Bill Text: IN HB1281 | 2013 | Regular Session | Introduced
Bill Title: Local income tax laws.
Spectrum: Partisan Bill (Republican 2-0)
Status: (Introduced - Dead) 2013-01-14 - First reading: referred to Committee on Ways and Means [HB1281 Detail]
Download: Indiana-2013-HB1281-Introduced.html
Citations Affected: IC 6-3.5; IC 6-3.6.
Synopsis: Local income tax laws. Replaces the county adjusted gross
income tax, the county option income tax, and the county economic
development tax with local income tax law. Provides for the
introduction of legislation in the 2014 session to make related
amendments to implement the local income tax.
Effective: Upon passage; January 1, 2014.
January 14, 2013, read first time and referred to Committee on Ways and Means.
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
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
A BILL FOR AN ACT to amend the Indiana Code concerning
taxation.
ARTICLE 3.6. LOCAL INCOME TAXES
Chapter 1. Application; Transitional Provisions
Sec. 1. This article applies to:
(1) taxes and tax liability in effect after September 30, 2013;
(2) homestead and property tax credits against property tax liability imposed for an assessment date after February 28,
2013; and
(3) subject to subdivisions (1) and (2), administration of taxes
described in section 2 of this chapter, after April 1, 2013.
Sec. 2. Except to the extent that taxes imposed in a county
under:
(1) IC 6-3.5-1 (repealed);
(2) IC 6-3.5-1.1 (repealed);
(3) IC 6-3.5-6 (repealed); or
(4) IC 6-3.5-7 (repealed);
are increased, decreased, or rescinded under this article, the total
tax rate in effect in a county under the provisions described in
subdivisions (1) through (4) on April 1, 2013, continue in effect
after April 1, 2013, and shall be treated as taxes imposed under this
article.
Sec. 3. Notwithstanding:
(1) IC 6-3.5-1 (repealed);
(2) IC 6-3.5-1.1 (repealed);
(3) IC 6-3.5-6 (repealed); or
(4) IC 6-3.5-7 (repealed);
a change in a tax imposed under a provision described in
subdivisions (1) through (4), credits related to property taxes,
allocations of tax revenue, and pledges for payment from tax
revenue after April 1, 2013, must be made under this article and
not under the provisions described in subdivisions (1) through (4).
Sec. 4. The certified distribution of a tax described in section
2(1) through 2(4) of this chapter shall be administered and
distributed for periods after December 31, 2013, based on this
article.
Sec. 5. A reference to a tax described in section 2(1) through 2(4)
of this chapter in a law or other document shall be treated as a
reference to the related tax under this article.
Sec. 6. A pledge of a tax described in section 2(1) through 2(4)
of this chapter for the payment of bonds, leases, or other
expenditures shall be treated as a pledge of the related tax under
this article for the same purpose.
Sec. 7. A period of time that began with respect to a tax
described in section 2(1) through 2(4) of this chapter and limits the
period in which the tax may be imposed continues under this
article from the starting date and time of the original action under
the laws described in section 2(1) through 2(4) of this chapter and
limits the period in which the related tax under this article may be
imposed as if the period of time were initiated under this article.
Sec. 8. A period of time that began with respect to the issuance of bonds or leases payable from a tax described in section 2(1) through 2(4) of this chapter and limits the period in which the bonds or leases may be in effect continues under this article from the starting date and time of the original action under the laws described in section 2(1) through 2(4) of this chapter and limits the period in which the bonds or leases may be in effect as if the period of time were initiated under this article.
Sec. 9. (a) Except as provided in this section, a tax imposed under IC 6-3.5-1 (repealed) or IC 6-3.5-1.1 (repealed) shall be treated under this article as a tax imposed under IC 6-3.6-5-2.
(b) An amount equal to twenty-five hundredths percent (0.25%) of the taxes imposed under IC 6-3.5-1.1 (repealed) shall be treated as a tax under IC 6-3.6-6-6.
(c) A tax imposed under any of the following shall be treated as a tax imposed under IC 6-3.6-6-6:
IC 6-3.5-1.1-24 (repealed)
IC 6-3.5-1.1-26 (repealed).
(d) A tax imposed under any of the following shall be treated as a tax imposed under IC 6-3.6-6-6:
IC 6-3.5-1.1-2.3 (repealed)
IC 6-3.5-1.1-2.5 (repealed)
IC 6-3.5-1.1-2.7 (repealed)
IC 6-3.5-1.1-2.8 (repealed)
IC 6-3.5-1.1-2.9 (repealed)
IC 6-3.5-1.1-3.3 (repealed)
IC 6-3.5-1.1-3.5 (repealed)
IC 6-3.5-1.1-3.6 (repealed).
Sec. 10. (a) Except as provided in this section, a tax imposed under IC 6-3.5-6 (repealed) shall be treated under this article as a tax imposed under IC 6-3.6-5-2.
(b) A tax imposed under any of the following shall be treated as a tax imposed under IC 6-3.6-6-6:
IC 6-3.5-6-30 (repealed)
IC 6-3.5-6-32 (repealed).
(c) An amount used for homestead credits under IC 6-3.5-6-13 (repealed) shall be treated as a tax imposed under IC 6-3.6-6-6.
(d) A tax imposed under IC 6-3.5-6-28 (repealed) shall be treated under this article as a tax imposed under IC 6-3.6-6-8.
(e) A tax imposed under IC 6-3.5-6-33 (repealed) shall be treated under this article as a tax imposed under IC 6-3.6-6-9.
(f) A tax imposed under any of the following shall be treated as
a tax imposed under the related provision in IC 6-3.6-7:
IC 6-3.5-6-27 (repealed)
IC 6-3.5-6-29 (repealed).
Sec. 11. (a) Except as provided in this section, a tax imposed
under IC 6-3.5-7 (repealed) shall be treated under this article as a
tax imposed under IC 6-3.6-5-2.
(b) An amount used for a reduction in a property tax levy under
IC 6-3.5-7-23 (repealed) or as homestead credits or property tax
replacement credits under IC 6-3.5-7-11 (repealed) or
IC 6-3.5-7-26 (repealed) shall be treated as a tax imposed under
IC 6-3.6-6-6.
(c) A tax imposed under any of the following shall be treated as
a tax imposed under the related provision in IC 6-3.6-7:
IC 6-3.5-7-22.5 (repealed)
IC 6-3.5-7-24 (repealed)
IC 6-3.5-7-27 (repealed)
IC 6-3.5-7-27.5 (repealed)
IC 6-3.5-7-27.6 (repealed)
IC 6-3.5-7-28 (repealed).
Sec. 12. Before August 2, 2013, the budget agency, with the
assistance of the department of local government finance shall
certify to each county the tax rates under IC 6-3.6, by category,
that are equivalent to the tax rates imposed in the county under the
following:
IC 6-3.5-1 (repealed)
IC 6-3.5-1.1 (repealed)
IC 6-3.5-6 (repealed)
IC 6-3.5-7 (repealed).
Sec. 13. The purpose of this section is to provide for a uniform
method of calculating levies and tax rates in all taxing units and a
uniform method of applying property tax credits that are funded
by a tax under this article. The department of local government
finance shall recalculate maximum permissible levies under
IC 6-1.1-18.5 and maximum permissible ad valorem property tax
levies for the proceeding year and take other actions, as necessary
or appropriate, to eliminate the effect of levy freezes and other levy
reductions related to the implementation of a tax described in
section 2 of this chapter. The department of local government
finance shall certify the recalculated maximum levies to county
auditors before August 2, 2013.
Sec. 14. The budget agency, after consultation with the
department of local government finance, may adjust a tax rate
under this article to eliminate any additional revenue that would
result, relative to the related tax imposed under a provision
described in section 2 of this chapter, from taxing county taxpayers
that are not resident county taxpayers at the same tax rates as
resident county taxpayers.
Sec. 15. The department of local government finance shall assist
adopting bodies and other local governmental entities as necessary
to provide for a transition to the administration of taxes under this
article.
Chapter 2. Definitions
Sec. 1. The definitions in this chapter apply throughout this
article.
Sec. 2. "Adjusted gross income" has the meaning set forth in
IC 6-3-1-3.5. However:
(1) in the case of a county taxpayer who is not treated as a
resident county taxpayer of a county, the term includes only
adjusted gross income derived from the taxpayer's principal
place of business or employment; and
(2) in the case of a resident county taxpayer of Perry County,
the term does not include adjusted gross income described in
IC 6-3.6-8-7.
Sec. 3. "Allocation amount" refers to an amount that qualifies
as an allocation amount under IC 6-3.6-5-17.
Sec. 4. "Attributed allocation amount" refers to an amount that
qualifies as an attributed allocation amount under IC 6-3.6-5-16.
Sec. 5. "Certified shares" refers the amount allocated for
distribution as certified shares under IC 6-3.6-5.
Sec. 6. "Certified distribution" refers to the amount certified
under IC 6-3.6-9-5, as adjusted under IC 6-3.6-9.
Sec. 7. "Civil taxing unit" refers to a taxing unit that is eligible
to receive certified shares under IC 6-3.6-5.
Sec. 8. "County income tax council" means a council established
by IC 6-3.6-3-10.
Sec. 9. "County taxpayer", as it relates to a particular county,
means any individual:
(1) who resides in that county on the date specified in
IC 6-3.6-8-3; or
(2) who maintains the taxpayer's principal place of business
or employment in that county on the date specified in
IC 6-3.6-8-3 and who does not reside on that same date in
another county in Indiana in which a tax under this article is
in effect.
