Reprinted

February 24, 2000





ENGROSSED

SENATE BILL No. 187

_____


DIGEST OF SB 187 (Updated February 23, 2000 3:22 PM - DI 92)



Citations Affected: IC 4-4; IC 6-1.1; noncode.

Synopsis: Economic development incentives. Provides that before a granting body may provide development assistance, the granting body must adopt criteria for awarding the assistance and enter into an agreement with the person that will receive the assistance. Applies only to projects of more than $100,000. Provides that the agreement must include certain employment and wage goals and provisions specifying the obligation to repay the assistance if the goals are not met. Requires the department of state revenue to publish a tax expenditure report. Requires each county auditor to report certain information. Requires the department of commerce to adopt a standardized information form that must be completed by any person applying for development assistance. Increases the acreage of property hat may be exempt from 50 to 200 acres if it is owned by a 4-H association. Allows property tax abatement for residential property that is located in the unincorporated area of a county if the designating body makes a finding that the facility is needed to serve elderly persons or disabled persons. Increases the
(Continued next page)

Effective: January 1, 1998 (retroactive); January 1, 1999 (retroactive); January 1, 2000 (retroactive); upon passage; July 1, 2000; January 1, 2001.





Meeks C, Meeks R
(HOUSE SPONSORS _ BAUER, GIAQUINTA, KRUSE)




    January 10, 2000, read first time and referred to Committee on Finance.
    January 27, 2000, amended, reported favorably _ Do Pass.
    January 31, 2000, read second time, ordered engrossed. Engrossed.
    February 1, 2000, read third time, passed. Yeas 50, nays 0.

HOUSE ACTION

    February 7, 2000, read first time and referred to Committee on Ways and Means.
    February 16, 2000, amended, reported _ Do Pass.
    February 21, 2000, read second time, amended, ordered engrossed.
    February 22, 2000, engrossed.
    February 23, 2000, read third time, recommitted to Committee of One, amended; passed. Yeas 72, nays 23.






Digest Continued

acreage of property hat may be exempt from 50 to 200 acres if it is owned by a 4-H association. Provides an exemption from personal property tax for commercial passenger airplanes located in St. Joseph County for maintenance. Provides local designating bodies the option of allowing new manufacturing equipment to be moved without losing the assessed value deduction. Specifies that the provision limiting a property tax abatement for new manufacturing equipment to the extent that it would cause the assessed value of all personal property of the owner in the taxing district in which the equipment is located to be less than the assessed value of all personal property of the owner in that taxing district in the immediately preceding year does not apply to new manufacturing equipment located in a particular township if the total original cost of all new manufacturing equipment placed into service by the owner during the preceding 60 months exceeds $50,000,000, and if the economic revitalization area in which the new manufacturing equipment was installed was approved by the designating body before September 1, 1994. Grandfathers in the abatement of property taxes in a consolidated city if the property owner and city complete all required procedures before July 1,2000 (retroactive to 1997).


Reprinted

February 24, 2000

Second Regular Session 111th General Assembly (2000)


PRINTING CODE. Amendments: Whenever an existing statute (or a section of the Indiana Constitution) is being amended, the text of the existing provision will appear in this style type, additions will appear in this style type, and deletions will appear in this style type.
Additions: Whenever a new statutory provision is being enacted (or a new constitutional provision adopted), the text of the new provision will appear in this style type. Also, the word NEW will appear in that style type in the introductory clause of each SECTION that adds a new provision to the Indiana Code or the Indiana Constitution.
Conflict reconciliation: Text in a statute in this style type or this style type reconciles conflicts between statutes enacted by the 1999 General Assembly.

ENGROSSED

SENATE BILL No. 187



    A BILL FOR AN ACT to amend the Indiana Code concerning taxation.

Be it enacted by the General Assembly of the State of Indiana:

    SECTION 1. IC 4-4-30 IS ADDED TO THE INDIANA CODE AS A NEW CHAPTER TO READ AS FOLLOWS [EFFECTIVE JULY 1, 2000]:
    Chapter 30. Development Assistance Disclosure and Taxpayer Protection
    Sec. 1. As used in this chapter, "development assistance" means any form of public assistance provided by Indiana or a political subdivision to stimulate economic development of a specific corporation, business, industry, geographic area, or part of Indiana's economy. The term includes the following:
        (1) Tax deductions under IC 6-1.1-12.1.
        (2) Tax credits under the enterprise zone program.
        (3) Training grants, including grants provided by the department of workforce development and grants or other assistance under the training 2000 program established by IC 4-4-4.6.
        (4) Loans and loan guarantees.


