HB 1003-1_ Filed 02/14/2001, 17:07
Adopted 2/15/2001


Text Box

Adopted Rejected


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COMMITTEE REPORT


                                                        YES:

19

                                                        NO:
3

MR. SPEAKER:

    Your Committee on       Ways and Means     , to which was referred       House Bill 1003     , has had the same under consideration and begs leave to report the same back to the House with the recommendation that said bill be amended as follows:

SOURCE: Page 1, line 1; (01)CR100301.1. -->     Page 1, between the enacting clause and line 1, begin a new paragraph and insert:
SOURCE: IC 4-30-17-3.5; (01)CR100301.1. -->     "SECTION 1. IC 4-30-17-3.5 IS AMENDED TO READ AS FOLLOWS [EFFECTIVE JULY 1, 2001]: Sec. 3.5. (a) Two (2) segregated accounts shall be established within the build Indiana fund as follows:
        (1) The state and local capital projects account.
        (2) The lottery and gaming surplus account.
    (b) Upon receiving surplus lottery revenue distributions from the state lottery commission and surplus gaming revenue distributions from the state gaming commission, the treasurer of state shall credit the surplus lottery revenue and surplus gaming revenue to the lottery and gaming surplus account. All money remaining in the lottery and gaming surplus account after the transfer transfers required by subsection (c) and (d) shall be transferred to the state and local capital projects account.
    (c) Before the twenty-fifth day of the month, the auditor of state shall transfer from the lottery and gaming surplus account to the state general fund motor vehicle excise tax replacement account an amount equal to the following:
        (1) In calendar year 1996, eleven million six hundred twenty-five thousand dollars ($11,625,000) per month.
        (2) In calendar year 1997, twelve million nine hundred twenty-five thousand twenty dollars ($12,925,020) per month.
        (3) In calendar year 1998, fifteen million ten thousand dollars ($15,010,000) per month.
        (4) In calendar year 1999, seventeen million one hundred ninety-two thousand dollars ($17, 192,000) per month.
        (5) In calendar year 2000, nineteen million four hundred thirty-five thousand two hundred ten dollars ($19,435,210) per month.
        (6) In calendar year 2001 and each year thereafter, nineteen million six hundred eighty-four thousand three hundred seventy dollars ($19,684,370) per month.
    (d) In 2001 and in 2002, the auditor of state shall transfer before the last day of December from the lottery and gaming surplus account to the family and children's property tax relief fund established by IC 6-1.1-20.4 an amount equal to the greater of zero (0) or the amount determined under the following STEPS:
        STEP ONE: Determine the amount transferred to the lottery and gaming surplus account during the preceding twelve (12) months.

         STEP TWO: Determine the amount transferred to the state general fund motor vehicle excise tax replacement account under subsection (c) from the lottery and gaming surplus account during the preceding twelve (12) months.
        STEP THREE: Determine the result of:
            (1) the STEP ONE amount; minus
            (2) the STEP TWO amount.
        STEP FOUR: Determine the result of:
            (1) the STEP THREE amount; minus
            (2) one hundred million dollars ($100,000,000).

     (e) This subsection applies only if insufficient money is available in the lottery and gaming surplus account of the build Indiana fund to

make the distributions to the state general fund motor vehicle excise tax replacement account that are required under subsection (c). Before the twenty-fifth day of each month, the auditor of state shall transfer from the state general fund to the state general fund motor vehicle excise tax replacement account the difference between:
        (1) the amount that subsection (c) requires the auditor of state to distribute from the lottery and gaming surplus account of the build Indiana fund to the state general fund motor vehicle excise tax replacement account; and
        (2) the amount that is available for distribution from the lottery and gaming surplus account in the build Indiana fund to the state general fund motor vehicle excise tax replacement account.
The transfers required under this subsection are annually appropriated from the state general fund.".