Sec. 10. "Economic development project" means 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 a project described in this section, including contract payments to a nonprofit corporation whose primary corporate purpose is to assist government in planning and implementing economic development projects;
(M) operating expenses of a governmental entity that plans or implements economic development projects; or
(N) substance removal or remedial action in a designated unit;
or any combination of these.
Sec. 11. "Executive" has the meaning set forth in IC 36-1-2-5.
Sec. 12. "Fiscal body" has the meaning set forth in IC 36-1-2-6.
Sec. 13. "Impose" includes adopt, amend, increase, decrease, and rescind.
Sec. 14. "Public safety" refers to the following:
(1) A police and law enforcement system to preserve public peace and order.
(2) A firefighting and fire prevention system.
(3) Emergency ambulance services (as defined in IC 16-18-2-107).
(4) Emergency medical services (as defined in
IC 16-18-2-110).
(5) Emergency action (as defined in IC 13-11-2-65).
(6) A probation department of a court.
(7) Confinement, supervision, services under a community
corrections program (as defined in IC 35-38-2.6-2), or other
correctional services for a person who has been:
(A) diverted before a final hearing or trial under an
agreement that is between the county prosecuting attorney
and the person or the person's custodian, guardian, or
parent and that provides for confinement, supervision,
community corrections services, or other correctional
services instead of a final action described in clause (B) or
(C);
(B) convicted of a crime; or
(C) adjudicated as a delinquent child or a child in need of
services.
(8) A juvenile detention facility under IC 31-31-8.
(9) A juvenile detention center under IC 31-31-9.
(10) A county jail.
(11) A communications system (as defined in IC 36-8-15-3), an
enhanced emergency telephone system (as defined in
IC 36-8-16-2 (before its repeal on July 1, 2012)), or the
statewide 911 system (as defined in IC 36-8-16.7-22).
(12) Medical and health expenses for jailed inmates and other
confined persons.
(13) Pension payments for any of the following:
(A) A member of the fire department (as defined in
IC 36-8-1-8) or any other employee of a fire department.
(B) A member of the police department (as defined in
IC 36-8-1-9), a police chief hired under a waiver under
IC 36-8-4-6.5, or any other employee hired by a police
department.
(C) A county sheriff or any other member of the office of
the county sheriff.
(D) Other personnel employed to provide a service
described in this section.
Sec. 15. "Resident county taxpayer", as it relates to a particular
county, means any county taxpayer who resides in that county on
the date specified in IC 6-3.6-8-3.
Sec. 16. "School corporation" has the meaning set forth in
IC 6-1.1-1-16.
Sec. 17. "Tax" refers to the following:
(1) A tax imposed under this article.
(2) A tax that was originally imposed under:
(A) IC 6-3.5-1 (repealed);
(B) IC 6-3.5-1.1 (repealed);
(C) IC 6-3.5-6 (repealed); or
(D) IC 6-3.5-7 (repealed);
and that is continued in effect under this article by IC 6-3.6-1-2.
Chapter 3. Adopting Body; Adoption Procedures; Effective Date of Ordinances
Sec. 1. Except as otherwise provided in this article, the following is the adopting body for a county:
(1) With respect to a particular tax, credit, or allocation of tax revenue authorized by this article, the fiscal body or other governmental entity specifically authorized by this article to adopt, increase, decrease, or rescind the tax, credit, or allocation.
(2) A county income tax council in a county other than Marion County that had a county option income tax under IC 6-3.5-6 (repealed) in effect on January 1, 2013, if subdivision (1) does not apply.
(3) A county income tax council in a county, if a county income tax council adopted a county economic development income tax for the county under IC 6-3.5-7 (repealed) that was in effect on January 1, 2013, if subdivisions (1) and (2) do not apply.
(4) The county fiscal body in any other county, if subdivisions (1), (2), and (3) do not apply.
(5) The county fiscal body in Lake County, regardless of whether subdivisions (2) or (3) would apply.
Sec. 2. An adopting body or, when authorized by this article, another governmental entity that is not an adopting body may take an action under this article only by ordinance, unless this article permits the action to be taken by resolution.
Sec. 3. (a) An ordinance adopted under this article takes effect as provided in this section.
(b) An ordinance that adopts, increases, decreases, or rescinds a tax or a tax rate takes effect as follows:
(1) An ordinance adopted after December 31 of the immediately preceding year and before October 1 of the current year takes effect October 1 of the current year.
(2) An ordinance adopted after September 30 and before
October 16 of the current year takes effect November 1 of the
current year.
(3) An ordinance adopted after October 15 and before
November 1 of the current year takes effect December 1 of the
current year.
(4) An ordinance adopted after October 31 of the current year
and before January 1 of the immediately succeeding year
takes effect October 1 of the immediately succeeding year.
(c) An ordinance that grants, increases, decreases, rescinds, or
changes a homestead credit, property tax replacement credit, or
other credit against the property tax liability of a taxpayer takes
effect as follows:
(1) An ordinance adopted after November 1 of the
immediately preceding year and before November 2 of the
current year takes effect for and applies to property taxes
first due and payable in the year immediately following the
year in which the ordinance is adopted.
(2) An ordinance adopted after November 1 of the current
year and before November 2 of the immediately succeeding
year takes effect for and applies to property taxes first due
and payable in the year that follows the current year by two
(2).
(d) An ordinance that grants, increases, decreases, rescinds, or
changes a distribution of allocation of taxes of another
governmental entity takes effect as follows:
(1) An ordinance adopted after November 1 of the
immediately preceding year and before November 2 of the
current year takes effect for the year immediately following
the year in which the ordinance is adopted.
(2) An ordinance adopted after November 1 of the current
year and before November 2 of the immediately succeeding
year takes effect for the year that follows the current year by
two (2).
(e) An ordinance not described in subsections (b) through (d),
takes effect as provided under IC 36 for other ordinances of the
governmental entity adopting the ordinance.
Sec. 4. Except as provided by law, a tax remains in effect until
the effective date of an ordinance that increases, decreases, or
rescinds that tax.
Sec. 5. (a) This section applies to all adopting bodies and all
other fiscal bodies authorized to adopt, increase, decrease, or
rescind a tax under this article. The additional procedures
described in sections 10 through 16 of this chapter apply to a
county income tax council acting as an adopting body.
(b) This section applies only if the county has not previously
adopted a tax rate under IC 6-3.6-5, IC 6-3.6-6, or IC 6-3.6-7
(including a tax continued under IC 6-3.6-1) that is, or will be in
the next twelve (12) months, effective in the county.
(c) To adopt a tax in a county that does not have a tax, an
adopting body must pass an ordinance. The ordinance must
substantially state the following:
"The _____________ (Insert County Income Tax Council or
other fiscal body name, as appropriate) imposes the county
income tax on the county taxpayers of _____________
County. The tax is imposed at a rate of __________ percent
(___ %) on all other county taxpayers.".
Sec. 6. (a) This section applies to all adopting bodies and all
other fiscal bodies authorized to adopt, increase, decrease, or
rescind a tax under this article. The additional procedures
described in sections 10 through 16 of this chapter apply to a
county income tax council acting as an adopting body.
(b) To decrease or increase a tax rate, the adopting body must
adopt an ordinance. The ordinance must substantially state the
following:
"The ______________ (Insert County Income Tax Council or
other fiscal body name, as appropriate) decreases (or
increases) the county income tax rate from __________
percent (___ %) to __________ percent (___ %).".
Sec. 7. (a) This section applies to all adopting bodies and all
other fiscal bodies authorized to adopt, increase, decrease, or
rescind a tax under this article. The additional procedures
described in sections 10 through 16 of this chapter apply to a
county income tax council acting as an adopting body.
(b) To rescind a tax, the adopting body must adopt an
ordinance. The ordinance must substantially state the following:
"The ______________ (Insert County Income Tax Council or
other fiscal body name, as appropriate) rescinds the county
income tax rate.".
Sec. 8. (a) This section applies to all adopting bodies. The
additional procedures described in sections 10 through 16 of this
chapter apply to a county income tax council acting as an adopting
body.
(b) A tax rate may be changed not more than once each year.
However, a single ordinance may provide for a series of annual
increases or decreases.
Sec. 9. (a) This section applies to all adopting bodies and all
other fiscal bodies authorized under this article to:
(1) adopt, increase, decrease, or rescind a tax; or
(2) adopt, increase, decrease, rescind, or otherwise change a
credit against the property tax liability of a taxpayer.
The additional procedures described in sections 10 through 16 of
this chapter apply to a county income tax council acting as an
adopting body.
(b) The auditor of a county shall record all votes taken on
ordinances presented for a vote under this article and not more
than ten (10) days after the vote, send a certified copy of the results
to:
(1) the commissioner of the department of state revenue;
(2) the director of the budget agency; and
(3) the commissioner of the department of local government
finance;
by certified mail or in an electronic format approved by the
director of the budget agency.
(c) This subsection applies only to a county that has a county
income tax council. The county auditor may cease sending certified
copies after the county auditor sends a certified copy of results
showing that members of the county income tax council have cast
a majority of the votes on the county income tax council for or
against the proposed ordinance.
Sec. 10. (a) This section applies to a county in which the county
adopting body is a county income tax council.
(b) A county income tax council is established for each county
described in section 1(2) or 1(3) of this chapter. The membership
of each county's county income tax council consists of the fiscal
body of the county and the fiscal body of each city or town that lies
either partially or entirely within that county.
Sec. 11. (a) This section applies to a county in which the county
adopting body is a county income tax council.