        (5) Tax increment financing.
        (6) Grants, including research and development grants, but excluding grants from the build Indiana fund.
        (7) Fee waivers.
        (8) Land price subsidies.
        (9) Infrastructure, the principal beneficiary of which is a single business or defined group of businesses at the time the infrastructure is built or improved.
        (10) Matching funds.
        (11) Industrial development bonds.
    Sec. 2. As used in this chapter, "granting body" means Indiana or a political subdivision that provides development assistance.
    Sec. 3. This chapter applies only to a project if the project involves an investment or expenditure of more than one hundred thousand dollars ($100,000).
    Sec. 4. (a) Before a granting body may provide any development assistance, the granting body must adopt by rule or resolution, after a public hearing, criteria for awarding development assistance. The criteria must include a policy regarding the wages that will be paid for any jobs related to the development assistance or that will be created or retained through the use of the development assistance.
    (b) The department of commerce, the department of workforce development, and the department of labor shall assist local government granting bodies in developing criteria required by this section.
    Sec. 5. (a) Before a granting body may provide development assistance to a person:
        (1) the person must enter into a development assistance agreement with the granting body; and
        (2) the development assistance agreement must be approved under subsection (d), if applicable.
    (b) A development assistance agreement entered into under subsection (a) must include at least all of the following:
        (1) A description of the development assistance, including the amount and type. The description must include the fair market value of the development assistance to the recipient, including the value of conveying any property at less than a fair market price and including any other in-kind benefits to the person receiving the development assistance.
        (2) A statement specifying the public purpose for the development assistance. The public purpose specified in the

development assistance agreement may not be increasing the tax base. Job retention may be specified in the development assistance agreement as a public purpose only if job loss by the person receiving the development assistance is imminent and demonstrable.
        (3) The general goals for the development assistance.
        (4) Goals for the number of jobs to be created by the person receiving the development assistance during the two (2) years following the date the development assistance is granted. The goals may include separate goals for the number of part-time jobs and full-time jobs, and in cases where job loss is imminent and demonstrable, separate goals for the number of jobs retained.
        (5) Wage goals for the jobs to be created or retained by the person receiving the development assistance during the two (2) years following the date the development assistance is granted.
        (6) A description of the financial obligation of the person receiving the development assistance if the goals specified in the development assistance agreement are not met.
        (7) A statement explaining why the development assistance is needed to achieve the public purpose specified in the development assistance agreement.
        (8) A commitment by the person receiving the development assistance to continue operations at any site where the development assistance is used for at least five (5) years after the date the development assistance is provided.
        (9) The name and address of the parent corporation or other parent entity, if any, of the person receiving the development assistance.
        (10) A list of all development assistance provided to the person receiving development assistance during the immediately preceding five (5) years by other granting bodies.
    (c) The granting body and the person receiving the development assistance must both sign the development assistance agreement. Before a granting body signs a development assistance agreement, the granting body must ensure that the person receiving the development assistance is not ineligible to receive the development assistance under section 9 of this chapter.
    (d) For a local government granting body that is not an elected body, a development agreement entered into under this chapter must be approved by the following:


        (1) The fiscal body of the county where the development assistance will be used, if the development assistance will not be used solely within a municipality.
        (2) The municipal fiscal body, if the development assistance will be used only within a municipality.
    Sec. 6. Before granting development assistance that exceeds five hundred thousand dollars ($500,000) for a state government granting body or one hundred thousand dollars ($100,000) for a local government granting body, the granting body must hold a public hearing concerning the proposed development assistance. However, a public hearing under this section is not required if a public hearing on the development assistance is required and held under any other law.
    Sec. 7. If development assistance provided by a granting body directly benefits more than one (1) person, the granting body must assign a proportion of the development assistance to each person receiving development assistance. The proportion assigned by the granting body to each person must reflect a reasonable estimate of the person's share of the total benefits of the development assistance.
    Sec. 8. (a) The development assistance agreement must include provisions that specify the obligation of the person receiving the development assistance to repay the development assistance if the person does not meet the goals specified by the development assistance agreement. The development assistance agreement must require at least that a person failing to meet the goals must pay back the development assistance plus interest to the granting body. A repayment required by this section may be prorated to reflect partial fulfillment of goals. The interest rate used to calculate the repayment must equal the gross domestic product implicit price deflator for the applicable period.
    (b) A granting body may, after a public hearing, extend for not more than one (1) year the period for meeting the goals specified by a development assistance agreement.
    Sec. 9. A person that fails to meet the terms of a development assistance agreement may not receive additional development assistance from a granting body until the earlier of the date:
        (1) five (5) years after the person's failure to meet the terms of a development assistance agreement; or
        (2) the person satisfies its repayment obligation under section 7 of this chapter.
    Sec. 10. (a) Before September 1, the department of state revenue