SOURCE: Page 4, line 31; (01)CR100301.4. -->     Page 4, delete lines 31 through 42.
    Page 5, delete lines 1 through 32.
                Page 6, line 10, reset in roman "five-hundredths (1.05)".
                Page 6, line 10, after "(1.05)" delete "." and insert ", for 2001 and for years after 2003, and".
                Page 6, line 11, after "(1.04)" delete "." and insert " , for 2002 and 2003.".
    Page 6, line 13, reset in roman "one-tenth (1.1).".
    Page 6, line 13, after "(1.1)" delete "." and insert ", for 2001 and for years after 2003, and".
    Page 6, line 13, after "(1.08)" delete "." and insert " , for 2002 and 2003.".
    Page 11, delete lines 40 through 42, begin a new paragraph and insert:
SOURCE: IC 6-1.1-20.4; (01)CR100301.7. -->     "SECTION 7. IC 6-1.1-20.4 IS ADDED TO THE INDIANA CODE AS A NEW CHAPTER TO READ AS FOLLOWS [EFFECTIVE JULY 1, 2001]:
     Chapter 20.4. Family and Children's Fund Property Tax Relief
    Sec. 1. As used in this chapter, "net family and children's fund property tax liability" means the property taxes imposed on a taxpayer under IC 12-19-7 for a county's family and children's fund that are due and payable in 2003, as shown on the property tax statement sent to a taxpayer after all deductions and credits have been applied under any other statute.
    Sec. 2. (a) The family and children's property tax relief fund is established. The purpose of the fund is to provide property tax relief as specified in this chapter. The fund shall be administered by the budget agency.
    (b) The fund consists of:
        (1) Transfers to the fund under IC 4-30-17-3.5.
        (2) Any appropriations from the general assembly.
        (3) Any gifts and grants to the fund.
    (c) The treasurer of state shall invest the money in the fund not currently needed to meet the obligations of the fund in the same manner as other public funds may be invested. Interest that accrues from these investments shall be deposited in the fund.
    (d) The money in the fund at the end of a state fiscal year does not revert to the state general fund but remains in the fund to be used exclusively for the purposes set forth in this chapter.
    (e) A local match account is established within the family and children's property tax relief fund for each county. A county may deposit into the county's local match account any local revenue, other than revenue from property taxes, for the purposes of providing the county's share of the credit under this chapter.
    (f) The credit paid under this chapter to taxpayers in a county shall consist of:
        (1) amounts that are transferred to the family and children's property tax relief fund from the lottery and gaming surplus account; and
        (2) a matching amount from local revenue, other than revenue from property taxes, that is deposited in the county's local match account.
The amount of state money used to pay a credit under this chapter for a county's taxpayers must be matched on a one (1) to one (1) basis by amounts deposited by the county in the county's local match account.
    Sec. 3. For property taxes first due and payable in 2003, a taxpayer is entitled to a credit under this chapter against the taxpayer's net family and children's fund property tax liability. The amount of the credit is equal to:
        (1) the taxpayer's net family and children's fund property tax liability for 2003; multiplied by
        (2) the percentage determined for the year for the taxpayer's county by the budget agency under section 4 of this chapter.
    Sec. 4. (a) The state board of tax commissioners shall provide the budget agency with an estimate, based on the balance in the family and children's property tax relief fund and the amount in each county's local match account, of the percentage that may be used under section 3(2) of this chapter in providing credits in 2003 to taxpayers under this chapter. The budget agency, after review by the state budget committee, shall determine the percentage that shall be used under section 3(2) of this chapter in providing credits in 2003 to taxpayers under this chapter.
    (b) The state board of tax commissioners' estimate of the credit percentage and the budget agency's final determination of the credit percentage for a particular county must be based on the balance in the family and children's property tax relief fund and the amounts deposited by the county in its local match account.
    (c) The state budget committee shall meet before the second Monday in January of 2003 to review the credit percentage proposed for the year for each county by the budget agency.
    (d) The budget agency must report to the governor and the legislative council the credit percentage determined under this section for each county not more than seven (7) days after the state budget committee meets to review the proposed credit percentage.
    Sec. 5. The county auditor shall compute the net amount of property taxes in the county that is attributable to property taxes imposed on a taxpayer under IC 12-19-7 in 2003 for the county's family and children's fund, after all deductions and credits have been applied under any other statute.
    Sec. 6. Before February 1 of 2003, each county auditor shall certify to the state board of tax commissioners the amount of credits allowed under this chapter in the county for 2003. Except as otherwise provided in this chapter, the credits shall be determined in the same manner as property tax replacement credits are determined under IC 6-1.1-21 , after deducting the property tax replacement credit under IC 6-1.1-21.
    Sec. 7. (a) In 2003, the auditor of state shall allocate from the family and children's property tax relief fund and a county's local match account an amount equal to the total amount of credits that

