Association of Indiana Counties Community Forum
Indiana Road and Highway Funding
Neal Carboneau Research Manager
Indiana Local Technical Assistance Program
Indiana Local Technical Assistance Program
Indiana LTAP
•National Network of Centers
•One in every state and Puerto Rico
•Regional Centers Serving Tribal Governments
• Indiana’s LTAP
• Affiliated with Purdue University
• Located in West Lafayette
Indiana Local Technical Assistance Program
Indiana LTAP
The LTAP Centers enable Counties, Cities and
Towns to improve their transportation network by
providing
•Training Programs
•Informational Clearinghouse
•New and existing technology updates
•Personalized technical assistance
•Newsletters, directories and publications
Indiana Road and Highway
Funding
1. The Main Source of Revenue for the Local
Roads and Highways
2. Other Sources of Revenue
3. How Is It Distributed
4. Why are distributions noticeably less this year
5. What else can be done
Indiana Road and Highway
Funding
The Motor Vehicle Highway Account or MVH account was
established by Indiana Code IC 8-14-1
Gasoline Tax IC6-6-1.1
•1923 .02 cent per gallon
•1947 .04 cent per gallon
•1957 .06 cent per gallon
•1969 .08 cent per gallon
•1980 Average Price Times 8% (max rate 12 cents per gallon)
•1981 Average Price Times 8% (max rate 14 cents per gallon)
•1982 Average Price Times 10% for the first dollar per gallon and 8% for
everything over the first dollar = $.0111 per gallon (max rate 14 cents
per gallon)
•1985 .14 cents per gallon
•1988 .15 cents per gallon
•2003 .18 cents per gallon (one cent dedicated to bonding and one cent
dedicated to the State and one cent dedicated to local units.
Indiana Road and Highway
Funding
1. The Main Source of Revenue for the Local
Roads and Highways
2. Other Sources of Revenue
3. How Is It Distributed
4. Why are distributions noticeably less this year
5. What else can be done
Indiana Road and Highway
Funding
Motor Vehicle Highway Account Revenues (MVHA)
(a few of the other revenue sources)
• Motor Fuel Tax (Gasoline)
• Special Fuel Tax (Diesel)
• Motor Carrier Fees and Taxes
• BMV (Bureau of Motor Vehicles) Fees
• Court Costs and Fees
• Other Misc Fees and Receipts
•Federal Traffic Safety
•State Police
Indiana Road and Highway
Funding
1. The Main Source of Revenue for the Local
Roads and Highways
2. Other Sources of Revenue
3. How Is It Distributed
4. Why are distributions noticeably less this year
5. What else can be done
Indiana Road and Highway
Funding
Motor Vehicle Highway Account Distributions
(a few areas of distribution)
State Police
BMV (Bureau of Motor Vehicles)
DOR (Department of Revenue)
Motor Fuel Tax Division
Traffic Safety Programs
Highway Safety Plan
State Trauma Registry
Audit Expense
Indiana Road and Highway
Funding
Motor Vehicle Highway Account Distribution
• INDOT Share
• County Share
• City / Town Share
• Highway Road and Street Fund (LRS)
• State Highway Construction and Reconstruction
Fund – SHCRF - INDOT
Indiana Road and Highway
Funding
1. The Main Source of Revenue for the Local
Roads and Highways
2. Other Sources of Revenue
3. How Is It Distributed
4. Why are distributions noticeably less this year
5. What else can be done
Factors Effecting Current
Funding?
