Lawmaker: Bills seeking tax relief for Hoosiers using Ohio River toll bridges dead for 2016
State Sen. Rom Grooms is pushing the measures ahead of the scheduled start of tolls on three bridges between Clark County, Ind., and Louisville later this year.
LOUISVILLE, Ky. (WDRB) – Two measures that would give tax relief to Hoosier drivers and businesses crossing Ohio River toll bridges have died in the Indiana legislature.
State Sen Ron Grooms, R-Jeffersonville, said Monday that the toll-related bills won't be heard in the Senate's tax and finance committee, ending their chances in this year's Indiana General Assembly.
(Note: An earlier version of this story was posted Monday afternoon before Grooms said the bills wouldn't get a hearing. It has been updated to reflect the change.)
Grooms had filed the bills ahead of the scheduled start of tolling later this year on three crossings between Southern Indiana and Louisville.
One measure, Senate Bill 228, would give residents of Clark and Floyd counties an income tax deduction if they have at least $100 of “nonreimbursed” toll expenses in a year. The annual deduction would be capped at $500.
Grooms’ Senate Bill 229 would allow businesses to claim a tax credit for toll expenses of up to $5,000. Those companies must have a principal office or branch in either Clark or Floyd County.
Grooms and Sen. Jim Smith, R-Charlestown, co-sponsored a 2015 bill seeking the tax deduction for drivers, but it failed to advance in the Indiana Senate’s tax committee. With traffic now on the Interstate 65 Abraham Lincoln Bridge, Grooms said in an interview last week that the time is right to push again for the tax proposals.
“Most legislators are much more familiar with the bridges this year than they were last year because now one is open and there is a general mood to try and relieve as much pressure on that tolling system as possible,” he said.
Grooms’ plan would have required businesses to be certified with the Indiana Secretary of State before claiming the tax credit, while drivers could claim the deduction on their state income tax forms.
“It would be an easier way to implement some type of savings or some type of reimbursement of expenses in the form of a tax deduction or tax credit than it would be to try to redo the system of collecting and changing the rates,” he said.
The Lincoln Bridge is one of two new spans being added as part of the $2.3 billion Ohio River Bridges Project, which also includes a redesigned interchange where I-65, I-64 and I-71 meet near downtown Louisville.
Once an upriver bridge between Utica, Ind., and Prospect, Ky., is finished later this year, Kentucky and Indiana will begin charging drivers to cross the new spans and the I-65 Kennedy Bridge, which is being repaired.
Federal data indicates that Southern Indiana residents who travel to jobs and school in Louisville will bear most of the toll burden. About three times as many Clark County residents commute to Louisville for work than do people who head in the opposite direction, according to Census estimates released last year.
Some Indiana-based companies already have chosen to open locations in Kentucky in an effort to ease the costs of tolls. The initial rates, for instance, call for heavy trucks to pay $10 to $12 per crossing, depending on the type of toll account they use.
Summit Trucking of Clarksville, Ind., plans to open a hub in Bullitt County, Ky., to mitigate expected toll costs of about $700,000 per year, an official told WDRB last fall.
For ecotech, a waste hauling and recycling company with offices in Louisville and Jeffersonville, the cost of bridge tolls is “an important issue,” said president Bryan Slade, whose company’s trucks cross the river several times per day, including runs to the Clark-Floyd landfill.
“It gets more painful as time has passed and you have two bridges with substantial tolls,” he said.
One Southern Indiana, the chamber of commerce for Clark and Floyd counties, urged Indiana officials in 2014 to consider a tax credit for businesses that incur high toll costs.
“As an organization, we stand behind that,” said Wendy Dant Chesser, the chamber’s president and CEO.
Taken together, Grooms’ bills would result in $2.4 million to $8.5 million less for Indiana’s general fund each year starting in 2018, increasing as much as five percent annually, according to estimates in fiscal impact statements.
In Kentucky, state Rep. Jim Wayne pushed for similar tax relief in the past. But Wayne, D-Louisville, said he isn’t planning to file toll-related bills during this year’s session.
Wayne, who calls tolls “an unjust tax,” said he may revisit the legislation in 2017 after tolls have started. Like Grooms, he envisions a rebate for some drivers to recoup their out-of-pocket toll costs.
“The low-income folks are harmed more by a toll than the wealthy folks as a percentage of their income,” Wayne said. “If someone is working a minimum wage job in Southern Indiana and they live in Louisville, we’ve calculated, based on the current proposed tolls that that would be a $500 tax on those people’s transportation just to get to and from work.”
Copyright 2016 WDRB News. All rights reserved. An earlier version of this story was posted Tuesday afternoon before Grooms said the bills wouldn't get a hearing. It has been updated to reflect the change.