shall publish a detailed tax expenditure report. The tax expenditure report must:
        (1) be derived from state tax returns filed during the preceding calendar year; and
        (2) include at least the following information:
            (A) The amount of tax expenditures made by Indiana, in the form of uncollected revenues, for each specific tax credit or tax deduction that is:
                (i) provided to a taxpayer by Indiana; and
                (ii) considered development assistance for purposes of this chapter.
            (B) An itemized listing for each of the tax expenditures described in clause (A) of:
                (i) each taxpayer that claimed a credit or deduction described in clause (A); and
                (ii) the specific amount of the credit or deduction provided to the taxpayer for the year.
            (C) The following additional information:
                (i) The name of each taxpayer receiving a credit or deduction described in clause (A), and the name and address of the controlling entity of the taxpayer.
                (ii) The address and description of any property for which a credit or deduction described in clause (A) is received.
                (iii) The date upon which a credit or deduction described in clause (A) first took effect.
                (iv) The date upon which a credit or deduction described in clause (A) is scheduled to expire.
                (v) The estimated or scheduled amount of any credit or deduction described in clause (A) for the period between the date the credit or deduction took effect and the date the credit or deduction is scheduled to expire.
                (vi) The tax revenue foregone for the year as a result of each specific credit or deduction described in clause (A).
    (b) The department of state revenue shall compile and publish all data in the report required by this section in both written and electronic form.
    Sec. 11. (a) Each county auditor shall before September 1 provide to the state board of tax commissioners the following information concerning property tax deductions and credits claimed during the preceding year for property located in the county:


        (1) The name and address of each taxpayer receiving a deduction or credit that is considered development assistance for purposes of this chapter, and the name and address of the controlling entity of the taxpayer.
        (2) The address and description of the property for which a credit or deduction described in subdivision (1) is received.
        (3) The date upon which a deduction or credit described in subdivision (1) took effect.
        (4) The date upon which a deduction or credit described in subdivision (1) is scheduled to expire.
        (5) The estimated or scheduled amount of any deduction or credit described in subdivision (1) for the period between the date the deduction or credit took effect and the date the deduction or credit is scheduled to expire.
        (6) The property tax revenue foregone for the year as a result of each specific deduction or credit described in subdivision (1).
        (7) A compilation and summary of the total property tax revenue foregone as a result of all deductions and credits described in subdivision (1), including a summary of foregone property tax revenue for each type of deduction or credit.
    (b) The state board of tax commissioners shall adopt a standardized disclosure form for use by county auditors under this section.
    (c) The state board of tax commissioners shall compile and publish all data in the report required by this section in both written and electronic form.
    Sec. 12. (a) If a county auditor does not provide the information required under section 10 of this chapter before September 1, the state board of tax commissioners shall before October 1 notify the department of commerce of the county auditor's failure to provide the required information.
    (b) Not more than fourteen (14) days after receiving notice under this section, the department of commerce:
        (1) shall suspend any current development assistance activities under its control in the county; and
        (2) may not complete any current development assistance in the county or provide any additional development assistance in the county;
until the department of commerce receives notice from the state board of tax commissioners that the county auditor has provided the information required by this chapter.
    Sec. 13. (a) The department of commerce shall, before January 1, 2001, adopt a standardized information form that must be completed by a person applying for development assistance under a program or fund operated by or administered by the state or a political subdivision of the state.
    (b) The information form under this section must require at least the following:
        (1) An application tracking number that is specific to each granting body and each application for development assistance.
        (2) The name, street and mailing address, phone number, and executive of the granting body.
        (3) The name, street and mailing address, phone number, and principal officers of the controlling entity of the applicant for development assistance.
        (4) The name, street and mailing address, phone number, four-digit standard industrial classification (SIC) number, and chief officer of the applicant for development assistance at any specific project site for which development assistance is sought.
        (5) The total number of the applicant's full-time employees, part-time employees, and temporary employees who work at a specific project site on the date of the application.
        (6) The total number of full-time employees, part-time employees, and temporary employees who are employed in Indiana by the applicant's controlling entity or any subsidiary of the controlling entity on December 31 of the calendar year preceding the date of the applicant's application.
        (7) The type and value of the development assistance for which the applicant is applying.
        (8) The total number of new full-time jobs, part-time jobs, and temporary jobs that the applicant estimates will be created by the development assistance.
        (9) The average hourly wage that the applicant will pay to full-time employees, part-time employees, and temporary employees described in subdivision (6) during the first calendar year after those employees are hired.
        (10) For an application for development assistance related to a specific project site located in a metropolitan statistical area (as defined by the United States Department of Commerce, Bureau of the Census), the average hourly wage paid in Indiana to nonmanagerial employees employed in the

