Boone County Highway Department is facing a shortfall in funding for roads from the state because of the Zionsville reorganization.
Council members and every state senator and representative that covers Boone County were on hand to last week to hear a presentation about the two main issues that are affecting funding in 2020. Both dealt with funding to the Boone County Highway Department.
It’s complicated, but the state funds counties and municipalities through the Motor Vehicle Highway fund and the Local Roads and Streets fund. The Indiana Department of Transportation also gets funded from the MVH.
In 2017, the Indiana legislature raised the gas tax 10 cents and raised other road taxes to be used for roads in the Crossroads of America. The plan worked. Revenues for roads increased more than 100%.
However, next year, the legislature put a restriction on the money that 50% of it must be used only for “construction, reconstruction and preservation.” Except, Boone County is not seeing a doubling of the state funding from those increased taxes. This means that the 50% rule is reducing the amount of unrestricted funds – used for administrative, salt, and other expenditures that are necessary to run the highway department.
“We’re actually only receiving a 29% increase across the board from the MVH (motor vehicle highway fund),” Boone County Highway Department Director Craig Parks said. “So that means there’s that gap, that shortfall that we cannot use for a lot of the things that we have to do as a highway department.”
In addition, the legislature is decreasing the amount of money going to the local entities. The new split is 60% going to the state and 40% divvied up among the local counties and municipalities. So the gas tax isn’t reaching Boone County.
“Even though we’re seeing some increase in funds — in 2018 we saw a real big increase and then it has gradually started to go down,” Parks said.
He added the department is going to have to split individual employee compensation which qualifies under unrestricted and restricted funds from the state. Someone has to track that and move the money. These are administrative costs that aren’t allowed to be used for 50% of the funds.
“It’s the part of government that people complain about – all the red tape,” Parks said.
Parks also told the council that the Local Roads and Street fund is being adversely effected by the reorganization of Zionsville. When Zionsville Town Council, in an agreement with Eagle, Union and Perry townships, took control of those areas, it entered into an interlocal agreement to have the outer areas of Zionsville to still be covered by county highway and law enforcement.
Yet, the population of those areas is going under Zionsville’s figures. Population is part of the funding formula for the LRS distribution. Parks said 60% of those funds are based on the municipality’s population, while 40% is based on road miles.
“So we get the road mileage credit, but we’re losing out on 60% of the population,” Parks said. “All that being said, Zionsville has been very helpful. They, on our initial Community Crossings grants, on the roads that were within the rural Zionsville, they agreed to pick up the 50% match.”
It also affects the public safety LIT or local option income tax increase approved by Boone County in 2016.
“We work well with Zionsville and Zionsville Police Department,” Boone County Sheriff Mike Neilsen said. “I think legislatively they (the state legislature) need to look at it and see how the back end gets funded.”
That “back end” includes administrative, judicial, prosecutor, jail and communications or the 911 call center, Nielsen said. All are affected by the distribution of the income tax based on population. He added that the council is funding all of the 911 operations, but may need to consider asking the city and towns to contribute in the future.
House Dist. 24 Representative Donna Schaibley was one of seven state legislators in the meeting who heard these concerns and also agrees that a legislative fix is needed.
“I think this will spur some of the people in the room to work toward a legislative fix,” Schaibley said. “Other cities are looking at reorganization and this could spur more problems down the road for counties and cities.”