Reprinted

March 18, 2005





ENGROSSED

SENATE BILL No. 1

_____


DIGEST OF SB 1 (Updated March 17, 2005 7:13 pm - DI 51)


Citations Affected: IC 5-28; IC 6-1.1; IC 6-2.5; IC 6-3.1; IC 6-3.5; IC 20-12; IC 36-7; noncode.

Synopsis: Tax incentives. Permits the economic development corporation to designate certain areas as global commerce centers. Extends the termination date for authority to approve new property tax abatements or to establish new tax increment finance areas from December 31, 2005, to December 31, 2017. Repeals the limitation of tax abatements for new logistical distribution equipment and new information technology equipment to certain counties located along Interstate Highway 69. Requires the filing of a personal property return schedule to apply for personal property tax abatement (instead of filing a separate application deduction) and provides that if the township assessor or county assessor does not deny the application, the abatement applies in the amount claimed or in an amount determined
(Continued next page)

Effective: January 1, 2005 (retroactive); February 9, 2005 (retroactive); upon passage; May 15, 2005; July 1, 2005; January 1, 2006.





Ford, Hume, Clark, Kenley, Simpson, Lanane, Zakas
(HOUSE SPONSORS _ TURNER, BORROR, WOODRUFF, SMITH J, ALDERMAN, AYRES, BECKER, BEHNING, BORDERS, BOSMA, BRIGHT, BROWN T, BUCK, BUDAK, BUELL, BURTON, CHERRY, DAVIS, DODGE, DUNCAN, ESPICH, FOLEY, FRIEND, FRIZZELL, GUTWEIN, HARRIS T, HEIM, HINKLE, HOFFMAN, KOCH, LEHE, LEONARD, LUTZ J, MCCLAIN, MESSER, MURPHY, NEESE, NOE, POND, RICHARDSON, RIPLEY, RUPPEL, SAUNDERS, STUTZMAN, THOMAS, THOMPSON, TORR, ULMER, WALORSKI, WHETSTONE, WOLKINS, YOUNT)




    January 18, 2005, read first time and referred to Committee on Tax and Fiscal Policy.
    February 10, 2005, amended, reported favorably _ Do Pass.
    February 14, 2005, read second time, ordered engrossed.
    February 15, 2005, engrossed.
    February 17, 2005, read third time, passed. Yeas 50, nays 0.

HOUSE ACTION

    March 8, 2005, read first time and referred to Committee on Ways and Means.
    March 14, 2005, amended, reported _ Do Pass.
    March 17, 2005, read second time, amended, ordered engrossed.





Digest Continued

by the township assessor or county assessor. Changes the procedure for appealing a denial of a property tax deduction or the alteration of a deduction amount in an economic revitalization area. Changes the deadline for submitting information updating a taxpayer's compliance with the taxpayer's statement of benefits that is required to obtain a property tax deduction in an economic revitalization area. Establishes a property tax investment deduction for certain real property development, redevelopment, or rehabilitation that increases assessed value and creates or retains employment. Establishes a similar deduction for the installation of personal property other than inventory subject to the same conditions and limitation. Establishes an assessment phase-in deduction for improvements to business and nonbusiness real property and the installation of business and nonbusiness personal property (other than property used in a retail business) that is available in addition to the property tax deduction available for job creating . Expands the sales tax exemption for tangible personal property used by professional motor vehicle racing teams. Exempts a person from 100% of the sales tax on research and development equipment acquired after June 30, 2007. Provides a refund of 50% of the sales taxes paid on transactions involving research and development equipment acquired after June 30, 2005, and before July 1, 2007. Increases the qualified research expense credit from 10% to 15% on the first $1,000,000 of investment for taxable years beginning after December 31, 2007. Reduces from 15 to 10 the number of years for which a taxpayer may carry over a research expense credit. Excludes certain debt provided by a financial institution after May 15, 2005, from the definition of "qualified investment capital" that is eligible for the venture capital investment tax credit. Specifies that a business primarily focused on professional motor vehicle racing is eligible for certification as a qualified Indiana business for purposes of the venture capital investment tax credit. Increases the total amount of venture capital investment tax credits that may be allowed in a calendar year from $10,000,000 to $12,500,000. Provides a refundable tax credit to a person who graduates from college or university with certain degrees and obtains employment in Madison, Grant, or Huntington County. Provides that a taxpayer may not carry over a venture capital investment credit for more than five taxable years following the first taxable year in which the credit is claimed. Provides that a business that relocates its corporate headquarters to a location in Indiana is entitled to a credit against its state tax liability equal to 50% of the costs incurred in relocating the headquarters. Authorizes counties, cities, and towns that receive county economic development income taxes to establish regional venture capital funds by pooling taxes payable to the participating units. Provides that a regional venture capital fund shall be administered by a governing board. Authorizes the governing board to make grants or loans from the fund to public or private entities for economic development purposes. Makes technical changes.


Reprinted

March 18, 2005

First Regular Session 114th General Assembly (2005)


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 2004 Regular Session of the General Assembly.


ENGROSSED

SENATE BILL No. 1



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

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

SOURCE: IC 5-28-26; (05)ES0001.2.1. -->     SECTION 1. IC 5-28-26 IS ADDED TO THE INDIANA CODE AS A NEW CHAPTER TO READ AS FOLLOWS [EFFECTIVE JULY 1, 2005]:
    Chapter 26. Global Commerce Centers
    Sec. 1. As used in this chapter, "corporation" means the Indiana economic development corporation established by IC 5-28-3-1.
    Sec. 2. As used in this chapter, "district" means a regional economic development district designated by the United States Department of Commerce Economic Development Administration.
    Sec. 3. As used in this chapter, "high technology activity" has the meaning set forth in IC 36-7-32-7.
    Sec. 4. As used in this chapter, "hub" means a regional economic development project that is:
        (1) selected by a district for development as a global commerce center; and
        (2) designated as a global commerce center under this chapter.
    Sec. 5. As used in this chapter, "spoke" means an economic development project that is:
        (1) located within the area served by a district;
        (2) undertaken to support the activities of a hub; and
        (3) treated as a global commerce center under this chapter upon the approval of the district board and fiscal body of the county in which the project is located.
    Sec. 6. The corporation shall do the following:
        (1) Review and approve or reject all applicants for global commerce center designation according to the criteria for designation set forth in section 7 of this chapter.
        (2) Establish a procedure by which global commerce centers may be monitored and evaluated on an annual basis.
        (3) Promote the global commerce center program.
    Sec. 7. (a) The corporation may designate up to three (3) global commerce centers under this chapter. A global commerce center must include a hub. The boundaries of the global commerce center are not required to be contiguous.
    (b) If a district applies to the corporation to have part of the area served by the district designated as a global commerce center, the corporation shall approve the district's application if the corporation determines that the proposed global commerce center meets the following criteria:
        (1) The district applying for a global commerce center designation does not contain a metropolitan statistical area.
        (2) The proposed global commerce center is well suited for the development of a hub and its supporting spokes.
        (3) The proposed global commerce center has the support of the surrounding community.
        (4) The proposed global commerce center is well suited for the development of at least one (1) of the following:
            (A) A high technology activity.
            (B) Advanced manufacturing.
            (C) Transportation, distribution, and logistics.
    (c) The corporation shall adopt rules under IC 4-22-2 specifying application procedures.
    (d) The corporation shall give priority to an application submitted by a district that:
        (1) serves a region that borders another state;
        (2) contains at least one (1) county that consistently ranks among the highest in Indiana in unemployment;
        (3) is served by an interstate highway; and
        (4) has identified a site for a proposed global commerce center that is well suited for the development of an intermodal transportation hub.
    Sec. 8. If a global commerce center is designated under section 7 of this chapter, an unlimited number of spokes may be added to the global commerce center at the discretion of the fiscal bodies of the counties served by the district and the district board.
    Sec. 9. A global commerce center expires fifteen (15) years after it is designated by the corporation.

SOURCE: IC 6-1.1-12.1-1; (05)ES0001.2.2. -->     SECTION 2. IC 6-1.1-12.1-1 IS AMENDED TO READ AS FOLLOWS [EFFECTIVE JULY 1, 2005]: Sec. 1. For purposes of this chapter:
        (1) "Economic revitalization area" means an area which is within the corporate limits of a city, town, or county which has become undesirable for, or impossible of, normal development and occupancy because of a lack of development, cessation of growth, deterioration of improvements or character of occupancy, age, obsolescence, substandard buildings, or other factors which have impaired values or prevent a normal development of property or use of property. The term "economic revitalization area" also includes:
            (A) any area where a facility or a group of facilities that are technologically, economically, or energy obsolete are located and where the obsolescence may lead to a decline in employment and tax revenues; and
            (B) a residentially distressed area, except as otherwise provided in this chapter.
        (2) "City" means any city in this state, and "town" means any town incorporated under IC 36-5-1.
        (3) "New manufacturing equipment" means any tangible personal property which:
            (A) was installed after February 28, 1983, and before January 1, 2006, 2018, in an area that is declared an economic revitalization area after February 28, 1983, in which a deduction for tangible personal property is allowed;
            (B) is used in the direct production, manufacture, fabrication, assembly, extraction, mining, processing, refining, or finishing of other tangible personal property, including but not limited to use to dispose of solid waste or hazardous waste by converting the solid waste or hazardous waste into energy or other useful products; and
            (C) was acquired by its owner for use as described in clause

(B) and was never before used by its owner for any purpose in Indiana.
        However, notwithstanding any other law, the term includes tangible personal property that is used to dispose of solid waste or hazardous waste by converting the solid waste or hazardous waste into energy or other useful products and was installed after March 1, 1993, and before March 2, 1996, even if the property was installed before the area where the property is located was designated as an economic revitalization area or the statement of benefits for the property was approved by the designating body.
        (4) "Property" means a building or structure, but does not include land.
        (5) "Redevelopment" means the construction of new structures in economic revitalization areas, either:
            (A) on unimproved real estate; or
            (B) on real estate upon which a prior existing structure is demolished to allow for a new construction.
        (6) "Rehabilitation" means the remodeling, repair, or betterment of property in any manner or any enlargement or extension of property.
        (7) "Designating body" means the following:
            (A) For a county that does not contain a consolidated city, the fiscal body of the county, city, or town.
            (B) For a county containing a consolidated city, the metropolitan development commission.
        (8) "Deduction application" means either:
            (A) the application filed in accordance with section 5 of this chapter by a property owner who desires to obtain the deduction provided by section 3 of this chapter; or
            (B) the application (before January 1, 2006) or schedule (after December 31, 2005) filed in accordance with section 5.5 section 5.4 of this chapter by a person who desires to obtain the deduction provided by section 4.5 of this chapter.
        (9) "Designation application" means an application that is filed with a designating body to assist that body in making a determination about whether a particular area should be designated as an economic revitalization area.
        (10) "Hazardous waste" has the meaning set forth in IC 13-11-2-99(a). The term includes waste determined to be a hazardous waste under IC 13-22-2-3(b).
        (11) "Solid waste" has the meaning set forth in IC 13-11-2-205(a). However, the term does not include dead animals or any animal

solid or semisolid wastes.
        (12) "New research and development equipment" means tangible personal property that:
            (A) is installed after June 30, 2000, and before January 1, 2006, 2018, in an economic revitalization area in which a deduction for tangible personal property is allowed;
            (B) consists of:
                (i) laboratory equipment;
                (ii) research and development equipment;
                (iii) computers and computer software;
                (iv) telecommunications equipment; or
                (v) testing equipment;
            (C) is used in research and development activities devoted directly and exclusively to experimental or laboratory research and development for new products, new uses of existing products, or improving or testing existing products; and
            (D) is acquired by the property owner for purposes described in this subdivision and was never before used by the owner for any purpose in Indiana.
        The term does not include equipment installed in facilities used for or in connection with efficiency surveys, management studies, consumer surveys, economic surveys, advertising or promotion, or research in connection with literacy, history, or similar projects.
        (13) "New logistical distribution equipment" means tangible personal property that:
            (A) is installed after June 30, 2004, and before January 1, 2006, 2018, in an economic revitalization area
                (i) in which a deduction for tangible personal property is allowed; and
                (ii) located in a county referred to in section 2.3 of this chapter, subject to section 2.3(c) of this chapter;
            (B) consists of:
                (i) racking equipment;
                (ii) scanning or coding equipment;
                (iii) separators;
                (iv) conveyors;
                (v) forklifts or lifting equipment (including "walk behinds");
                (vi) transitional moving equipment;
                (vii) packaging equipment;
                (viii) sorting and picking equipment; or
                (ix) software for technology used in logistical distribution;


            (C) is used for the storage or distribution of goods, services, or information; and
            (D) before being used as described in clause (C), was never used by its owner for any purpose in Indiana.
        (14) "New information technology equipment" means tangible personal property that:
            (A) is installed after June 30, 2004, and before January 1, 2006, 2018, in an economic revitalization area
                (i) in which a deduction for tangible personal property is allowed; and
                (ii) located in a county referred to in section 2.3 of this chapter, subject to section 2.3(c) of this chapter;
            (B) consists of equipment, including software, used in the fields of:
                (i) information processing;
                (ii) office automation;
                (iii) telecommunication facilities and networks;
                (iv) informatics;
                (v) network administration;
                (vi) software development; and
                (vii) fiber optics; and
            (C) before being installed as described in clause (A), was never used by its owner for any purpose in Indiana.
SOURCE: IC 6-1.1-12.1-2; (05)ES0001.2.3. -->     SECTION 3. IC 6-1.1-12.1-2 IS AMENDED TO READ AS FOLLOWS [EFFECTIVE JULY 1, 2005]: Sec. 2. (a) A designating body may find that a particular area within its jurisdiction is an economic revitalization area. However, the deduction provided by this chapter for economic revitalization areas not within a city or town shall not be available to retail businesses.
    (b) In a county containing a consolidated city or within a city or town, a designating body may find that a particular area within its jurisdiction is a residentially distressed area. Designation of an area as a residentially distressed area has the same effect as designating an area as an economic revitalization area, except that the amount of the deduction shall be calculated as specified in section 4.1 of this chapter and the deduction is allowed for not more than five (5) years. In order to declare a particular area a residentially distressed area, the designating body must follow the same procedure that is required to designate an area as an economic revitalization area and must make all the following additional findings or all the additional findings described in subsection (c):
        (1) The area is comprised of parcels that are either unimproved or

contain only one (1) or two (2) family dwellings or multifamily dwellings designed for up to four (4) families, including accessory buildings for those dwellings.
        (2) Any dwellings in the area are not permanently occupied and are:
            (A) the subject of an order issued under IC 36-7-9; or
            (B) evidencing significant building deficiencies.
        (3) Parcels of property in the area:
            (A) have been sold and not redeemed under IC 6-1.1-24 and IC 6-1.1-25; or
            (B) are owned by a unit of local government.
However, in a city in a county having a population of more than two hundred thousand (200,000) but less than three hundred thousand (300,000), the designating body is only required to make one (1) of the additional findings described in this subsection or one (1) of the additional findings described in subsection (c).
    (c) In a county containing a consolidated city or within a city or town, a designating body that wishes to designate a particular area a residentially distressed area may make the following additional findings as an alternative to the additional findings described in subsection (b):
        (1) A significant number of dwelling units within the area are not permanently occupied or a significant number of parcels in the area are vacant land.
        (2) A significant number of dwelling units within the area are:
            (A) the subject of an order issued under IC 36-7-9; or
            (B) evidencing significant building deficiencies.
        (3) The area has experienced a net loss in the number of dwelling units, as documented by census information, local building and demolition permits, or certificates of occupancy, or the area is owned by Indiana or the United States.
        (4) The area (plus any areas previously designated under this subsection) will not exceed ten percent (10%) of the total area within the designating body's jurisdiction.
However, in a city in a county having a population of more than two hundred thousand (200,000) but less than three hundred thousand (300,000), the designating body is only required to make one (1) of the additional findings described in this subsection as an alternative to one (1) of the additional findings described in subsection (b).
    (d) A designating body is required to attach the following conditions to the grant of a residentially distressed area designation:
        (1) The deduction will not be allowed unless the dwelling is

