The Indianapolis City-County Council introduced Proposal No. 192 on June 1 to establish a long-term local funding source for infrastructure and to position Indianapolis to secure up to $50 million annually in additional state road funding.
Proposal No. 192, 2026, would amend Chapter 121 of the Revised Code to increase Marion County’s county vehicle excise surtax and wheel tax through existing state-authorized mechanisms. Revenues generated would be restricted transportation dollars dedicated to the construction, reconstruction, and repair of roads and streets and cannot be used for other infrastructure needs.
“This proposal is about more than a fee change, it is about creating a long-term infrastructure funding strategy for Indianapolis,” said City-County Council President Maggie A. Lewis. “For too long, Indianapolis has relied on short-term and inconsistent funding sources while our infrastructure needs continue to grow. This plan allows us to secure critical state matching dollars, stabilize funding for roads and neighborhood infrastructure, and move from reactive repairs toward a more predictable, long-term investment strategy that residents can see and feel in their communities.”
Under the proposed ordinance:
- For vehicles that currently pay the county vehicle excise surtax — including passenger cars, motorcycles, and trucks under 11,000 pounds — the proposal would replace the current fee structure with a flat $100 annual fee paid at registration. Currently, the surtax is based on 10% of the state vehicle excise tax, with a minimum charge of $7.50.
- For vehicles subject to the county wheel tax, the proposal would replace the current fee schedule of $10 to $40, depending on vehicle type, with a flat annual fee of $240 paid once per year, at the same time you register or renew your vehicle registration.
- These fees apply to different types of vehicles. A vehicle that pays the excise surtax would not also pay the wheel tax, so no vehicle would be charged both fees.
- These changes would take effect on Jan. 1, 2027.
In 2025, the Indiana General Assembly passed House Bill 1461 which created a pathway for Indianapolis to receive up to $50 million annually in additional state road funding if the city provides a required local match.
In 2026, Senate Bill 179 amended the structure of those matching requirements, increasing the local contribution over time beginning in 2027. The required match increases over time: $50 million in 2027, $70 million in 2028, $80 million in 2029, $90 million in 2030, and $100 million beginning in 2031 and each year thereafter. The 2027 match must be entirely new revenue, based on this state law.
According to estimates provided by the City-County Council, the proposed surtax and wheel tax changes are projected to generate about $70.95 million in new local transportation revenue in 2027 and about $355.75 million over five years.
When combined with the state match and other projected transportation funding, the Council’s infrastructure plan is estimated to support about $855.75 million in new state and local infrastructure investment from 2027 through 2031.
“We hear daily from our constituents that the condition of city streets is unacceptable. Our plan provides the certainty Indianapolis needs to secure a generational investment from the State of Indiana while providing additional local resources to address our growing infrastructure backlog,” said Assistant Majority Leader Andy Nielsen. “Our plan is a transparent, long-term strategy that takes a meaningful step to address decades of deferred maintenance, and commits the city to more sustainable infrastructure planning in the future.”
The proposal is scheduled for a vote during the Rules and Public Policy Committee meeting on June 16.
For more information about the current County Vehicle Excise Tax visit mybmv.bmv.in.gov/Default.aspx.
Contact Staff Writer Malik Simon at 317-762-7847.
Malik Simon is a Staff Writer for the Indianapolis Recorder Newspaper. Originally from Memphis, TN, he graduated from Mississippi Valley State University with a Bachelor of Arts in General Studies concentrating on journalism. Before joining the Recorder, he wrote for the Devil’s Gazette newspaper at MVSU and served as a freelance content and video editor. He seeks to use media to help communities flourish through literacy and factual reporting.