(b) In the case of a city or town that lies within more than one
(1) county, the county auditor of each county shall base the
allocations required by subsection (c) on the population of that
part of the city or town that lies within the county for which the
allocations are being made.
(c) Every county income tax council has a total of one hundred
(100) votes. Every member of the county income tax council is
allocated a percentage of the total one hundred (100) votes that
may be cast. The percentage that a city or town is allocated for a
year equals the same percentage that the population of the city or
town bears to the population of the county. The percentage that the
county is allocated for a year equals the same percentage that the
population of all areas in the county not located in a city or town
bears to the population of the county. On or before January 1 of
each year, the county auditor shall certify to each member of the
county income tax council the number of votes, rounded to the
nearest one hundredth (0.01), each member has for that year.
Sec. 12. (a) This section applies to a county in which the county
adopting body is a county income tax council.
(b) Before a member of the county income tax council may
propose an ordinance or vote on a proposed ordinance, the
member must hold a public hearing on the proposed ordinance and
provide the public with notice of the time and place where the
public hearing will be held.
(c) The notice required by subsection (b) must be given in
accordance with IC 5-3-1.
(d) The form of the notice required by this section must be in
substantially the following form:
The fiscal body of the _____________ (insert name of civil taxing unit) hereby declares that on __________ (insert date) at ______________ (insert the time of day) a public hearing will be held at _______________ (insert location) concerning the following resolution to propose an ordinance (or proposed ordinance) that is before the members of the county income tax council. Members of the public are cordially invited to attend the hearing for the purpose of expressing their views.
(Insert a copy of the proposed ordinance or resolution to propose an ordinance.)".
Sec. 13. (a) This section applies to a county in which the county adopting body is a county income tax council.
(b) Any member of a county income tax council may present an ordinance for passage. To do so, the member must pass a resolution to propose the ordinance to the county income tax council and distribute a copy of the proposed ordinance to the auditor of the county. The auditor of the county shall treat any proposed ordinance presented to the auditor under this section as a casting of all that member's votes in favor of that proposed ordinance.
(c) The auditor of the county shall deliver copies of a proposed ordinance the auditor receives to all members of the county income tax council within ten (10) days after receipt. Subject to subsection (d), once a member receives a proposed ordinance from the auditor of the county, the member shall vote on it within thirty (30) days after receipt.
(d) If before the elapse of thirty (30) days after receipt of a proposed ordinance, the county auditor notifies the member that the members of the county income tax council have cast a majority of the votes on the county income tax council for or against the proposed ordinance, the member need not vote on the proposed ordinance.
Sec. 14. (a) This section applies to a county in which the county adopting body is a county income tax council.
(b) A member of the county income tax council may exercise its votes by passing a resolution and transmitting the resolution to the auditor of the county.
(c) The form of a resolution is as follows:
"The ______________ (name of civil taxing unit's fiscal body) casts its _____ votes _____ (for or against) the proposed ordinance of the ______________ County Income Tax Council, which reads as follows:".
(d) A resolution passed by a member of the county income tax council exercises all votes of the member on the proposed ordinance, and those votes may not be changed during the year.
Sec. 15. (a) This section applies to a county in which the county adopting body is a county income tax council.
(b) A county income tax council may pass only one (1) ordinance adopting, increasing, decreasing, or rescinding a tax in one (1) year. Once the ordinance has been passed, the auditor of the county shall:
(1) cease distributing those types of proposed ordinances for the rest of the year; and
(2) withdraw from the membership any other of those types of proposed ordinances.
Any votes subsequently received by the auditor of the county on those types of proposed ordinances during that same year are void.
(c) The county income tax council may not vote on, nor may the auditor of the county distribute to the members of the county income tax council, any proposed ordinance during a year, if previously during that same year the auditor of the county received and distributed to the members of the county income tax council a
proposed ordinance whose passage would have substantially the
same effect.
Sec. 16. (a) This section applies to a county in which the county
adopting body is a county income tax council.
(b) A county income tax council must, before August 1 of each
odd-numbered year, hold at least one (1) public meeting at which
the county income tax council discusses whether the tax rate under
IC 6-3.6-5 should be adjusted.
Chapter 4. Imposition of Tax
Sec. 1. A tax is imposed on the adjusted gross income of county
taxpayers at a tax rate that is a sum of the tax rates imposed by the
county's adopting body and in effect in the county.
Sec. 2. Subject to section 3 of this chapter, a tax rate authorized
under IC 6-3.6-5, IC 6-3.6-6, or IC 6-3.6-7 may be adopted,
increased, decreased, or rescinded without adopting, increasing,
decreasing, or rescinding a tax rate authorized by either of the two
(2) other chapters. However, an adopting body may:
(1) adopt, increase, decrease, or rescind a tax authorized
under a particular chapter of this article; and
(2) adopt, increase, decrease, or rescind a tax authorized
under another chapter of this article;
in the same ordinance.
Sec. 3. If there are bonds or leases outstanding that are payable
from a tax imposed under IC 6-3.6-5 or IC 6-3.6-7 (but not
IC 6-3.6-6), the adopting body may not reduce the tax rate below
a rate that would produce one and twenty-five hundredths (1.25)
times the total of the highest annual debt service on the bonds to
their final maturity, plus the highest annual lease payments, unless:
(1) the adopting body; or
(2) any city, town, or county;
pledges all or a portion of its share of revenues from the tax
imposed under IC 6-3.6-5 or IC 6-3.6-7 (but not IC 6-3.6-6), for the
life of the bonds or the term of the lease, in an amount that is
sufficient, when combined with the amount pledged by the city,
town, or county that issued the bonds, to produce one and
twenty-five hundredths (1.25) times the total of the highest annual
debt service plus the highest annual lease payments.
Chapter 5. Expenditure Rate
Sec. 1. An adopting body may impose a tax under section 2 of
this chapter on the adjusted gross income of county taxpayers in
the county served by the adopting body. The tax rate imposed
under this chapter, when added to any tax rates imposed under
IC 6-3.6-6 and IC 6-3.6-7, constitute the tax imposed on the
adjusted gross income of county taxpayers in the county.
Sec. 2. (a) This section applies to all counties.
(b) The adopting body may impose a tax rate on the adjusted
gross income of county taxpayers in the county served by the
adopting body that does not exceed one and twenty-five hundredths
percent (1.25%).
Sec. 3. Revenue raised from a tax imposed under this chapter
shall be treated as additional revenue and may not be considered
by the department of local government finance in determining:
(1) any taxing unit's maximum permissible property tax levy
limit under IC 6-1.1-18.5; or
(2) the approved property tax rate for any fund.
Sec. 4. The adopting body shall, by ordinance, determine how
the revenue from a tax under this chapter shall be allocated among
the following uses as provided in this chapter:
(1) Public safety.
(2) Economic development.
(3) Certified shares.
The ordinance may describe the allocation of revenue by use of
percentages or amounts.
Sec. 5. The adopting body may not allocate in a year less to the
payment of bonds or leases for which the tax under this chapter
has been pledged in accordance with law than the amount pledged
and payable in that year or required under the agreements for the
bonds or lease to be deposited in a sinking fund or other reserve in
that year.
Sec. 6. (a) The total amount allocated in a year to the categories
described in section 4 of this chapter may not, in the aggregate,
exceed the amount of revenue raised by the tax imposed under this
chapter for that year. If the amount available in a year is less than
the amount necessary to fund all of the purposes authorized by the
adopting body, the county auditor shall reduce the amount
distributed to these purposes to eliminate the deficit.
(b) The county auditor may not reduce an allocation of money
pledged to make bond payments or lease payments in a year less
than the amount pledged to make payments in that year.
(c) Subject to subsection (b), the county auditor shall reduce
allocations under this section in accordance with the instructions
in an ordinance adopted by the adopting body. To the extent that
the adopting body has not adopted an ordinance to specify how a
deficiency is to be eliminated or the ordinance does not eliminate
the deficiency, the county auditor shall, subject to subsection (b),
uniformly reduce allocations in each category.
Sec. 7. The county auditor may not allocate more than the
amount authorized by the adopting body. If the amount available
in a year for allocation under this chapter is greater than the
amount necessary to fund all of the purposes authorized by the
adopting body, the county auditor shall:
(1) allocate the excess as directed by the adopting body; or
(2) in the absence of an ordinance that allocates all of the
excess, retain the excess and apply it, as necessary to fund the
purposes authorized by the adopting body for the following
year.
Sec. 8. (a) This section applies to the allocation of revenue from
a tax under this chapter to public safety purposes.
(b) This subsection applies to Marion County. The adopting
body may allocate part or all of the allocation for public safety to
fund the operation of a public communications system and
computer facilities district as provided in an election, if any, made
by the county fiscal body under IC 36-8-15-19(b).
(c) Except as provided in subsection (d), revenue remaining
from the amount allocated for public safety purposes after making
allocations under subsection (b) shall be allocated to each
municipality in the county that is carrying out or providing at least
one (1) public safety purpose. The amount allocated under this
subsection to a municipality is equal to the result of:
(1) the revenue allocated to public safety purposes; multiplied
by
(2) a fraction equal to:
(A) the total property taxes being collected in the county by
the municipality for the calendar year; divided by
(B) the sum of the total property taxes being collected in
the county by each municipality in the county that is
entitled to a distribution under this section for the calendar
year.
(d) A fire department, volunteer fire department, or emergency
medical services provider that:
(1) provides fire protection or emergency medical services
within the county; and
(2) is operated by or serves a political subdivision that is not
otherwise entitled to receive a distribution of tax revenue
under this section;
may, before July 1 of a year, apply to the adopting body for a
distribution of tax revenue under this section during the following
calendar year. The adopting body shall review an application
submitted under this subsection and may, before September 1 of a
year, adopt a resolution requiring that one (1) or more of the
applicants shall receive a specified amount of the tax revenue to be
distributed under this section during the following calendar year.