rehabilitated to meet local code standards for habitability.
        (2) If a designation application is filed, the designating body may require that the redevelopment or rehabilitation be completed within a reasonable period of time.
    (e) To make a designation described in subsection (a) or (b), the designating body shall use procedures prescribed in section 2.5 of this chapter.
    (f) The property tax deductions provided by sections 3 and 4.5 of this chapter are only available within an area which the designating body finds to be an economic revitalization area.
    (g) The designating body may adopt a resolution establishing general standards to be used, along with the requirements set forth in the definition of economic revitalization area, by the designating body in finding an area to be an economic revitalization area. The standards must have a reasonable relationship to the development objectives of the area in which the designating body has jurisdiction. The following three (3) sets of standards may be established:
        (1) One (1) relative to the deduction under section 3 of this chapter for economic revitalization areas that are not residentially distressed areas.
        (2) One (1) relative to the deduction under section 3 of this chapter for residentially distressed areas.
        (3) One (1) relative to the deduction allowed under section 4.5 of this chapter.
    (h) A designating body may impose a fee for filing a designation application for a person requesting the designation of a particular area as an economic revitalization area. The fee may be sufficient to defray actual processing and administrative costs. However, the fee charged for filing a designation application for a parcel that contains one (1) or more owner-occupied, single-family dwellings may not exceed the cost of publishing the required notice.
    (i) In declaring an area an economic revitalization area, the designating body may:
        (1) limit the time period to a certain number of calendar years during which the area shall be so designated;
        (2) limit the type of deductions that will be allowed within the economic revitalization area to either the deduction allowed under section 3 of this chapter or the deduction allowed under section 4.5 of this chapter;
        (3) limit the dollar amount of the deduction that will be allowed with respect to new manufacturing equipment, new research and development equipment, new logistical distribution equipment,

and new information technology equipment if a deduction under this chapter had not been filed before July 1, 1987, for that equipment;
        (4) limit the dollar amount of the deduction that will be allowed with respect to redevelopment and rehabilitation occurring in areas that are designated as economic revitalization areas on or after September 1, 1988; or
        (5) impose reasonable conditions related to the purpose of this chapter or to the general standards adopted under subsection (g) for allowing the deduction for the redevelopment or rehabilitation of the property or the installation of the new manufacturing equipment, new research and development equipment, new logistical distribution equipment, or new information technology equipment.
To exercise one (1) or more of these powers, a designating body must include this fact in the resolution passed under section 2.5 of this chapter.
    (j) Notwithstanding any other provision of this chapter, if a designating body limits the time period during which an area is an economic revitalization area, that limitation does not:
        (1) prevent a taxpayer from obtaining a deduction for new manufacturing equipment, new research and development equipment, new logistical distribution equipment, or new information technology equipment installed before January 1, 2006, 2018, but after the expiration of the economic revitalization area if:
            (A) the economic revitalization area designation expires after December 30, 1995; and
            (B) the new manufacturing equipment, new research and development equipment, new logistical distribution equipment, or new information technology equipment was described in a statement of benefits submitted to and approved by the designating body in accordance with section 4.5 of this chapter before the expiration of the economic revitalization area designation; or
        (2) limit the length of time a taxpayer is entitled to receive a deduction to a number of years that is less than the number of years designated under section 4 or 4.5 of this chapter.
    (k) Notwithstanding any other provision of this chapter, deductions:
        (1) that are authorized under section 3 of this chapter for property in an area designated as an urban development area before March 1, 1983, and that are based on an increase in assessed valuation

resulting from redevelopment or rehabilitation that occurs before March 1, 1983; or
        (2) that are authorized under section 4.5 of this chapter for new manufacturing equipment installed in an area designated as an urban development area before March 1, 1983;
apply according to the provisions of this chapter as they existed at the time that an application for the deduction was first made. No deduction that is based on the location of property or new manufacturing equipment in an urban development area is authorized under this chapter after February 28, 1983, unless the initial increase in assessed value resulting from the redevelopment or rehabilitation of the property or the installation of the new manufacturing equipment occurred before March 1, 1983.
    (l) If property located in an economic revitalization area is also located in an allocation area (as defined in IC 36-7-14-39 or IC 36-7-15.1-26), an application for the property tax deduction provided by this chapter may not be approved unless the commission that designated the allocation area adopts a resolution approving the application.

SOURCE: IC 6-1.1-12.1-5; (05)ES0001.2.4. -->     SECTION 4. IC 6-1.1-12.1-5 IS AMENDED TO READ AS FOLLOWS [EFFECTIVE JANUARY 1, 2005 (RETROACTIVE)]: Sec. 5. (a) A property owner who desires to obtain the deduction provided by section 3 of this chapter must file a certified deduction application, on forms prescribed by the department of local government finance, with the auditor of the county in which the property is located. Except as otherwise provided in subsection (b) or (e), the deduction application must be filed before May 10 of the year in which the addition to assessed valuation is made.
    (b) If notice of the addition to assessed valuation or new assessment for any year is not given to the property owner before April 10 of that year, the deduction application required by this section may be filed not later than thirty (30) days after the date such a notice is mailed to the property owner at the address shown on the records of the township assessor.
    (c) The deduction application required by this section must contain the following information:
        (1) The name of the property owner.
        (2) A description of the property for which a deduction is claimed in sufficient detail to afford identification.
        (3) The assessed value of the improvements before rehabilitation.
        (4) The increase in the assessed value of improvements resulting from the rehabilitation.
        (5) The assessed value of the new structure in the case of redevelopment.
        (6) The amount of the deduction claimed for the first year of the deduction.
        (7) If the deduction application is for a deduction in a residentially distressed area, the assessed value of the improvement or new structure for which the deduction is claimed.
    (d) A deduction application filed under subsection (a) or (b) is applicable for the year in which the addition to assessed value or assessment of a new structure is made and in the following years the deduction is allowed without any additional deduction application being filed. However, property owners who had an area designated an urban development area pursuant to a deduction 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 a deduction application filed after December 31, 1978, and before January 1, 1986, are entitled to a deduction for a ten (10) year period.
    (e) A property owner who desires to obtain the deduction provided by section 3 of this chapter but who has failed to file a deduction application within the dates prescribed in subsection (a) or (b) may file a deduction application between March 1 and May 10 of a subsequent year which shall be applicable for the year filed and the subsequent years without any additional deduction application being filed for the amounts of the deduction which would be applicable to such years pursuant to section 4 of this chapter if such a deduction application had been filed in accordance with subsection (a) or (b).
    (f) Subject to subsection (i), the county auditor shall act as follows:
        (1) If a determination about the number of years the deduction is allowed has been made in the resolution adopted under section 2.5 of this chapter, the county auditor shall make the appropriate deduction.
        (2) If a determination about the number of years the deduction is allowed has not been made in the resolution adopted under section 2.5 of this chapter, the county auditor shall send a copy of the deduction application to the designating body. Upon receipt of the resolution stating the number of years the deduction will be allowed, the county auditor shall make the appropriate deduction.
        (3) If the deduction application is for rehabilitation or redevelopment in a residentially distressed area, the county auditor shall make the appropriate deduction.
    (g) The amount and period of the deduction provided for property

by section 3 of this chapter are not affected by a change in the ownership of the property if the new owner of the property:
        (1) continues to use the property in compliance with any standards established under section 2(g) of this chapter; and
        (2) files an application in the manner provided by subsection (e).
    (h) The township assessor shall include a notice of the deadlines for filing a deduction application under subsections (a) and (b) with each notice to a property owner of an addition to assessed value or of a new assessment.
    (i) Before the county auditor acts under subsection (f), the county auditor may request that the township assessor of the township in which the property is located review the deduction application.
    (j) A property owner may appeal the a determination of the county auditor under subsection (f) to deny or alter the amount of the deduction by filing a complaint in the office of the clerk of the circuit or superior court requesting in writing a preliminary conference with the county auditor not more than forty-five (45) days after the county auditor gives the person notice of the determination. An appeal initiated under this subsection is processed and determined in the same manner that an appeal is processed and determined under IC 6-1.1-15.

SOURCE: IC 6-1.1-12.1-5.1; (05)ES0001.2.5. -->     SECTION 5. IC 6-1.1-12.1-5.1 IS AMENDED TO READ AS FOLLOWS [EFFECTIVE JANUARY 1, 2005 (RETROACTIVE)]: Sec. 5.1. (a) This subsection applies to:
        (1) all deductions under section 3 of this chapter for property located in a residentially distressed area; and
        (2) any other deductions for which a statement of benefits was approved under section 3 of this chapter before July 1, 1991.
In addition to the requirements of section 5(c) of this chapter, a deduction application filed under section 5 of this chapter must contain information showing the extent to which there has been compliance with the statement of benefits approved under section 3 of this chapter. Failure to comply with a statement of benefits approved before July 1, 1991, may not be a basis for rejecting a deduction application.
    (b) This subsection applies to each deduction (other than a deduction for property located in a residentially distressed area) for which a statement of benefits was approved under section 3 of this chapter after June 30, 1991. In addition to the requirements of section 5(c) of this chapter, a property owner who files a deduction application under section 5 of this chapter must provide the county auditor and the designating body with information showing the extent to which there has been compliance with the statement of benefits approved under

section 3 of this chapter. This information must be included in the deduction application and must also be updated within sixty (60) days after the end of each year in which the deduction is applicable at the same time that the property owner is required to file a personal property tax return in the taxing district in which the property for which the deduction was granted is located. If the taxpayer does not file a personal property tax return in the taxing district in which the property is located, the information must be provided before May 15.
    (c) Notwithstanding IC 5-14-3 and IC 6-1.1-35-9, the following information is a public record if filed under this section:
        (1) The name and address of the taxpayer.
        (2) The location and description of the property for which the deduction was granted.
        (3) Any information concerning the number of employees at the property for which the deduction was granted, including estimated totals that were provided as part of the statement of benefits.
        (4) Any information concerning the total of the salaries paid to those employees, including estimated totals that were provided as part of the statement of benefits.
        (5) Any information concerning the assessed value of the property, including estimates that were provided as part of the statement of benefits.
    (d) The following information is confidential if filed under this section:
        (1) Any information concerning the specific salaries paid to individual employees by the property owner.
        (2) Any information concerning the cost of the property.

SOURCE: IC 6-1.1-12.1-5.4; (05)ES0001.2.6. -->     SECTION 6. IC 6-1.1-12.1-5.4 IS AMENDED TO READ AS FOLLOWS [EFFECTIVE JANUARY 1, 2006]: Sec. 5.4. (a) A person that desires to obtain the deduction provided by section 4.5 of this chapter must file a certified deduction application schedule with the person's personal property return on forms a form prescribed by the department of local government finance with the auditor township assessor of the county township in which the new manufacturing equipment, new research and development equipment, new logistical distribution equipment, or new information technology equipment is located. A Except as provided in subsection (e), the deduction is applied in the amount claimed in a certified schedule that a person that files with:
        (1) a
timely files a personal property return under IC 6-1.1-3-7(a) for the year in which the new manufacturing equipment, new

research and development equipment, new logistical distribution equipment, or new information technology equipment is installed must file the application between March 1 and May 15 of that year. A person that obtains a filing extension under or IC 6-1.1-3-7(b); for the year in which the new manufacturing equipment, new research and development equipment, new logistical distribution equipment, or new information technology equipment is installed must file the application between March 1 and the extended due date for that year. or
        (2) a timely amended personal property return under IC 6-1.1-3-7.5.
The township assessor shall forward to the county auditor and the county assessor a copy of each certified deduction schedule filed under this subsection.

    (b) The deduction application schedule required by this section must contain the following information:
        (1) The name of the owner of the new manufacturing equipment, new research and development equipment, new logistical distribution equipment, or new information technology equipment.
        (2) A description of the new manufacturing equipment, new research and development equipment, new logistical distribution equipment, or new information technology equipment.
        (3) Proof of the date the new manufacturing equipment, new research and development equipment, new logistical distribution equipment, or new information technology equipment was installed.
        (4) (3) The amount of the deduction claimed for the first year of the deduction.
    (c) This subsection applies to a deduction application schedule with respect to new manufacturing equipment, new research and development equipment, new logistical distribution equipment, or new information technology equipment for which a statement of benefits was initially approved after April 30, 1991. If a determination about the number of years the deduction is allowed has not been made in the resolution adopted under section 2.5 of this chapter, the county auditor shall send a copy of the deduction application schedule to the designating body, and the designating body shall adopt a resolution under section 4.5(g)(2) of this chapter.
    (d) A deduction application schedule must be filed under this section in the year in which the new manufacturing equipment, new research and development equipment, new logistical distribution

equipment, or new information technology equipment is installed and in each of the immediately succeeding years the deduction is allowed.
    (e) Subject to subsection (i), The county auditor shall: township assessor or the county assessor may:
        (1) review the deduction application; schedule; and
        (2) approve, before the March 1 that next succeeds the assessment date for which the deduction is claimed, deny or alter the amount of the deduction.
Upon approval of the deduction application or alteration of the amount of the deduction, If the township assessor or the county assessor does not deny the deduction, the county auditor shall make apply the deduction in the amount claimed in the deduction schedule or in the amount as altered by the township assessor or the county assessor. A township assessor or a county assessor who denies a deduction under this subsection or alters the amount of the deduction shall notify the person that claimed the deduction and the county auditor of the assessor's action. The county auditor shall notify the designating body and the county property tax assessment board of appeals of all deductions approved applied under this section.
    (f) If the ownership of new manufacturing equipment, new research and development equipment, new logistical distribution equipment, or new information technology equipment changes, the deduction provided under section 4.5 of this chapter continues to apply to that equipment if the new owner:
        (1) continues to use the equipment in compliance with any standards established under section 2(g) of this chapter; and
        (2) files the deduction applications schedules required by this section.
    (g) The amount of the deduction is the percentage under section 4.5 of this chapter that would have applied if the ownership of the property had not changed multiplied by the assessed value of the equipment for the year the deduction is claimed by the new owner.
    (h) A person may appeal the a determination of the county auditor township assessor or the county assessor under subsection (e) to deny or alter the amount of the deduction by filing a complaint in the office of the clerk of the circuit or superior court requesting in writing a preliminary conference with the township assessor or the county assessor not more than forty-five (45) days after the county auditor township assessor or the county assessor gives the person notice of the determination. Except as provided in subsection (i), an appeal initiated under this subsection is processed and determined in the same manner that an appeal is processed and determined

under IC 6-1.1-15.
    (i) Before the county auditor acts under subsection (e), the county auditor may request that the township assessor in which the property is located review the deduction application.
    (i) The county assessor is recused from any action the county property tax assessment board of appeals takes with respect to an appeal under subsection (h) of a determination by the county assessor.