are provided under this chapter for the county for that year in the same manner as the homestead credits are allocated from the property tax replacement fund under IC 6-1.1-21.
    (b) The auditor of state shall distribute to each county treasurer, from the family and children's property tax relief fund and a county's local match account, the estimated distribution for that year for the county at the same time and in the same manner as the homestead credit distributions are made under IC 6-1.1-21. The money in the family and children's property tax relief fund and the county local match accounts is appropriated to make the distributions under this section. The amount of state money distributed from the family and children's property tax relief fund to pay a credit under this chapter for a county's taxpayers must be matched on a one (1) to one (1) basis by amounts deposited by the county in the county's local match account.
    (c) All distributions provided under this section shall be made on warrants issued by the auditor of state drawn on the treasurer of state.

    Sec. 8. To the extent it is consistent with this chapter, IC 6-1.1-21 applies with respect to the credit under this chapter.

SOURCE: IC 6-3.1-20; (01)CR100301.8. -->     SECTION 8. IC 6-3.1-20 IS ADDED TO THE INDIANA CODE AS A NEW CHAPTER TO READ AS FOLLOWS [EFFECTIVE JANUARY 1, 2003]:
     Chapter 20. Credit for Property Taxes Paid on Personal Property
    Sec. 1. As used in this chapter, "assessed value" means the assessed value determined under IC 6-1.1-3.
    Sec. 2. As used in this chapter, "net ad valorem property taxes" means the
amount of property taxes paid by a taxpayer for a particular calendar year after the application of all property tax deductions and property tax credits.
    Sec. 3. As used in this chapter, "pass through entity" means:
        (1) a corporation that is exempt from the adjusted gross income tax under IC  6-3-2-2.8(2);
        (2) a partnership;
        (3) a trust;
        (4) a limited liability company; or
        (5) a limited liability partnership.
    Sec. 4. As used in this chapter, "personal property" includes personal property as defined in IC 6-1.1-1-11 and personal property assessed under IC 6-1.1-7.
    Sec. 5. As used in this chapter, "state tax liability" means a taxpayer's total tax liability that is incurred under:
        (1) IC 6-2.1 (gross income tax);
        (2) IC 6-3-1 through IC 6-3-7 (adjusted gross income tax);
        (3) IC 6-3-8 (supplemental net income tax);
        (4) IC 6-5.5 (financial institutions tax); and
        (5) IC 27-1-18-2 (insurance premiums tax);
as computed after the application of the credits that under IC 6-3.1-1-2 are to be applied before the credit provided by this chapter.
    Sec. 6. As used in this chapter, "taxpayer" means an individual or entity that has state tax liability.
    Sec. 7. (a) A taxpayer is entitled to a credit against the taxpayer's state tax liability for a taxable year for the net ad valorem property taxes paid by the taxpayer in the taxable year on personal property with an assessed value equal to the lesser of:
        (1) the assessed value of the person's personal property; or
        (2) thirty-seven thousand five hundred dollars ($37,500).
A taxpayer is entitled to only one (1) credit under this chapter each taxable year.
    (b) An affiliated group that files a consolidated return under IC 6-2.1-5-5 is entitled to only one (1) credit under this chapter each taxable year on that consolidated return. A taxpayer that is a partnership, joint venture, or pool is entitled to only one (1) credit under this chapter each taxable year, regardless of the number of partners or participants in the organization.
    Sec. 8. If the amount of the credit determined under section 7 of this chapter for a taxpayer in a taxable year exceeds the taxpayer's state tax liability for that taxable year, the taxpayer may carry the excess over to the following taxable years. The amount of the credit carryover from a taxable year shall be reduced to the extent that the carryover is used by the taxpayer to obtain a credit under this chapter for any subsequent taxable year. A taxpayer is not entitled to a carryback.
    Sec. 9. If a pass through entity does not have state income tax

