Mayor Joe Hogsett has vetoed a Democrat-led proposal to raise the city’s taxes on registered vehicles. In a video posted to social media, the mayor said he can’t support a measure that “adds to the increased financial burdens facing Indianapolis residents.”
It’s the first time Hogsett, also a Democrat, has exercised his veto power during his 10-year tenure.
“Over the course of the last month, my office has heard from older adults on fixed incomes who say this increase is simply not doable,” Hogsett said in the 2-minute video posted on social media July 16 explaining his justification for the veto. “When neighbors tell me rising costs are forcing hard decisions, it is my responsibility to listen.”
The City-County Council voted 14-10 on July 6 to increase both the city’s wheel tax and vehicle excise surtax.
The proposal would set a flat fee of $100 on passenger vehicles and $240 for heavy vehicles, a move that’s expected to raise about $71 million a year in new revenue.
The council proposed the increase to access an additional $50 million in annual road funding from the state. That money can only be accessed if the city comes up with a $50 million match — an amount that will increase in subsequent years while the state’s share remains unchanged.
Hogsett said he’s confident the city can make the match without raising taxes, but councilors have expressed doubts about the city’s ability to raise the necessary revenue in the coming years.
The mayor has said his plan would rely on funding already allocated in the 2026 and 2027 budgets, as well as money from stormwater fees and supplemental income tax funding from the state.
But according to the state law that opened the door for Indy to receive the additional state funding, the city would need to raise more than $50 million in subsequent years to receive the state match: $70 million in 2028, $80 million in 2029, $90 million in 2030 and $100 million in 2031.
Councilor Andy Nielsen, an eastside Democrat who led the vehicle tax proposal, said Hogsett’s proposal “is not really a plan” but a “one-year patch.”
The council can override the mayor’s veto with support from a two-thirds majority, which would equate to 17 out of the 25 councilors.
Council President Maggie Lewis, a Democrat who voted in favor of the tax increase, said the full council will likely vote on whether to override the veto at its Aug. 10 meeting.
Lewis said the tax increase, while difficult to swallow, has support from community members who want better roads for their city.
“Folks are not happy about raising taxes, but they understood that in order for us to really fix our infrastructure we needed to do something major, and the plan we created did exactly that,” Lewis told reporters gathered at the City-County Building following the mayor’s veto.
2 Democrats short
All six Republicans on council were opposed to the tax increase. One Democrat was absent, meaning it seems likely that at least one and maybe two Democrats would need to change their vote in order to override the veto.
Councilor Dan Boots, a northside Democrat, was not present for the July 6 vote but said he will vote in favor of the tax increase at the next opportunity. Four Democrats voted against the tax hike: Brienne Delaney, Ron Gibson, Frank Mascari and Crista Wells.
Wells, who has called on Hogsett to resign for his handling of sexual misconduct allegations against his former chief of staff, Thomas Cook, said she supports Hogsett’s veto.
“I think he should step down today,” said Wells, “but I also think he should vote down this wheel tax increase. Both can be true.”
Wells added, though, that she would support a smaller tax increase in subsequent years. She believes now is the wrong time.
The other three Democrats who voted against the tax increase did not respond to a request for comment.
Lewis didn’t dismiss the possibility that the proposal could be altered to get her Democratic colleagues on board.
“There will be a lot more conversations being had over the next couple weeks. If that requires us to make some tweaks to the proposal, we’re all ears,” Lewis said.
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Peter Blanchard covers local government. Reach him at 317-605-4836 or peter.blanchard@mirrorindy.org. Follow him on X @peterlblanchard.
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