Lawmakers ponder Community Crossings, road funding formula
“I may have just heard, for the first time in eight years, that Community Crossings was ill-conceived,” Rep. Ed Soliday (R) of Valparaiso needles. “Are you sure [your] presentation isn’t really that [Accelerate Indiana Municipalities] wants Community Crossings gone?”
Rep. Soliday’s pointed response was triggered by AIM Policy Director Campbell Ricci’s presentation at the Funding Indiana’s Roads for a Stronger, Safer Tomorrow (FIRSST) Task Force meeting last month. Ricci stressed the need to preserve the Community Crossings program while also pushing for tweaks to funding allocation. He reported hearing larger communities complain about the funding cap ($1.5 million) being too low to meaningfully impact their infrastructure . . . while smaller communities worry that they can’t always afford the match, leaving them stuck saving for years to afford projects that CC is meant to expedite.
Ricci was not the only one who presented at the FIRSST meeting echoing some version of that sentiment. Although concerns about losing funds to electric vehicles and hybrids often take over road funding conversations, their impact was minimal in the task force meeting. Interest groups continuously discussed how disparate Indiana counties are in their need for funds. Presentations implied that Community Crossings’ existence may be increasing these disparities – not remedying them.
The Community Crossings moniker is often tossed around in legislative circles, but let’s clarify what the program actually does.
Community Crossings was launched in 2016, prompted by legislation from the Indiana General Assembly. The initiative aimed to provide “funding to cities, towns, and counties across Indiana to make improvements to local roads and bridges.” The Indiana Department of Transportation describes CC as “a partnership between INDOT and Hoosier communities, both urban and rural, to invest in infrastructure projects that catalyze economic development, create jobs, and strengthen local transportation networks.” There are two Calls for Projects annually in January and July; submittable projects include road resurfacing, bridge rehabilitation, road reconstruction, and Americans with Disabilities Act-compliant upgrades.
In 2022, 224 Hoosier cities, towns, and counties received a combined $107.8 million in state-matching funds for local road projects through Community Crossings. We’d call that a bit more than a drop in the road funding bucket – the issue lies in how the monies are spread across the Crossroads of America.
Modern Motorists
Our Hannah News Service sister newsletter INDIANA LEGISLATIVE INSIGHT reported that, in 2020, Purdue University estimated the potential revenue lost to Indiana’s Motor Vehicle Highway Account and Highway Road and Street Account from Covid-19 to be between 30% and 50 percent. This sharp decrease affected the amount of funds shunted to CC, too. People didn’t travel as often during the pandemic. Fuel tax revenue has yet to bounce back – while the pandemic and its work-from-home policies play a role, so does increased fuel efficiency. Modern motorists simply need less gas. In turn, they spend less cash at the pump. The Community Crossings funding formula – and the gas tax revenue formula – doesn’t work as effectively in a post-Covid world.
While modern trends certainly have an impact, concerns about Indiana’s roads are a time-tested concern. In a past issue, INDIANA LEGISLATIVE INSIGHT reviewed the 13th Intergovernmental Issues in Indiana: 2017 IACIR Survey, which revealed that while local road conditions were – and are! – improving overall, many Hoosiers still had worries about dilapidated local infrastructure. ILI also reports that local road decay has shown up consistently as an item of concern since 1999. A substantive shift has been needed for a while now.
Community Crossings Back-and-Forth
This isn’t the first conversation about the potential inequity embedded in Community Crossings.
In 2021, five years into Community Crossings’ 20-year lifespan, Interim Study Committee on Roads and Transportation Chair Jim Pressel (R) of LaPorte began to express some concern. At his behest, the Committee agreed to “take a deeper dive” into how CC could be made more equitable without cutting programs. Rep. Pressel felt that larger Hoosier cities may be paying more than their “fair share.” In response, then-Rep. Randy Frye (R) of Greensburg at the time firmly stated that he would support rural districts and “fight tooth and nail” against changes that may hurt rural Indiana communities.
In 2024, Rep. Pressel finds himself on the other side of the argument against Sen. Fady Qaddoura (D) of Indianapolis. Sen. Qaddoura asserts that Marion County may be getting shortchanged, and that research should be conducted to better ascertain how much each Hoosier community contributes and the scope of their local infrastructure needs.
“Senator, we will need to have a conversation offline … if you intend on pursuing this agenda,” Rep. Pressel warned. The House solon denounced the idea of allocating a “third” of road funding to Marion County under any circumstance.
Sen. Qaddoura clarified that his intention was to conduct more analysis and “look at [the needs of] the entire state,” not prioritize one county over another . . . and where exactly that offline conversation takes the two lawmakers remains to be seen.
Note as well that all of this discussion resembles one that Hoosiers in D.C. are perennially having with colleagues because Indiana is a donor state.
The Build Indian’ Council wrote late last year that “As a highway funding ‘donor state,’ Hoosier motorists contribute a greater share of fuel tax revenue to the federal Highway Trust Fund (HTF) than the share of funds the state receives back. Since the creation of the program in 1956, Indiana has forgone over $3 billion that instead went to other states for road construction and repair. Under the 2015 Fixing America’s Surface Transportation (FAST) Act, Indiana’s rate of return has averaged only 92.8%.”