liability against which the tax credit may be applied, a shareholder or partner of the pass through entity is entitled to a tax credit equal to:
        (1) the tax credit determined for the pass through entity for the taxable year; multiplied by
        (2) the percentage of the pass through entity's distributive income to which the shareholder or partner is entitled.
    Sec. 10. To receive the credit provided by this chapter, a taxpayer must claim the credit on the taxpayer's state tax return or returns in the manner prescribed by the department. The taxpayer shall submit to the department proof of payment of an ad valorem property tax and all information that the department determines is necessary for the calculation of the credit provided by this chapter.

SOURCE: IC 6-3.1-21-10; (01)CR100301.9. -->     SECTION 9. IC 6-3.1-21-10 , AS ADDED BY P.L.273-1999, SECTION 227, IS AMENDED TO READ AS FOLLOWS [EFFECTIVE JULY 1, 2001]: Sec. 10. This chapter expires December 31, 2001. 2003.
SOURCE: IC 6-3.5-1.1-2; (01)CR100301.10. -->     SECTION 10. IC 6-3.5-1.1-2 IS AMENDED TO READ AS FOLLOWS [EFFECTIVE UPON PASSAGE]: Sec. 2. (a) The county council of any county in which the county option income tax will not be in effect on July 1 of a year under an ordinance adopted during a previous calendar year may impose the county adjusted gross income tax on the adjusted gross income of county taxpayers of its county effective July 1 of that year.
    (b) Except as provided in section 2.5 or 3.5 of this chapter and in subsection (g), the county adjusted gross income tax may be imposed at a rate of one-half of one percent (0.5%), three-fourths of one percent (0.75%), or one percent (1%) on the adjusted gross income of resident county taxpayers of the county. Any county imposing the county adjusted gross income tax must impose the tax on the nonresident county taxpayers at a rate of one-fourth of one percent (0.25%) on their adjusted gross income. If the county council elects to decrease the county adjusted gross income tax, the county council may decrease the county adjusted gross income tax rate in increments of one-tenth of one percent (0.1%).
    (c) To impose the county adjusted gross income tax, the county council must, after January 1 but before April 1 of a year, adopt an

ordinance. The ordinance must substantially state the following:
        "The ________ County Council imposes the county adjusted gross income tax on the county taxpayers of ________ County. The county adjusted gross income tax is imposed at a rate of _____ percent (_____%) on the resident county taxpayers of the county and one-fourth of one percent (0.25%) on the nonresident county taxpayers of the county. This tax takes effect July 1 of this year.".
    (d) Any ordinance adopted under this section takes effect July 1 of the year the ordinance is adopted.
    (e) The auditor of a county shall record all votes taken on ordinances presented for a vote under the authority of this section and immediately send a certified copy of the results to the department by certified mail.
    (f) If the county adjusted gross income tax had previously been adopted by a county under IC 6-3.5-1 (before its repeal on March 15, 1983) and that tax was in effect at the time of the enactment of this chapter, then the county adjusted gross income tax continues in that county at the rates in effect at the time of enactment until the rates are modified or the tax is rescinded in the manner prescribed by this chapter. If a county's adjusted gross income tax is continued under this subsection, then the tax shall be treated as if it had been imposed under this chapter and is subject to rescission or reduction as authorized in this chapter.
     (g) In addition to the rates imposed under section 2.5 or 3.5 of this chapter or under subsection (b), a county council may adopt an ordinance to impose one (1) or both of the following additional county adjusted gross income tax rates:
        (1) An additional rate of not more one-fourth of one percent (0.25%) may be imposed for the purposes of providing property tax relief under section 11.5(b)(1) through 11.5(b)(3) of this chapter.
        (2) An additional rate of not more than one-fourth of one percent (0.25%) may be imposed for the purposes of providing local revenue that will be deposited under section 11.5(b)(4) of this chapter in the county's local match account established under IC 6-1.1-20.4. However, a county may not impose a rate under this subdivision after June 30, 2003. A