SOURCE: IC 6-1.1-12.1-5.6; (05)ES0001.2.7. -->     SECTION 7. IC 6-1.1-12.1-5.6 IS AMENDED TO READ AS FOLLOWS [EFFECTIVE JANUARY 1, 2006]: Sec. 5.6. (a) This subsection applies to a property owner whose statement of benefits was approved under section 4.5 of this chapter before July 1, 1991. In addition to the requirements of section 5.5(b) 5.4(b) of this chapter, a deduction application schedule filed under section 5.5 5.4 of this chapter must contain information showing the extent to which there has been compliance with the statement of benefits approved under section 4.5 of this chapter. Failure to comply with a statement of benefits approved before July 1, 1991, may not be a basis for rejecting a deduction application.
    (b) This subsection applies to a property owner whose statement of benefits was approved under section 4.5 of this chapter after June 30, 1991. In addition to the requirements of section 5.5(b) 5.4(b) of this chapter, a property owner who files a deduction application schedule under section 5.5 5.4 of this chapter must provide the county auditor and the designating body with information showing the extent to which there has been compliance with the statement of benefits approved under section 4.5 of this chapter.
    (c) Notwithstanding IC 5-14-3 and IC 6-1.1-35-9, the following information is a public record if filed under this section:
        (1) The name and address of the taxpayer.
        (2) The location and description of the new manufacturing equipment, new research and development equipment, new logistical distribution equipment, or new information technology equipment for which the deduction was granted.
        (3) Any information concerning the number of employees at the facility where the new manufacturing equipment, new research and development equipment, new logistical distribution equipment, or new information technology equipment is located, including estimated totals that were provided as part of the statement of benefits.
        (4) Any information concerning the total of the salaries paid to those employees, including estimated totals that were provided as

part of the statement of benefits.
        (5) Any information concerning the amount of solid waste or hazardous waste converted into energy or other useful products by the new manufacturing equipment.
        (6) Any information concerning the assessed value of the new manufacturing equipment, new research and development equipment, new logistical distribution equipment, or new information technology equipment including estimates that were provided as part of the statement of benefits.
    (d) The following information is confidential if filed under this section:
        (1) Any information concerning the specific salaries paid to individual employees by the owner of the new manufacturing equipment, new research and development equipment, new logistical distribution equipment, or new information technology equipment.
        (2) Any information concerning the cost of the new manufacturing equipment, new research and development equipment, new logistical distribution equipment, or new information technology equipment.

SOURCE: IC 6-1.1-12.1-5.9; (05)ES0001.2.8. -->     SECTION 8. IC 6-1.1-12.1-5.9 IS AMENDED TO READ AS FOLLOWS [EFFECTIVE JANUARY 1, 2006]: Sec. 5.9. (a) This section does not apply to:
        (1) a deduction under section 3 of this chapter for property located in a residentially distressed area; or
        (2) any other deduction under section 3 or 4.5 of this chapter for which a statement of benefits was approved before July 1, 1991.
    (b) Not later than forty-five (45) days after receipt of the information described in section 5.1 or 5.6 of this chapter, the designating body may determine whether the property owner has substantially complied with the statement of benefits approved under section 3 or 4.5 of this chapter. If the designating body determines that the property owner has not substantially complied with the statement of benefits and that the failure to substantially comply was not caused by factors beyond the control of the property owner (such as declines in demand for the property owner's products or services), the designating body shall mail a written notice to the property owner. The written notice must include the following provisions:
        (1) An explanation of the reasons for the designating body's determination.
        (2) The date, time, and place of a hearing to be conducted by the designating body for the purpose of further considering the

property owner's compliance with the statement of benefits. The date of the hearing may not be more than thirty (30) days after the date on which the notice is mailed.
    (c) On the date specified in the notice described in subsection (b)(2), the designating body shall conduct a hearing for the purpose of further considering the property owner's compliance with the statement of benefits. Based on the information presented at the hearing by the property owner and other interested parties, the designating body shall again determine whether the property owner has made reasonable efforts to substantially comply with the statement of benefits and whether any failure to substantially comply was caused by factors beyond the control of the property owner. If the designating body determines that the property owner has not made reasonable efforts to comply with the statement of benefits, the designating body shall adopt a resolution terminating the property owner's deduction under section 3 or 4.5 of this chapter. If the designating body adopts such a resolution, the deduction does not apply to the next installment of property taxes owed by the property owner or to any subsequent installment of property taxes.
    (d) If the designating body adopts a resolution terminating a deduction under subsection (c), the designating body shall immediately mail a certified copy of the resolution to:
        (1) the property owner; and
        (2) the county auditor; and
        (3) if the deduction applied under section 4.5 of this chapter, the township assessor.

The county auditor shall remove the deduction from the tax duplicate and shall notify the county treasurer of the termination of the deduction. If the designating body's resolution is adopted after the county treasurer has mailed the statement required by IC 6-1.1-22-8, the county treasurer shall immediately mail the property owner a revised statement that reflects the termination of the deduction.
    (e) A property owner whose deduction is terminated by the designating body under this section may appeal the designating body's decision by filing a complaint in the office of the clerk of the circuit or superior court together with a bond conditioned to pay the costs of the appeal if the appeal is determined against the property owner. An appeal under this subsection shall be promptly heard by the court without a jury and determined within thirty (30) days after the time of the filing of the appeal. The court shall hear evidence on the appeal and may confirm the action of the designating body or sustain the appeal. The judgment of the court is final and conclusive unless an appeal is

taken as in other civil actions.
    (f) If an appeal under subsection (e) is pending, the taxes resulting from the termination of the deduction are not due until after the appeal is finally adjudicated and the termination of the deduction is finally determined.

SOURCE: IC 6-1.1-12.1-8; (05)ES0001.2.9. -->     SECTION 9. IC 6-1.1-12.1-8 IS AMENDED TO READ AS FOLLOWS [EFFECTIVE JANUARY 1, 2006]: Sec. 8. (a) Not later than December 31 of each year, the county auditor shall publish the following in a newspaper of general interest and readership and not one of limited subject matter:
        (1) A list of the approved deduction applications that were filed under this chapter during that year that resulted in deductions being applied under this chapter for that year. The list must contain the following:
            (A) The name and address of each person approved for or receiving a deduction that was filed for during the year.
            (B) The amount of each deduction that was filed for during the year.
            (C) The number of years for which each deduction that was filed for during the year will be available.
            (D) The total amount for all deductions that were filed for and granted applied during the year.
        (2) The total amount of all deductions for real property that were in effect under section 3 of this chapter during the year.
        (3) The total amount of all deductions for new manufacturing equipment, new research and development equipment, new logistical distribution equipment, or new information technology equipment that were in effect under section 4.5 of this chapter during the year.
    (b) The county auditor shall file the information described in subsection (a)(2) and (a)(3) with the department of local government finance not later than December 31 of each year.
SOURCE: IC 6-1.1-12.1-9; (05)ES0001.2.10. -->     SECTION 10. IC 6-1.1-12.1-9 IS AMENDED TO READ AS FOLLOWS [EFFECTIVE JULY 1, 2005]: Sec. 9. Notwithstanding any other provision of this chapter, a designating body may not approve a statement of benefits for a deduction under section 3 or 4.5 of this chapter after December 31, 2005. 2017.
SOURCE: IC 6-1.1-12.1-14; (05)ES0001.2.11. -->     SECTION 11. IC 6-1.1-12.1-14 IS AMENDED TO READ AS FOLLOWS [EFFECTIVE JANUARY 1, 2006]: Sec. 14. (a) This section does not apply to:
        (1) a deduction under section 3 of this chapter for property located in a residentially distressed area; or
        (2) any other deduction under section 3 or 4.5 of this chapter for which a statement of benefits was approved before July 1, 2004.
    (b) A property owner that receives a deduction under section 3 or 4.5 of this chapter is subject to this section only if the designating body, with the consent of the property owner, incorporates this section, including the percentage to be applied by the county auditor for purposes of STEP TWO of subsection (c), into its initial approval of the property owner's statement of benefits and deduction at the time of that approval.
    (c) During each year in which a property owner's property tax liability is reduced by a deduction granted applied under this chapter, the property owner shall pay to the county treasurer a fee in an amount determined by the county auditor. The county auditor shall determine the amount of the fee to be paid by the property owner according to the following formula:
        STEP ONE: Determine the additional amount of property taxes that would have been paid by the property owner during the year if the deduction had not been in effect.
        STEP TWO: Multiply the amount determined under STEP ONE by the percentage determined by the designating body under subsection (b), which may not exceed fifteen percent (15%). The percentage determined by the designating body remains in effect throughout the term of the deduction and may not be changed.
        STEP THREE: Determine the lesser of the STEP TWO product or one hundred thousand dollars ($100,000).
    (d) Fees collected under this section must be distributed to one (1) or more public or nonprofit entities established to promote economic development within the corporate limits of the city, town, or county served by the designating body. The designating body shall notify the county auditor of the entities that are to receive distributions under this section and the relative proportions of those distributions. The county auditor shall distribute fees collected under this section in accordance with the designating body's instructions.
    (e) If the designating body determines that a property owner has not paid a fee imposed under this section, the designating body may adopt a resolution terminating the property owner's deduction under section 3 or 4.5 of this chapter. If the designating body adopts such a resolution, the deduction does not apply to the next installment of property taxes owed by the property owner or to any subsequent installment of property taxes.
SOURCE: IC 6-1.1-12.4; (05)ES0001.2.12. -->     SECTION 12. IC 6-1.1-12.4 IS ADDED TO THE INDIANA CODE AS A NEW CHAPTER TO READ AS FOLLOWS [EFFECTIVE

JANUARY 1, 2006]:
     Chapter 12.4. Investment Deduction
    Sec. 1.    For purposes of this chapter, "official" means:
        (1) a county auditor;
        (2) a county assessor; or
        (3) a township assessor.
    Sec. 2. (a) For purposes of this section, an increase in the assessed value of real property is determined in the same manner that an increase in the assessed value of real property is determined for purposes of IC 6-1.1-12.1.
    (b) This subsection applies only to a development, redevelopment, or rehabilitation that is first assessed after March 1, 2005, and before March 2, 2009. Except as provided in subsection (h) and sections 4, 5, and 8 of this chapter, an owner of real property that:
        (1) develops, redevelops, or rehabilitates the real property; and
        (2) creates or retains employment from the development, redevelopment, or rehabilitation;
is entitled to a deduction from the assessed value of the real property.
    (c) The deduction under this section is first available in the year in which the increase in assessed value resulting from the development, redevelopment, or rehabilitation occurs and continues for the following two (2) years. The amount of the deduction that a property owner may receive with respect to real property located in a county for a particular year equals the lesser of:
        (1) two million dollars ($2,000,000); or
        (2) the product of:
            (A) the increase in assessed value resulting from the development, rehabilitation, or redevelopment; multiplied by
            (B) the percentage from the following table:
    YEAR OF DEDUCTION     PERCENTAGE
    1st     75%
    2nd     50%
    3rd     25%
    (d) A property owner that qualifies for the deduction under this section must file a notice to claim the deduction in the manner prescribed by the department of local government finance under rules adopted by the department of local government finance

under IC 4-22-2 to implement this chapter. The township assessor shall:
        (1) inform the county auditor of the real property eligible for the deduction as contained in the notice filed by the taxpayer under this subsection; and
        (2) inform the county auditor of the deduction amount.
    (e) The county auditor shall:
        (1) make the deductions; and
        (2) notify the county property tax assessment board of appeals of all deductions approved;
under this section.
    (f) The amount of the deduction determined under subsection (c)(2) is adjusted to reflect the percentage increase or decrease in assessed valuation that results from:
        (1) a general reassessment of real property under IC 6-1.1-4-4; or
        (2) an annual adjustment under IC 6-1.1-4-4.5.
    (g) If an appeal of an assessment is approved that results in a reduction of the assessed value of the real property, the amount of the deduction under this section is adjusted to reflect the percentage decrease that results from the appeal.
    (h) The deduction under this section does not apply to a facility listed in IC 6-1.1-12.1-3(e).
    Sec. 3. (a) For purposes of this section, an increase in the assessed value of personal property is determined in the same manner that an increase in the assessed value of new manufacturing equipment is determined for purposes of IC 6-1.1-12.1.
    (b) This subsection applies only to personal property that the owner installs after March 1, 2005, and before March 2, 2009. Except as provided in sections 4, 5, and 8 of this chapter, an owner that installs personal property other than inventory (as defined in 50 IAC 4.2-5-1, as in effect on January 1, 2005) that:
        (1) was never before used by its owner for any purpose in Indiana; and
        (2) creates or retains employment;
is entitled to a deduction from the assessed value of the personal property. For purposes of this subsection, personal property is considered to be installed if the property is installed as described in 50 IAC 10-1-2 (as in effect on January 1, 2005).
    (c) The deduction under this section is first available in the year in which the increase in assessed value resulting from the

installation of the personal property occurs and continues for the following two (2) years. The amount of the deduction that a property owner may receive with respect to personal property located in a county for a particular year equals the lesser of:
        (1) two million dollars ($2,000,000); or
        (2) the product of:
            (A) the increase in assessed value resulting from the installation of the personal property; multiplied by
            (B) the percentage from the following table:
    YEAR OF DEDUCTION     PERCENTAGE
    1st     75%
    2nd     50%
    3rd     25%
    (d) If an appeal of an assessment is approved that results in a reduction of the assessed value of the personal property, the amount of the deduction is adjusted to reflect the percentage decrease that results from the appeal.
    (e) A property owner must claim the deduction under this section on the owner's annual personal property tax return. The township assessor shall:
        (1) identify the personal property eligible for the deduction to the county auditor; and
        (2) inform the county auditor of the deduction amount.
    (f) The county auditor shall:
        (1) make the deductions; and
        (2) notify the county property tax assessment board of appeals of all deductions approved;
under this section.
    Sec. 4. A property owner may not receive a deduction under this chapter with respect to real property or personal property located in an allocation area (as defined in IC 6-1.1-21.2-3).
    Sec. 5. A property owner that qualifies for a deduction for a year under this chapter and another statute with respect to the same:
        (1) real property development, redevelopment, or rehabilitation; or
        (2) personal property installation;
may not receive a deduction under both statutes for the development, redevelopment, rehabilitation, or installation for that year.
    Sec. 6. An official may:
        (1) review the creation or retention of employment from:


            (A) the development, redevelopment, or rehabilitation of real property; or
            (B) the installation of personal property;
        that qualifies a property owner for a deduction under this chapter;
        (2) determine whether the creation or retention of employment described in subdivision (1) has occurred; and
        (3) if the official determines under subdivision (2) that:
            (A) the creation or retention of employment described in subdivision (1) has not occurred; and
            (B) the failure to create or retain employment was not caused by factors beyond the control of the property owner (such as declines in demand for the property owner's products or services);
        mail a written notice to the property owner of a hearing on the termination of the deduction under this chapter.
    Sec. 7. The written notice under section 6(3) of this chapter must include the following:
        (1) An explanation of the reasons for the determination that the creation or retention of employment described in section 6(1) of this chapter has not occurred.
        (2) The date, time, and place of a hearing to be conducted:
            (A) by the official; and
            (B) not more than thirty (30) days after the date of the notice under section 6(3) of this chapter;
        to further consider the property owner's creation or retention of employment as described in section 6(1) of this chapter.
    Sec. 8. On the date specified in the notice described in section 6(3) of this chapter, the official shall conduct a hearing for the purpose of further considering the property owner's creation or retention of employment as described in section 6(1) of this chapter. Based on the information presented at the hearing by the property owner and other interested parties, the official shall determine whether the property owner has made reasonable efforts to create or retain employment as described in section 6(1) of this chapter and whether any failure to create or retain employment was caused by factors beyond the control of the property owner. If the official determines that the property owner has not made reasonable efforts to create or retain employment, the official shall determine that the property owner's deduction under this chapter is terminated. If the official terminates the deduction, the deduction does not apply to:
        (1) the next installment of property taxes owed by the property owner; or
        (2) any subsequent installment of property taxes.
    Sec. 9. If an official terminates a deduction under section 8 of this chapter:
        (1) the official shall immediately mail a certified copy of the determination to:
            (A) the property owner; and
            (B) if the determination is made by the county assessor or the township assessor, the county auditor;
        (2) the county auditor shall:
            (A) remove the deduction from the tax duplicate; and
            (B) notify the county treasurer of the termination of the deduction; and
        (3) if the official's determination to terminate the deduction occurs after the county treasurer has mailed the statement required by IC 6-1.1-22-8, the county treasurer shall immediately mail the property owner a revised statement that reflects the termination of the deduction.
    Sec. 10. A property owner whose deduction is terminated under section 8 of this chapter may appeal the official's decision by filing a complaint in the office of the clerk of the circuit or superior court together with a bond conditioned to pay the costs of the appeal if the appeal is determined against the property owner. The court shall:
        (1) hear an appeal under this section promptly without a jury; and
        (2) determine the appeal not later than thirty (30) days after the date of the filing of the appeal.
The judgment of the court is final and conclusive unless an appeal is taken as in other civil actions.
    Sec. 11. If an appeal under section 10 of this chapter is pending, the taxes resulting from the termination of the deduction are not due until after the appeal is finally adjudicated and the termination of the deduction is finally determined.
    Sec. 12. If ownership of the real property or new personal property changes, the deduction under this chapter continues to apply to the real property or personal property, and the amount of deduction is the product of:
        (1) the percentage under section 2(c)(2)(B) or 3(c)(2)(B) of this chapter that would have applied if the ownership of the property had not changed; multiplied by
        (2) the assessed value of the real property or personal property for the year the new owner qualifies for the deduction.
    Sec. 13. The department of local government finance shall adopt rules under IC 4-22-2 to implement this chapter.