But let’s take another look Back Home.
What’s the Plan for CC?
Sen. Qaddoura pushed for a more extensive evaluation of Community Crossings throughout the meeting, quizzing INDOT Commissioner Mike Smith (who, it should be noted, was battling a spotty connection over Zoom and was unable to provide robust answers to some questions because of it) whether he believes the program should be “folded” in the name of equitable county distribution of funds. Commissioner Smith stopped short of agreeing with that statement, but did acquiesce that Community Crossings should be “tweaked a little bit” and “capping the program” may be a part of that. Sen. Qaddoura also pushed Legislative Service Agency Senior Fiscal/Program Analyst Bill Brumbach on the lack of formal reports on sectionized county funding needs.
Sen. Qaddoura also questioned Association of Indiana Counties Director of Governmental Affairs and General Council Ryan Hoff. He stated that CC’s appeal lies in it being a “bucket outside of the normal formula,” but then reminded the task force that “at the end of the day, it is local communities trying to reach that match … if we put [the funds] back into the formula, locals will see those funds anyway … am I wrong? I would like to be wrong.”
Hoff informed Sen. Qaddoura, that he was, in fact, not wrong.
When Commissioner Smith was asked how difficult it would be to expand the categories of funding within Community Crossings, he framed the program’s scope as “road preservation … it’s been centered around more quick-hitting projects like maintenance.” According to Smith, the “pull of resources” is,
currently, appropriately limited, but pressed again for reevaluation.
Indiana’s Expensive, Expensive Roads
Another theme in the FIRSST meeting was the need to reevaluate the road funding formula and its reliance on Indiana’s gas tax.
While Indiana, overall, is a low-tax state, the gas tax is an exception, ranking high in comparison to other U.S. states. Commissioner Smith admitted that INDOT’s purchasing power is eroding – and will continue to erode – due to inflation, fuel efficiency, and EV and hybrid adoption. Smith stressed that fuel consumption comprises 84% of INDOT’s revenue.
His suggestion to increase highway tolling is one we’ve heard tossed around since the end of the 2024 legislative session, but, arguably, the idea hasn’t found its champion yet. Many lawmakers bring it up, but few seem to push for implementation – at least, so far.
Commissioner Smith also hypothesized that Indiana, with its constant influx of non-resident traffic, will want to follow in Oregon and Hawaii’s footsteps and establish a Road Usage Charge program (RUC). RUCs are pay-per-mile road funding systems that implement per-mile charges, base registrations, fuel tax credits, and reduced registration fees for EVs and hybrid vehicles. Rep. Pressel seemed particularly interested in the adoption of a RUC, especially after hearing that Oregon and Hawaii have mostly found success with their pilot programs. Expect RUCs to come up again in subsequent meetings.
Perhaps the most damning statistics to emerge in the FIRSST meeting were sourced from Local Technical Assistance Program research, relayed by Purdue University Lead Research Engineer Jennifer Sharkey. She predicts a shortfall of $2.4 billion needed for Indiana to drag its city and county roads and bridges out of the “poor” category within the next 10 years. Currently, 31% of city roads, 27% of country roads, and 5.0% of bridges are in poor condition.
Even though $2.4 billion may sound like an inflated number, a worst-case scenario, you should understand that this figure doesn’t include any local government funding, nor does it account for adding extra capacity to roads as a means of revitalization. The true number may end up even higher.
Don’t forget about Indiana’s bridges, too.
Engineers are reporting an acceleration of disintegrating American bridges due to “extreme heat and increased flooding linked to climate change,” according to the New York Times’ Coral Davenport. Put simply, our infrastructure is hyper-aging, expiring before its time.
U.S. Secretary of Transportation Pete Buttigieg deems bridges “one of the forms of infrastructure that takes the longest to update or refresh . . . and yet we’re seeing those vulnerabilities everywhere across the country.” Or, to borrow University of Colorado Civil Engineering Professor Paul Chinowsky’s verbiage: “Bridges are literally falling apart like Tinkertoys.” Dr. Chinowsky asserts bridges with decades under their belt are often built with materials unprepared to withstand modern climates and sharp temperature swings – the average age of a Hoosier bridge is 50 years old. This does not portend a happy future for Indiana’s “fair” and “poor” bridges if rehabilitation isn’t prioritized.
Rep. Pressel and Rep. Soliday were particularly concerned after Sharkey’s presentation.
Rep. Pressel fretted over whether “highway dollars [were] going back into highways … we need to figure out a way to … [meet] a $2.5 billion need – and that’s just on the local side! And we need safety improvement projects. How do we make sure that money gets back into the roads?”
Rep. Soliday recalled his spearheading of a 2016 push to support local roads, resulting in a modification of the wheel tax. “How else can we empower them?” he wondered.
Hoff suggested a “local option gas tax,” but, again, expect this to be a hot topic of conversation in future meetings.
Despite Rep. Soliday’s later chagrin at the idea, he also pondered how to better evaluate Community Crossings. “We wanted locals to participate in asset management. It was a noble experiment, but I think it’s time to now rethink: ‘How are we going to use it?’”
A big takeaway? As conversations about tackling Indiana’s road funding dilemmas move forward, Community Crossings may be looking at an overhaul . . . along with our road funding formula as a whole.