rate imposed under this subdivision before July 1, 2003, is rescinded on July 1, 2003.
An additional rate imposed under his subsection shall be adopted in the manner described in subsection (c).
    (h) If a county adopts an additional rate under subsection (g)(2), the additional rate shall apply to the adjusted gross income of county taxpayers and to the apportioned net income of corporations. For purposes of this subsection, "apportioned net income" means net income (as defined in IC 6-3-8-2 ) multiplied by:
        (1) the assessed value of all property of a corporation that is:
            (A) taxable under IC 6-1.1; and
            (B) located in the county; divided by
        (2) the assessed value of all property of the corporation that is:
            (A) taxable under IC 6-1.1; and
            (B) located in Indiana.
".
    Delete pages 12 through 15.

SOURCE: Page 16, line 1; (01)CR100301.16. -->     Page 16, delete lines 1 through 8.
    Page 17, between lines 23 and 24, begin a new line block indented and insert:
        " (4) Depositing revenue under this chapter in the county's local match account established under IC 6-1.1-20.4 to be used for the purpose of matching state distributions for the credit under IC 6-1.1-20.4 against the net family and children's fund property tax liability of taxpayers in the county in 2003. This subdivision expires January 1, 2004.".
    Page 17, line 24, delete "(4)" and insert " (5)".
    Page 17, line 25, delete "(3)" and insert " (4)".
    Page 21, line 22, delete "; plus" and insert ".".
    Page 21, delete lines 23 through 25.
    Page 22, between lines 9 and 10, begin a new paragraph and insert:
SOURCE: IC 6-3.5-6-9.6; (01)CR100301.20. -->     "SECTION 20. IC 6-3.5-6-9.6 IS ADDED TO THE INDIANA CODE AS A NEW SECTION TO READ AS FOLLOWS [EFFECTIVE UPON PASSAGE]: Sec. 9.6. (a) In addition to the rates imposed under section 8 or 9 of this chapter, a county income tax council may adopt an ordinance to impose one (1) or both of the following additional county option income tax rates:
        (1) An additional rate of not more than one-fourth of one

percent (0.25%) may be imposed for the purposes of providing property tax relief under section 13(b)(1) through 13(b)(3) of this chapter.
        (2) An additional rate of not more than one-fourth of one percent (0.25%) may be imposed for the purposes of providing local revenue that will be deposited under section 13(b)(4) of this chapter in the county's local match account established under IC 6-1.1-20.4. However, a county may not impose a rate under this subdivision after June 30, 2003. A rate imposed under this subdivision before July 1, 2003, is rescinded on July 1, 2003.
An additional rate imposed under his subsection shall be adopted in the manner described in section 8 of this chapter.
    (b) If a county adopts an additional rate under subsection (a)(2), the additional rate shall apply to the adjusted gross income of county taxpayers and to the apportioned net income of corporations. For purposes of this subsection, "apportioned net income" means net income (as defined in IC 6-3-8-2 ) multiplied by:
        (1) the assessed value of all property of a corporation that is:
            (A) taxable under IC 6-1.1; and
            (B) located in the county; divided by
        (2) the assessed value of all property of the corporation that is:
            (A) taxable under IC 6-1.1; and
            (B) located in Indiana.
".