applicant's industry, as most recently provided by the United States Department of Labor, Bureau of Labor Statistics. The information required under this subdivision must be listed according to two (2) digit standard industrial classification (SIC) numbers or three (3) digit standard industrial classification (SIC) numbers, if that information is available.
        (11) For an application for development assistance related to a specific project site that is not located in a metropolitan statistical area (as defined by the United States Department of Commerce, Bureau of the Census), the average weekly wage paid in the county in which the project is located, as most recently reported by the United States Department of Commerce in the "County Business Patterns" report or a similar report.
        (12) The type and amount of employer paid health care coverage that the applicant will provide to its new employees not more than ninety (90) days after hiring. The applicant must specify any costs that will be paid by the new employees.
        (13) A list of all other forms of development assistance that the applicant is seeking and the name of the granting body from which that development assistance is sought.
        (14) A description of effects the applicant's use of the development assistance may have on employment at any site in a United States jurisdiction controlled by the applicant or the applicant's controlling entity, including any automation, consolidation, merger, acquisition, product line movement, business activity movement, or restructuring by either the applicant or the controlling entity.
        (15) Individual certifications by the executives of the applicant and the granting body as to the accuracy of the application, under penalty of perjury.
    (c) Beginning January 1, 2001, each applicant for development assistance must complete an information form under this section and submit the information form to the granting body from which the development assistance is being sought.
    Sec. 14. (a) A granting body that provides development assistance to a person must monitor the progress by the person in achieving goals set forth in the development assistance agreement under section 4 of this chapter.
    (b) A person receiving development assistance must provide information required by the department of commerce concerning goals and results of the development assistance until the later of:


        (1) two (2) years after the date of the development assistance; or
        (2) the date that all of the goals set forth in the development assistance agreement under section 4 of this chapter are met.
    (c) A person receiving development assistance must file the information required by this section with the granting body that provided the development assistance and with the department of commerce. The person must provide the information on forms developed by the department of commerce in cooperation with representatives of local government.
    (d) A person must file information required by this section not later than July 1 of each year for the previous year.
    (e) If a person receiving development assistance does not submit the information required by this section, the granting body must give the person notice not later than seven (7) days after the information was due. If the person does not provide the information within fourteen (14) days after the notice is provided by the granting body, the recipient must pay to the granting body a civil penalty of one hundred dollars ($100) for each subsequent day until the information is provided. The maximum penalty that may be imposed on a person under this subsection may not exceed one thousand dollars ($1,000) each year.
    Sec. 15. (a) A local government granting body that provides development assistance must, before September 1, file a report with the department of commerce. The report must do the following:
        (1) List the persons receiving development assistance that failed to do any of the following:
            (A) Provide the information required by section 13 of this chapter.
            (B) Meet the person's job and wage goals in the development assistance agreement under section 4 of this chapter within the time provided in the development assistance agreement.
        (2) The steps being taken by the granting body to:
            (A) bring a person that did not meet the person's job and wage goals into compliance with those goals; or
            (B) recover from the person the amount of the development assistance.
    (b) If a local government granting body does not provide the department of commerce with the information required by this section before September 1, the department of commerce shall

provide the local government granting body with notice that the information must be filed. If the local government granting body does not provide the department of commerce with the required information within fourteen (14) days after the notice is provided, the department of commerce:
        (1) shall suspend any current development assistance activities under its control in the granting body's jurisdiction; and
        (2) may not complete any current development assistance or provide any additional development assistance in the granting body's jurisdiction;
until the granting body provides the information required by section 13 of this chapter.
    (c) The department of commerce shall provide information and assistance to local government granting bodies concerning the granting bodies' reporting requirements under this section.
    Sec. 16. (a) The department of commerce must, before November 1, publish a report compiling and summarizing the information provided to the department under this chapter. The report must include information provided for the previous calendar year.
    (b) The report required by this section must include at least the following information:
        (1) The total amount of development assistance provided by all granting bodies.
        (2) The total amount of development assistance provided in various regions of the state.
        (3) The distribution of development assistance by amount of the development assistance.
        (4) The distribution of development assistance by type and by public purpose.
        (5) The number and percentage of all persons receiving development assistance that reached the goals specified in their development assistance agreements during the year.
        (6) The number and percentage of all persons receiving development assistance that have met the goals specified in their development assistance agreements within two (2) years after the date of the development assistance.
        (7) The total dollar amount of development assistance provided to persons that have met the goals specified in their development assistance agreements within two (2) years after the date of the development assistance.


