Residents and councilors weigh in on proposed wheel tax increase
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A packed house for a public comment session on the proposed wheel tax increase. Photo: Arika Herron/Axios
City-County councilors are facing resistance as they pitch raising the wheel tax to fund road improvements.
Why it matters: The city needs a plan to raise $50 million in new road funding next year to secure a matching grant from the state, but residents who spoke at the first public hearing Tuesday largely opposed the proposal.
- "You're going to kill us," said Jody Beach, a small business owner on the south side with a fleet of vehicles.
Driving the news: The next public comment opportunity is tonight at the public works committee meeting, 5:30pm at the Pike Township Government Center, 5665 Lafayette Road.
State of play: Tuesday was the first time for the public to weigh in on a plan to raise the county vehicle excise surtax and wheel tax starting next year.
- It was also the first opportunity for councilors on the administration and finance committee to share their thoughts on the tax hike being sponsored by a dozen of their colleagues and spearheaded by Councilor Andy Nielsen.
- "If we don't do something about this … 10 to 20 years from now, I think we will realize we made a generational mistake," Councilor Nick Roberts said.
What they're saying: Residents who spoke on Tuesday were largely against the tax increase, raising concerns about the already untenable cost of living.
- One 81-year-old resident said she's worried higher registration fees, coupled with other rising expenses, will mean she'll have to go back to work.
Zoom in: Under the proposal, the excise surtax — paid by passenger cars, motorcycles and light trucks — would be raised to a flat $100 annual fee paid at registration. The current fee structure averages out to about $20 for most vehicles.
- Larger vehicles like RVs and heavy-duty trucks that pay the county wheel tax would pay a flat annual fee of $240 at registration — up from the current $10–$40 range.
- Nielsen said he anticipates $70 million in new annual revenue from the increases, allowing "the city to continue investing in basic services like police, fire, parks, picking up trash, plowing the snow and doing other basic services in local government."
The other side: Several Republicans said they'd like to see more cuts to the city budget before raising the annual registration fee on local residents.
- "I don't think anybody in this room disagrees that Indianapolis should not be driving around on streets that look like we're in a third world country," Councilor Brian Mowery said. "I do think there's much better ways to get to it than raising a tax."
Reality check: The city has already made some budget cuts after state lawmakers enacted property tax cuts last year.
- "In essence what the state's doing is forcing us to raise the taxes on our constituents," said Councilor Frank Mascari, who expressed some hesitation about the plan. "I still blame the state for this."
The intrigue: Mayor Joe Hogsett has also opposed the increase in the wheel tax. He has a competing plan to make the $50 million match, though Nielsen has criticized its reliance on a variable distribution in state dollars the city will receive next spring.
- The city needs to confirm to the state it has the cash for the $50 million match by the end of this year.
What's next: After tonight's meeting, the next public comment opportunity will be at the rules and public policy committee, 5:30pm on June 16.
- A vote on the proposal is expected at the council meeting on July 6.