or electric vehicle. And all sales taxes on gasoline will be earmarked for roads after a six-year phase-in. House Republicans had insisted on the shift. Speaker Brian Bosma says Hoosiers believe all the taxes they pay at the pump go to roads, and it's time to make that true.

Senate President Pro Tem David Long (R-Fort Wayne) says the plan will make Indiana nearly unique in fully funding its road projects for two decades without a penny of new debt. And Senate Transportation Chairman Mike Crider (R-Greenfield) says nearly all the money the bill brings in is some form of user fee for drivers.

To meet the revenue needs, legislators warn the state will need to look at imposing tolls. The bill orders a study of tolling options, which an eye to a full discussion in seven years or so. That debate will include whether tolls should be limited to new lanes or new roads, or applied to existing highways.

Governor Holcomb made a long-term road funding plan one of his legislative priorities, and has already congratulated lawmakers for what they came up with.

Senate Appropriations Chairman Luke Kenley (R-Noblesville, left) and House Ways and Means Chairman Tim Brown (R-Crawfordsville) (Photo: Eric Berman/WIBC)

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