        (8) A list of each person receiving development assistance that has failed to meet the terms of a development assistance agreement during the past five (5) years and has not satisfied the person's repayment obligations.
        (9) The number of part-time and full-time jobs created by each person receiving development assistance during the two (2) years after the person received the development assistance.
        (10) The wages paid and benefits provided by each person receiving development assistance.
    (c) The department of commerce shall make the following available to the public:
        (1) The report published under this section.
        (2) Except as provided in section 18 of this chapter, all information provided to the department under this chapter by a granting body or by a person receiving development assistance.
    (d) The department of commerce may add to the report under this section other information that is useful in evaluating development assistance.
    Sec. 17. The department and a granting body may inspect:
        (1) a specific project site; and
        (2) the tax and financial records;
of a recipient of development assistance.
    Sec. 18. A recipient's tax and financial records are not public records for purposes of IC 5-14-3 and shall be keep confidential. All reports and other information prepared by or received by the department of commerce, the department of state revenue, the state board of tax commissioners, or a granting body under this chapter are public records for purposes of IC 5-14-3, and any person may inspect and copy those reports. The department of commerce, the department of state revenue, the state board of tax commissioners, and a granting body shall separate and exclude all tax and financial records from a public record.
    Sec. 19. If a granting body, the department of commerce, the state board of tax commissioners, or the department of state revenue does not enforce or carry out the requirements under this chapter, a person who paid state income taxes or paid property taxes to a taxing unit in the preceding year, or any organization representing such a person, is entitled to bring a civil action to compel enforcement of this chapter. In an action under this section, a court shall award reasonable attorney's fees and actual incurred costs in pursuing the action to a prevailing plaintiff or

organization.
        SECTION 2. IC 6-1.1-10-15 IS AMENDED TO READ AS FOLLOWS [EFFECTIVE JANUARY 1, 2001]: Sec. 15. (a) The acquisition and improvement of land for use by the public as an airport and the maintenance of commercial passenger aircraft is a municipal purpose regardless of whether the airport or maintenance facility is owned or operated by a municipality. The owner of any airport located in this state, who holds a valid and current public airport certificate issued by the Indiana department of transportation, may claim an exemption for only so much of the land as is reasonably necessary to and used for public airport purposes. A person maintaining commercial passenger aircraft in a county having a population of more than two hundred thousand (200,000) but less than three hundred thousand (300,000) may claim an exemption for commercial passenger aircraft not subject to the aircraft excise tax under IC 6-6-6.5 that is being assessed under this article, if it is located in the county only for the purposes of maintenance.
    (b) The exemption provided by this section is noncumulative and applies only to property that would not otherwise be exempt. Nothing contained in this section applies to or affects any other tax exemption provided by law.
    (c) As used in this section, "land used for public airport purposes" includes the following:
        (1) That part of airport land used for the taking off or landing of aircraft, taxiways, runway and taxiway lighting, access roads, auto and aircraft parking areas, and all buildings providing basic facilities for the traveling public.
        (2) Real property owned by the airport owner and used directly for airport operation and maintenance purposes.
        (3) Real property used in providing for the shelter, storage, or care of aircraft, including hangars.
        (4) Housing for weather and signaling equipment, navigational aids, radios, or other electronic equipment.
The term does not include land areas used solely for purposes unrelated to aviation.
    SECTION 3. IC 6-1.1-10-16 IS AMENDED TO READ AS FOLLOWS [EFFECTIVE JANUARY 1, 2000 (RETROACTIVE)]: Sec. 16. (a) All or part of a building is exempt from property taxation if it is owned, occupied, and used by a person for educational, literary, scientific, religious, or charitable purposes.
    (b) A building is exempt from property taxation if it is owned, occupied, and used by a town, city, township, or county for educational,

literary, scientific, fraternal, or charitable purposes.
    (c) A tract of land, including the campus and athletic grounds of an educational institution, is exempt from property taxation if:
        (1) a building which is exempt under subsection (a) or (b) is situated on it; and
        (2) the tract does not exceed:
            (A) fifty (50) acres in the case of:
                (i) an educational institution; or
                (ii) a tract that was exempt under this subsection on March 1, 1987; or
             (B) two hundred (200) acres in the case of a local association formed for the purpose of promoting 4-H programs; or
            (B) (C) fifteen (15) acres in all other cases.
    (d) A tract of land is exempt from property taxation if:
        (1) it is purchased for the purpose of erecting a building which is to be owned, occupied, and used in such a manner that the building will be exempt under subsection (a) or (b);
        (2) the tract does not exceed:
            (A) fifty (50) acres in the case of:
                (i) an educational institution; or
                (ii) a tract that was exempt under this subsection on March 1, 1987;
             (B) two hundred (200) acres in the case of a local association formed for the purpose of promoting 4-H programs; or
            (B) (C) fifteen (15) acres in all other cases; and
        (3) not more than three (3) years after the property is purchased, and for each year after the three (3) year period, the owner demonstrates substantial progress towards the erection of the intended building and use of the tract for the exempt purpose. To establish that substantial progress is being made, the owner must prove the existence of factors such as the following:
            (A) Organization of and activity by a building committee or other oversight group.
            (B) Completion and filing of building plans with the appropriate local government authority.
            (C) Cash reserves dedicated to the project of a sufficient amount to lead a reasonable individual to believe the actual construction can and will begin within three (3) years.
            (D) The breaking of ground and the beginning of actual construction.


