in-20261007-IR-GOV260391FSA: EXECUTIVE ORDER 26-34 FISCAL IMPACT STATEMENT

LEGISLATIVE SERVICES AGENCY OFFICE OF FISCAL AND MANAGEMENT ANALYSIS EXECUTIVE ORDER 26-34 FISCAL IMPACT STATEMENT Suspension of Special Fuel Restrictions for Farmer and Timber Harvesters Executive Order 26-34 Note Prepared October 5, 2026 Disaster Declared August 7, 2026 Order Issued September 30, 2026 Disaster Period August 7 – November 4, 2026 FEMA Disaster Declaration NA Nature of Disaster Energy Emergency Affected Counties All Counties Summary of Executive Order The executive order provides an allowance for agricultural machinery to utilize untaxed red-dye special fuel for transportation of agricultural products. This allowance was made for the duration of the energy emergency executive order. In total, an estimated 6.8 M gallons of special fuel could be substituted with untaxed red dye special fuel under the executive order, resulting in an estimated $4.29 M revenue loss from special fuel excise tax for the duration of the harvest season. Revenue Impact by Fund Distributions to Local Units of Government ($1.62 M) State Highway Fund ($2.67 M) Total Estimated Impact ($4.29 M) This waiver lasts from October 6, 2026, to November 4, 2026. The Governor may terminate the order before 30 days. Local Resources Money collected from the special fuel excise tax is provided to counties and municipalities through (1) the Motor Vehicle Highway Account and (2) the Highway Road and Street distribution formulas. Counties and municipalities will receive about $1.62 M less in revenue through these formulas. The estimated impact was calculated using estimates for total harvest amounts of corn and soybeans, fuel efficiency of agricultural product haulers, and estimates for distance to first and second choice delivery points. The estimates are also limited, as the process of producing enough red-dye special fuel to meet increased demand is not immediately known. There is also no information available on the total number of red-dye special fuel distribution locations in the state, as these locations fluctuate and are distributed across cardlock networks, agricultural cooperatives, commercial travel plazas, and bulk fuel distributors without a single centralized registry. State Resources Special fuel excise tax revenues are also deposited in the State Highway Fund (INDOT). The waiver will reduce revenue to this Fund by about $2.67 M. Federal Resources The emergency order has no impact on federal resources. Agencies Affected Level Agencies Local Counties and municipalities State Indiana Department of Transportation; Department of State Revenue Information Sources USDA AMS, Central Plains Grain Farm Truck Fleet study USDA AMS, Central Plains Grain Farm Truck Fleet and Marketing Patterns study Farm Progress, "Consider transport distance, premiums when hauling grain" USDA NASS, 2025 State Agriculture Overview for Indiana USDA NASS, Crop Production 2025 Summary (January 2026) Fleet industry benchmarks, Class 8 semi fuel economy Iowa State University Extension, "Estimates of Total Fuel Consumption in Transporting Grain" Fiscal Analyst: Bill Brumbach, 317.232.9559; Heath Holloway 317.232.9867