Introduced Version




SENATE BILL No. 440

_____


DIGEST OF INTRODUCED BILL



Citations Affected: IC 6-3.5-1.1; IC 6-3.5-7-5.

Synopsis: Adjusted gross income tax for Wayne County. Allows Wayne County to impose the county adjusted gross income tax at a rate of 1.25%. Provides that the county adjusted gross income tax revenue in Wayne County that is derived from the additional 0.25% tax rate may be used only to pay the costs of constructing, improving, or renovating the county jail and related buildings and parking facilities. Authorizes the county council to pledge the tax revenue from the additional 0.25% tax rate to pay bonds issued for the construction, improvement, or renovation.

Effective: Upon passage.



Paul


    January 10, 2000, read first time and referred to Committee on Rules and Legislative Procedure.




Introduced

Second Regular Session 111th General Assembly (2000)


PRINTING CODE. Amendments: Whenever an existing statute (or a section of the Indiana Constitution) is being amended, the text of the existing provision will appear in this style type, additions will appear in this style type, and deletions will appear in this style type.
Additions: Whenever a new statutory provision is being enacted (or a new constitutional provision adopted), the text of the new provision will appear in this style type. Also, the word NEW will appear in that style type in the introductory clause of each SECTION that adds a new provision to the Indiana Code or the Indiana Constitution.
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SENATE BILL No. 440


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

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

    SECTION 1. IC 6-3.5-1.1-2 IS AMENDED TO READ AS FOLLOWS [EFFECTIVE UPON PASSAGE]: Sec. 2. (a) The county council of any county in which the county option income tax will not be in effect on July 1 of a year under an ordinance adopted during a previous calendar year may impose the county adjusted gross income tax on the adjusted gross income of county taxpayers of its county effective July 1 of that year.
    (b) Except as provided in section 2.5, 2.7, or 3.5 of this chapter, the county adjusted gross income tax may be imposed at a rate of one-half of one percent (0.5%), three-fourths of one percent (0.75%), or one percent (1%) on the adjusted gross income of resident county taxpayers of the county. Any county imposing the county adjusted gross income tax must impose the tax on the nonresident county taxpayers at a rate of one-fourth of one percent (0.25%) on their adjusted gross income. If the county council elects to decrease the county adjusted gross income tax, the county council may decrease the county adjusted gross income tax rate in increments of one-tenth of one percent (0.1%).

    (c) To impose the county adjusted gross income tax, the county council must, after January 1 but before April 1 of a year, adopt an ordinance. The ordinance must substantially state the following:
        "The ________ County Council imposes the county adjusted gross income tax on the county taxpayers of ________ County. The county adjusted gross income tax is imposed at a rate of _____ percent (_____%) on the resident county taxpayers of the county and one-fourth of one percent (0.25%) on the nonresident county taxpayers of the county. This tax takes effect July 1 of this year.".
    (d) Any ordinance adopted under this section takes effect July 1 of the year the ordinance is adopted.
    (e) The auditor of a county shall record all votes taken on ordinances presented for a vote under the authority of this section and immediately send a certified copy of the results to the department by certified mail.
    (f) If the county adjusted gross income tax had previously been adopted by a county under IC 6-3.5-1 (before its repeal on March 15, 1983) and that tax was in effect at the time of the enactment of this chapter, then the county adjusted gross income tax continues in that county at the rates in effect at the time of enactment until the rates are modified or the tax is rescinded in the manner prescribed by this chapter. If a county's adjusted gross income tax is continued under this subsection, then the tax shall be treated as if it had been imposed under this chapter and is subject to rescission or reduction as authorized in this chapter.
    SECTION 2. IC 6-3.5-1.1-2.7 IS ADDED TO THE INDIANA CODE AS A NEW SECTION TO READ AS FOLLOWS [EFFECTIVE UPON PASSAGE]: Sec. 2.7. (a) This section applies only to a county having a population of more than sixty-eight thousand (68,000) but less than seventy-three thousand (73,000).
    (b) The county council of a county described in subsection (a) may, by ordinance, determine that additional county adjusted gross income tax revenue is needed in the county to finance, construct, improve, or renovate the county jail and related buildings and parking facilities, including costs related to the demolition of existing buildings and the acquisition of land.
    (c) Notwithstanding section 2 of this chapter, if the county council adopts an ordinance under subsection (b), the county council may impose the county adjusted gross income tax at a rate of one and twenty-five hundredths percent (1.25%) on adjusted gross income. However, a county may impose the county adjusted

