Lawmakers Hear from INDOT on Road Funding; Gov. Makes $1 Billion No-Tax Proposal

30449450Two key events in recent weeks on the transportation front in Indiana: A long-awaited Indiana Department of Transportation (INDOT) study on long-term funding options for Indiana’s roads, highways and bridges was presented on Oct. 15 to the Interim Study Committee on Roads and Transportation; and just a few days before, on Oct. 13, Gov. Pence proposed a $1 billion, four-year plan for short-term transportation needs whose most prominent feature was no tax increases. INDOT Commissioner Brandye Hendrickson appeared with the governor at his announcement and testified before the interim study committee.

Hendrickson provided a broad overview of the state of Indiana’s roads and bridges during her testimony and INDOT’s study vendor, Cambridge Systematics, testified at length on the options available to the state to address long-term transportation funding, concluding that policymakers need to “decide what Indiana should invest in and how best to pay for it.” Both federal and state highway revenues are expected to decline in future years due to a number of factors, including increased fuel efficiency standards and more alternative-fuel vehicles hitting the roads.

All fuel excise tax revenues from the state’s highway fund are required for maintenance of existing infrastructure; no funding is available for expansion projects such as completion of I-69, adding lanes to I-65 or I-70, or new bridges across the Ohio River. Additionally, more than half of the state’s bridges are in the last 25 years of their useful life (50-plus years or older) and will need significant reconstruction or remediation in coming years.

Bottom line: The state needs more revenues to address a growing need for maintenance of existing infrastructure – let alone expansion of the state’s highway network.

Pence proposes a mix of bonding (debt), general fund appropriations and use of the state’s reserves in his “21st Century Crossroads” plan. His proposal would seek $450 million over three years to be appropriated by the General Assembly from the state’s general fund, $250 million to be used from the state’s reserve funds, $50 million from the state’s Next Generation Trust Fund (established by Major Moves monies) and roughly $240 million in new bond financing as existing debt gets retired or refinanced. The plan is short term in nature and, while tapping appropriate sources, needs the consent of the Legislature (where several Statehouse voices expressed reservations about the bonding aspect of the plan).

The Indiana Chamber would like to see a mix of increased fuel excise taxes, indexation, tolling, fees on alternative fuel vehicles and other tools based upon a “user fee” model discussed in the 2016 legislative session, along with the use of existing tax authority by cities, towns and counties to address the needs of local streets and county roads. Policymakers must make some hard choices with the support of the state’s business community to address the scale and scope of the challenge.

In short, the era of strategic investments fueled by the Major Moves program is over. The prevailing (default) practice of making stop-gap appropriations from the state’s general fund is not a reliable or strategic means to pay for future maintenance and upgrades to Indiana’s surface transportation network. Currently, we risk wasting strategic investments already made, and our roads and highways will deteriorate along with our reputation as “The Crossroads of America.”

Throwback Thursday: Water on the Brain

Many involved in the Indiana environmental community are likely aware of our ongoing work on a survey of Indiana water resources in an effort to gauge future supply and demand.The Chamber actually hired Bloomington-based hydrogeologist Jack Wittman for the effort. In fact, read his recent Q & A with Indy-based NUVO magazine on the issue.

Along these lines, we recently discovered a similar report from June 1953, titled “Water Resources Report to Southern Indiana Inc.” The entire document is nearly 70 pages, but here are a few notes from the general summary:

These points are held to be fundamental guides for conducting future work:

1. Present water conditions – supplies; flood damages
2. Potential long-term supply needs
3. Potential long-term supply opportunities
4. Possible reductions of flood losses
5. General benefits to entire area which may result from improvement projects

The valley-wide approach to the water problem of Southern Indiana is all-important because surface water must be the main source of supply.

It is recognized that there now is a tremendous waste of water resources in Southern Indiana. Much water is lost in flood periods during the heavy rainfall seasons of the spring and early summer while many stream beds are almost dry in late summer and fall months. Equalization of the stream flows, therefore, is taken as the key approach to the problem…

It is impossible to propose a “blanket remedy”  for water problems in Southern Indiana. IN any year, losses from drought may be just as severe as losses from flood, or greater. Any storage of water in small watersheds is of much value to farm operations. The value of farming is on equal status with that of manufacturing and commercial activities in the support of the business system.

Battledish Event in Evansville to Pit Chef Against Chef

Evansville is adding to its culinary environment with an event this Saturday. If you're in the area, check it out. Your tastebuds will thank you. A release from Michael Armanno, Evansville Dishcrawl community manager, has the details:

Battledish, an international chef competition, comes to the River City this fall!  Chefs across the world take their turn to compete for various titles such as most delicious, most creative, best modern, best cocktail, and most authentic.

Battledish will kick off Fall Festival season with the first ever competition in Evansville with six lucky chefs on Saturday October 5th at 2pm.  All ticket holders will have a chance to vote for their favorites in the competition along with an esteemed panel of featured guest judges.  Only one chef will emerge King of Battledish!

Chefs, details, and more to be unveiled weekly!  More info and registration at dishcrawl.com/battledish.

Indiana Can Win the Water Battle

(The following column from Vince Griffin, our VP of environment and energy, appeared in the Inside INdiana Business newsletter.)

Wouldn't it be nice if every time you got in your car, you had a full tank of gas? You wouldn't have to worry about where you were going to fill up next or how much it was going to cost. Unfortunately, this is how most Hoosiers view the state's water supply.

