Paperwork mistake means Indiana cities and towns could see less for road projects

(WTHR Staff)

INDIANAPOLIS (WTHR) — State Auditor Tera Klutz said an error in Indiana’s Motor Vehicle Highway Fund formula will mean cities and towns across the state could see up to an 8 percent drop in road funding. That money will instead shift to Indianapolis.

“This adjustment will affect all cities and towns,” said Klutz in a letter to municipalities across the state earlier this month.

The Motor Vehicle Highway Fund is made up of revenue from fuel taxes and other fees and distributed each year to cities and towns. How much depends on population. That money helps cities and towns pay for road projects.

Klutz said the population of Indianapolis is based on the area covered by the city’s fire department.

When several township fire departments merged with IFD in the mid-2000s, the fire district grew. So, Indianapolis should have received a higher percentage of the Motor Vehicle Highway Fund.

But late this year, as officials were preparing for the census, they discovered that number was never updated.

Now that the numbers are corrected, Klutz said Indianapolis will get more money in 2020, which means other cities and towns could see less.

The auditors office is working on confirming the current population and will have that in the coming weeks.

Until then, a spokesperson for the auditor said it’s hard to tell at this time what the specific dollar impacts will be.

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