A resolution approved under this subsection providing for a
distribution to one (1) or more fire departments, volunteer fire
departments, or emergency services providers applies only to
distributions in the following calendar year. Any amount of tax
revenue distributed under this subsection to a fire department,
volunteer fire department, or emergency medical services provider
shall be distributed before the remainder of the tax revenue is
allocated under subsection (c).
Sec. 9. (a) This section applies to the allocation of revenue from
a tax under this chapter for economic development purposes.
(b) Money designated for economic development purposes shall
be allocated to the county for use by the county fiscal body for any
of the purposes described in IC 6-3.6-10.
Sec. 10. (a) This section applies to the allocation of revenue from
a tax under this chapter for certified shares.
(b) Revenues remaining from a tax imposed under this chapter,
after deducting the amounts allocated to public safety purposes
and economic development purposes, shall be distributed among
the civil taxing units as certified shares.
Sec. 11. (a) This section applies to an allocation of certified
shares.
(b) Subject to this chapter, any taxing unit that imposes an ad
valorem property tax in the county with a tax under this chapter
is eligible for an allocation under this chapter.
Sec. 12. (a) This section applies to the allocation of revenue from
a tax under this chapter for certified shares.
(b) A county solid waste management district (as defined in
IC 13-11-2-47) or a joint solid waste management district (as
defined in IC 13-11-2-113) is not a civil taxing district for the
purpose of receiving an allocation of certified shares under this
chapter unless a majority of the members of each of the county
fiscal bodies of the counties within the district passes a resolution
approving the distribution.
(c) A resolution passed by a county fiscal body under subsection
(b) may:
(1) expire on a date specified in the resolution; or
(2) remain in effect until the county fiscal body revokes or rescinds the resolution.
Sec. 13. (a) This section applies to the allocation of revenue from a tax under this chapter for certified shares.
(b) A school corporation is not a civil taxing district for the purpose of receiving an allocation of certified shares under this chapter.
Sec. 14. (a) This section applies to the allocation of revenue from a tax under this chapter for certified shares.
(b) The consolidated city, the county, all special taxing districts, special service districts, included towns (as defined in IC 36-3-1-7), and all other political subdivisions except:
(1) townships;
(2) excluded cities (as defined in IC 36-3-1-7); and
(3) school corporations;
shall be considered to comprise one (1) civil taxing unit whose fiscal body is the fiscal body of the consolidated city.
Sec. 15. (a) This section applies to an allocation of certified shares in a county other than Marion County.
(b) Subject to this chapter, certified shares must be allocated among civil taxing units based on the attributed allocation amount.
(c) This subsection applies to the allocation of certified shares based on the attributed allocation amount. The amount of certified shares to be allocated to each civil taxing unit is equal to:
(1) the total amount of certified shares available for the certified distribution to the county for the month; multiplied by
(2) a fraction.
(d) The numerator of the fraction is the attributed allocation amount for the civil taxing unit in the county during the calendar year.
(e) The denominator of the fraction is the sum of the attributed allocation amounts for all civil taxing units in the county during the calendar year.
Sec. 16. (a) This section applies to an allocation of certified shares.
(b) The attributed allocation amount of a civil taxing unit during a calendar year is equal to the sum of:
(1) the allocation amount of the civil taxing unit for that calendar year; plus
(2) the current ad valorem property tax levy of any special taxing district, authority, board, or other entity formed to
discharge governmental services or functions on behalf of or
ordinarily attributable to the civil taxing unit; plus
(3) in the case of a county, an amount equal to the welfare
allocation amount.
The welfare allocation amount is an amount equal to the sum of the
property taxes imposed by the county in 1999 for the county's
welfare fund and welfare administration fund and, if the county
received a certified distribution under IC 6-3.5-1.1 (repealed) or
IC 6-3.5-6 (repealed) in 2008, the property taxes imposed by the
county in 2008 for the county's county medical assistance to wards
fund, family and children's fund, children's psychiatric residential
treatment services fund, county hospital care for the indigent fund,
and children with special health care needs county fund.
Sec. 17. (a) This section applies to an allocation of certified
shares.
(b) The allocation amount of a taxing unit during a calendar
year is equal to the amount determined using the following
formula:
STEP ONE: Determine the sum of the total property taxes
being collected by the civil taxing unit or school corporation
during the calendar year of the distribution.
STEP TWO: Determine the sum of the following:
(A) Amounts appropriated from property taxes to pay the
principal of or interest on any debenture or other debt
obligation issued after June 30, 2005, other than an
obligation described in subsection (c).
(B) Amounts appropriated from property taxes to make
payments on any lease entered into after June 30, 2005,
other than a lease described in subsection (d).
(C) The proceeds of any property that are:
(i) received as the result of the issuance of a debt
obligation described in clause (A) or a lease described in
clause (B); and
(ii) appropriated from property taxes for any purpose
other than to refund or otherwise refinance a debt
obligation or lease described in subsection (c) or (d).
STEP THREE: Subtract the STEP TWO amount from the
STEP ONE amount.
STEP FOUR: Determine the sum of:
(A) the STEP THREE amount; plus
(B) the civil taxing unit's or school corporation's certified
distribution for the previous calendar year.
The allocation amount is subject to adjustment as provided in IC 36-8-19-7.5.
(c) Except as provided in this subsection, an appropriation from property taxes to repay interest and principal of a debt obligation is not deducted from the allocation amount for a civil taxing unit or school corporation if:
(1) the debt obligation was issued; and
(2) the proceeds appropriated from property taxes;
to refund or otherwise refinance a debt obligation or a lease issued before July 1, 2005. However, an appropriation from property taxes related to a debt obligation issued after June 30, 2005, is deducted if the debt extends payments on a debt or lease beyond the time in which the debt or lease would have been payable if the debt or lease had not been refinanced or increases the total amount that must be paid on a debt or lease in excess of the amount that would have been paid if the debt or lease had not been refinanced. The amount of the deduction is the annual amount for each year of the extension period or the annual amount of the increase over the amount that would have been paid.
(d) Except as provided in this subsection, an appropriation from property taxes to make payments on a lease is not deducted from the allocation amount for a civil taxing unit or school corporation if:
(1) the lease was issued; and
(2) the proceeds were appropriated from property taxes;
to refinance a debt obligation or lease issued before July 1, 2005. However, an appropriation from property taxes related to a lease entered into after June 30, 2005, is deducted if the lease extends payments on a debt or lease beyond the time in which the debt or lease would have been payable if the debt or lease had not been refinanced or increases the total amount that must be paid on a debt or lease in excess of the amount that would have been paid if the debt or lease had not been refinanced. The amount of the deduction is the annual amount for each year of the extension period or the annual amount of the increase over the amount that would have been paid.
Sec. 18. (a) This section applies to an allocation of certified shares in a county other than Marion County.
(b) The county adopting body may adopt an ordinance to allocate part or all of the certified shares among civil taxing districts based on population.
(c) For purposes of this section, the population of a civil taxing
unit is the population as determined under IC 1-1-3.5-3(a).
(d) This subsection applies to the allocation of certified shares
based on population. The amount of certified shares to be allocated
to each civil taxing unit is equal to:
(1) the total amount of certified shares available for the
certified distribution to the county for the month; multiplied
by
(2) a fraction.
(e) For a city or town, the numerator of the fraction equals the
population of the city or the town.
(f) For a county, the numerator of the fraction equals the
population of the part of the county that is not located in a city or
town.
(g) The denominator of the fraction equals the sum of the
population of all cities and towns located in the county and the
population of the part of the county that is not located in a city or
town.
Sec. 19. (a) This section applies to an allocation or distribution,
or both, of certified shares that is required to be made to a civil
taxing unit in a county other than Marion County.
(b) IC 36-8-19-7.5 applies to the adjustment of the amounts
distributed to a civil taxing unit that participates in a fire
protection district.
Sec. 20. (a) This section applies to an allocation of certified
shares in Marion County.
(b) The amount of certified shares to be allocated to each civil
taxing unit is equal to:
(1) the total amount of certified shares available for the
certified distribution to the county for the month; multiplied
by
(2) the following factor:
.0251 for Center Township
.00217 for Decatur Township
.0023 for Franklin Township
.01177 for Lawrence Township
.01130 for Perry Township
.01865 for Pike Township
.01359 for Warren Township
.01346 for Washington Township
.01307 for Wayne Township
.00858 for Lawrence-City
.00845 for Beech Grove
.00025 for Southport
.00722 for Speedway
.86409 for Indianapolis/Marion County.
Sec. 21. A civil taxing unit may use its certified shares for any of the purposes of the civil taxing unit.
Sec. 22. A civil taxing unit may pledge its certified shares to the payment of bonds or to lease payments for:
(1) any purpose of the civil taxing unit;
(2) any purpose of another governmental entity located in any part in the county, including a governmental entity organized on a regional basis; or
(3) any purpose for which certified shares may be used under IC 6-3.6-10.
The pledge must be approved in an ordinance adopted by the fiscal body of the political subdivision.
Sec. 23. (a) A civil taxing unit may distribute any part of its certified shares to any governmental entity located in any part of its county to:
(1) carry out a joint purpose; or
(2) fund the purposes of the other governmental entity;
including a governmental entity organized on a regional basis to serve an area in more than one (1) county.