SOURCE: Page 22, line 23; (01)CR100301.22. -->     Page 22, between lines 23 and 24, begin a new line block indented and insert:
        " (4) Depositing revenue under this chapter in the county's local match account established under IC 6-1.1-20.4 to be used for the purpose of matching state distributions for the credit under IC 6-1.1-20.4 against the net family and children's fund property tax liability of taxpayers in the county in 2003. This subdivision expires January 1, 2004.".
    Page 22, line 24, delete "(4)" and insert " (5)".
    Page 22, line 25, delete "(3)" and insert " (4)".
    Page 24, delete lines 26 through 42.
    Page 25, delete lines 1 through 22.
    Page 26, line 27, delete "and, after December 31, 2002, an amount"

and insert ".".
    Page 26, delete line 28.
    Page 26, line 29, delete "the county family and children's fund.".
    Page 26, line 34, delete "and, after" and insert ".".
    Page 26, delete lines 35 through 37.
    Page 27, delete lines 30 through 42.
    Delete pages 28 through 29.
    Page 30, delete lines 1 through 7.
    Page 31, line 18, after "(h)" insert ",".
    Page 31, line 18, strike "or".
    Page 31, line 18, after "(i)," insert " or (k),".
    Page 32, line 25, delete "adjusted gross" and insert " option".
    Page 32, line 26, delete "the" and insert " :".
    Page 32, delete lines 27 through 42, begin a new line block indented and insert:
        " (1) the additional rate that is imposed under IC 6-3.5-6-9.6 (a)(1) for property tax relief purposes; plus
        (2) the additional rate that is imposed under IC 6-3.5-6-9.6 (a)(2) for property tax relief purposes.
     (k) For a county that has adopted an ordinance under IC 6-3.5-1-11.5 , the county economic development income tax rate plus the county adjusted gross income tax rate that are in effect on January 1 of a year may not exceed the sum of:
        (1) one and twenty-five hundredths percent (1.25%) in the case of a county not described in subsection (h) or (i), one and thirty-five hundredths percent (1.35%) in the case of a county described in subsection (h), or one and fifty-five hundredths percent in the case of a county described in subsection (i); plus
        (2) the additional rate that is imposed under IC 6-3.5-1.1-2 (g)(1) for property tax relief purposes; plus

        (3) the additional rate that is imposed under IC 6-3.5-1.1-2 (g)(2) for property tax relief purposes.

SOURCE: IC 6-1.1-20.5; (01)CR100301.27. -->     SECTION 27. IC 6-1.1-20.5 IS REPEALED [EFFECTIVE JANUARY 1, 2003].
SOURCE: ; (01)CR100301.28. -->     SECTION 28. [EFFECTIVE JULY 1, 2001] The credits provided under IC 6-1.1-20.4 , as added by this act, apply only to property taxes first due and payable in 2003.
SOURCE: ; (01)CR100301.29. -->     SECTION 29. [EFFECTIVE JANUARY 1, 2003] IC 6-3.1-20 , as

added by this act, applies only to taxable years that begin after December 31, 2002.

SOURCE: ; (01)CR100301.30. -->     SECTION 30. [EFFECTIVE UPON PASSAGE] (a) Notwithstanding IC 6-3.5-1.1 , a county council may adopt an ordinance to impose an additional rate or additional rates under IC 6-3.5-1.1-2 (g), as added by this act, after April 1 of a year.
    (b) This SECTION expires December 31, 2001.

SOURCE: ; (01)CR100301.31. -->     SECTION 31. [EFFECTIVE UPON PASSAGE] (a) Notwithstanding IC 6-3.5-6 , a county council may adopt an ordinance to impose an additional rate or additional rates under IC 6-3.5-6-9.6 , as added by this act, after April 1 of a year.
    (b) This SECTION expires December 31, 2001.
".
    Delete pages 33 through 58.
SOURCE: Page 59, line 1; (01)CR100301.59. -->     Page 59, delete lines 1 through 13.
    Renumber all SECTIONS consecutively.
    (Reference is to HB 1003 as introduced.)

and when so amended that said bill do pass.

__________________________________

Representative Bauer


CR100301/DI 73    2001