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McCordsville holds first reading on wheel and excise tax tied to state road-funding changes
Summary
Staff briefed council on state law changes that will funnel additional Community Crossing funds based on lane miles only to jurisdictions with a wheel and excise tax in place; council held a first reading and asked staff for a work session to set rates and possible exemptions before a second reading.
Town staff presented a first reading of an ordinance to impose a municipal wheel and excise tax and create funds for road and transportation projects in light of changes to the state Community Crossing Matching Grant (CCMG) program.
Public works staff explained that Senate Bill One creates an additional pool of lane-mile-weighted funds that will be distributed only to jurisdictions that have both a wheel tax and an excise tax in place. Tim (public works staff) summarized: “The real brief version is the regular CCMG program doesn't change much. However, there's an additional set of money that will only get distributed based on lane miles to communities that have the wheel and excise tax in place.”
Council members pressed for specifics on potential revenue; staff said exact distributions and formulas are still being finalized by the state, and that town estimates built on 2023 registration data are imperfect but suggest the new requirement could unlock additional grant eligibility and increase the town's CCMG cap. Staff noted the county currently has wheel/excise taxes at maximum rates and that adopting some municipal rate (even a minimum) may be sufficient to qualify for lane-mile distributions.
The council discussed possible exemptions (municipal vehicles, antique/collector vehicles, and other categories allowed by state law) and the timing required to qualify for the first lane-mile distribution (staff said adoption in fall 2025 could make the town eligible for a distribution in mid-2027). Council directed staff to schedule a work session to present options for rates and exemptions prior to a required second reading.
Next steps: Staff will present rate options and model revenue estimates at a council work session before the second reading; final adoption would determine eligibility for the lane-mile distribution and affect future grant competitiveness.