            (E) Any other factor that would lead a reasonable individual to believe that construction of the building is an active plan and that the building is capable of being completed within six (6) years considering the circumstances of the owner.
    (e) Personal property is exempt from property taxation if it is owned and used in such a manner that it would be exempt under subsection (a) or (b) if it were a building.
    (f) A hospital's property which is exempt from property taxation under subsection (a), (b), or (e) shall remain exempt from property taxation even if the property is used in part to furnish goods or services to another hospital whose property qualifies for exemption under this section.
    (g) Property owned by a shared hospital services organization which is exempt from federal income taxation under Section 501(c)(3) or 501(e) of the Internal Revenue Code is exempt from property taxation if it is owned, occupied, and used exclusively to furnish goods or services to a hospital whose property is exempt from property taxation under subsection (a), (b), or (e).
    (h) This section does not exempt from property tax an office or a practice of a physician or group of physicians that is owned by a hospital licensed under IC 16-21-1 or other property that is not substantially related to or supportive of the inpatient facility of the hospital unless the office, practice, or other property:
        (1) provides or supports the provision of charity care (as defined in IC 16-18-2-52.5), including providing funds or other financial support for health care services for individuals who are indigent (as defined in IC 16-18-2-52.5(b) and IC 16-18-2-52.5(c)); or
        (2) provides or supports the provision of community benefits (as defined in IC 16-21-9-1), including research, education, or government sponsored indigent health care (as defined in IC 16-21-9-2).
However, participation in the Medicaid or Medicare program alone does not entitle an office, practice, or other property described in this subsection to an exemption under this section.
    (i) A tract of land or a tract of land plus all or part of a structure on the land is exempt from property taxation if:
        (1) the tract is acquired for the purpose of erecting, renovating, or improving a single family residential structure that is to be given away or sold:
            (A) in a charitable manner;
            (B) by a nonprofit organization; and
            (C) to low income individuals who will:
                (i) use the land as a family residence; and
                (ii) not have an exemption for the land under this section;
        (2) the tract does not exceed three (3) acres;
        (3) the tract of land or the tract of land plus all or part of a structure on the land is not used for profit while exempt under this section; and
        (4) not more than three (3) years after the property is acquired for the purpose described in subdivision (1), and for each year after the three (3) year period, the owner demonstrates substantial progress towards the erection, renovation, or improvement of the intended structure. To establish that substantial progress is being made, the owner must prove the existence of factors such as the following:
            (A) Organization of and activity by a building committee or other oversight group.
            (B) Completion and filing of building plans with the appropriate local government authority.
            (C) Cash reserves dedicated to the project of a sufficient amount to lead a reasonable individual to believe the actual construction can and will begin within six (6) years of the initial exemption received under this subsection.
            (D) The breaking of ground and the beginning of actual construction.
            (E) Any other factor that would lead a reasonable individual to believe that construction of the structure is an active plan and that the structure is capable of being:
                (i) completed; and
                (ii) transferred to a low income individual who does not receive an exemption under this section;
            within six (6) years considering the circumstances of the owner.
    (j) An exemption under subsection (i) terminates when the property is conveyed by the nonprofit organization to another owner. When the property is conveyed to another owner, the nonprofit organization receiving the exemption must file a certified statement with the auditor of the county, notifying the auditor of the change not later than sixty (60) days after the date of the conveyance. A nonprofit organization that fails to file the statement required by this subsection is liable for the amount of property taxes due on the property conveyed if it were not for the exemption allowed under this chapter.
    (k) If property is granted an exemption in any year under subsection (i) and the owner:
        (1) ceases to be eligible for the exemption under subsection (i)(4);
        (2) fails to transfer the tangible property within six (6) years after the assessment date for which the exemption is initially granted; or
        (3) transfers the tangible property to a person who:
            (A) is not a low income individual; or
            (B) does not use the transferred property as a residence for at least one (1) year after the property is transferred;
the person receiving the exemption shall notify the county recorder and the county auditor of the county in which the property is located not later than sixty (60) days after the event described in subdivision (1), (2), or (3) occurs.
    (l) If subsection (k)(1), (k)(2), or (k)(3) applies, the owner shall pay, not later than the date that the next installment of property taxes is due, an amount equal to the sum of the following:
        (1) The total property taxes that, if it were not for the exemption under subsection (i), would have been levied on the property in each year in which an exemption was allowed.
        (2) Interest on the property taxes at the rate of ten percent (10%) per year.
    (m) The liability imposed by subsection (l) is a lien upon the property receiving the exemption under subsection (i). An amount collected under subsection (l) shall be collected as an excess levy. If the amount is not paid, it shall be collected in the same manner that delinquent taxes on real property are collected.
    SECTION 4. IC 6-1.1-12.1-3, AS AMENDED BY P.L.4-2000, SECTION 4, IS AMENDED TO READ AS FOLLOWS [EFFECTIVE JULY 1, 2000]: Sec. 3. (a) An applicant must provide a statement of benefits to the designating body. If the designating body requires information from the applicant for economic revitalization area status for use in making its decision about whether to designate an economic revitalization area, the applicant shall provide the completed statement of benefits form to the designating body before the hearing required by section 2.5(c) of this chapter. Otherwise, the statement of benefits form must be submitted to the designating body before the initiation of the redevelopment or rehabilitation for which the person desires to claim a deduction under this chapter. The state board of tax commissioners shall prescribe a form for the statement of benefits. The statement of benefits must include the following information:
        (1) A description of the proposed redevelopment or rehabilitation.
        (2) An estimate of the number of individuals who will be employed or whose employment will be retained by the person as

