Hot Topic: The State Road Funding Formula
Pickup Trucks and Road
Money
Indiana counties, cities and
towns spend hundreds of millions of dollars each year on road construction and
maintenance. Much of this money
comes from license fees, and state taxes on gasoline and diesel fuel.
The state takes about three-fifths of this revenue off the top, and then
distributes the rest to local governments.
Who gets how much?
The state divides the money based on two formulas, called the MVH (motor
vehicle highway) and LRS (local road and street).
First, the state pays to
support the State Police and Bureau of Motor Vehicles.
That costs about $100 million. About
$550 million remains. The state
uses the MVH formula to divide three quarters of this remaining money. Using the MVH, 53% goes to the State Department of
Transportation for state highways. 15% goes to cities and towns, based on shares
in total population. The other 32%
goes to county governments, some based on equal shares, most based on shares of
road mileage and motor vehicle registrations.
The state uses the LRS
formula to divide the other quarter of the revenue.
The state keeps 55% for the Department of Transportation.
The other 45% goes to counties based on shares in total passenger car
registrations. This county money is
divided between county, city and town governments based on population and road
mileage.
That’s right, the LRS
formula divides revenue among counties based on passenger car registrations
only. Pickup trucks aren’t included.
People in rural counties don’t think this is fair.
Pickup trucks drive on the roads, and they are a bigger share of vehicles
in rural counties. If pickup trucks
were included in the LRS formula, rural counties would get more of the revenue.
Urban counties would get less.
Not much more or
less, though. Out of the $250
million distributed to counties, cities and towns, only $2 to $3 million would
be shifted from urban to rural counties.
Still, every year the
General Assembly debates bills to add pickups to the LRS.
Every year the bills are defeated. People
in urban counties argue that if pickups are included, so should other things
like “lane miles.” If 4-lane
roads counted twice as much as 2-lane roads in the formulas, urban counties
would get more, and rural counties would get less.
Mostly, though, the bills always lose because there are more urban
legislators to vote “no” than there are rural legislators to vote “yes.” The MVH and LRS formulas haven’t been changed for decades.