Right now Hoosiers are using water with little to no regard for where it will come from in the future. Most people take for granted everyday things such as how they are able to have water available every time they turn on the faucet. As the most manufacturing-intensive state in the country, Indiana uses vast amounts of water each day to keep its economic engine operating. The aquifers and rivers also support agricultural production in Indiana that contributes almost $38 billion to the state's economy.

This abundant resource may become unreliable if we do not take the proper steps now. Indiana, along with other states east of the Mississippi River, currently doesn't have a plan that secures its long-term water supply.

A clear and concise strategy is required for getting water to Hoosiers who will need it most. In order to do this, three questions must be answered:

1. Where is the water?
2. Who needs the water?
3. How do we get the water to where it is needed at the right time?

Central and southern Indiana have fewer aquifers than the northern half of the state. Without some policy that promotes regional distribution systems, development could be geographically constrained. Regional supplies would alleviate those concerns.

The Ohio River could serve as one resource. Twelve billion gallons of water flow through several Indiana cities and towns that sit on the river. At several points along the Ohio, there are ranney wells built during World War II to collect water from the river. But they have not been used in recent years. By adding pumps to these wells and building a system to distribute the water farther north, future shortages could be addressed.

Other options also would be available. All would be focused on moving the water to where it is needed. Doing so will help stabilize the economic performance of southern Indiana.

Lessons can be learned from Texas. Despite experiencing a tremendous population growth, it has no usable water source. In order to combat this problem, the state is divided into water regions. The supplies being used by each are closely tracked and, depending on consumption, water moved to the regions that need it most. This system allows for continued economic growth as potential shortages are addressed.

While there are future challenges, now is a time of opportunity. Unlike many areas of the country, Indiana has water resources. We can invent our energy and water future by taking charge and planning for the future.

Senate Enrolled Act 132 in 2012, which enables the state to gather information from water utilities, will help policymakers make informed decisions. The data also will help the utilities make smart choices when it comes to distributing their resources. Utilities submitted their surveys earlier this year, and the combined findings will be reported in September.

By being proactive, Indiana can become an example for others to follow. Early commitment is also critical as projects to distribute water supplies, while tremendously beneficial, will be costly.

In a recent speech, Dr. Jack Wittman, a national water expert based in Bloomington, summed up the importance of creating a water plan: "The first state, east of the Mississippi, to come up with a plan is the winner."

Indiana has the opportunity to be that winner. The state will soon have the data; it then needs to use it. The goal is to have a plan in the next two years, then execute it to secure the water future for all Hoosiers.

Kentuckiana Bridge Project Moving Forward

As southern Indiana continues to work toward enhancing its economy, one critical component is the Ohio River Bridges Project. The governors of Indiana and Kentucky announced Tuesday they are eager to continue the endeavor:

Governor Mitch Daniels, Kentucky Governor Steve Beshear and Louisville Mayor Jerry Abramson today convened the first meeting of the 14-member Indiana-Kentucky Bi-State Authority.

“It’s time to move, and in a way that creates a model on how two states can act together for the good of all,” said Daniels.

The Bi-State Authority was created to spearhead the project to construct two bridges over the Ohio River and to rebuild the Kennedy Interchange, where Interstates 64, 65 and 71 come together in downtown Louisville.

The authority’s mandate includes devising a financial plan for the project. The initial plan set the estimated cost at $4.1 billion. Indiana’s share is 30 percent.

“We’re taking a historic step today,” Gov. Beshear said. “The task before this authority is challenging but critically important. The work done here will benefit both of our states for generations to come.”

“It has taken many years, and lots of hard work, but we are now ready to move this important project forward,” Mayor Abramson said. “This authority will lay the groundwork for a vastly improved transportation system in Louisville and Southern Indiana.”

Beshear proposed the creation of special authorities to oversee development and financing of “mega” projects – those costing more than $500 million – between Kentucky and Indiana. The Kentucky General Assembly enacted the proposal in 2009. It created the statewide Kentucky Public Transportation Infrastructure Authority, which voted in October 2009 to recommend that Beshear, in cooperation with Daniels, create a bi-state authority for the Ohio River bridges project.

Corydon an Ideal Weekend Get-Away for Those On a Budget

My ladyfriend and I took advantage of some lovely late summer weather last weekend and headed down to Indiana’s former state capital — Corydon. We stayed at the Kintner House, a well-known bed and breakfast. We felt like royalty in the William Henry Harrison room, which serves as an homage to our former President (although his stint at the helm was brief).

While in Harrison County, we toured the first capitol building and an early Governor’s mansion (I even bought an artistic rendering of the scene from a local consignment shop for my new home).

In the afternoon, we took a cave tour at Squire Boone Caverns — an Indiana Chamber member. The tour was quite enlightening as we meandered through stalactites and stalagmites nearly nine stories below the ground. Seeing rock formations formed over millions of years is quite humbling — a feeling most of us don’t experience nearly enough (if my hours of watching reality television — or watching Kanye West do anything — are any indication). We also sported a serious glute burn on the 60-foot climb up a spiral stair case back to the surface.

All told, if you’re on a budget and looking to get away on a one-tank trip — to borrow vernacular from Bob Gregory — I highly recommend the Corydon area, especially as fall approaches. Visit Indiana’s blog has a more detailed post highlighting the history and allure of our former capital, as well.