SOURCE: IC 6-1.1-12.5; (05)ES0001.2.13. -->     SECTION 13. IC 6-1.1-12.5 IS ADDED TO THE INDIANA CODE AS A NEW CHAPTER TO READ AS FOLLOWS [EFFECTIVE JANUARY 1, 2006]:
     Chapter 12.5. Assessment Phase-in Deduction
     Sec. 1. For purposes of this chapter:
        (1) "personal property" does not include:
            (A) inventory (as defined in IC 6-1.1-3-11); and
            (B) personal property used by a retail business;
        (2) "real property" does not include:
            (A) a single family dwelling if the first year in which the dwelling would otherwise qualify for the deduction under this section is the first year the dwelling is subject to assessment; and
            (B) real property used by a retail business; and
        (3) "rehabilitate" means to remodel, repair, or improve in any manner.
    Sec. 2. (a) Subject to subsection (g) and section 3 of this chapter, a taxpayer that installs or rehabilitates personal property for which the taxpayer is liable for property taxes is entitled to a deduction from the assessed value of the personal property. For purposes of this subsection, personal property is considered to be installed if the property is installed as described in 50 IAC 10-1-2, as in effect on January 1, 2005.
    (b) Subject to subsection (g) and section 3 of this chapter, a taxpayer that constructs or rehabilitates real property for which the taxpayer is liable for property taxes is entitled to a deduction from the assessed value of the real property.
    (c) The deduction under this section is available in:
        (1) the year in which:
            (A) the personal property or real property is first subject to assessment; or
            (B) the rehabilitation of the real property results in an increased assessed valuation of the real property; and
        (2) the immediately succeeding two (2) years.
    (d) The amount of the deduction that a taxpayer may receive for the year referred to in subsection (c)(1) equals the product of:
        (1) the assessed value for that year resulting from:
            (A) the installation of the personal property, or the rehabilitation of the personal property to the extent the rehabilitation results in an assessed value that exceeds the assessed value of the personal property for the immediately preceding year; or
            (B) the construction or rehabilitation of the real property;
        multiplied by
        (2) seventy-five percent (75%).
    (e) The amount of the deduction that a taxpayer may receive for the first year referred to in subsection (c)(2) equals the product of:
        (1) the assessed value of:
            (A) the personal property installed in the year referred to in subsection (c)(1) determined for the first year referred to in subsection (c)(2);
            (B) the personal property rehabilitated in the year referred to in subsection (c)(1) to the extent the rehabilitation results in an assessed value for the first year referred to in subsection (c)(2) that exceeds the assessed value of the personal property that would have applied for the first year referred to in subsection (c)(2) if the rehabilitation had not occurred; or
            (C) the real property determined for the immediately preceding year under subsection (d)(1)(B) as adjusted:
                (i) in a general reassessment of real property under IC 6-1.1-4-4; or
                (ii) under IC 6-1.1-4-4.5;
        multiplied by
        (2) fifty percent (50%).
    (f) The amount of the deduction that a taxpayer may receive for the second year referred to in subsection (c)(2) equals the product of:
        (1) the assessed value of:
            (A) the personal property installed in the year referred to in subsection (c)(1) determined for the second year referred to in subsection (c)(2);
            (B) the personal property rehabilitated in the year referred to in subsection (c)(1) to the extent the rehabilitation results in an assessed value for the second year referred to in subsection (c)(2) that exceeds the assessed value of the personal property that would have applied for the second year referred to in subsection (c)(2) if the rehabilitation had not occurred; or
            (C) the real property determined for the immediately preceding year under subsection (d)(1)(B) as adjusted:
                (i) in a general reassessment of real property under IC 6-1.1-4-4; or
                (ii) under IC 6-1.1-4-4.5;
        multiplied by
        (2) twenty-five percent (25%).
    (g) A property owner that qualifies for a deduction for a year under:
        (1) this section; and
        (2) another statute;
with respect to the same real property or personal property may not receive a deduction for the property under both statutes for that year.
    (h) A property owner is not required to file an application to qualify for the deduction under this section. The county auditor shall:
        (1) make the deduction; and
        (2) notify the county property tax assessment board of appeals of all deductions approved;
under this section.
    Sec. 3. If ownership of the personal property or real property changes:
        (1) the deduction provided under this chapter continues to apply to the property; and
        (2) the amount of deduction is:
            (A) the percentage under subsection 2(d)(2), or 2(e)(2), or 2(f)(2) of this chapter that would have applied if the ownership of the property had not changed; multiplied by
            (B) the assessed value of the property for the year the new owner is entitled to the deduction.
    Sec. 4. The department of local government finance shall adopt rules under IC 4-22-2 to implement this chapter.

SOURCE: IC 6-1.1-39-2; (05)ES0001.2.14. -->     SECTION 14. IC 6-1.1-39-2 IS AMENDED TO READ AS FOLLOWS [EFFECTIVE JULY 1, 2005]: Sec. 2. (a) If the fiscal body of a unit finds that:
        (1) in order to promote opportunities for the gainful employment of its citizens, the attraction of a new business enterprise to the unit, the retention or expansion of a business enterprise existing within the boundaries of the unit, or the preservation or enhancement of the tax base of the unit, an area under the fiscal body's jurisdiction should be declared an economic development

district;
        (2) the public health and welfare of the unit will be benefited by designating the area as an economic development district; and
        (3) there has been proposed a qualified industrial development project to be located in the economic development district, with the proposal supported by:
            (A) financial and economic data; and
            (B) preliminary commitments by business enterprises, associations, state or federal governmental units, or similar entities that evidence a reasonable likelihood that the proposed qualified industrial development project will be initiated and accomplished;
the fiscal body may, before January 1, 2006, 2018, adopt an ordinance declaring the area to be an economic development district and declaring that the public health and welfare of the unit will be benefited by the designation.
    (b) For the purpose of adopting an ordinance under subsection (a), it is sufficient to describe the boundaries of the area by its location in relation to public ways or streams or otherwise as determined by the fiscal body.

SOURCE: IC 6-2.5-5-37; (05)ES0001.2.15. -->     SECTION 15. IC 6-2.5-5-37 IS AMENDED TO READ AS FOLLOWS [EFFECTIVE JULY 1, 2005]: Sec. 37. Transactions involving the following tangible personal property are exempt from the state gross retail tax, if the tangible personal property:
        (1) Engines or chassis that are is leased, owned, or operated by a professional racing teams. team; and
        (2) All spare, replacement, and rebuilding parts or components for the engines and chassis described in subdivision (1), excluding tires and accessories.
        (2) comprises any part of a professional motor racing vehicle, excluding tires and accessories.

SOURCE: IC 6-2.5-5-39; (05)ES0001.2.16. -->     SECTION 16. IC 6-2.5-5-39 IS ADDED TO THE INDIANA CODE AS A NEW SECTION TO READ AS FOLLOWS [EFFECTIVE JULY 1, 2005]: Sec. 39. (a) As used in this chapter, "research and development activities" does not include any of the following:
        (1) Efficiency surveys.
        (2) Management studies.
        (3) Consumer surveys.
        (4) Economic surveys.
        (5) Advertising or promotions.
        (6) Research in connection with literary, historical, or similar projects.
        (7) Testing for purposes of quality control.
    (b) As used in this section, "research and development equipment" means tangible personal property that:
        (1) consists of or is a combination of:
            (A) laboratory equipment;
            (B) computers;
            (C) computer software;
            (D) telecommunications equipment; or
            (E) testing equipment;
        (2) has not previously been used in Indiana for any purpose; and
        (3) is acquired by the purchaser for the purpose of research and development activities devoted directly to experimental or laboratory research and development for:
            (A) new products;
            (B) new uses of existing products; or
            (C) improving or testing existing products.
    (c) A retail transaction:
        (1) involving research and development equipment; and
        (2) occurring after June 30, 2007;
is exempt from the state gross retail tax.

SOURCE: IC 6-2.5-6-16; (05)ES0001.2.17. -->     SECTION 17. IC 6-2.5-6-16 IS ADDED TO THE INDIANA CODE AS A NEW SECTION TO READ AS FOLLOWS [EFFECTIVE JULY 1, 2005]: Sec. 16. (a) As used in this section, "research and development equipment" has the meaning set forth in IC 6-2.5-5-39.
    (b) A person is entitled to a refund equal to fifty percent (50%) of the gross retail tax paid by the person under this article in a retail transaction occurring after June 30, 2005, and before July 1, 2007, to acquire research and development equipment.
    (c) To receive the refund provided by this section, a person must claim the refund under IC 6-8.1-9 in the manner prescribed by the department.

SOURCE: IC 6-3.1-4-1; (05)ES0001.2.18. -->     SECTION 18. IC 6-3.1-4-1 IS AMENDED TO READ AS FOLLOWS [EFFECTIVE JULY 1, 2005]: Sec. 1. As used in this chapter:
    "Base amount" means base amount (as defined in Section 41(c) of the Internal Revenue Code as in effect on January 1, 2001), modified by considering only Indiana qualified research expenses and gross receipts attributable to Indiana in the calculation of the taxpayer's:
        (1) fixed base percentage; and
        (2) average annual gross receipts.

    "Base period Indiana qualified research expense" means base period research expense that is incurred for research conducted in Indiana.
    "Base period research expense" means base period research expense (as defined in Section 41(c) of the Internal Revenue Code before January 1, 1990).
    "Indiana qualified research expense" means qualified research expense that is incurred for research conducted in Indiana.
    "Qualified research expense" means qualified research expense (as defined in Section 41(b) of the Internal Revenue Code as in effect on January 1, 2001).
    "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 limited liability company; or
        (4) a limited liability partnership.
    "Research expense tax credit" means a credit provided under this chapter against any tax otherwise due and payable under IC 6-3.
    "Taxpayer" means an individual, a corporation, a limited liability company, a limited liability partnership, a trust, or a partnership that has any tax liability under IC 6-3 (adjusted gross income tax).
SOURCE: IC 6-3.1-4-2; (05)ES0001.2.19. -->     SECTION 19. IC 6-3.1-4-2 IS AMENDED TO READ AS FOLLOWS [EFFECTIVE JULY 1, 2005]: Sec. 2. (a) A taxpayer who incurs Indiana qualified research expense in a particular taxable year is entitled to a research expense tax credit for the taxable year. in
     (b) For Indiana qualified research expense incurred before January 1, 2008, the amount of the research expense tax credit is equal to the product of (1) ten percent (10%) multiplied by (2) the remainder of:
         (1) the taxpayer's Indiana qualified research expenses for the taxable year; minus
            (A) the taxpayer's base period Indiana qualified research expenses, for taxable years beginning before January 1, 1990; or
        (B) (2) the taxpayer's base amount. for taxable years beginning after December 31, 1989.
     (c) For Indiana qualified research expense incurred after December 31, 2007, the amount of the research expense tax credit is determined under STEP FOUR of the following formula:
        STEP ONE: Subtract the taxpayer's base amount from the taxpayer's Indiana qualified research expense for the taxable year.
        STEP TWO: Multiply the lesser of:
            (A) one million dollars ($1,000,000); or
            (B) the STEP ONE remainder;
        by fifteen percent (15%).
        STEP THREE: If the STEP ONE remainder exceeds one million dollars ($1,000,000), multiply the amount of that excess by ten percent (10%).
        STEP FOUR: Add the STEP TWO and STEP THREE products.

SOURCE: IC 6-3.1-4-3; (05)ES0001.2.20. -->     SECTION 20. IC 6-3.1-4-3 IS AMENDED TO READ AS FOLLOWS [EFFECTIVE JANUARY 1, 2006]: Sec. 3. (a) The amount of the credit provided by this chapter that a taxpayer uses during a particular taxable year may not exceed the sum of the taxes imposed by IC 6-3 for the taxable year after the application of all credits that under IC 6-3.1-1-2 are to be applied before the credit provided by this chapter. If the credit provided by this chapter exceeds that sum for the taxable year for which the credit is first claimed, then the excess may be carried over to succeeding taxable years and used as a credit against the tax otherwise due and payable by the taxpayer under IC 6-3 during those taxable years. Each time that the credit is carried over to a succeeding taxable year, it is to be reduced by the amount which was used as a credit during the immediately preceding taxable year. The credit provided by this chapter may be carried forward and applied to succeeding taxable years for fifteen (15) ten (10) taxable years following the unused credit year.
    (b) A credit earned by a taxpayer in a particular taxable year shall be applied against the taxpayer's tax liability for that taxable year before any credit carryover is applied against that liability under subsection (a).
    (c) A taxpayer is not entitled to any carryback or refund of any unused credit.
SOURCE: IC 6-3.1-4-7; (05)ES0001.2.21. -->     SECTION 21. IC 6-3.1-4-7 IS AMENDED TO READ AS FOLLOWS [EFFECTIVE JULY 1, 2005]: Sec. 7. (a) If a pass through entity does not have state income tax liability against which the research expense tax credit may be applied, a shareholder, or partner, or member of the pass through entity is entitled to a research expense tax credit equal to:
        (1) the research expense 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, or member is entitled.
    (b) The credit provided under subsection (a) is in addition to a

research expense tax credit to which a shareholder, or partner, or member of a pass through entity is otherwise entitled under this chapter. However, a pass through entity and a shareholder, or partner, or member of the pass through entity may not claim a credit under this chapter for the same qualified research expenses.

SOURCE: IC 6-3.1-24-3; (05)ES0001.2.22. -->     SECTION 22. IC 6-3.1-24-3 IS AMENDED TO READ AS FOLLOWS [EFFECTIVE MAY 15, 2005]: Sec. 3. As used in this chapter, "qualified investment capital" means debt or equity capital that is provided to a qualified Indiana business after December 31, 2003. However, the term does not include debt that:
        (1) is provided by a financial institution (as defined in IC 5-13-4-10) after May 15, 2005; and
        (2) is secured by a valid mortgage, security agreement, or other agreement or document that establishes a collateral or security position for the financial institution that is senior to all collateral or security interests of other taxpayers that provide debt or equity capital to the qualified Indiana business.