gross income tax at a rate of one and twenty-five hundredths percent (1.25%) only until the later of:
        (1) the time the construction, improvement, or renovation under subsection (b) is completed; or
        (2) the time any bonds issued or loans obtained to finance the construction, improvement, or renovation under subsection (b) are paid.
After the county has imposed the county adjusted gross income tax at a rate of one and twenty-five hundredths percent (1.25%) for the period allowed by this subsection, the rate is reduced to one percent (1%). If the county council imposes the county adjusted gross income tax at a rate of one and twenty-five hundredths percent (1.25%), the county council may decrease the rate or rescind the tax in the manner provided under this chapter.
    (d) If a county imposes the county adjusted gross income tax at a rate of one and twenty-five hundredths percent (1.25%) under this section, the revenue derived from a tax rate of twenty-five hundredths percent (0.25%) on adjusted gross income:
        (1) shall be paid to the county treasurer;
        (2) may be used only for the purposes described in subsection (b);
        (3) may not be considered by the state board of tax commissioners in determining the county's maximum permissible property tax levy limit under IC 6-1.1-18.5; and
        (4) may be pledged by the county council to pay bonds issued or loans obtained by the county for the purposes described in subsection (b).
    (e) A pledge under subsection (d):
        (1) applies only to bonds, loans, lease payments, or obligations that are issued, obtained, or incurred after the date the additional tax rate of twenty-five hundredths percent (0.25%) on adjusted gross income is imposed under this section; and
        (2) is enforceable under IC 5-1-14-4.
    (f) With respect to obligations for which a pledge has been made under subsection (d), the general assembly covenants with the holders of the obligations that this chapter will not be repealed or amended in a manner that will adversely affect the imposition or collection of the additional tax rate of twenty-five hundredths percent (0.25%) on adjusted gross income tax imposed under this section if the payment of any of the obligations is outstanding.
    SECTION 3. IC 6-3.5-1.1-10 IS AMENDED TO READ AS FOLLOWS [EFFECTIVE UPON PASSAGE]: Sec. 10. (a) One-half (1/2) of each adopting county's certified distribution for a calendar year

shall be distributed from its account established under section 8 of this chapter to the appropriate county treasurer on May 1 and the other one-half (1/2) on November 1 of that calendar year.
    (b) Except for revenue that must be used to pay the costs of operating a jail and juvenile detention center under section 2.5(d) of this chapter, revenue that must be used to pay the costs of construction, improvement, or renovation of a jail under section 2.7 of this chapter, or revenue that must be used to pay the costs of operating and maintaining a jail and justice center under section 3.5(d) of this chapter, distributions made to a county treasurer under subsection (a) shall be treated as though they were property taxes that were due and payable during that same calendar year. The certified distribution shall be distributed and used by the taxing units and school corporations as provided in sections 11 through 15 of this chapter.
    (c) All distributions from an account established under section 8 of this chapter shall be made by warrants issued by the auditor of the state to the treasurer of the state ordering the appropriate payments.
    SECTION 4. IC 6-3.5-1.1-11 IS AMENDED TO READ AS FOLLOWS [EFFECTIVE UPON PASSAGE]: Sec. 11. (a) Except for revenue that must be used to pay the costs of operating a jail and juvenile detention center under section 2.5(d) of this chapter, revenue that must be used to pay the costs of construction, improvement, or renovation of a jail under section 2.7 of this chapter, or revenue that must be used to pay the costs of operating and maintaining a jail and justice center under section 3.5(d) of this chapter, the certified distribution received by a county treasurer shall, in the manner prescribed in this section, be allocated, distributed, and used by the civil taxing units and school corporations of the county as certified shares and property tax replacement credits.
    (b) Before August 2 of each calendar year, each county auditor shall determine the part of the certified distribution for the next succeeding calendar year that will be allocated as property tax replacement credits and the part that will be allocated as certified shares. The percentage of a certified distribution that will be allocated as property tax replacement credits or as certified shares depends upon the county adjusted gross income tax rate for resident county taxpayers in effect on August 1 of the calendar year that precedes the year in which the certified distribution will be received. The percentages are set forth in the following table:
         PROPERTY
    COUNTY     TAX
    ADJUSTED GROSS     REPLACEMENT     CERTIFIED

