or to increase the school option income tax rate to a rate higher
than the rate at which the school option income tax was imposed
only if a majority of the electorate participating in the general
election votes to adopt the ordinance. If a majority of the electorate
participating in the general election votes to adopt the ordinance,
the governing body of the school corporation shall adopt the
ordinance before December 1 of the year in which the local public
question was placed on the ballot.
(d) The governing body of a school corporation may adopt an
ordinance under this chapter to:
(1) rescind a school option income tax;
(2) decrease the school option income tax rate; or
(3) increase the school option income tax rate to a rate lower
than or equal to the rate at which the school option income tax
was originally imposed under subsection (c);
at any time and without notice.
Sec. 4. The governing body of a school corporation shall impose
a school option income tax on the adjusted gross income of resident
taxpayers residing in the school corporation effective January 1 of
the year following the general election in which a majority of the
electorate participating in the general election voted to adopt an
ordinance to impose a school option income tax under the
procedure set forth in section 3 of this chapter.
Sec. 5. (a) The school option income tax imposed under this
chapter by a governing body of a school corporation remains in
effect until rescinded by the governing body.
(b) Subject to subsection (c), a governing body of a school
corporation may rescind the school option income tax by passing
an ordinance to rescind the tax. The ordinance must be passed
after July 1 but before December 1 of a year. The governing body
may rescind the tax without causing a public question to be placed
on a general election ballot.
(c) If the governing body of a school corporation has pledged
school option income tax revenue for any purpose permitted by
statute, the governing body may not rescind a school option income
tax or take any special action that would result in the school
corporation receiving a distributive share under section 10 of this
chapter smaller than the distributive share to which the school
corporation was entitled when it pledged the school option income
tax revenue.
Sec. 6. (a) Subject to subsection (b), a governing body of a school
corporation may decrease the school option income tax rate at any
time and without notice.
(b) A governing body of a school corporation may not decrease
the school option income tax if the school corporation has pledged
the school option income tax for any purpose permitted by
IC 5-1-14
or any other statute.
chapter is not part of the school corporation's previous year
revenue as defined in
IC 21-3-1.7-3.1.
Sec. 10. (a) Revenue derived from the imposition of a school
option income tax shall be distributed in the manner prescribed by
this section to the school corporation whose governing body
imposed the tax. The amount that is to be distributed to a school
corporation during a calendar year equals the amount of school
option income tax revenue that the department, after reviewing the
recommendation of the budget agency, estimates will be received
from that school corporation during the school year.
(b) This subsection applies to a school corporation that has
adopted an ordinance to impose a school option income tax or to
increase or decrease the school option income tax rate (referred to
in this subsection as the "adopting school corporation"). Before
July 1 of each calendar year for which a school option income tax
has been imposed, the department shall review the
recommendation of the budget agency and shall estimate and
certify to the governing body of the adopting school corporation
and to the auditor of the county in which the adopting school
corporation is located the amount of school option income tax
revenue that will be collected from that school corporation during
the school year.
(c) This subsection applies to a school corporation that has
caused a local public question described in section 3 of this chapter
to be placed on a general election ballot but whose governing body
has not adopted an ordinance to impose a school option income tax
or to increase or decrease the school option income tax rate
(referred to in this subsection as the "electing school corporation").
Before December 15 of a year in which a local public question
described in section 3 of this chapter is placed on a general election
ballot, the department shall review the recommendation of the
budget agency and estimate the amount of school option income tax
revenue that will be collected from the electing school corporation
during the period beginning on the date when the school option
income tax is imposed and ending on June 30 of the year in which
the school option income tax is imposed. The department shall
multiply this amount by two (2) and certify the doubled amount to
the governing body of an electing school corporation and to the
county auditor of the county in which the electing school
corporation is located.
(d) The amount certified under subsection (b) or (c) is the school
corporation's certified distribution for the immediately succeeding
calendar year. The amount certified may be adjusted under
subsection (e) or (f).
(e) The department may certify to an adopting school
corporation an amount that is greater than the estimated twelve
(12) month revenue collection if the department, after reviewing
the recommendation of the budget agency, determines that there
will be a greater amount of revenue available for distribution from
the school corporation's account established under section 9 of this
chapter.
(f) The department may certify an amount less than the
estimated twelve (12) month revenue collection if the department,
after reviewing the recommendation of the budget agency,
determines that a part of those collections needs to be distributed
during the current calendar year so that the school corporation
will receive its full certified distribution for the current calendar
year.
(g) One-twelfth (1/12) of each adopting school corporation's
certified distribution for a school year shall be distributed from the
account established under section 9 of this chapter to the school
corporation on the first day of each month of the school year.
(h) All distributions from an account established under section
9 of this chapter shall be made by warrants issued by the auditor
of state to the treasurer of state ordering the appropriate
payments.
Sec. 11. (a) Using procedures provided under this chapter, the
governing body of a school corporation may adopt an ordinance to
enter into reciprocity agreements with the taxing authority of any
city, town, municipality, county, or other similar local
governmental entity of any other state. The reciprocity agreements
must provide that the income of taxpayers is exempt from income
taxation by the other local governmental entity to the extent that
income of the residents of the other local governmental entity is
exempt from the school option income tax in the adopting school
corporation.
(b) A reciprocity agreement adopted under this section may not
become effective until it is also made effective in the other local
governmental entity that is a party to the agreement.
(c) The department shall approve the form and effective date of
any reciprocity agreement described in this section.
Sec. 12. (a) All provisions of the adjusted gross income tax law
(IC 6-3) concerning:
(1) definitions;
(2) declarations of estimated tax;
(3) filing of returns;
(4) deductions or exemptions from adjusted gross income;
(5) remittances;
(6) incorporation of the provisions of the Internal Revenue
Code;
(7) penalties and interest; and
(8) exclusion of military pay credits for withholding;
apply to the imposition, collection, and administration of a tax
imposed under this chapter.
for the same taxable year, they shall compute the credit under this
section by using the formula provided by subsection (a), except that
they shall use the average of the two (2) school option income tax
rates imposed against them as the numerator referred to in
subsection (a)(1)(B).
Sec. 15. Notwithstanding any other law, if a school corporation
desires to issue obligations, or enter into leases, payable wholly or
in part by the school option income tax, the obligations of the
school corporation or any lessor may be sold at public sale in
accordance with
IC 5-1-11
or at negotiated sale.
Sec. 16. A school option income tax imposed under this chapter
expires ten (10) years after its effective date.".