SOURCE: IC 6-3.1-24-7; (05)ES0001.2.23. -->     SECTION 23. IC 6-3.1-24-7, AS AMENDED BY P.L.4-2005, SECTION 98, IS AMENDED TO READ AS FOLLOWS [EFFECTIVE FEBRUARY 9, 2005 (RETROACTIVE)]: Sec. 7. (a) The Indiana economic development corporation shall certify that a business is a qualified Indiana business if the corporation determines that the business:
        (1) has its headquarters in Indiana;
        (2) is primarily focused on professional motor vehicle racing, commercialization of research and development, technology transfers, or the application of new technology, or is determined by the Indiana economic development corporation to have significant potential to:
            (A) bring substantial capital into Indiana;
            (B) create jobs;
            (C) diversify the business base of Indiana; or
            (D) significantly promote the purposes of this chapter in any other way;
        (3) has had average annual revenues of less than ten million dollars ($10,000,000) in the two (2) years preceding the year in which the business received qualified investment capital from a taxpayer claiming a credit under this chapter;
        (4) has:
            (A) at least fifty percent (50%) of its employees residing in Indiana; or
            (B) at least seventy-five percent (75%) of its assets located in Indiana; and
        (5) is not engaged in a business involving:
            (A) real estate;
            (B) real estate development;
            (C) insurance;
            (D) professional services provided by an accountant, a lawyer, or a physician;
            (E) retail sales, except when the primary purpose of the business is the development or support of electronic commerce using the Internet; or
            (F) oil and gas exploration.
    (b) A business shall apply to be certified as a qualified Indiana business on a form prescribed by the Indiana economic development corporation.
    (c) If a business is certified as a qualified Indiana business under this section, the Indiana economic development corporation shall provide a copy of the certification to the investors in the qualified Indiana business for inclusion in tax filings.
    (d) The Indiana economic development corporation may impose an application fee of not more than two hundred dollars ($200).
SOURCE: IC 6-3.1-24-9; (05)ES0001.2.24. -->     SECTION 24. IC 6-3.1-24-9, AS AMENDED BY P.L.4-2005, SECTION 99, IS AMENDED TO READ AS FOLLOWS [EFFECTIVE FEBRUARY 9, 2005 (RETROACTIVE)]: Sec. 9. (a) The total amount of tax credits that may be allowed under this chapter in a particular calendar year for qualified investment capital provided during that calendar year may not exceed ten twelve million five hundred thousand dollars ($10,000,000). ($12,500,000). The Indiana economic development corporation may not certify a proposed investment plan under section 12.5 of this chapter if the proposed investment would result in the total amount of the tax credits certified for the calendar year exceeding ten twelve million five hundred thousand dollars ($10,000,000). ($12,500,000). An amount of an unused credit carried over by a taxpayer from a previous calendar year may not be considered in determining the amount of proposed investments that the Indiana economic development corporation may certify under this chapter.
    (b) Notwithstanding the other provisions of this chapter, a taxpayer is not entitled to a credit for providing qualified investment capital to a qualified Indiana business after December 31, 2008. However, this subsection may not be construed to prevent a taxpayer from carrying over to a taxable year beginning after December 31, 2008, an unused

tax credit attributable to an investment occurring before January 1, 2009.

SOURCE: IC 6-3.1-24-12; (05)ES0001.2.25. -->
SOURCE: IC 6-3.1-24-12. -->     SECTION 25. IC 6-3.1-24-12 IS AMENDED TO READ AS FOLLOWS [EFFECTIVE JANUARY 1, 2006]: Sec. 12. If the amount of the credit determined under section 10 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 credit over for a period not to exceed the taxpayer's following five (5) 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 or a refund of any unused credit amount.
SOURCE: IC 6-3.1-24-12.5; (05)ES0001.2.26. -->     SECTION 26. IC 6-3.1-24-12.5, AS AMENDED BY P.L.4-2005, SECTION 100, IS AMENDED TO READ AS FOLLOWS [EFFECTIVE FEBRUARY 9, 2005 (RETROACTIVE)]: Sec. 12.5. (a) A taxpayer wishing to obtain a credit under this chapter must apply to the Indiana economic development corporation for a certification that the taxpayer's proposed investment plan would qualify for a credit under this chapter.
    (b) The application required under subsection (a) must include:
        (1) the name and address of the taxpayer;
        (2) the name and address of each proposed recipient of the taxpayer's proposed investment;
        (3) the amount of the proposed investment;
        (4) a copy of the certification issued under section 7 of this chapter that the proposed recipient is a qualified Indiana business; and
        (5) any other information required by the Indiana economic development corporation.
    (c) If the Indiana economic development corporation determines that:
        (1) the proposed investment would qualify the taxpayer for a credit under this chapter; and
        (2) the amount of the proposed investment would not result in the total amount of tax credits certified for the calendar year exceeding ten twelve million five hundred thousand dollars ($10,000,000); ($12,500,000);
the corporation shall certify the taxpayer's proposed investment plan.
    (d) To receive a credit under this chapter, the taxpayer must provide qualified investment capital to a qualified Indiana business according to the taxpayer's certified investment plan within two (2) years after the date on which the Indiana economic development corporation certifies

the investment plan.
    (e) Upon making the investment required under subsection (d), the taxpayer shall provide proof of the investment to the Indiana economic development corporation.
    (f) Upon receiving proof of a taxpayer's investment under subsection (e), the Indiana economic development corporation shall issue the taxpayer a certificate indicating that the taxpayer has fulfilled the requirements of the corporation and that the taxpayer is entitled to a credit under this chapter.
    (g) A taxpayer forfeits the right to a tax credit attributable to an investment certified under subsection (c) if the taxpayer fails to make the proposed investment within the period required under subsection (d).

SOURCE: IC 6-3.1-30; (05)ES0001.2.27. -->     SECTION 27. IC 6-3.1-30 IS ADDED TO THE INDIANA CODE AS A NEW CHAPTER TO READ AS FOLLOWS [EFFECTIVE JANUARY 1, 2006]:
     Chapter 30. Headquarters Relocation Tax Credit
    Sec. 1. As used in this chapter, "corporate headquarters" means the building or buildings where the principal offices of the principal executive officers of an eligible business are located.
    Sec. 2. As used in this chapter, "eligible business" means a business that:
        (1) is engaged in either interstate or intrastate commerce;
        (2) maintains a corporate headquarters at a location outside Indiana;
        (3) has not previously maintained a corporate headquarters at a location in Indiana;
        (4) had annual worldwide revenues of at least five hundred million dollars ($500,000,000) for the taxable year immediately preceding the business's application for a tax credit under section 12 of this chapter; and
        (5) commits contractually to relocating its corporate headquarters to Indiana.
    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 limited liability company; or
        (4) a limited liability partnership.
    Sec. 4. As used in this chapter, "qualifying project" means the relocation of the corporate headquarters of an eligible business from a location outside Indiana to a location in Indiana.
    Sec. 5. As used in this chapter, "relocation costs" means the reasonable and necessary expenses incurred by an eligible business for a qualifying project. The term includes:
        (1) moving costs and related expenses;
        (2) the purchase of new or replacement equipment;
        (3) capital investment costs; and
        (4) property assembly and development costs, including:
            (A) the purchase, lease, or construction of buildings and land;
            (B) infrastructure improvements; and
            (C) site development costs.
The term does not include any costs that do not directly result from the relocation of the business to a location in Indiana.
    Sec. 6. As used in this chapter, "state tax liability" means a taxpayer's total tax liability that is incurred under:
        (1) IC 6-3-1 through IC 6-3-7 (the adjusted gross income tax);
        (2) IC 6-5.5 (the financial institutions tax); and
        (3) IC 27-1-18-2 (the 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. 7. As used in this chapter, "taxpayer" means an individual or entity that has any state tax liability.
    Sec. 8. A taxpayer that:
        (1) is an eligible business;
        (2) completes a qualifying project; and
        (3) incurs relocation costs;
is entitled to a credit against the taxpayer's state tax liability for the taxable year in which the relocation costs are incurred. The credit allowed under this section is equal to the amount determined under section 9 of this chapter.
    Sec. 9. (a) Subject to subsection (b), the amount of the credit to which a taxpayer is entitled under section 8 of this chapter equals the product of:
        (1) fifty percent (50%); multiplied by
        (2) the amount of the taxpayer's relocation costs in the taxable year.
    (b) The credit to which a taxpayer is entitled under section 8 of this chapter may not reduce the taxpayer's state tax liability below the amount of the taxpayer's state tax liability in the taxable year immediately preceding the taxable year in which the taxpayer first incurred relocation costs.
    Sec. 10. If a pass through entity is entitled to a credit under section 8 of this chapter but does not have state tax liability against which the tax credit may be applied, a shareholder, partner, or member 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, partner, or member is entitled.
    Sec. 11. (a) If the credit provided by this chapter exceeds the taxpayer's state tax liability for the taxable year for which the credit is first claimed, the excess may be carried forward to succeeding taxable years and used as a credit against the taxpayer's state tax liability during those taxable years. Each time that the credit is carried forward to a succeeding taxable year, the credit is to be reduced by the amount that was used as a credit during the immediately preceding taxable year. The credit provided by this chapter may be carried forward and applied to succeeding taxable years for nine (9) taxable years following the unused credit year.
    (b) A taxpayer is not entitled to any carryback or refund of any unused credit.
    Sec. 12. 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 the taxpayer's relocation costs and all information that the department determines is necessary for the calculation of the credit provided by this chapter.
    Sec. 13. In determining whether an expense of the eligible business directly resulted from the relocation of the business, the department shall consider whether the expense would likely have been incurred by the eligible business if the business had not relocated from its original location.

SOURCE: IC 6-3.1-31; (05)ES0001.2.28. -->     SECTION 28. IC 6-3.1-31 IS ADDED TO THE INDIANA CODE AS A NEW CHAPTER TO READ AS FOLLOWS [EFFECTIVE JANUARY 1, 2006]:
     Chapter 31. Hoosier Scholars Tax Credit
    Sec. 1. As used in this chapter, "eligible county" has the meaning set forth in IC 20-12-20.3-3.

     Sec. 2. As used in this chapter, "eligible taxpayer" means an

individual who satisfies the following requirements:
        (1) The individual participated in the Hoosier scholars pilot program established under IC 20-12-20.3.
        (2) The individual received provisional tax credits under the program described in subdivision (1).
        (3) The individual graduated from a degree program offered at an institution of higher learning (as defined in IC 20-12-20.3-4).
        (4) The individual is employed in the eligible county where the educational institution conferring the degree referred to in subdivision (3) is located.
        (5) The individual is employed in a field of targeted employment.
    Sec. 3. As used in this chapter, "state income tax liability" means an individual's adjusted gross income tax liability under IC 6-3.
    Sec. 4. As used in this chapter, "targeted employment" means employment in any of the following business activities:
        (1) Advanced manufacturing, including the following:
            (A) Automotive and electronics.
            (B) Aerospace technology.
            (C) Robotics.
            (D) Engineering design technology.
        (2) Life sciences, including the following:
            (A) Orthopedics or medical devices.
            (B) Biomedical research or development.
            (C) Pharmaceutical manufacturing.
            (D) Agribusiness.
            (E) Nanotechnology or molecular manufacturing.
        (3) Information technology, including the following:
            (A) Informatics.
            (B) Certified network administration.
            (C) Software development.
            (D) Fiber optics.
        (4) Twenty-first century logistics, including the following:
            (A) High technology distribution.
            (B) Efficient and effective flow and storage of goods, services, or information.
            (C) Intermodal ports.
    Sec. 5. (a) Beginning with the eligible taxpayer's first taxable year that begins after the date that the eligible taxpayer graduated from a degree program, an eligible taxpayer is entitled to a

refundable credit against the eligible taxpayer's state income tax liability. The amount of the tax credit is equal to the amount of the provisional credit awarded to the eligible taxpayer in the academic year that corresponds to the number of taxable years following the eligible taxpayer's graduation as follows:
        Taxable year following     Academic year in the
        graduation    program
        1st                            1st
        2nd                            2nd
        3rd                            3rd
        4th                            4th
    (b) If the amount of the credit under this chapter exceeds the eligible taxpayer's state tax liability for the taxable year, the excess shall be refunded to the eligible taxpayer.
    Sec. 6. To obtain the credit provided by this chapter, an eligible taxpayer must file with the department information proving the amount of the provisional tax credits awarded to the eligible taxpayer as a student participating in the Indiana growth scholars program and any other information required by the department.

SOURCE: IC 6-3.5-7-13.1; (05)ES0001.2.29. -->     SECTION 29. IC 6-3.5-7-13.1 IS AMENDED TO READ AS FOLLOWS [EFFECTIVE JULY 1, 2005]: Sec. 13.1. (a) The fiscal officer of each county, city, or town for a county in which the county economic development tax is imposed shall establish an economic development income tax fund. Except as provided in sections 23, 25, 26, and 27 of this chapter, the revenue received by a county, city, or town under this chapter shall be deposited in the unit's economic development income tax fund.
    (b) Except as provided in sections 15, 23, 25, 26, and 27 of this chapter, revenues from the county economic development income tax may be used as follows:
        (1) By a county, city, or town for economic development projects, for paying, notwithstanding any other law, under a written agreement all or a part of the interest owed by a private developer or user on a loan extended by a financial institution or other lender to the developer or user if the proceeds of the loan are or are to be used to finance an economic development project, for the retirement of bonds under section 14 of this chapter for economic development projects, for leases under section 21 of this chapter, or for leases or bonds entered into or issued prior to the date the economic development income tax was imposed if the purpose of the lease or bonds would have qualified as a purpose under this chapter at the time the lease was entered into

or the bonds were issued.
        (2) By a county, city, or town for:
            (A) the construction or acquisition of, or remedial action with respect to, a capital project for which the unit is empowered to issue general obligation bonds or establish a fund under any statute listed in IC 6-1.1-18.5-9.8;
            (B) the retirement of bonds issued under any provision of Indiana law for a capital project;
            (C) the payment of lease rentals under any statute for a capital project;
            (D) contract payments to a nonprofit corporation whose primary corporate purpose is to assist government in planning and implementing economic development projects;
            (E) operating expenses of a governmental entity that plans or implements economic development projects;
            (F) to the extent not otherwise allowed under this chapter, funding substance removal or remedial action in a designated unit; or
            (G) funding of a revolving fund established under IC 5-1-14-14.
         (3) For a regional venture capital fund established under section 13.5 of this chapter.
    (c) As used in this section, an economic development project is any project that:
        (1) the county, city, or town determines will:
            (A) promote significant opportunities for the gainful employment of its citizens;
            (B) attract a major new business enterprise to the unit; or
            (C) retain or expand a significant business enterprise within the unit; and
        (2) involves an expenditure for:
            (A) the acquisition of land;
            (B) interests in land;
            (C) site improvements;
            (D) infrastructure improvements;
            (E) buildings;
            (F) structures;
            (G) rehabilitation, renovation, and enlargement of buildings and structures;
            (H) machinery;
            (I) equipment;
            (J) furnishings;


            (K) facilities;
            (L) administrative expenses associated with such a project, including contract payments authorized under subsection (b)(2)(D);
            (M) operating expenses authorized under subsection (b)(2)(E); or
            (N) to the extent not otherwise allowed under this chapter, substance removal or remedial action in a designated unit;
or any combination of these.
SOURCE: IC 6-3.5-7-13.5; (05)ES0001.2.30. -->     SECTION 30. IC 6-3.5-7-13.5 IS ADDED TO THE INDIANA CODE AS A NEW SECTION TO READ AS FOLLOWS [EFFECTIVE JULY 1, 2005]: Sec. 13.5. (a) The general assembly finds that counties and municipalities in Indiana have a need to foster economic development, the development of new technology, and industrial and commercial growth. The general assembly finds that it is necessary and proper to provide an alternative method for counties and municipalities to foster the following:
        (1) Economic development.
        (2) The development of new technology.
        (3) Industrial and commercial growth.
        (4) Employment opportunities.
        (5) The diversification of industry and commerce.
It is declared that the fostering of economic development and the development of new technology under this section for the benefit of the general public, including industrial and commercial enterprises, is a public purpose.
    (b) The fiscal bodies of two (2) or more counties or municipalities may, by resolution, do the following:
        (1) Determine that part or all the taxes received by the units under this chapter should be combined to foster:
            (A) economic development;
            (B) the development of new technology; and
            (C) industrial and commercial growth.
        (2) Establish a regional venture capital fund.
    (c) Each unit participating in a regional venture capital fund established under subsection (b) may deposit the following in the fund:
        (1) Taxes distributed to the unit under this chapter.
        (2) The proceeds of public or private grants.
    (d) A regional venture capital fund shall be administered by a governing board. The expenses of administering the fund shall be paid from money in the fund. The governing board shall invest the

money in the fund not currently needed to meet the obligations of the fund in the same manner as other public money may be invested. Interest that accrues from these investments shall be deposited into the fund. The fund is subject to an annual audit by the state board of accounts. The fund shall bear the full costs of the audit.
    (e) The fiscal body of each participating unit shall approve an interlocal agreement created under IC 36-1-7 establishing the terms for the administration of the regional venture capital fund. The terms must include the following:
        (1) The membership of the governing board.
        (2) The amount of each unit's contribution to the fund.
        (3) The procedures and criteria under which the governing board may loan or grant money from the fund.
        (4) The procedures for the dissolution of the fund and for the distribution of money remaining in the fund at the time of the dissolution.
    (f) An interlocal agreement made by the participating units under subsection (e) must be submitted to the Indiana economic development corporation for approval before the participating units may contribute to the fund.
    (g) A majority of the members of a governing board of a regional venture capital fund established under this section must each have at least fifteen (15) years of experience in business, finance, or venture capital.
    (h) The governing board of the fund may loan or grant money from the fund to a private or public entity if the governing board finds that the loan or grant will be used by the borrower or grantee for at least one (1) of the following economic development purposes:
        (1) To promote significant employment opportunities for the residents of the units participating in the regional venture capital fund.
        (2) To attract a major new business enterprise to a participating unit.
        (3) To develop, retain, or expand a significant business enterprise in a participating unit.
    (i) The expenditures of a borrower or grantee of money from a regional venture capital fund that are considered to be for an economic development purpose include expenditures for any of the following:
        (1) Research and development of technology.


