In a bold move to address long-term transportation funding challenges, Indiana has passed legislation that positions it as the first state in the nation to authorize tolling on all of its interstate highways. Signed into law as Public Law 173 (formerly House Bill 1461) in May 2025, the legislation enables the Indiana Department of Transportation (INDOT), with approval from the governor, to seek a federal waiver to implement toll lanes on any interstate route within the state.
This marks a significant shift in highway funding strategy. Currently, the only tolled interstate in Indiana is the I-80/90 corridor, where commercial trucks are charged roughly 49 cents per vehicle-mile via the EZ-Pass system. Under the new law, tolling could expand to heavily used freight and passenger corridors such as Interstates 64, 65, 69, 70, 71, 80, and 90.
Why Indiana Is Turning to Tolling
The push for expanded tolling arises amid growing concerns over the viability of the Highway Trust Fund—the federal government’s primary source of funding for interstate construction and maintenance. Historically supported by fuel taxes, the fund is now threatened by a combination of factors: increasing fuel efficiency in vehicles, the rise of electric vehicles, and fuel tax rates that haven’t kept pace with inflation.
Indiana officials, including State Senator Mike Crider, have publicly acknowledged the need for alternative funding solutions. “The gas tax is not a viable method anymore. We have to leave all options on the table,” Crider told Axios. This perspective aligns with a broader national conversation about modernizing infrastructure funding in light of evolving transportation technologies and usage patterns.
Federal Approval Still Required
While Indiana has cleared the legal path at the state level, the implementation of interstate tolls will require approval from the Federal Highway Administration (FHWA). The law stipulates that INDOT must submit a formal request to FHWA for a waiver to toll interstate lanes.
Although federal approval is not guaranteed, the FHWA has a history of greenlighting similar proposals from other states. Notably, the FHWA recently reversed its approval of New York City’s congestion pricing plan under the Trump administration. Still, Indiana’s more traditional tolling proposal may face fewer political or logistical hurdles.
Impact on Trucking and Freight Movement
For the trucking industry, which heavily relies on Indiana’s central location and interstate network, the tolling initiative could lead to higher operational costs. Routes like I-65 and I-70 are critical freight corridors that connect Midwest hubs with the rest of the country. Any tolling plan would likely factor into carrier rate adjustments, route planning, and supply chain strategies.
As of now, 24 states already have tolled interstate roads—not including tolled bridges and tunnels—but none have enacted legislation covering every interstate within their borders. Indiana’s plan is thus a groundbreaking model that other states may follow as they grapple with aging infrastructure and dwindling federal funds.
Ultimately, Indiana’s move represents a significant policy shift that could redefine how interstate highway maintenance is financed nationwide.
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