Motor fuel tax (Gasoline) and special fuel tax ( Diesel)
make up 71.9 % of the revenue into the MVHA
Gasoline $0.18 per gallon
Special fuel $0.16 per gallon
As per gallon prices increase fuel sales decrease
Fewer gallons pumped equals less revenue for
roads and highways
2007
2005
2003
2001
1999
1997
1995
1993
1991
1989
1987
1985
1983
1981
1979
1977
1975
1973
1971
1969
1967
1965
1963
1961
1959
1957
1955
1953
1951
1949
3.500
Price Per Gallon National Average 1946 -…
3.000
2.500
2.000
1.500
1.000
0.500
0.000
All Types of Gasoline, U.S. City Average Retail Price ($/Gallon)
3.5
Price
per
Gallon
3
2.5
2
1.5
1
1999
2000
2001
2002
2003
2004
2005
2006
2007
2008
2009
Indiana Total Gasoline Retail (Million Gallons / Year)
750
700
Gallons
Pumped
(Indiana)
650
600
550
500
450
400
1999
2000
2001
2002
CPI
(cost of
goods and
services)
2004
2005
2006
2007
2008
2009
Approximate Gas Tax (Million $)
140
Highway
revenue
from gas
tax
2003
120
100
80
1999
2000
2001
2002
2003
2004
2005
2006
2007
2008
2009
2005
2006
2007
2008
2009
Consumer Price Index
250
200
150
1999
2000
2001
2002
2003
2004
All Types of Gasoline, U.S. City Average Retail Price ($/Gallon)
3.5
Price
per
Gallon
3
2.5
2
1.5
1
1999
2000
2001
2002
2003
2004
2005
2006
2007
2008
2009
Indiana Total Gasoline Retail (Million Gallons / Year)
750
700
Gallons
Pumped
(Indiana)
650
600
550
500
450
400
1999
2000
2001
2002
CPI
(cost of
goods and
services)
2004
2005
2006
2007
2008
2009
Approximate Gas Tax (Million $)
140
Highway
revenue
from gas
tax
2003
120
100
80
1999
2000
2001
2002
2003
2004
2005
2006
2007
2008
2009
2005
2006
2007
2008
2009
Consumer Price Index
250
200
150
1999
2000
2001
2002
2003
2004
Percent Change Municipal Cost Index 2000 – 2009
(http://americancityandcounty.com/mciarchive/#Archive)
35.00%
30.00%
25.00%
20.00%
MVH Funds
LRS Funds
15.00%
Municipal Cost Index
Consumer Price Index
10.00%
5.00%
0.00%
00-01
-5.00%
01-02
02-03
03-04
04-05
05-06
06-07
07-08
08-09
Factors Effecting Current
Funding?
Assumptions
• Petroleum products
• Would be the primary fuel source
• Would be economical to produce
• Gallons of fuel pumped is relative to miles driven
• Vehicle’s miles per gallon would stay consistent
• Highway revenues
• Will increase with the increase in the driving population.
• Will adjust with the cost of goods and services.
Indiana Road and Highway
Funding
1. The Main Source of Revenue for the Local
Roads and Highways
2. Other Sources of Revenue
3. How Is It Distributed
4. Why are distributions noticeably less this year
5. What else can be done
Wheel Tax (LOHUT)
• Local option highway user tax (LOHUT)
• Surtax < 11,000 lbs GVW
• Wheel Tax > 11,000 lbs GVW
• Only local optional tax specifically for road funding
• Passed Indiana legislature in 1980
Wheel Tax (LOHUT)
• 47 of 92 Counties have enacted this fund
• To stay in the county
• LRS formula determines the distribution between
Cities, Towns and County
• Used for Roads and Streets in the County Collected
• Repair
• Maintenance
• Construction
• Indiana Code 6-3.5-5
Other Sources of
Road & Highway Funding
• Cumulative Bridge Fund
• Major Bridge Fund
• CEDIT - County Economic Development Income Tax
• CAGIT - County Adjusted Gross Income Tax
• COIT - County Option Income Tax
http://www.in.gov/dor/3614.htm
County Tax Map
Revised 01/08
Number of Counties Average per County Statewide Totals
CAGIT
7
$745,451.43
$5,218,160.01
CAGIT, CEDIT
49
$1,053,947.91
$51,643,447.62
COIT
9
$2,207,922.77
$19,871,304.96
COIT, CEDIT
19
$2,516,419.25
$47,811,965.81
CEDIT
7
$308,496.48
$2,159,475.36
N/A
1
$0.00
$0.00
Other Sources of
Road & Highway Funding
What innovative ideas have other counties, cities
& towns implemented?
•
•
•
•
•
•
•
•
•
Interlocal Agreements / Cost Sharing
Non-motorized vehicles
Sale of Salvage Items
Disaster Relief Funds
Bond Issue
Cumulative Capital Development
Gaming Funds
Grants
Innkeeper Tax
We appreciate you taking the time
to hear more about Indiana Road
and Highway Funding Issues.
For more information contact
Indiana LTAP at (800) 428-7639 or
view our website at
www.purdue.edu/INLTAP