        (2) Job training and education.
        (3) Acquisition of property interests.
        (4) Infrastructure improvements.
        (5) New buildings or structures.
        (6) Rehabilitation, renovation, or enlargement of buildings or structures.
        (7) Machinery, equipment, and furnishings.

SOURCE: IC 20-12-20.3; (05)ES0001.2.31. -->     SECTION 31. IC 20-12-20.3 IS ADDED TO THE INDIANA CODE AS A NEW CHAPTER TO READ AS FOLLOWS [EFFECTIVE JULY 1, 2005]:
     Chapter 20.3. Hoosier Scholars Pilot Program
    Sec. 1. As used in this chapter, "commission" refers to the state student assistance commission established by IC 20-12-21-4.
    Sec. 2. As used in this chapter, "eligible county" means any of the following counties:
        (1) Madison County.
        (2) Grant County.
        (3) Huntington County.

    Sec. 3. As used in this chapter, "eligible student" means a student (as defined in IC 22-4.1-7-4) who is enrolled full time as an undergraduate in a degree program offered at an institution of higher learning located in an eligible county. The commission may impose additional eligibility requirements, including requirements set forth in IC 20-12-21-6.
    Sec. 4. As used in this chapter, "institution of higher learning" means:
        (1) a state educational institution (as defined in IC 20-12-0.5-1); or
        (2) a private institution of higher education (as defined in IC 20-12-63-3(10)).
    Sec. 5. (a) The Indiana growth scholars program is established.
    (b) The commission shall administer the program.
    Sec. 6. The executive director of the commission may employ or contract for clerical and professional staff and administrative support necessary to implement this chapter.
    Sec. 7. (a) The commission shall award a provisional tax credit to an eligible student who:
        (1) is enrolled in good standing in a degree program at an institution of higher learning located in an eligible county;
        (2) enters into an agreement with the commission under this chapter; and
        (3) complies with the requirements established under the rules

of the commission.
    (b) An eligible student may not claim a tax credit against the student's Indiana adjusted gross income tax under this chapter. However, proof of the provisional tax credit awarded under this chapter may be used to obtain a tax credit under IC 6-3.1-31 in a taxable year that begins after the eligible student graduates from a degree program and remains eligible for a tax credit under the requirements of IC 6-3.1-31.
    Sec. 8. (a) The amount of a provisional tax credit awarded under section 8 of this chapter to an eligible student may not exceed two thousand dollars ($2,000) per academic year.
    (b) The commission may not award total provisional tax credits for any academic year that exceeds the limit specified by law (if any).
    (c) The commission may consider any of the following factors in determining the amount of the provisional tax credit to award under section 7 of this chapter:
        (1) Whether an eligible student is enrolled in a degree program for less than a full academic year.
        (2) Any other factor set forth in the rules of the commission.
    Sec. 9. An eligible student must enter into an agreement with the commission to be eligible for a provisional tax credit under this chapter. The agreement must include the following requirements:
        (1) The eligible student must remain enrolled in good standing in a degree program during the academic year at an institution of higher learning located in an eligible county.
        (2) After the student graduates from the degree program, the eligible student must, as a condition of claiming the credit provided under IC 6-3.1-31:
            (A) remain in Indiana; and
            (B) be employed in the eligible county where the institution of higher learning referred to in subdivision (1) is located;
        for a period of years equal to the number of years for which the student received a provisional tax credit under this chapter.
The agreement may include any other provisions that the commission considers necessary to administer this chapter.
    Sec. 10. The commission shall enter into agreements to implement this chapter with institutions of higher learning located in eligible counties.
    Sec. 11. The commission may adopt rules under IC 4-22-2 that are necessary or appropriate to implement this chapter. The rules

that are adopted under this chapter may include rules establishing different standards or procedures for resident and nonresident students.

SOURCE: IC 36-7-14-39; (05)ES0001.2.32. -->     SECTION 32. IC 36-7-14-39, AS AMENDED BY P.L.4-2005, SECTION 135, IS AMENDED TO READ AS FOLLOWS [EFFECTIVE JULY 1, 2005]: Sec. 39. (a) As used in this section:
    "Allocation area" means that part of a blighted area to which an allocation provision of a declaratory resolution adopted under section 15 of this chapter refers for purposes of distribution and allocation of property taxes.
    "Base assessed value" means the following:
        (1) If an allocation provision is adopted after June 30, 1995, in a declaratory resolution or an amendment to a declaratory resolution establishing an economic development area:
            (A) the net assessed value of all the property as finally determined for the assessment date immediately preceding the effective date of the allocation provision of the declaratory resolution, as adjusted under subsection (h); plus
            (B) to the extent that it is not included in clause (A), the net assessed value of property that is assessed as residential property under the rules of the department of local government finance, as finally determined for any assessment date after the effective date of the allocation provision.
        (2) If an allocation provision is adopted after June 30, 1997, in a declaratory resolution or an amendment to a declaratory resolution establishing a blighted area:
            (A) the net assessed value of all the property as finally determined for the assessment date immediately preceding the effective date of the allocation provision of the declaratory resolution, as adjusted under subsection (h); plus
            (B) to the extent that it is not included in clause (A), the net assessed value of property that is assessed as residential property under the rules of the department of local government finance, as finally determined for any assessment date after the effective date of the allocation provision.
        (3) If:
            (A) an allocation provision adopted before June 30, 1995, in a declaratory resolution or an amendment to a declaratory resolution establishing a blighted area expires after June 30, 1997; and
            (B) after June 30, 1997, a new allocation provision is included in an amendment to the declaratory resolution;
        the net assessed value of all the property as finally determined for the assessment date immediately preceding the effective date of the allocation provision adopted after June 30, 1997, as adjusted under subsection (h).
        (4) Except as provided in subdivision (5), for all other allocation areas, the net assessed value of all the property as finally determined for the assessment date immediately preceding the effective date of the allocation provision of the declaratory resolution, as adjusted under subsection (h).
        (5) If an allocation area established in an economic development area before July 1, 1995, is expanded after June 30, 1995, the definition in subdivision (1) applies to the expanded part of the area added after June 30, 1995.
        (6) If an allocation area established in a blighted area before July 1, 1997, is expanded after June 30, 1997, the definition in subdivision (2) applies to the expanded part of the area added after June 30, 1997.
Except as provided in section 39.3 of this chapter, "property taxes" means taxes imposed under IC 6-1.1 on real property. However, upon approval by a resolution of the redevelopment commission adopted before June 1, 1987, "property taxes" also includes taxes imposed under IC 6-1.1 on depreciable personal property. If a redevelopment commission adopted before June 1, 1987, a resolution to include within the definition of property taxes taxes imposed under IC 6-1.1 on depreciable personal property that has a useful life in excess of eight (8) years, the commission may by resolution determine the percentage of taxes imposed under IC 6-1.1 on all depreciable personal property that will be included within the definition of property taxes. However, the percentage included must not exceed twenty-five percent (25%) of the taxes imposed under IC 6-1.1 on all depreciable personal property.
    (b) A declaratory resolution adopted under section 15 of this chapter before January 1, 2006, 2018, may include a provision with respect to the allocation and distribution of property taxes for the purposes and in the manner provided in this section. A declaratory resolution previously adopted may include an allocation provision by the amendment of that declaratory resolution before January 1, 2006, 2018, in accordance with the procedures required for its original adoption. A declaratory resolution or an amendment that establishes an allocation provision after June 30, 1995, must specify an expiration date for the allocation provision that may not be more than thirty (30) years after the date on which the allocation provision is established. However, if bonds or other obligations that were scheduled when issued to mature

before the specified expiration date and that are payable only from allocated tax proceeds with respect to the allocation area remain outstanding as of the expiration date, the allocation provision does not expire until all of the bonds or other obligations are no longer outstanding. The allocation provision may apply to all or part of the blighted area. The allocation provision must require that any property taxes subsequently levied by or for the benefit of any public body entitled to a distribution of property taxes on taxable property in the allocation area be allocated and distributed as follows:
        (1) Except as otherwise provided in this section, the proceeds of the taxes attributable to the lesser of:
            (A) the assessed value of the property for the assessment date with respect to which the allocation and distribution is made; or
            (B) the base assessed value;
        shall be allocated to and, when collected, paid into the funds of the respective taxing units.
        (2) Except as otherwise provided in this section, property tax proceeds in excess of those described in subdivision (1) shall be allocated to the redevelopment district and, when collected, paid into an allocation fund for that allocation area that may be used by the redevelopment district only to do one (1) or more of the following:
            (A) Pay the principal of and interest on any obligations payable solely from allocated tax proceeds which are incurred by the redevelopment district for the purpose of financing or refinancing the redevelopment of that allocation area.
            (B) Establish, augment, or restore the debt service reserve for bonds payable solely or in part from allocated tax proceeds in that allocation area.
            (C) Pay the principal of and interest on bonds payable from allocated tax proceeds in that allocation area and from the special tax levied under section 27 of this chapter.
            (D) Pay the principal of and interest on bonds issued by the unit to pay for local public improvements in or serving that allocation area.
            (E) Pay premiums on the redemption before maturity of bonds payable solely or in part from allocated tax proceeds in that allocation area.
            (F) Make payments on leases payable from allocated tax proceeds in that allocation area under section 25.2 of this chapter.


            (G) Reimburse the unit for expenditures made by it for local public improvements (which include buildings, parking facilities, and other items described in section 25.1(a) of this chapter) in or serving that allocation area.
            (H) Reimburse the unit for rentals paid by it for a building or parking facility in or serving that allocation area under any lease entered into under IC 36-1-10.
            (I) Pay all or a part of a property tax replacement credit to taxpayers in an allocation area as determined by the redevelopment commission. This credit equals the amount determined under the following STEPS for each taxpayer in a taxing district (as defined in IC 6-1.1-1-20) that contains all or part of the allocation area:
            STEP ONE: Determine that part of the sum of the amounts under IC 6-1.1-21-2(g)(1)(A), IC 6-1.1-21-2(g)(2), IC 6-1.1-21-2(g)(3), IC 6-1.1-21-2(g)(4), and IC 6-1.1-21-2(g)(5) that is attributable to the taxing district.
            STEP TWO: Divide:
                (i) that part of each county's eligible property tax replacement amount (as defined in IC 6-1.1-21-2) for that year as determined under IC 6-1.1-21-4 that is attributable to the taxing district; by
                (ii) the STEP ONE sum.
            STEP THREE: Multiply:
                (i) the STEP TWO quotient; times
                (ii) the total amount of the taxpayer's taxes (as defined in IC 6-1.1-21-2) levied in the taxing district that have been allocated during that year to an allocation fund under this section.
            If not all the taxpayers in an allocation area receive the credit in full, each taxpayer in the allocation area is entitled to receive the same proportion of the credit. A taxpayer may not receive a credit under this section and a credit under section 39.5 of this chapter in the same year.
            (J) Pay expenses incurred by the redevelopment commission for local public improvements that are in the allocation area or serving the allocation area. Public improvements include buildings, parking facilities, and other items described in section 25.1(a) of this chapter.
            (K) Reimburse public and private entities for expenses incurred in training employees of industrial facilities that are located:
                (i) in the allocation area; and
                (ii) on a parcel of real property that has been classified as industrial property under the rules of the department of local government finance.
            However, the total amount of money spent for this purpose in any year may not exceed the total amount of money in the allocation fund that is attributable to property taxes paid by the industrial facilities described in this clause. The reimbursements under this clause must be made within three (3) years after the date on which the investments that are the basis for the increment financing are made.
        The allocation fund may not be used for operating expenses of the commission.
        (3) Except as provided in subsection (g), before July 15 of each year the commission shall do the following:
            (A) Determine the amount, if any, by which the base assessed value when multiplied by the estimated tax rate of the allocation area will exceed the amount of assessed value needed to produce the property taxes necessary to make, when due, principal and interest payments on bonds described in subdivision (2) plus the amount necessary for other purposes described in subdivision (2).
            (B) Notify the county auditor of the amount, if any, of the amount of excess assessed value that the commission has determined may be allocated to the respective taxing units in the manner prescribed in subdivision (1). The commission may not authorize an allocation of assessed value to the respective taxing units under this subdivision if to do so would endanger the interests of the holders of bonds described in subdivision (2) or lessors under section 25.3 of this chapter.
    (c) For the purpose of allocating taxes levied by or for any taxing unit or units, the assessed value of taxable property in a territory in the allocation area that is annexed by any taxing unit after the effective date of the allocation provision of the declaratory resolution is the lesser of:
        (1) the assessed value of the property for the assessment date with respect to which the allocation and distribution is made; or
        (2) the base assessed value.
    (d) Property tax proceeds allocable to the redevelopment district under subsection (b)(2) may, subject to subsection (b)(3), be irrevocably pledged by the redevelopment district for payment as set forth in subsection (b)(2).
    (e) Notwithstanding any other law, each assessor shall, upon petition of the redevelopment commission, reassess the taxable property situated upon or in, or added to, the allocation area, effective on the next assessment date after the petition.
    (f) Notwithstanding any other law, the assessed value of all taxable property in the allocation area, for purposes of tax limitation, property tax replacement, and formulation of the budget, tax rate, and tax levy for each political subdivision in which the property is located is the lesser of:
        (1) the assessed value of the property as valued without regard to this section; or
        (2) the base assessed value.
    (g) If any part of the allocation area is located in an enterprise zone created under IC 5-28-15, the unit that designated the allocation area shall create funds as specified in this subsection. A unit that has obligations, bonds, or leases payable from allocated tax proceeds under subsection (b)(2) shall establish an allocation fund for the purposes specified in subsection (b)(2) and a special zone fund. Such a unit shall, until the end of the enterprise zone phase out period, deposit each year in the special zone fund any amount in the allocation fund derived from property tax proceeds in excess of those described in subsection (b)(1) from property located in the enterprise zone that exceeds the amount sufficient for the purposes specified in subsection (b)(2) for the year. The amount sufficient for purposes specified in subsection (b)(2) for the year shall be determined based on the pro rata portion of such current property tax proceeds from the part of the enterprise zone that is within the allocation area as compared to all such current property tax proceeds derived from the allocation area. A unit that has no obligations, bonds, or leases payable from allocated tax proceeds under subsection (b)(2) shall establish a special zone fund and deposit all the property tax proceeds in excess of those described in subsection (b)(1) in the fund derived from property tax proceeds in excess of those described in subsection (b)(1) from property located in the enterprise zone. The unit that creates the special zone fund shall use the fund (based on the recommendations of the urban enterprise association) for programs in job training, job enrichment, and basic skill development that are designed to benefit residents and employers in the enterprise zone or other purposes specified in subsection (b)(2), except that where reference is made in subsection (b)(2) to allocation area it shall refer for purposes of payments from the special zone fund only to that part of the allocation area that is also located in the enterprise zone. Those programs shall reserve at least one-half (1/2) of their enrollment in any

session for residents of the enterprise zone.
    (h) The state board of accounts and department of local government finance shall make the rules and prescribe the forms and procedures that they consider expedient for the implementation of this chapter. After each general reassessment under IC 6-1.1-4, the department of local government finance shall adjust the base assessed value one (1) time to neutralize any effect of the general reassessment on the property tax proceeds allocated to the redevelopment district under this section. However, the adjustment may not include the effect of property tax abatements under IC 6-1.1-12.1, and the adjustment may not produce less property tax proceeds allocable to the redevelopment district under subsection (b)(2) than would otherwise have been received if the general reassessment had not occurred. The department of local government finance may prescribe procedures for county and township officials to follow to assist the department in making the adjustments.