(b) The distribution must be authorized by ordinance of the fiscal body of the civil taxing unit to which the revenue is allocated by this chapter. An ordinance must specify the purpose of the designation and its duration.
(c) The fiscal body of the civil taxing unit may direct the county auditor in the ordinance to withhold from the civil taxing unit's allocation the amount that is the subject of the ordinance and distribute the amount directly to the other governmental entity authorized to receive the money.
Chapter 6. Property Tax Relief Rates
Sec. 1. An adopting body may impose a tax on the adjusted gross income of county taxpayers in the county served by the adopting body that is a combination of one (1) or more of the tax rates permitted in this chapter in the county served by the adopting body. The tax rates imposed under this chapter, when added to any tax rates imposed under IC 6-3.6-5 and IC 6-3.6-7, constitute the tax imposed on the adjusted gross income of county taxpayers in the county.
Sec. 2. A tax imposed under this chapter shall be treated as property taxes for all purposes. However, the department of local
government finance may not:
(1) reduce any taxing unit's maximum permissible property
tax levy limit under IC 6-1.1-18.5; or
(2) the approved property tax levy or rate for any fund;
by the amount of any credits granted under this chapter.
Sec. 3. (a) This section applies to a tax imposed under section 8
or 9 of this chapter.
(b) In order to impose a tax under this chapter, the adopting
body must adopt an ordinance finding and determining that
revenues from the tax are needed for the purposes described in the
section under which the tax is imposed.
Sec. 4. (a) A credit granted under this chapter shall be applied
to reduce the property tax liability of a taxpayer before the
application of a credit granted under IC 6-1.1-20.4 or
IC 6-1.1-20.6.
(b) A credit granted under section 8 or 9 of this chapter shall be
applied to reduce the property tax liability of a taxpayer before the
application of a credit granted under section 6 of this chapter.
Sec. 5. The department of local government finance shall assist
adopting bodies and county auditors in calculating credit
percentages and amounts under this chapter.
Sec. 6. (a) This section applies to all counties.
(b) The adopting body may impose a tax rate on the adjusted
gross income of county taxpayers in the county served by the
adopting body that does not exceed two and five-tenths percent
(2.5%).
(c) Revenues from a tax under this section may be used only for
the purpose of funding a property tax credit to reduce the property
tax liability of taxpayers with tangible property located in the
county as authorized under this section. The following are property
taxes that are not eligible for a credit under this section:
(1) Property taxes levied after a referendum in which a
majority of the voters in the taxing unit imposing the property
taxes approved the property taxes.
(2) A property tax that does not qualify as an allocation
amount.
(d) This subsection applies to Hancock County. The county
fiscal body may, by ordinance, allocate part of the tax imposed
under this section not to exceed an amount equal to a tax rate of
fifteen hundredths percent (0.15%) to a property tax credit against
the property tax liability imposed for public libraries in the county,
if all territory in the county is included in a library district. Section
7 of this chapter applies to the allocation of revenue for property
tax credits among the public libraries in the county.
(e) The adopting body shall specify by ordinance how the
amount remaining after allocating an amount for property tax
credits under subsection (d) shall be applied to provide property
tax credits among any combination of the following categories of
tangible property:
(1) Homesteads eligible for a credit under IC 6-1.1-20.6-7.5
that limits the taxpayer's property tax liability for the
property to one percent (1%).
(2) Residential property, long term care property,
agricultural land, and other tangible property (if any) eligible
for a credit under IC 6-1.1-20.6-7.5 that limits the taxpayer's
property tax liability for the property to two percent (2%).
(3) Nonresidential real property, personal property, and other
tangible property (if any) eligible for a credit under
IC 6-1.1-20.6-7.5 that limits the taxpayer's property tax
liability for the property to three percent (3%).
(f) Within a category described in subsection (e) for which an
ordinance grants property tax credits, the property tax credit rate
must be uniform for all qualifying taxpayers with property in that
category in the county. However, the adopting body may limit part
or all of the credits provided in a category described in subsection
(e) to providing credits for the increased property tax liability
imposed on property located in the county or one (1) or more
taxing districts in the county that results from the inventory
assessed value deducted under IC 6-1.1-12-42.
(g) The total of all tax credits granted under this section for a
year may not exceed the amount of revenue raised by the tax
imposed under this section. If the amount available in a year for
property tax credits under this section is less than the amount
necessary to provide all of the property tax credits authorized by
the adopting body, the county auditor shall reduce the property tax
credits granted to eliminate the excess. The county auditor shall
reduce credits uniformly within a category described in subsection
(e) as follows:
(1) First, against property taxes imposed on property
described in subsection (e)(3).
(2) Second, if an excess remains after applying the reduction
as described in subdivision (1), against property taxes
imposed on property described in subsection (e)(2).
(3) Third, if an excess remains after applying the reduction as
described in subdivisions (1) and (2), against property taxes
imposed on property described in subsection (e)(1).
(h) The total of all tax credits granted under this section for a
year may not exceed the amount authorized by the adopting body.
If the amount available in a year for property tax credits under
this section is greater than the amount necessary to provide all of
the property tax credits authorized by the adopting body, the
county auditor shall retain and apply the excess, as necessary to
provide the property tax credits authorized by the adopting body
for the following year. The adopting body may adopt an ordinance
that directs to which categories described in subsection (e) the
excess is to be uniformly applied.
(i) The county auditor shall allocate the amount of revenue
applied as tax credits under this section to the taxing units that
imposed the eligible property taxes against which the credits are
applied.
Sec. 7. (a) This section applies to Hancock County if the county
fiscal body provides for an allocation of taxes to public libraries
under section 6(d) of this chapter.
(b) The amount of property tax replacement credits that each
public library in the county is entitled to receive during a calendar
year under this section equals the lesser of:
(1) the product of:
(A) the amount of revenue deposited by the county auditor
in the library property tax replacement fund; multiplied
by
(B) a fraction described as follows:
(i) The numerator of the fraction equals the sum of the
total property taxes that would have been collected by
the public library during the previous calendar year
from taxpayers located within the library district if the
property tax replacement under this section had not been
in effect.
(ii) The denominator of the fraction equals the sum of
the total property taxes that would have been collected
during the previous year from taxpayers located within
the county by all public libraries that are eligible to
receive property tax replacement credits under this
section if the property tax replacement under this section
had not been in effect; or
(2) the total property taxes that would otherwise be collected
by the public library for the calendar year if the property tax
replacement credit under this section were not in effect.
The department of local government finance shall make any
adjustments necessary to account for the expansion of a library
district. However, a public library is eligible to receive property
tax replacement credits under this section only if it has entered into
reciprocal borrowing agreements with all other public libraries in
the county. If the total amount of tax revenue deposited by the
county auditor in the library property tax replacement fund for a
calendar year exceeds the total property tax liability that would
otherwise be imposed for public libraries in the county for the
year, the excess shall remain in the library property tax
replacement fund and shall be used for library property tax
replacement purposes in the following calendar year.
(c) A public library receiving property tax replacement credits
under this section shall allocate the credits among each fund for
which a distinct property tax levy is imposed in proportion to the
property taxes levied for each fund.
Sec. 8. (a) This section applies only to Howard County.
(b) Maintaining low property tax rates is essential to economic
development, and the use of a tax under this section, as needed in
the county, to carry out the purposes of this section, rather than
the use of property taxes, promotes these purposes.
(c) The county fiscal body may impose a tax rate on the adjusted
gross income of county taxpayers that does not exceed twenty-five
hundredths percent (0.25%).
(d) Revenues raised from a tax imposed under this section may
be used only for the purposes of funding a property tax credit to
reduce the property tax liability imposed by a county to fund the
county's operation and maintenance of a jail or a juvenile
detention center, or both.
(e) The total of all tax credits granted under this section for a
year may not exceed the amount of revenue raised by the tax
imposed under this section. If the amount available in a year for
property tax credits under this section is less than the amount
necessary to provide all of the property tax credits authorized by
the adopting body, the county auditor shall reduce the property tax
credits granted to eliminate the excess. The county auditor shall
reduce credits uniformly in proportion to the tax liability incurred
by each taxpayer.
(f) The total of all tax credits granted under this section for a
year may not exceed the amount necessary to offset the property
tax liability imposed for the purposes of this section. If the amount
available in a year for property tax credits under this section is
greater than the amount necessary to provide property tax credits
to offset the property tax liability imposed for the purposes of this
section, the county auditor shall retain and apply the excess, as
necessary to provide the property tax credits for the purposes of
this section for the following year.
(g) The county auditor shall allocate the amount of revenue
applied as tax credits under this section to the county.
Sec. 9. (a) This section applies only to Monroe County.
(b) Maintaining low property tax rates is essential to economic
development, and the use of a tax under this section, as needed in
the county, to carry out the purposes of this section, rather than
the use of property taxes, promotes these purposes.
(c) The county fiscal body may impose a tax rate on the adjusted
gross income of county taxpayers that does not exceed twenty-five
hundredths percent (0.25%).
(d) Revenues raised from a tax imposed under this section may
be used only for the purposes of funding a property tax credit to
reduce the property tax liability imposed by a county to fund the
operation and maintenance of a juvenile detention center and other
facilities to provide juvenile services.
(e) The total of all tax credits granted under this section for a
year may not exceed the amount of revenue raised by the tax
imposed under this section. If the amount available in a year for
property tax credits under this section is less than the amount
necessary to provide all of the property tax credits authorized by
the adopting body, the county auditor shall reduce the property tax
credits granted to eliminate the excess. The county auditor shall
reduce credits uniformly in proportion to the tax liability incurred
by each taxpayer.