a result of the redevelopment or rehabilitation and an estimate of the annual salaries of these individuals.
        (3) An estimate of the value of the redevelopment or rehabilitation.
With the approval of the state board of tax commissioners, the statement of benefits may be incorporated in a designation application. Notwithstanding any other law, a statement of benefits is a public record that may be inspected and copied under IC 5-14-3-3.
    (b) The designating body must review the statement of benefits required under subsection (a). The designating body shall determine whether an area should be designated an economic revitalization area or whether a deduction should be allowed, based on (and after it has made) the following findings:
        (1) Whether the estimate of the value of the redevelopment or rehabilitation is reasonable for projects of that nature.
        (2) Whether the estimate of the number of individuals who will be employed or whose employment will be retained can be reasonably expected to result from the proposed described redevelopment or rehabilitation.
        (3) Whether the estimate of the annual salaries of those individuals who will be employed or whose employment will be retained can be reasonably expected to result from the proposed described redevelopment or rehabilitation.
        (4) Whether any other benefits about which information was requested are benefits that can be reasonably expected to result from the proposed described redevelopment or rehabilitation.
        (5) Whether the totality of benefits is sufficient to justify the deduction.
A designating body may not designate an area an economic revitalization area or approve a deduction unless the findings required by this subsection are made in the affirmative.
    (c) Except as provided in subsections (a) through (b), the owner of property which is located in an economic revitalization area is entitled to a deduction from the assessed value of the property. If the area is a residentially distressed area, the period is not more than five (5) years. For all other economic revitalization areas designated before July 1, 2000, the period is three (3), six (6), or ten (10) years. For all economic revitalization areas designated after June 30, 2000, the period is the number of years determined under subsection (d). The owner is entitled to a deduction if:
        (1) the property has been rehabilitated; or
        (2) the property is located on real estate which has been

redeveloped.
The owner is entitled to the deduction for the first year, and any successive year or years, in which an increase in assessed value resulting from the rehabilitation or redevelopment occurs and for the following years determined under subsection (d). However, property owners who had an area designated an urban development area pursuant to an application filed prior to January 1, 1979, are only entitled to a deduction for a five (5) year period. In addition, property owners who are entitled to a deduction under this chapter pursuant to an application filed after December 31, 1978, and before January 1, 1986, are entitled to a deduction for a ten (10) year period.
    (d) For an area designated as an economic revitalization area after June 30, 2000, that is not a residentially distressed area, the designating body shall determine the number of years for which the property owner is entitled to a deduction. However, the deduction may not be allowed for more than ten (10) years. This determination shall be made:
        (1) as part of the resolution adopted under section 2.5 of this chapter; or
        (2) by resolution adopted within sixty (60) days after receiving a copy of a property owner's certified deduction application from the county auditor. A certified copy of the resolution shall be sent to the county auditor who shall make the deduction as provided in section 5 of this chapter.
A determination about the number of years the deduction is allowed that is made under subdivision (1) is final and may not be changed by following the procedure under subdivision (2).
    (e) Except for deductions related to redevelopment or rehabilitation of real property in a county containing a consolidated city or a deduction related to redevelopment or rehabilitation of real property initiated before December 31, 1987, in areas designated as economic revitalization areas before that date, a deduction for the redevelopment or rehabilitation of real property may not be approved for the following facilities:
        (1) Private or commercial golf course.
        (2) Country club.
        (3) Massage parlor.
        (4) Tennis club.
        (5) Skating facility (including roller skating, skateboarding, or ice skating).
        (6) Racquet sport facility (including any handball or racquetball court).
        (7) Hot tub facility.