SOURCE: IC 36-7-15.1-26; (05)ES0001.2.33. -->     SECTION 33. IC 36-7-15.1-26, AS AMENDED BY P.L.4-2005, SECTION 138, IS AMENDED TO READ AS FOLLOWS [EFFECTIVE JULY 1, 2005]: Sec. 26. (a) As used in this section:
    "Allocation area" means that part of a blighted area to which an allocation provision of a resolution adopted under section 8 of this chapter refers for purposes of distribution and allocation of property taxes.
    "Base assessed value" means the following:
        (1) If an allocation provision is adopted after June 30, 1995, in a declaratory resolution or an amendment to a declaratory resolution establishing an economic development area:
            (A) the net assessed value of all the property as finally determined for the assessment date immediately preceding the effective date of the allocation provision of the declaratory resolution, as adjusted under subsection (h); plus
            (B) to the extent that it is not included in clause (A), the net assessed value of property that is assessed as residential property under the rules of the department of local government finance, as finally determined for any assessment date after the effective date of the allocation provision.
        (2) If an allocation provision is adopted after June 30, 1997, in a declaratory resolution or an amendment to a declaratory resolution establishing a blighted area:
            (A) the net assessed value of all the property as finally determined for the assessment date immediately preceding the effective date of the allocation provision of the declaratory

resolution, as adjusted under subsection (h); plus
            (B) to the extent that it is not included in clause (A), the net assessed value of property that is assessed as residential property under the rules of the department of local government finance, as finally determined for any assessment date after the effective date of the allocation provision.
        (3) If:
            (A) an allocation provision adopted before June 30, 1995, in a declaratory resolution or an amendment to a declaratory resolution establishing a blighted area expires after June 30, 1997; and
            (B) after June 30, 1997, a new allocation provision is included in an amendment to the declaratory resolution;
        the net assessed value of all the property as finally determined for the assessment date immediately preceding the effective date of the allocation provision adopted after June 30, 1997, as adjusted under subsection (h).
        (4) Except as provided in subdivision (5), for all other allocation areas, the net assessed value of all the property as finally determined for the assessment date immediately preceding the effective date of the allocation provision of the declaratory resolution, as adjusted under subsection (h).
        (5) If an allocation area established in an economic development area before July 1, 1995, is expanded after June 30, 1995, the definition in subdivision (1) applies to the expanded part of the area added after June 30, 1995.
        (6) If an allocation area established in a blighted area before July 1, 1997, is expanded after June 30, 1997, the definition in subdivision (2) applies to the expanded part of the area added after June 30, 1997.
    Except as provided in section 26.2 of this chapter, "property taxes" means taxes imposed under IC 6-1.1 on real property. However, upon approval by a resolution of the redevelopment commission adopted before June 1, 1987, "property taxes" also includes taxes imposed under IC 6-1.1 on depreciable personal property. If a redevelopment commission adopted before June 1, 1987, a resolution to include within the definition of property taxes taxes imposed under IC 6-1.1 on depreciable personal property that has a useful life in excess of eight (8) years, the commission may by resolution determine the percentage of taxes imposed under IC 6-1.1 on all depreciable personal property that will be included within the definition of property taxes. However, the percentage included must not exceed twenty-five percent (25%) of

the taxes imposed under IC 6-1.1 on all depreciable personal property.
    (b) A resolution adopted under section 8 of this chapter before January 1, 2006, 2018, may include a provision with respect to the allocation and distribution of property taxes for the purposes and in the manner provided in this section. A resolution previously adopted may include an allocation provision by the amendment of that resolution before January 1, 2006, 2018, in accordance with the procedures required for its original adoption. A declaratory resolution or an amendment that establishes an allocation provision after June 30, 1995, must specify an expiration date for the allocation provision that may not be more than thirty (30) years after the date on which the allocation provision is established. However, if bonds or other obligations that were scheduled when issued to mature before the specified expiration date and that are payable only from allocated tax proceeds with respect to the allocation area remain outstanding as of the expiration date, the allocation provision does not expire until all of the bonds or other obligations are no longer outstanding. The allocation provision may apply to all or part of the blighted area. The allocation provision must require that any property taxes subsequently levied by or for the benefit of any public body entitled to a distribution of property taxes on taxable property in the allocation area be allocated and distributed as follows:
        (1) Except as otherwise provided in this section, the proceeds of the taxes attributable to the lesser of:
            (A) the assessed value of the property for the assessment date with respect to which the allocation and distribution is made; or
            (B) the base assessed value;
        shall be allocated to and, when collected, paid into the funds of the respective taxing units.
        (2) Except as otherwise provided in this section, property tax proceeds in excess of those described in subdivision (1) shall be allocated to the redevelopment district and, when collected, paid into a special fund for that allocation area that may be used by the redevelopment district only to do one (1) or more of the following:
            (A) Pay the principal of and interest on any obligations payable solely from allocated tax proceeds that are incurred by the redevelopment district for the purpose of financing or refinancing the redevelopment of that allocation area.
            (B) Establish, augment, or restore the debt service reserve for bonds payable solely or in part from allocated tax proceeds in that allocation area.


            (C) Pay the principal of and interest on bonds payable from allocated tax proceeds in that allocation area and from the special tax levied under section 19 of this chapter.
            (D) Pay the principal of and interest on bonds issued by the consolidated city to pay for local public improvements in that allocation area.
            (E) Pay premiums on the redemption before maturity of bonds payable solely or in part from allocated tax proceeds in that allocation area.
            (F) Make payments on leases payable from allocated tax proceeds in that allocation area under section 17.1 of this chapter.
            (G) Reimburse the consolidated city for expenditures for local public improvements (which include buildings, parking facilities, and other items set forth in section 17 of this chapter) in that allocation area.
            (H) Reimburse the unit for rentals paid by it for a building or parking facility in that allocation area under any lease entered into under IC 36-1-10.
            (I) Reimburse public and private entities for expenses incurred in training employees of industrial facilities that are located:
                (i) in the allocation area; and
                (ii) on a parcel of real property that has been classified as industrial property under the rules of the department of local government finance.
            However, the total amount of money spent for this purpose in any year may not exceed the total amount of money in the allocation fund that is attributable to property taxes paid by the industrial facilities described in this clause. The reimbursements under this clause must be made within three (3) years after the date on which the investments that are the basis for the increment financing are made.
        The special fund may not be used for operating expenses of the commission.
        (3) Before July 15 of each year, the commission shall do the following:
            (A) Determine the amount, if any, by which the base assessed value when multiplied by the estimated tax rate of the allocated area will exceed the amount of assessed value needed to provide the property taxes necessary to make, when due, principal and interest payments on bonds described in subdivision (2) plus the amount necessary for other purposes

described in subdivision (2) and subsection (g).
            (B) Notify the county auditor of the amount, if any, of excess assessed value that the commission has determined may be allocated to the respective taxing units in the manner prescribed in subdivision (1).
        The commission may not authorize an allocation to the respective taxing units under this subdivision if to do so would endanger the interests of the holders of bonds described in subdivision (2).
    (c) For the purpose of allocating taxes levied by or for any taxing unit or units, the assessed value of taxable property in a territory in the allocation area that is annexed by any taxing unit after the effective date of the allocation provision of the resolution is the lesser of:
        (1) the assessed value of the property for the assessment date with respect to which the allocation and distribution is made; or
        (2) the base assessed value.
    (d) Property tax proceeds allocable to the redevelopment district under subsection (b)(2) may, subject to subsection (b)(3), be irrevocably pledged by the redevelopment district for payment as set forth in subsection (b)(2).
    (e) Notwithstanding any other law, each assessor shall, upon petition of the commission, reassess the taxable property situated upon or in, or added to, the allocation area, effective on the next assessment date after the petition.
    (f) Notwithstanding any other law, the assessed value of all taxable property in the allocation area, for purposes of tax limitation, property tax replacement, and formulation of the budget, tax rate, and tax levy for each political subdivision in which the property is located is the lesser of:
        (1) the assessed value of the property as valued without regard to this section; or
        (2) the base assessed value.
    (g) If any part of the allocation area is located in an enterprise zone created under IC 5-28-15, the unit that designated the allocation area shall create funds as specified in this subsection. A unit that has obligations, bonds, or leases payable from allocated tax proceeds under subsection (b)(2) shall establish an allocation fund for the purposes specified in subsection (b)(2) and a special zone fund. Such a unit shall, until the end of the enterprise zone phase out period, deposit each year in the special zone fund the amount in the allocation fund derived from property tax proceeds in excess of those described in subsection (b)(1) from property located in the enterprise zone that exceeds the amount sufficient for the purposes specified in subsection (b)(2) for the

year. A unit that has no obligations, bonds, or leases payable from allocated tax proceeds under subsection (b)(2) shall establish a special zone fund and deposit all the property tax proceeds in excess of those described in subsection (b)(1) in the fund derived from property tax proceeds in excess of those described in subsection (b)(1) from property located in the enterprise zone. The unit that creates the special zone fund shall use the fund, based on the recommendations of the urban enterprise association, for one (1) or more of the following purposes:
        (1) To pay for programs in job training, job enrichment, and basic skill development designed to benefit residents and employers in the enterprise zone. The programs must reserve at least one-half (1/2) of the enrollment in any session for residents of the enterprise zone.
        (2) To make loans and grants for the purpose of stimulating business activity in the enterprise zone or providing employment for enterprise zone residents in the enterprise zone. These loans and grants may be made to the following:
            (A) Businesses operating in the enterprise zone.
            (B) Businesses that will move their operations to the enterprise zone if such a loan or grant is made.
        (3) To provide funds to carry out other purposes specified in subsection (b)(2). However, where reference is made in subsection (b)(2) to the allocation area, the reference refers for purposes of payments from the special zone fund only to that part of the allocation area that is also located in the enterprise zone.
    (h) The state board of accounts and department of local government finance shall make the rules and prescribe the forms and procedures that they consider expedient for the implementation of this chapter. After each general reassessment under IC 6-1.1-4, the department of local government finance shall adjust the base assessed value one (1) time to neutralize any effect of the general reassessment on the property tax proceeds allocated to the redevelopment district under this section. However, the adjustment may not include the effect of property tax abatements under IC 6-1.1-12.1, and the adjustment may not produce less property tax proceeds allocable to the redevelopment district under subsection (b)(2) than would otherwise have been received if the general reassessment had not occurred. The department of local government finance may prescribe procedures for county and township officials to follow to assist the department in making the adjustments.

SOURCE: IC 36-7-15.1-53; (05)ES0001.2.34. -->     SECTION 34. IC 36-7-15.1-53, AS AMENDED BY P.L.4-2005,

SECTION 140, IS AMENDED TO READ AS FOLLOWS [EFFECTIVE JULY 1, 2005]: Sec. 53. (a) As used in this section:
    "Allocation area" means that part of a blighted area to which an allocation provision of a resolution adopted under section 40 of this chapter refers for purposes of distribution and allocation of property taxes.
    "Base assessed value" means:
        (1) the net assessed value of all the property as finally determined for the assessment date immediately preceding the effective date of the allocation provision of the declaratory resolution, as adjusted under subsection (h); plus
        (2) to the extent that it is not included in subdivision (1), the net assessed value of property that is assessed as residential property under the rules of the department of local government finance, as finally determined for any assessment date after the effective date of the allocation provision.
    Except as provided in section 55 of this chapter, "property taxes" means taxes imposed under IC 6-1.1 on real property.
    (b) A resolution adopted under section 40 of this chapter before January 1, 2006, 2018, may include a provision with respect to the allocation and distribution of property taxes for the purposes and in the manner provided in this section. A resolution previously adopted may include an allocation provision by the amendment of that resolution before January 1, 2006, 2018, in accordance with the procedures required for its original adoption. A declaratory resolution or an amendment that establishes an allocation provision must be approved by resolution of the legislative body of the excluded city and must specify an expiration date for the allocation provision that may not be more than thirty (30) years after the date on which the allocation provision is established. However, if bonds or other obligations that were scheduled when issued to mature before the specified expiration date and that are payable only from allocated tax proceeds with respect to the allocation area remain outstanding as of the expiration date, the allocation provision does not expire until all of the bonds or other obligations are no longer outstanding. The allocation provision may apply to all or part of the blighted area. The allocation provision must require that any property taxes subsequently levied by or for the benefit of any public body entitled to a distribution of property taxes on taxable property in the allocation area be allocated and distributed as follows:
        (1) Except as otherwise provided in this section, the proceeds of the taxes attributable to the lesser of:
            (A) the assessed value of the property for the assessment date

with respect to which the allocation and distribution is made; or
            (B) the base assessed value;
        shall be allocated to and, when collected, paid into the funds of the respective taxing units.
        (2) Except as otherwise provided in this section, property tax proceeds in excess of those described in subdivision (1) shall be allocated to the redevelopment district and, when collected, paid into a special fund for that allocation area that may be used by the redevelopment district only to do one (1) or more of the following:
            (A) Pay the principal of and interest on any obligations payable solely from allocated tax proceeds that are incurred by the redevelopment district for the purpose of financing or refinancing the redevelopment of that allocation area.
            (B) Establish, augment, or restore the debt service reserve for bonds payable solely or in part from allocated tax proceeds in that allocation area.
            (C) Pay the principal of and interest on bonds payable from allocated tax proceeds in that allocation area and from the special tax levied under section 50 of this chapter.
            (D) Pay the principal of and interest on bonds issued by the excluded city to pay for local public improvements in that allocation area.
            (E) Pay premiums on the redemption before maturity of bonds payable solely or in part from allocated tax proceeds in that allocation area.
            (F) Make payments on leases payable from allocated tax proceeds in that allocation area under section 46 of this chapter.
            (G) Reimburse the excluded city for expenditures for local public improvements (which include buildings, park facilities, and other items set forth in section 45 of this chapter) in that allocation area.
            (H) Reimburse the unit for rentals paid by it for a building or parking facility in that allocation area under any lease entered into under IC 36-1-10.
            (I) Reimburse public and private entities for expenses incurred in training employees of industrial facilities that are located:
                (i) in the allocation area; and
                (ii) on a parcel of real property that has been classified as industrial property under the rules of the department of local