(f) The total of all tax credits granted under this section for a
year may not exceed the amount necessary to offset the property
tax liability imposed for the purposes of this section. If the amount
available in a year for property tax credits under this section is
greater than the amount necessary to provide property tax credits
to offset the property tax liability imposed for the purposes of this
section, the county auditor shall retain and apply the excess, as
necessary to provide the property tax credits for the purposes of
this section for the following year.
(g) The county auditor shall allocate the amount of revenue
applied as tax credits under this section to the county.
Chapter 7. Other Restricted Purpose Rates
Sec. 1. An adopting body may impose a tax on the adjusted gross income of county taxpayers in the county served by the adopting body that is a combination of one (1) or more of the tax rates permitted in this chapter in the county served by the adopting body. The tax rates imposed under this chapter, when added to any tax rates imposed under IC 6-3.6-5 and IC 6-3.6-6, constitute the tax imposed on the adjusted gross income of county taxpayers in the county.
Sec. 2. In order to impose a tax under this chapter, the adopting body must adopt an ordinance finding and determining that revenues from the tax are needed for the purposes described in the section under which the tax is imposed.
Sec. 3. Revenue raised from a tax imposed under this chapter shall be treated as additional revenue and may not be considered by the department of local government finance in determining:
(1) any taxing unit's maximum permissible property tax levy limit under IC 6-1.1-18.5; or
(2) the approved property tax rate for any fund.
Sec. 4. A governmental entity to which revenue raised from a tax under this chapter is distributed must segregate the amount raised from the tax in a separate account or fund and maintain sufficient records, as required by the state board of accounts, to demonstrate that the revenue is used only for the purposes for which the tax was imposed.
Sec. 5. (a) This section applies to Daviess County.
(b) Daviess County possesses unique governmental and economic development challenges due to:
(1) underemployment in relation to similarly situated counties and the loss of a major manufacturing business;
(2) an increase in property taxes for taxable years after December 31, 2000, for the construction of a new elementary school; and
(3) overcrowding of the county jail, the costs associated with housing the county's inmates outside the county, and the potential unavailability of additional housing for inmates outside the county.
The use of a tax under this section is necessary for the county to provide adequate jail capacity in the county and to maintain low property tax rates essential to economic development. The use of a tax under this section for the purposes of this section, rather than the use of property taxes, promotes these purposes.
(c) The county fiscal body may impose a tax on the adjusted
gross income of county taxpayers at a tax rate that does not exceed
the lesser of the following:
(1) Twenty-five hundredths percent (0.25%).
(2) The rate necessary to carry out the purposes described in
this section.
(d) Revenue from the tax under this section may be used only
for the following purposes:
(1) To finance, construct, acquire, improve, renovate,
remodel, or equip the county jail and related buildings and
parking facilities, including costs related to the demolition of
existing buildings, the acquisition of land, and any other
reasonably related costs.
(2) To repay bonds issued or leases entered into for
constructing, acquiring, improving, renovating, remodeling,
and equipping the county jail and related buildings and
parking facilities, including costs related to the demolition of
existing buildings, the acquisition of land, and any other
reasonably related costs.
(e) The tax imposed under this section may be imposed only
until the last of the following dates:
(1) The date on which the purposes described in subsection
(d)(1) are completed.
(2) The date on which the last of any bonds issued (including
any refunding bonds) or leases described in subsection (d)(2)
are fully paid.
The term of the bonds issued (including any refunding bonds) or a
lease entered into under subsection (d)(2) may not exceed
twenty-five (25) years.
(f) Money accumulated from the tax under this section after:
(1) the redemption of bonds issued; or
(2) the final payment of lease rentals due under a lease
entered into under this section;
shall be transferred to the county highway fund to be used for
construction, resurfacing, restoration, and rehabilitation of county
highways, roads, and bridges.
Sec. 6. (a) This section applies to Elkhart County.
(b) The county fiscal body may impose a tax on the adjusted
gross income of county taxpayers at a tax rate that does not exceed
the lesser of the following:
(1) Twenty-five hundredths percent (0.25%).
(2) The rate necessary to carry out the purposes described in
subsection (c).
(c) Revenue raised from a tax under this section may be used only for the following purposes:
(1) To finance, construct, acquire, improve, renovate, or equip:
(A) jail facilities;
(B) juvenile court, detention, and probation facilities;
(C) other criminal justice facilities; and
(D) related buildings and parking facilities;
located in the county, including costs related to the demolition of existing buildings and the acquisition of land.
(2) Repay bonds issued or leases entered into for the purposes described in subdivision (1).
(3) To operate and maintain jail facilities described in subdivision (1)(A) but only after the purposes described in subdivision (1) are completed and any bonds issued or leases entered into under subdivision (2) are fully paid.
(d) The term of the bonds issued (including any refunding bonds) or a lease entered into under this section may not exceed twenty (20) years.
(e) Money accumulated from a tax under this section that remains after the tax imposed by this section is terminated shall be transferred to the county highway fund to be used for construction, resurfacing, restoration, and rehabilitation of county highways, roads, and bridges.
Sec. 7. (a) This section applies only to Jackson County.
(b) The county fiscal body may impose a tax on the adjusted gross income of county taxpayers at a tax rate that does not exceed one percent (1%). If the tax rate under this section was initially imposed under IC 6-3.5-1.1-2.5 (repealed) at a rate that exceeds one percent (1%), the rate is reduced to one percent (1%).
(c) Revenue raised from a tax under this section may be used only for the purposes of funding the operation and maintenance of a jail and juvenile detention center opened after July 1, 1998.
Sec. 8. (a) This section applies only to Knox County.
(b) The county fiscal body may impose a tax on the adjusted gross income of county taxpayers at a tax rate that does not exceed the lesser of the following:
(1) Twenty-five hundredths percent (0.25%).
(2) The rate necessary to carry out the purposes described in this section.
(c) Revenue from a tax under this section may be used only for the following purposes:
(1) To finance, construct, acquire, and equip the county jail.
(2) To repay bonds issued or leases entered into for constructing, acquiring, and equipping the county jail.
Sec. 9. (a) This section applies only to Marshall County.
(b) The county fiscal body may impose a tax on the adjusted gross income of county taxpayers at a tax rate that does not exceed the lesser of the following:
(1) Twenty-five hundredths percent (0.25%).
(2) The rate necessary to carry out the purposes described in subsection (c).
(c) Revenue raised from a tax under this section may be used only for the following purposes:
(1) To finance, construct, acquire, improve, renovate, or equip:
(A) jail facilities;
(B) juvenile court, detention, and probation facilities;
(C) other criminal justice facilities; and
(D) related buildings and parking facilities;
located in the county, including costs related to the demolition of existing buildings and the acquisition of land.
(2) Repay bonds issued or leases entered into for the purposes described in subdivision (1).
(d) The tax imposed under this section may be imposed only until the last of the following dates:
(1) The date on which the purposes described in subsection (c)(1) are completed.
(2) The date on which the last of any bonds issued (including any refunding bonds) or leases described in subsection (c)(2) are fully paid.
The term of the bonds issued (including any refunding bonds) or a lease entered into under subsection (c)(2) may not exceed twenty (20) years.
(e) Money accumulated from the tax under this section after the tax imposed by this section is terminated shall be transferred to the county highway fund to be used for construction, resurfacing, restoration, and rehabilitation of county highways, roads, and bridges.
Sec. 10. (a) This section applies only to Miami County.
(b) Miami County possesses unique economic development challenges due to:
(1) underemployment in relation to similarly situated counties; and
(2) the presence of a United States government military base or other military installation that is completely or partially inactive or closed.
Maintaining low property tax rates is essential to economic development, and the use of a tax under this section to pay any bonds issued or leases entered into to carry out the purposes of this section rather than use of property taxes promotes these purposes.
(c) The county fiscal body may impose a tax rate on the adjusted gross income of county taxpayers that is the lesser of the following:
(1) Twenty-five hundredths percent (0.25%).
(2) The rate necessary to pay the costs of financing, constructing, acquiring, renovating, and equipping a county jail.
(d) Revenue raised from a tax imposed under this section may be used only for the purposes of paying the costs of financing, constructing, acquiring, renovating, and equipping a county jail, including the repayment of bonds issued, or leases entered into, for financing, constructing, acquiring, renovating, and equipping a county jail.
Sec. 11. (a) This section applies only to Perry County.
(b) Perry County possesses unique governmental and economic development challenges due to:
(1) underemployment in relation to similarly situated counties and the loss of a major manufacturing business; and
(2) overcrowding of the county jail, the costs associated with housing the county's inmates outside the county, and the potential unavailability of additional housing for inmates outside the county.
The use of a tax under this section is necessary for the county to provide adequate jail capacity in the county and to maintain low property tax rates essential to economic development. The use of a tax under this section for the purposes described in this section promotes these purposes.
(c) The county fiscal body may impose a tax on the adjusted gross income of county taxpayers at a tax rate that does not exceed the lesser of the following:
(1) Five-tenths percent (0.5%).
(2) The rate necessary to carry out the purposes described in this section.
(d) Revenue for a tax imposed under this section may be used only for the following purposes:
(1) To finance, construct, acquire, improve, renovate,
remodel, or equip the county jail and related buildings and
parking facilities, including costs related to the demolition of
existing buildings, the acquisition of land, and any other
reasonably related costs.
(2) To repay bonds issued or leases entered into for
constructing, acquiring, improving, renovating, remodeling,
and equipping the county jail and related buildings and
parking facilities, including costs related to the demolition of
existing buildings, the acquisition of land, and any other
reasonably related costs.
