INDIANAPOLIS — Gov. Eric Holcomb's infusion of $90 million into improving Hoosier hiking, biking and riding trails could require the reallocation of current taxes or creating a new tax to maintain those routes or expand the program.
Reallocations could involve state revenues from fees imposed to dispose of old vehicle tires, designating sporting goods sales from the state sales tax or using a portion of the state gas tax.
In all, there are seven funding sources that are expected to be proposed by the Indiana Bike Trails Task Force in a report that is to be finalized by mid-June.
"Even though there's money proposed, there will need to be more from other places," Indiana Bicycle Trails Task Force Chair Kyle Hannon said. "It's the same with road projects — the federal government comes in or the state government comes but the local government puts in money also. I believe it would be that same kind of thing. I believe there's interest there."
Among its proposals discussed in a meeting Thursday, the task force considered recommending the imposition of a real estate transfer tax on property transfers under the concept that bike trails would enhance the quality of life for residents and businesses. The task force anticipates opposition to a new tax.
"I can't imagine a new tax for that purpose to be put on the table and be successful this year," House Speaker Brian Bosma, R-Indianapolis, said.
Some funding sources would require action by the Indiana General Assembly, which will have ended its current session by the time the report is issued in June.
The state is confronted with 82 pending requests in search of a slice of the $90 million. The requests total $144 million. The applications are from 42 counties and total more than 240 miles of biking and hiking trails. The first grants amounting to $25 million are to be awarded in spring through the Indiana Department of Natural Resources (DNR).
Some of the projects have come in with a 50 percent match, said Amy Marisavljevic, DNR Trails Section Chief. If applicants brought only 20 percent in matching grants, the $90 million in grants would yield $112 million in investment, she said.
Holcomb announced the grant program in September saying he would use revenues from the state's reworked toll road deal to fund some projects under his Next Level agenda including $90 million for better trail connections.
"The number of applications in the first round far surpassed our expectations and shows Indiana’s enthusiasm for trails,” Holcomb said in a statement. "This sends a big message that Hoosiers are invested in improving quality of life across the state."
The grant program is comprised of $70 million for regional projects and $20 million for local projects. Each fund requires the applicant to provide at least a 20 percent project match, which can include monetary contributions, land value, and in-kind donations of materials and labor.
Task force members said amenities, such as trailheads, restrooms or benches, may come at the expense of local communities or project applicants.
The revenue sources proposed by the task force could be used to award grants for the remainder of the $144 million, Hannon said. "If you have all this revenue in place, maybe you can fund more than the $90 million."