government finance.
            However, the total amount of money spent for this purpose in any year may not exceed the total amount of money in the allocation fund that is attributable to property taxes paid by the industrial facilities described in this clause. The reimbursements under this clause must be made within three (3) years after the date on which the investments that are the basis for the increment financing are made.
        The special fund may not be used for operating expenses of the commission.
        (3) Before July 15 of each year, the commission shall do the following:
            (A) Determine the amount, if any, by which property taxes payable to the allocation fund in the following year will exceed the amount of assessed value needed to provide the property taxes necessary to make, when due, principal and interest payments on bonds described in subdivision (2) plus the amount necessary for other purposes described in subdivision (2) and subsection (g).
            (B) Notify the county auditor of the amount, if any, of excess assessed value that the commission has determined may be allocated to the respective taxing units in the manner prescribed in subdivision (1).
        The commission may not authorize an allocation to the respective taxing units under this subdivision if to do so would endanger the interests of the holders of bonds described in subdivision (2).
    (c) For the purpose of allocating taxes levied by or for any taxing unit or units, the assessed value of taxable property in a territory in the allocation area that is annexed by any taxing unit after the effective date of the allocation provision of the resolution is the lesser of:
        (1) the assessed value of the property for the assessment date with respect to which the allocation and distribution is made; or
        (2) the base assessed value.
    (d) Property tax proceeds allocable to the redevelopment district under subsection (b)(2) may, subject to subsection (b)(3), be irrevocably pledged by the redevelopment district for payment as set forth in subsection (b)(2).
    (e) Notwithstanding any other law, each assessor shall, upon petition of the commission, reassess the taxable property situated upon or in, or added to, the allocation area, effective on the next assessment date after the petition.
    (f) Notwithstanding any other law, the assessed value of all taxable

property in the allocation area, for purposes of tax limitation, property tax replacement, and formulation of the budget, tax rate, and tax levy for each political subdivision in which the property is located, is the lesser of:
        (1) the assessed value of the property as valued without regard to this section; or
        (2) the base assessed value.
    (g) If any part of the allocation area is located in an enterprise zone created under IC 5-28-15, the unit that designated the allocation area shall create funds as specified in this subsection. A unit that has obligations, bonds, or leases payable from allocated tax proceeds under subsection (b)(2) shall establish an allocation fund for the purposes specified in subsection (b)(2) and a special zone fund. Such a unit shall, until the end of the enterprise zone phase out period, deposit each year in the special zone fund the amount in the allocation fund derived from property tax proceeds in excess of those described in subsection (b)(1) from property located in the enterprise zone that exceeds the amount sufficient for the purposes specified in subsection (b)(2) for the year. A unit that has no obligations, bonds, or leases payable from allocated tax proceeds under subsection (b)(2) shall establish a special zone fund and deposit all the property tax proceeds in excess of those described in subsection (b)(1) in the fund derived from property tax proceeds in excess of those described in subsection (b)(1) from property located in the enterprise zone. The unit that creates the special zone fund shall use the fund, based on the recommendations of the urban enterprise association, for one (1) or more of the following purposes:
        (1) To pay for programs in job training, job enrichment, and basic skill development designed to benefit residents and employers in the enterprise zone. The programs must reserve at least one-half (1/2) of the enrollment in any session for residents of the enterprise zone.
        (2) To make loans and grants for the purpose of stimulating business activity in the enterprise zone or providing employment for enterprise zone residents in an enterprise zone. These loans and grants may be made to the following:
            (A) Businesses operating in the enterprise zone.
            (B) Businesses that will move their operations to the enterprise zone if such a loan or grant is made.
        (3) To provide funds to carry out other purposes specified in subsection (b)(2). However, where reference is made in subsection (b)(2) to the allocation area, the reference refers, for

purposes of payments from the special zone fund, only to that part of the allocation area that is also located in the enterprise zone.
    (h) The state board of accounts and department of local government finance shall make the rules and prescribe the forms and procedures that they consider expedient for the implementation of this chapter. After each general reassessment under IC 6-1.1-4, the department of local government finance shall adjust the base assessed value one (1) time to neutralize any effect of the general reassessment on the property tax proceeds allocated to the redevelopment district under this section. However, the adjustment may not include the effect of property tax abatements under IC 6-1.1-12.1, and the adjustment may not produce less property tax proceeds allocable to the redevelopment district under subsection (b)(2) than would otherwise have been received if the general reassessment had not occurred. The department of local government finance may prescribe procedures for county and township officials to follow to assist the department in making the adjustments.

SOURCE: IC 6-1.1-12.1-2.3; (05)ES0001.2.35. -->     SECTION 35. IC 6-1.1-12.1-2.3 IS REPEALED [EFFECTIVE JULY 1, 2005].
SOURCE: ; (05)ES0001.2.36. -->     SECTION 36. [EFFECTIVE JULY 1, 2005] (a) IC 6-1.1-12.4, as added by this act, applies only to:
        (1) real property development, redevelopment, or rehabilitation; and
        (2) personal property installation;
that occurs
as described in that chapter after March 1, 2005.
    (b) The definitions in IC 6-2.5 apply throughout this subsection. For purposes of IC 6-2.5-6-16, as added by this act, all transactions shall be considered as having occurred after June 30, 2005, to the extent that delivery of the property or services constituting selling at retail is made after that date to the purchaser or to the place of delivery designated by the purchaser. However, a transaction shall be considered as having occurred before July 1, 2005, to the extent that the agreement of the parties to the transaction was entered into before July 1, 2005, and payment for the property or services furnished in the transaction is made before July 1, 2005, notwithstanding the delivery of the property or services after June 30, 2005.
    (c) The definitions in IC 6-2.5 apply throughout this subsection. For purposes of IC 6-2.5-5-39, as added by this act, all transactions shall be considered as having occurred after June 30, 2007, to the extent that delivery of the property or services constituting selling at retail is made after that date to the purchaser or to the place of

delivery designated by the purchaser. However, a transaction shall be considered as having occurred before July 1, 2007, to the extent that the agreement of the parties to the transaction was entered into before July 1, 2007, and payment for the property or services furnished in the transaction is made before July 1, 2007, notwithstanding the delivery of the property or services after June 30, 2007.
    (d) IC 6-3.1-4-2, as amended by this act, applies only to taxable years beginning after December 31, 2007.
     (e) IC 6-3.1-4-3, as amended by this act, applies to taxable years beginning after December 31, 2005. A taxpayer with a credit carryover under IC 6-3.1-4-3 on December 31, 2005, from a taxable year beginning before January 1, 2006, may carry the excess credit over for a period not to exceed the ten (10) taxable years following the taxable year in which the taxpayer was first entitled to claim the credit. This subsection shall not be construed to disallow any part of an excess credit used under IC 6-3.1-4-3, as effective before amendment by this act, for any taxable year ending before January 1, 2005.

SOURCE: ; (05)ES0001.2.37. -->     SECTION 37. [EFFECTIVE JANUARY 1, 2005 (RETROACTIVE)] (a) IC 6-3.1-24-7, IC 6-3.1-24-9, and IC 6-3.1-24-12.5, all as amended by this act, apply to taxable years beginning and proposed investment plans approved after December 31, 2004.
    (b) IC 6-3.1-24-12, as amended by this act, applies to taxable years beginning after December 31, 2005. A taxpayer with a credit carryover under IC 6-3.1-24-12 on December 31, 2005, from a taxable year beginning before January 1, 2006, may carry the excess credit over for a period not to exceed the five (5) taxable years following the taxable year in which the taxpayer was first entitled to claim the credit. This subsection shall not be construed to disallow any part of an excess credit used under IC 6-3.1-24-12, as effective before amendment by this act, for any taxable year ending before January 1, 2006.

SOURCE: ; (05)ES0001.2.38. -->     SECTION 38. [EFFECTIVE JULY 1, 2005] For purposes of IC 6-2.5-5-37, as amended by this act, all transactions shall be considered as having occurred after June 30, 2005, to the extent that delivery of the property or services constituting selling at retail is made after that date to the purchaser or to the place of delivery designated by the purchaser. However, a transaction shall be considered as having occurred before July 1, 2005, to the extent that the agreement of the parties to the transaction was entered

into before July 1, 2005, and payment for the property or services furnished in the transaction is made before July 1, 2005, notwithstanding the delivery of the property or services after June 30, 2005.

SOURCE: ; (05)ES0001.2.39. -->     SECTION 39. [EFFECTIVE UPON PASSAGE] (a) Notwithstanding the effective dates included in HEA 1003-2005, the following provisions take effect February 9, 2005, and not July 1, 2005:
        (1) SECTIONS 66 through 85 of HEA 1003-2005.
        (2) SECTIONS 102 through 110 of HEA 1003-2005.
        (3) SECTION 112 of HEA 1003-2005.
    (b) The actions taken by the Indiana economic development corporation to administer IC 6-3.1-13 and IC 6-3.1-26, both as amended by HEA 1003-2005, after February 8, 2005, and before the effective date of this act, are legalized and validated.

SOURCE: ; (05)ES0001.2.40. -->     SECTION 40. [EFFECTIVE JULY 1, 2005] The following, all as amended by this act, apply only to property taxes first due and payable after December 31, 2006:
        (1) IC 6-1.1-12.1-5.4.

         (2) IC 6-1.1-12.1-5.6.
         (3) IC 6-1.1-12.1-5.9.
        (4) IC 6-1.1-12.1-8.

         (5) IC 6-1.1-12.1-14.
SOURCE: ; (05)ES0001.2.41. -->     SECTION 41. [EFFECTIVE JANUARY 1, 2005 (RETROACTIVE)] IC 6-1.1-12.1-5 and IC 6-1.1-12.1-5.1, both as amended by this act, apply to property taxes first due and payable after December 31, 2005.
SOURCE: ; (05)ES0001.2.42. -->     SECTION 42. [EFFECTIVE JANUARY 1, 2006] IC 6-3.1-31, as added by this act, applies only to taxable years beginning after December 31, 2005.
SOURCE: ; (05)ES0001.2.43. -->     SECTION 43. [EFFECTIVE JANUARY 1, 2006] IC 6-3.1-30, as added by this act, applies to taxable years beginning after December 31, 2005.
SOURCE: ; (05)ES0001.2.44. -->     SECTION 44. [EFFECTIVE JANUARY 1, 2005 (RETROACTIVE)] (a) Beginning January 1, 2005, and ending February 9, 2005, this SECTION applies instead of IC 6-3.1-24-7.
    (b) The definitions set forth in IC 6-3.1-24 apply throughout this SECTION.
    (c) The Indiana economic development corporation shall certify that a business is a qualified Indiana business if the corporation determines that the business:
        (1) has its headquarters in Indiana;
        (2) is primarily focused on professional motor vehicle racing, commercialization of research and development, technology transfers, or the application of new technology, or is determined by the Indiana economic development corporation to have significant potential to:
            (A) bring substantial capital into Indiana;
            (B) create jobs;
            (C) diversify the business base of Indiana; or
            (D) significantly promote the purposes of this chapter in any other way;
        (3) has had average annual revenues of less than ten million dollars ($10,000,000) in the two (2) years preceding the year in which the business received qualified investment capital from a taxpayer claiming a credit under IC 6-3.1-24;
        (4) has:
            (A) at least fifty percent (50%) of its employees residing in Indiana; or
            (B) at least seventy-five percent (75%) of its assets located in Indiana; and
        (5) is not engaged in a business involving:
            (A) real estate;
            (B) real estate development;
            (C) insurance;
            (D) professional services provided by an accountant, a lawyer, or a physician;
            (E) retail sales, except when the primary purpose of the business is the development or support of electronic commerce using the Internet; or
            (F) oil and gas exploration.
    (d) A business shall apply to be certified as a qualified Indiana business on a form prescribed by the Indiana economic development corporation.
    (e) If a business is certified as a qualified Indiana business under this SECTION, the Indiana economic development corporation shall provide a copy of the certification to the investors in the qualified Indiana business for inclusion in tax filings.
    (f) The Indiana economic development corporation may impose an application fee of not more than two hundred dollars ($200).
    (g) This SECTION expires February 9, 2005.

SOURCE: ; (05)ES0001.2.45. -->     SECTION 45. [EFFECTIVE JANUARY 1, 2005 (RETROACTIVE)] (a) Beginning January 1, 2005, and ending February 9, 2005, this SECTION applies instead of IC 6-3.1-24-9.
    (b) The definitions set forth in IC 6-3.1-24 apply throughout this SECTION.
    (c) The total amount of tax credits that may be allowed under IC 6-3.1-24 in a particular calendar year for qualified investment capital provided during that calendar year may not exceed twelve million five hundred thousand dollars ($12,500,000). The Indiana economic development corporation may not certify a proposed investment plan under IC 6-3.1-24-12.5 if the proposed investment would result in the total amount of the tax credits certified for the calendar year exceeding twelve million five hundred thousand dollars ($12,500,000). An amount of an unused credit carried over by a taxpayer from a previous calendar year may not be considered in determining the amount of proposed investments that the Indiana economic development corporation may certify under IC 6-3.1-24.
    (d) Notwithstanding the other provisions of this chapter, a taxpayer is not entitled to a credit for providing qualified investment capital to a qualified Indiana business after December 31, 2008. However, this subsection may not be construed to prevent a taxpayer from carrying over to a taxable year beginning after December 31, 2008, an unused tax credit attributable to an investment occurring before January 1, 2009.
    (e) This SECTION expires February 9, 2005.

SOURCE: ; (05)ES0001.2.46. -->     SECTION 46. [EFFECTIVE JANUARY 1, 2005 (RETROACTIVE)] (a) Beginning January 1, 2005, and ending February 9, 2005, this SECTION applies instead of IC 6-3.1-24-12.5.
    (b) The definitions set forth in IC 6-3.1-24 apply throughout this SECTION.
    (c) A taxpayer wishing to obtain a credit under IC 6-3.1-24 must apply to the Indiana economic development corporation for a certification that the taxpayer's proposed investment plan would qualify for a credit under IC 6-3.1-24.
    (d) The application required under subsection (c) must include:
        (1) the name and address of the taxpayer;
        (2) the name and address of each proposed recipient of the taxpayer's proposed investment;
        (3) the amount of the proposed investment;
        (4) a copy of the certification issued under section IC 6-3.1-24-7 that the proposed recipient is a qualified Indiana business; and
        (5) any other information required by the Indiana economic

development corporation.
    (e) If the Indiana economic development corporation determines that:
        (1) the proposed investment would qualify the taxpayer for a credit under IC 6-3.1-24; and
        (2) the amount of the proposed investment would not result in the total amount of tax credits certified for the calendar year exceeding twelve million five hundred thousand dollars ($12,500,000);
the corporation shall certify the taxpayer's proposed investment plan.
    (f) To receive a credit under IC 6-3.1-24, the taxpayer must provide qualified investment capital to a qualified Indiana business according to the taxpayer's certified investment plan within two (2) years after the date on which the Indiana economic development corporation certifies the investment plan.
    (g) Upon making the investment required under subsection (f), the taxpayer shall provide proof of the investment to the Indiana economic development corporation.
    (h) Upon receiving proof of a taxpayer's investment under subsection (g), the Indiana economic development corporation shall issue the taxpayer a certificate indicating that the taxpayer has fulfilled the requirements of the corporation and that the taxpayer is entitled to a credit under IC 6-3.1-24.
    (i) A taxpayer forfeits the right to a tax credit attributable to an investment certified under subsection (e) if the taxpayer fails to make the proposed investment within the period required under subsection (f).
    (j) This SECTION expires February 9, 2005.

SOURCE: ; (05)ES0001.2.47. -->     SECTION 47. [EFFECTIVE JANUARY 1, 2006] IC 6-1.1-12.5, as added by this act, applies only to property taxes first due and payable after December 31, 2006.
SOURCE: ; (05)ES0001.2.48. -->     SECTION 48. An emergency is declared for this act.


ES 1_LS 7834/DI 51

Figure

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