        (8) Suntan facility.
        (9) Racetrack.
        (10) Any facility the primary purpose of which is:
            (A) retail food and beverage service;
            (B) automobile sales or service; or
            (C) other retail;
        unless the facility is located in an economic development target area established under section 7 of this chapter.
        (11) Residential, unless:
            (A) the facility is a multifamily facility that contains at least twenty percent (20%) of the units available for use by low and moderate income individuals;
            (B) the facility is located in an economic development target area established under section 7 of this chapter; or
            (C) the area is designated as a residentially distressed area; or
            (D) the facility is located in the unincorporated area of a county and the designating body makes a finding that the facility is needed to serve elderly persons or disabled persons, or both.

        (12) A package liquor store that holds a liquor dealer's permit under IC 7.1-3-10 or any other entity that is required to operate under a license issued under IC 7.1. However, this subdivision does not apply to an applicant that:
            (A) was eligible for tax abatement under this chapter before July 1, 1995; or
            (B) is described in IC 7.1-5-7-11.
    SECTION 5. IC 6-1.1-12.1-4.6 IS ADDED TO THE INDIANA CODE AS A NEW SECTION TO READ AS FOLLOWS [EFFECTIVE UPON PASSAGE]: Sec. 4.6. (a) A designating body may adopt a resolution to authorize a property owner to relocate new manufacturing equipment for which a deduction is being granted under this chapter. The resolution may provide that the new manufacturing equipment may only be relocated to:
        (1) a new location within the same economic revitalization area; or
        (2) a new location within a different economic revitalization area if the area is within the jurisdiction of the designating body.
    (b) Before adopting a resolution under this section, the designating body shall conduct a public hearing on the proposed resolution. Notice of the public hearing shall be published in accordance with IC 5-3-1. In addition, the designating body shall

notify each taxing unit within the original and the new economic revitalization area of the proposed resolution, including the date and time of the public hearing. If a resolution is adopted under this section, the designating body shall deliver a copy of the adopted resolution to the county auditor and the state board of tax commissioners within thirty (30) days after its adoption.
    (c) New manufacturing equipment relocated under this section remains eligible for the assessed value deduction under this chapter. However, the same deduction percentage is to be applied as if the new manufacturing equipment had not been relocated.

    SECTION 6. IC 6-1.1-12.1-4.7 IS ADDED TO THE INDIANA CODE AS A NEW SECTION TO READ AS FOLLOWS [EFFECTIVE JANUARY 1, 1998 (RETROACTIVE)]: Sec. 4.7. Section 4.5(f) of this chapter does not apply to new manufacturing equipment located in a township that:
        (1) has a population of more than three thousand five hundred (3,500) but less than four thousand three hundred (4,300); and
        (2) is located in a county having a population of more than thirty-five thousand (35,000) but less than thirty-seven thousand (37,000);
if the total original cost of all new manufacturing equipment placed into service by the owner during the preceding sixty (60) months exceeds fifty million dollars ($50,000,000), and if the economic revitalization area in which the new manufacturing equipment was installed was approved by the designating body before September 1, 1994.

    SECTION 7. [EFFECTIVE JANUARY 1, 1999 (RETROACTIVE)] (a) This SECTION applies to a property owner that:
        (1) before January 1, 1999, received a notice from a consolidated city that offered to provide assessed value deductions to the property owner under IC 6-1.1-12.1;
        (2) has fulfilled all expectations of the consolidated city concerning job creation or retention, capital investment, and other requirements imposed by the consolidated city; and
        (3) is not eligible for the assessed value deductions described in the agreement because of the failure of the property owner or the consolidated city, or both, to comply with one (1) or more requirements of IC 6-1.1-12.1.
    (b) Notwithstanding IC 6-1.1-12.1, the consolidated city may grant the assessed value deductions described in subsection (a) if, before July 1, 2000, both the property owner and the consolidated city complete all the procedures required by IC 6-1.1-12.1 that

would have been necessary to comply with IC 6-1.1-12.1 and grant the deductions described in subsection (a).
    (c) Assessed value deductions granted under this SECTION apply to property taxes first due and payable after December 31, 1997. However, the interest provided for in IC 6-1.1.-37-11 does not apply to a property tax refund due the property owner as a result of this SECTION.
    (d) This SECTION expires July 2, 2000.

    SECTION 8. [EFFECTIVE UPON PASSAGE] IC 6-1.1-10-16, as amended by this act, applies to assessments for March 1, 2000, and property taxes first due and payable after December 31, 2000.
    SECTION 9. An emergency is declared for this act.


ES 187_LS 6441/DI 73

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