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Indiana Approves Billion Dollar Infrastructure Bill

On April 27, 2017 Governor Eric Holcomb (R-IN) signed H.B. 1002 into law. This bill seeks to raise revenue in order to close a $1.2 billion shortfall in the state's highway trust fund.  This new law will raise revenue by increasing the gas tax, instituting a Transportation Infrastructure Improvement Fund (TIIF), increasing International Registration Plan (IRP) registration fees, and potentially looking at tolling.  This ends months of negotiations between the legislature and the trucking industry.  While the final bill does represent an increase in costs to members, the final bill is significantly more palatable compared to initial proposals which could have cost the industry tens of millions of dollars more.  Additionally, several other fees in Indiana were either eliminated or simplified reducing cost and compliance burdens in the state.

On April 27, 2017 Governor Eric Holcomb (R-IN) signed H.B. 1002 into law. This bill seeks to raise revenue in order to close a $1.2 billion shortfall in the state's highway trust fund.  This new law will raise revenue by increasing the gas tax, instituting a Transportation Infrastructure Improvement Fund (TIIF), increasing International Registration Plan (IRP) registration fees, and potentially looking at tolling.  This ends months of negotiations between the legislature and the trucking industry.  While the final bill does represent an increase in costs to members, the final bill is significantly more palatable compared to initial proposals which could have cost the industry tens of millions of dollars more.  Additionally, several other fees in Indiana were either eliminated or simplified reducing cost and compliance burdens in the state.
 
TRALA began lobbying the state legislature after the initial draft for H.B. 1002 included a $15 non-apportioned TIIF on all vehicles registered in Indiana.  TRALA and a coalition of motor carriers, the Indiana Motor Truck Association, and the Scopelitis law firm, were able to get an amendment included during the House markup of the bill which would apportion the $15 TIIF for all IRP vehicles including vehicles under 26,000 lbs.  The amendment was accepted by the committee on January 26, 2017.  The bill passed the full House on February 16, 2017 and it was sent to the Senate for further consideration.
 
Once it arrived in the Senate, it was referred to the Tax and Fiscal Policy Committee where it was amended and passed on March 30, 2017.  The amended version proposed to dramatically increase the cost to TRALA members.  The Senate proposal called for an increase in the TIIF for trucks over 26,000 pounds from $15 to $100, a 50% increase in the IRP registration fee, a $5 per tire tax, and a 10 cent increase in the diesel tax.  The Senate proposal passed on April 4, 2017.  With two competing bills, the House and Senate each appointed conferees to negotiate a final bill.
 
TRALA and its allies immediately began pushing the conferees to adopt language which would allow the state to generate the revenue they needed without dramatically increasing the costs on carriers in Indiana.  TRALA's belief was that the Senate version went too far and that instead of a large TIIF, and other trucking targeted taxes, the state should just increase the IRP registration fee in order to make sure everyone who operated in Indiana paid their fair share. 
 
The Conference Report was released on April 21, 2017 and it included a 25% increase in IRP registration fees for all trucks over 26,000 pounds and a $15 non-apportioned TIIF for all trucks under 26,000 lbs.  Additionally, the report included a 10 cent increase in the gas tax, the diesel surcharge will now be assessed at the pump, the $8.75 trailer renewal fee was eliminated, and the $5 tire tax was removed.  Furthermore, the bill required the governor and the budget committee to approve any efforts to toll existing highway in the state, and it required a public comment period on any tolling project. 
 
TRALA strongly opposes the $15 non-apportioned TIIF for trucks under 26,000 lbs.  TRALA was the strongest voice for apportioning the TIIF for trucks less than 26,000 lbs during the initial House negotiations.  The TIIF does not go into effect until January 1, 2018 and TRALA will be working with its allies in the state in an attempt to change this language to make it apportioned for commercial trucks under 26,000 operating in the IRP. 
 
You may view the final infrastructure bill by clicking here.
 
If you have any questions or concerns about this new law in Indiana please contact Andrew Stasiowski at astasiowski@trala.org or call (703)299-9120.     
 
 
 
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