(e) The tax imposed under this section may be imposed only
until the last of the following dates:
(1) The date on which the purposes described in subsection
(d)(1) are completed.
(2) The date on which the last of any bonds issued (including
any refunding bonds) or leases described in subsection (d)(2)
are fully paid.
The term of the bonds issued (including any refunding bonds) or a
lease entered into under subsection (d)(2) may not exceed
twenty-five (25) years.
(f) Funds accumulated from a tax under this section after:
(1) the redemption of the bonds issued; or
(2) the final payment of lease rentals due under a lease
entered into under this section;
shall be transferred to the county highway fund to be used for
construction, resurfacing, restoration, and rehabilitation of county
highways, roads, and bridges.
Sec. 12. (a) This section applies only to Pulaski County.
(b) The county fiscal body may impose a tax on the adjusted
gross income of county taxpayers at a tax rate that does not exceed
three-tenths percent (0.3%).
(c) Revenue from a tax imposed under this section may be used
only for the purposes of paying the costs of operating and
maintaining a jail and justice center.
(d) The tax imposed under this section may be imposed only for
eight (8) years.
Sec. 13. (a) This section applies only to Randolph County.
(b) Randolph County possesses:
(1) unique fiscal challenges to finance the operations of county
government due to the county's ongoing obligation to repay
amounts received by the county due to an overpayment of the
county's certified distribution under IC 6-3.5-1.1-9 for a prior
year; and
(2) unique capital financing needs related to the purposes
described in this section.
(c) The county fiscal body may impose a tax on the adjusted
gross income of county taxpayers at a tax rate that does not exceed
the lesser of the following:
(1) Twenty-five hundredths percent (0.25%).
(2) The rate necessary to carry out the purposes described in
this section.
(d) Revenues from a tax under this section may be used only for
the following purposes:
(1) Financing, constructing, acquiring, renovating, and
equipping the county courthouse, and financing and
renovating the former county hospital for additional office
space, educational facilities, nonsecure juvenile facilities, and
other county functions, including the repayment of bonds
issued, or leases entered into, for constructing, acquiring,
renovating, and equipping the county courthouse and for
renovating the former county hospital for additional office
space, educational facilities, nonsecure juvenile facilities, and
other county functions.
(2) Financing, constructing, acquiring, renovating, and
equipping buildings for a volunteer fire department (as
defined in IC 36-8-12-2) that provides services in any part of
the county.
(3) Financing, constructing, acquiring, and renovating
firefighting apparatus or other related equipment for a
volunteer fire department (as defined in IC 36-8-12-2) that
provides services in any part of the county.
Sec. 14. (a) This section applies only to Scott County.
(b) Scott County is a county in which:
(1) maintaining low property tax rates is essential to economic
development; and
(2) the use of additional tax revenues as provided in this
section, rather than the use of property taxes, to fund:
(A) the financing, construction, acquisition, improvement,
renovation, equipping, operation, or maintenance of jail
facilities; and
(B) the repayment of bonds issued or leases entered into
for the purposes described in clause (A), except operation
or maintenance;
promotes the purpose of maintaining low property tax rates.
(c) The county fiscal body may impose a tax rate on the adjusted gross income of county taxpayers that is the lesser of the following:
(1) Twenty-five hundredths percent (0.25%).
(2) The rate necessary to pay the costs of financing, constructing, acquiring, renovating, and equipping the facilities described in subsection (d).
(d) Revenues raised under this section may be used only for the following purposes:
(1) The financing, construction, acquisition, improvement, renovation, equipping, operation, or maintenance of jail facilities.
(2) The repayment of bonds issued or leases entered into for the purposes described in subdivision (1), except operation or maintenance.
Sec. 15. (a) This section applies only to Starke County.
(b) Starke County possesses unique governmental and economic development challenges due to:
(1) the county's predominantly rural geography, demography, and economy;
(2) the county's relatively low tax base and relatively high property tax rates;
(3) the current maximum capacity of the county jail, which was constructed in 1976; and
(4) pending federal class action litigation seeking a mandate to address capacity and living conditions in the county jail.
The use of a tax under this section is necessary for the county to address jail capacity and appropriate inmate living conditions and to maintain low property tax rates essential to economic development. The use of a tax revenue under this section for the purposes described in this section promotes these purposes.
(c) The county fiscal body may impose a tax on the adjusted gross income of county taxpayers at a tax rate that does not exceed the lesser of the following:
(1) Sixty-five hundredths percent (0.65%).
(2) The rate necessary to carry out the purposes described in this section.
(d) Revenue from a tax under this section may be used only for the following purposes:
(1) To finance, construct, acquire, and equip the county jail and related buildings and parking facilities, including costs related to the demolition of existing buildings, the acquisition of land, and any other reasonably related costs.
(2) To repay bonds issued or leases entered into for constructing, acquiring, and equipping the county jail and related buildings and parking facilities, including costs related to the demolition of existing buildings, the acquisition of land, and any other reasonably related costs.
(e) The tax imposed under this section may be imposed only until the last of the following dates:
(1) The date on which the purposes described in subsection (d)(1) are completed.
(2) The date on which the last of any bonds issued (including any refunding bonds) or leases described in subsection (d)(2) are fully paid.
The term of the bonds issued (including any refunding bonds) or a lease entered into under subsection (d)(2) may not exceed twenty-five (25) years.
Sec. 16. (a) This section applies only to Union County.
(b) Union County possesses unique economic development challenges due to:
(1) the county's heavy agricultural base;
(2) the presence of a large amount of state owned property in the county that is exempt from property taxation; and
(3) recent obligations of the school corporation in the county that have already increased property taxes in the county and imposed additional property tax burdens on the county's agricultural base.
Maintaining low property tax rates is essential to economic development. The use of a tax under this section for the purposes described in this section, rather than the use of property taxes, promotes these purposes.
(c) The county fiscal body may impose a tax on the adjusted gross income of county taxpayers at a tax rate that does not exceed the lesser of the following:
(1) Twenty-five hundredths percent (0.25%).
(2) The rate necessary to carry out the purposes described in this section.
(d) Revenue raised from a tax under this section may be used only for the following purposes:
(1) To finance, construct, acquire, improve, renovate, or equip the county courthouse.
(2) To repay bonds issued, or leases entered into, for constructing, acquiring, improving, renovating, and equipping the county courthouse.
(e) The tax imposed under this section may be imposed only until the last of the following dates:
(1) The date on which the purposes described in subsection (d)(1) are completed.
(2) The date on which the last of any bonds issued (including any refunding bonds) or leases described in subsection (d)(2) are fully paid.
The term of the bonds issued (including any refunding bonds) or a lease entered into under subsection (d)(2) may not exceed twenty-two (22) years.
(f) Funds accumulated from a tax under this section after:
(1) the redemption of the bonds issued; or
(2) the final payment of lease rentals due under a lease entered into under this section;
shall be transferred to the county highway fund to be used for construction, resurfacing, restoration, and rehabilitation of county highways, roads, and bridges.
Sec. 17. (a) This section applies only to Wayne County.
(b) Wayne County possesses unique economic development challenges due to underemployment in relation to similarly situated counties. Maintaining low property tax rates is essential to economic development, and the use of a tax under this section to pay any bonds issued or leases entered into to carry out the purposes of this section, rather than use of property taxes, promotes these purposes.
(c) The county fiscal body may impose a tax on the adjusted gross income of county taxpayers at a tax rate that does not exceed twenty-five hundredths percent (0.25%).
(d) Revenue raised from a tax under this section may be used only for the following purposes:
(1) To finance, construct, acquire, improve, renovate, or equip the county jail and related buildings and parking facilities, including costs related to the demolition of existing buildings and the acquisition of land.
(2) To repay bonds issued, or leases entered into, for constructing, acquiring, improving, renovating, and equipping the county jail and related buildings and parking facilities, including costs related to the demolition of existing buildings and the acquisition of land.
(e) The tax imposed under this section may be imposed only until the later of the date on which the financing, acquisition, improvement, renovation, and equipping described in this section
is completed or the date on which the last of any bonds issued or
leases entered into to finance the construction, acquisition,
improvement, renovation, and equipping described in this section
are fully paid. The term of the bonds issued (including any
refunding bonds) or a lease entered into under this section may not
exceed twenty (20) years.
(f) Notwithstanding any other law, funds accumulated from the
tax imposed under this section after:
(1) the redemption of bonds issued; or
(2) the final payment of lease rentals due under a lease
entered into under this section;
shall be transferred to the county highway fund to be used for
construction, resurfacing, restoration, and rehabilitation of county
highways, roads, and bridges.
Sec. 18. (a) This section applies only to a county that is a
member of a regional development authority under IC 36-7.6.
(b) The adopting body for the county may impose a tax rate on
the adjusted gross income tax of county taxpayers that is not
greater than:
(1) in the case of a county described in IC 36-7.6-4-2(b)(2),
twenty-five thousandths of one percent (0.025%); or
(2) in the case of any other county to which this section
applies, five-hundredths of one percent (0.05%).
(c) The revenue from a tax under this section may be used only
for the purpose of transferring the revenue in the regional
development authority under IC 36-7.6.
Sec. 19. (a) This section applies only to a county that:
(1) operates a county jail that is subject to an order that:
(A) was issued by a federal district court before January 1,
2003; and
(B) has not been terminated;
(2) operates a county jail that fails to meet:
(A) American Correctional Association Jail Construction
Standards; and
(B) Indiana jail operation standards adopted by the
department of correction; and
(3) has insufficient revenue to finance the construction,
acquisition, improvement, renovation, and equipping of a
county jail and related buildings and parking facilities.
