Indiana lawmakers may have to boost taxes for roads funding

INDIANAPOLIS — Republicans who control Indiana's Statehouse say fiscal restraint will be in order when they write the state's two-year budget in the coming months. But as GOP leaders preach frugality ahead of the annual legislative session which kicks off Tuesday, they are also planning for a big increase in infrastructure spending — and want to raise taxes to pay for it.

"We don't have enough revenue to even sustain our maintenance program," said state Sen. Luke Kenley, the Senate's chief budget writer. Last year the Noblesville Republican opposed a similar tax increase; now he says lawmakers need to "face up to the fact" that more money is needed.

That means residents could find themselves paying more for cigarettes, gasoline or vehicle registration in order to build out and repair the state's roads, highways and bridges. It also creates an awkward situation for roughly two dozen Republicans who signed a pledge to conservative activist Grover Norquist, promising never to raise taxes.

Indiana is sitting on about $2 billion in reserves. Revenues are projected to grow 2 percent over the next two years, which could bring in an estimated $1 billion in new money.

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