    INCOME TAX RATE     CREDITS     SHARES
    0.5%     50%     50%
    0.75%     33 1/3%     66 2/3%
    1%     25%     75%
    (c) The part of a certified distribution that constitutes property tax replacement credits shall be distributed as provided under sections 12, 13, and 14 of this chapter.
    (d) The part of a certified distribution that constitutes certified shares shall be distributed as provided by section 15 of this chapter.
    SECTION 5. IC 6-3.5-7-5 IS AMENDED TO READ AS FOLLOWS [EFFECTIVE UPON PASSAGE]: Sec. 5. (a) Except as provided in subsection (c), the county economic development income tax may be imposed on the adjusted gross income of county taxpayers. The entity that may impose the tax is:
        (1) the county income tax council (as defined in IC 6-3.5-6-1) if the county option income tax is in effect on January 1 of the year the county economic development income tax is imposed;
        (2) the county council if the county adjusted gross income tax is in effect on January 1 of the year the county economic development tax is imposed; or
        (3) the county income tax council or the county council, whichever acts first, for a county not covered by subdivision (1) or (2).
To impose the county economic development income tax, a county income tax council shall use the procedures set forth in IC 6-3.5-6 concerning the imposition of the county option income tax.
    (b) Except as provided in subsections (c) and (g), the county economic development income tax may be imposed at a rate of:
        (1) one-tenth percent (0.1%);
        (2) two-tenths percent (0.2%);
        (3) twenty-five hundredths percent (0.25%);
        (4) three-tenths percent (0.3%);
        (5) thirty-five hundredths percent (0.35%);
        (6) four-tenths percent (0.4%);
        (7) forty-five hundredths percent (0.45%); or
        (8) five-tenths percent (0.5%);
on the adjusted gross income of county taxpayers.
    (c) Except as provided in subsection (h), or (i), or (j), the county economic development income tax rate plus the county adjusted gross income tax rate, if any, that are in effect on January 1 of a year may not exceed one and twenty-five hundredths percent (1.25%). Except as provided in subsection (g), the county economic development tax rate

plus the county option income tax rate, if any, that are in effect on January 1 of a year may not exceed one percent (1%).
    (d) To impose the county economic development income tax, the appropriate body must, after January 1 but before April 1 of a year, adopt an ordinance. The ordinance must substantially state the following:
    "The ________ County _________ imposes the county economic development income tax on the county taxpayers of _________ County. The county economic development income tax is imposed at a rate of _________ percent (____%) on the county taxpayers of the county. This tax takes effect July 1 of this year.".
    (e) Any ordinance adopted under this section takes effect July 1 of the year the ordinance is adopted.
    (f) The auditor of a county shall record all votes taken on ordinances presented for a vote under the authority of this section and immediately send a certified copy of the results to the department by certified mail.
    (g) This subsection applies to a county having a population of more than one hundred twenty-nine thousand (129,000) but less than one hundred thirty thousand six hundred (130,600). In addition to the rates permitted by subsection (b), the:
        (1) county economic development income tax may be imposed at a rate of:
            (A) fifteen-hundredths percent (0.15%);
            (B) two-tenths percent (0.2%); or
            (C) twenty-five hundredths percent (0.25%); and
        (2) county economic development income tax rate plus the county option income tax rate that are in effect on January 1 of a year may equal up to one and twenty-five hundredths percent (1.25%);
if the county income tax council makes a determination to impose rates under this subsection and section 22 of this chapter.
    (h) For a county having a population of more than thirty-seven thousand (37,000) but less than thirty-seven thousand eight hundred (37,800), the county economic development income tax rate plus the county adjusted gross income tax rate that are in effect on January 1 of a year may not exceed one and thirty-five hundredths percent (1.35%) if the county has imposed the county adjusted gross income tax at a rate of one and one-tenth percent (1.1%) under IC 6-3.5-1.1-2.5.
    (i) For a county having a population of more than twelve thousand six hundred (12,600) but less than thirteen thousand (13,000), the county economic development income tax rate plus the county adjusted gross income tax rate that are in effect on January 1 of a year may not exceed one and fifty-five hundredths percent (1.55%).

     (j) For a county having a population of more than sixty-eight thousand (68,000) but less than seventy-three thousand (73,000), the county economic development income tax rate plus the county adjusted gross income tax rate that are in effect on January 1 of a year may not exceed one and five-tenths percent (1.5%).
    SECTION 6. [EFFECTIVE UPON PASSAGE] (a) Notwithstanding IC 6-3.5-1.1-3, the county council of a county described in IC 6-3.5-1.1-2.7, as added by this act, may adopt an ordinance to increase the county's county adjusted gross income tax rate after the April 1 deadline provided in IC 6-3.5-1.1-3(a).
    (b) This SECTION expires January 1, 2001.
    SECTION 7. An emergency is declared for this act.