Diners won’t see boost in food tax

GREENFIELD — Hancock County won’t be allowed to raise its tax at restaurants this year.

While county officials pitched the idea to state lawmakers in hopes of raising money for local road repairs, Rep. Bob Cherry said the idea didn’t go far.

Cherry, R-Greenfield, said the only community in line to be allowed to raise its food and beverage tax is Rockville in Parke County. Local officials had wanted to add Hancock County to the measure, but Cherry said the House Ways and Means Committee turned it down.

“They made their pitch, but Rockville was the only one,” Cherry said. The Rockville bill passed the House and will next be heard in the Senate.

It was a disappointment but not necessarily a surprise to county officials, who admit it was a long shot to ask the Legislature for more cash this year.

The food and beverage tax is a tax on dining. Every restaurant bill has a 7 percent state sales tax and an additional 1 percent food and beverage tax. Half of the money generated from the extra tax goes to pay off debt on Lucas Oil Stadium; the other half goes into Hancock County coffers.

A 1 percent increase would have brought in an additional $800,000 a year to the county, which members of the Hancock County Council said in January they would earmark for road work.

But it was not meant to be — at least not this year. County officials had hoped to piggyback on the bill for Rockville, but Cherry said the argument to add the county wasn’t compelling enough for the committee that oversees finances and tax matters.

County Councilman Jim Shelby said he might recommend the council try again next year.

“I figured it was 50/50, so I’m not shocked,” said Shelby, a proponent of the tax increase.

Road work has been a pet project of county officials over the past four years. The additional money could have meant 11 more miles of paving; 53 miles of chip seal work; or 20 miles of strip paving.

County Highway Engineer Gary Pool said he wasn’t surprised it was a no-go this year because county officials got in on the legislative process late in the game. Pool, who spoke along with Shelby to lawmakers last month, said he’ll do so again if asked.

“I’m like every department head; everyone wants more funding,” Pool said. “But as to where the funds come from is not my job.”

Still, county highway department officials say they will have plenty of money to work with this year.

The county council decided to dip into its reserves and boost funding for road work.

Nearly $2 million will be spent in 2015 on road repairs, the most spent in at least five years.

Shelby said the county council was able to dip into its reserves from the food and beverage fund but won’t be able to keep doing that unless the state Legislature allows for a tax hike.

“We’re going to be spending about $2 million, and we want to keep it that way if we can, but we can’t use the food and beverage (fund) forever,” Shelby said.