Sustainable road funding requires an evolution in our thinking
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Road and bridge advocates closed the books on the 2023 Indiana General Assembly session knowing a significant discussion on infrastructure funding was yet to come. In 2017, when lawmakers passed a historic funding package, their solution was informed by findings from the FIRSST (Funding Indiana’s Roads for a Stronger, Safer Tomorrow) Task Force. Last year, lawmakers re-established FIRSST to review our state’s infrastructure conditions and long-term funding needs.
We arrive at this discussion at an unprecedented moment for our state’s infrastructure network as our hard-working construction and materials partners have grappled with rising costs, project delays and supply shortages. The state’s previous 20-year investment plan – the guiding document coinciding with the new funding approach in 2017 – met our needs for only about half the initially contemplated time. The challenges we face from high inflation with road construction project costs soaring by 43 percent since the pandemic, workforce shortages, increased usage of alternative fuel vehicles and other emerging technologies are bringing us back to the table much sooner than expected.
Simply put, the world we operate in today is much different from 2017. Because of this reality, how we fund our infrastructure must transform to meet present-day and future demands. There is a growing necessity to systemically shift how we think about supporting our road and bridge network, which acts not just as a way to connect us from Point A to Point B but is a critical component of our state’s economic health.
We also arrive at this discussion at the time of year when road work is at its busiest. Driving around, you can’t miss the orange cones dotting our roads, highways and interstates. Many Hoosiers are likely asking themselves why we need to revisit infrastructure funding right now when it seems we have ample resources. While it is true that Indiana’s strong fiscal health and proactive decision-making by our state and local leaders allow us to meet many of our near-term infrastructure needs, we run the risk of undercutting our system if we remain at the status quo. A new approach is needed for our future.
Our funding system is already facing unprecedented challenges from rapidly shifting consumer habits. Just as homes have “cut the cord” for entertainment, more Hoosiers are about to plug in their vehicles instead of needing to visit the pump. Once regarded as a niche product, the adoption of vehicles relying on EV or hybrid technology is becoming much more mainstream and will rock the very foundation of our infrastructure funding system. It is no longer a question of “if” we need to evolve. We “must” evolve – and the time is now.
The General Assembly must look at our immediate and long-term needs and devise a plan that will smoothly transition us to a funding model that is workable and substantive amid innovations in energy sources. Our industry is excited to be an active participant in devising these solutions. Whether a vehicle is fueled by gasoline, electricity, hydrogen or CNG, every driver should pay their fair share using our roadways. That also means every driver, whether a Hoosier or out-of-state motorist, should be paying for the miles they drive and the weight of their vehicle.
Lastly, and perhaps one of the most significant challenges we face, is transitioning from a passive funding system (pay at the pump) to an assertive system (direct user fees). Currently, the majority of our revenue is collected incrementally at the pump, but only from those who fill up their tanks here in the Hoosier state. New funding concepts will require the user to pay upfront, and users will be very aware of the exact fees they are paying to fund our infrastructure network.
We have a lot of work to do, but the Indiana General Assembly has proven its dedication to identifying fiscally responsible ways to meet our infrastructure needs. We applaud legislative leaders for their foresight to address significant issues on the horizon proactively. The relationship with the Indiana Department of Transportation has never been stronger. Build Indiana Council is thankful for a seat at the FIRSST table, with our Board Chairman David Heyde serving as our industry’s representative. A plan offering long-term and sustainable funding for our infrastructure network benefits all Hoosiers – and we look forward to the Task Force’s initial steps in determining a strategy that puts Indiana on the strongest footing to support the Crossroads of America.