(b) A county described in subsection (a) possesses unique
economic development challenges due to underemployment in
relation to similarly situated counties. Maintaining low property
tax rates is essential to economic development. The use of a tax
under this section for the purposes of this section, rather than use
of property taxes, promotes these purposes.
(c) For purposes of this section, "county jail" includes any other
penal facility that is:
(1) located in; and
(2) operated by;
the county.
(d) The county fiscal body may impose a tax on the adjusted
gross income of county taxpayers at a tax rate that does not exceed
the lesser of the following:
(1) Twenty-five hundredths percent (0.25%).
(2) The rate necessary to carry out the purposes described in
this section.
(e) Revenue from a tax under this section may be used only for
the following purposes:
(1) To finance, construct, acquire, improve, renovate, or equip
a county jail and related buildings and parking facilities,
including costs related to the demolition of existing buildings
and the acquisition of land.
(2) To repay bonds issued or leases entered into for
constructing, acquiring, improving, renovating, and equipping
the county jail and related buildings and parking facilities,
including costs related to the demolition of existing buildings
and the acquisition of land.
(f) The tax imposed under this section may be imposed only
until the last of the following dates:
(1) The date on which the purposes described in subsection
(e)(1) are completed.
(2) The date on which the last of any bonds issued (including
any refunding bonds) or leases described in subsection (e)(2)
are fully paid.
The term of the bonds issued (including any refunding bonds) or a
lease entered into under subsection (e)(2) may not exceed thirty
(30) years.
(g) Funds accumulated from the tax under this section after:
(1) the redemption of bonds issued; or
(2) the final payment of lease rentals due under a lease
entered into under this section;
shall be transferred to the county general fund.
Sec. 20. (a) This section applies to a county that:
(1) operates a courthouse that is subject to an order that:
(A) is issued by a federal district court;
(B) applies to an action commenced before January 1, 2003; and
(C) requires the county to comply with the federal Americans with Disabilities Act; and
(2) has insufficient revenues to finance the construction, acquisition, improvement, renovation, equipping, and operation of the courthouse facilities and related facilities.
(b) A county described in this section possesses unique fiscal challenges in financing, renovating, equipping, and operating the county courthouse facilities and related facilities because the county consistently has one (1) of the highest unemployment rates in Indiana. Maintaining low property tax rates is essential to economic development in the county. The use of a tax under this section for the purposes of this section promotes these purposes.
(c) The county fiscal body may impose a tax on the adjusted gross income of county taxpayers at a tax rate that does not exceed the lesser of the following:
(1) Twenty-five hundredths percent (0.25%).
(2) The rate necessary to carry out the purposes described in this section.
(d) Revenue from a tax under this section may be used only for the following purposes:
(1) To finance, construct, acquire, improve, renovate, equip, or operate the county courthouse or related facilities.
(2) To repay bonds issued or leases entered into for constructing, acquiring, improving, renovating, equipping, or operating the county courthouse or related facilities.
(3) To pay for economic development projects described in the county's capital improvement plan.
(e) Funds accumulated from a tax under this section or any other revenues of the county may be deposited into a nonreverting fund of the county to be used for operating costs of the courthouse facilities, juvenile detention facilities, or related facilities.
Chapter 8. Administration of Tax
Sec. 1. If for any taxable year a county taxpayer is subject to different tax rates for the tax imposed by a particular county, the taxpayer's tax rate for that county and that taxable year is the rate determined in the last STEP of the following STEPS:
STEP ONE: For each tax rate in effect in a year, multiply the number of months in the taxpayer's taxable year in which the rate is in effect.
STEP TWO: Divide the sum of the amounts determined under STEP ONE by twelve (12).
Sec. 2. If the tax is not in effect during a county taxpayer's entire taxable year, the amount of tax that the county taxpayer owes for that taxable year equals the product of:
(1) the amount of tax the county taxpayer would owe if the tax had been imposed during the county taxpayer's entire taxable year; multiplied by
(2) a fraction. The numerator of the fraction equals the number of days in the county taxpayer's taxable year during which the tax was in effect. The denominator of the fraction equals the total number of days in the county taxpayer's taxable year.
However, if the taxpayer files state income tax returns on a calendar year basis, the fraction to be applied under this section is one-half (1/2).
Sec. 3. (a) For purposes of this article, an individual shall be treated as a resident of the county in which the individual:
(1) maintains a home, if the individual maintains only one (1) home in Indiana;
(2) if subdivision (1) does not apply, is registered to vote;
(3) if subdivision (1) or (2) does not apply, registers the individual's personal automobile; or
(4) if subdivision (1), (2), or (3) does not apply, the majority of the individual's time is spent in Indiana during the taxable year in question.
(b) The residence or principal place of business or employment of an individual is to be determined on January 1 of the calendar year in which the individual's taxable year commences. If an individual changes the location of the individual's residence or principal place of employment or business to another county in Indiana during a calendar year, the individual's liability for tax is not affected.
(c) Notwithstanding subsection (b), if an individual becomes a county taxpayer for purposes of IC 36-7-27 during a calendar year because the individual:
(1) changes the location of the individual's residence to a county in which the individual begins employment or business at a qualified economic development tax project (as defined in IC 36-7-27-9); or
(2) changes the location of the individual's principal place of employment or business to a qualified economic development
tax project and does not reside in another county in which a
tax is in effect;
the individual's adjusted gross income attributable to employment
or business at the qualified economic development tax project is
taxable only by the county containing the qualified economic
development tax project.
Sec. 4. (a) Using procedures provided under this chapter, the
adopting body of any adopting county may pass an ordinance to
enter into reciprocity agreements with the taxing authority of any
city, town, municipality, county, or other similar local
governmental entity of any other state. The reciprocity agreements
must provide that the income of resident county taxpayers is
exempt from income taxation by the other local governmental
entity to the extent income of the residents of the other local
governmental entity is exempt from the tax in the adopting county.
(b) A reciprocity agreement adopted under this section may not
become effective until it is also made effective in the other local
governmental entity that is a party to the agreement.
(c) The form and effective date of any reciprocity agreement
described in this section must be approved by the department.
Sec. 5. (a) Except as otherwise provided in subsection (b) and
the other provisions of this article, all provisions of the adjusted
gross income tax law (IC 6-3) concerning:
(1) definitions;
(2) declarations of estimated tax;
(3) filing of returns;
(4) deductions or exemptions from adjusted gross income;
(5) remittances;
(6) incorporation of the provisions of the Internal Revenue
Code;
(7) penalties and interest; and
(8) exclusion of military pay credits for withholding;
apply to the imposition, collection, and administration of the tax
imposed by this article.
(b) The provisions of IC 6-3-1-3.5(a)(6), IC 6-3-3-3, IC 6-3-3-5,
and IC 6-3-5-1 do not apply to the tax imposed by this article.
(c) Notwithstanding subsections (a) and (b), each employer shall
report to the department the amount of withholdings attributable
to each county. This report shall be submitted to the department:
(1) each time the employer remits to the department the tax
that is withheld; and
(2) annually along with the employer's annual withholding
report.
Sec. 6. (a) Except as provided in subsection (b), if for a
particular taxable year a county taxpayer is liable for an income
tax imposed by a county, city, town, or other local governmental
entity located outside of Indiana, that county taxpayer is entitled
to a credit against the tax liability imposed under this article for
that same taxable year. The amount of the credit equals the
amount of tax imposed by the other governmental entity on income
derived from sources outside Indiana and subject to the tax
imposed under this article. However, the credit provided by this
section may not reduce a county taxpayer's tax liability to an
amount less than would have been owed if the income subject to
taxation by the other governmental entity had been ignored.
(b) The credit provided by this section does not apply to a
county taxpayer to the extent that the other governmental entity
provides for a credit to the taxpayer for the amount of taxes owed
under this article.
(c) To claim the credit provided by this section, a county
taxpayer must provide the department with satisfactory evidence
that the taxpayer is entitled to the credit.
Sec. 7. In the case of a county taxpayer who is a resident of
Perry County, the term "adjusted gross income" does not include
adjusted gross income that is:
(1) earned in a county that is:
(A) located in another state; and
(B) adjacent to the county in which the taxpayer resides;
and
(2) subject to an income tax imposed by a county, city, town,
or other local governmental entity in the other state.
Sec. 8. (a) If for a particular taxable year a county taxpayer is,
or a county taxpayer and the taxpayer's spouse who file a joint
return are, allowed a credit for the elderly or individuals with a
total disability under Section 22 of the Internal Revenue Code, the
county taxpayer is, or the county taxpayer and the taxpayer's
spouse are, entitled to a credit against the tax liability imposed
under this article for that same taxable year. The amount of the
credit equals the lesser of:
(1) the product of:
(A) the credit for the elderly or individuals with a total
disability for that same taxable year; multiplied by
(B) a fraction, the numerator of which is the tax rate
imposed against the county taxpayer, or the county
taxpayer and the taxpayer's spouse, and the denominator
of which is fifteen-hundredths (0.15); or
(2) the amount of tax imposed on the county taxpayer, or the
county taxpayer and the taxpayer's spouse.
(b) If a county taxpayer and the taxpayer's spouse file a joint
return and are subject to different tax rates for the same taxable
year, they shall compute the credit under this section by using the
formula provided by subsection (a), except that they shall use the
average of the two (2) tax rates imposed against them as the
numerator referred to in subsection (a)(1)(B).
Chapter 9. Distribution of Revenue
Sec. 1. (a) A special account within the state general fund shall
be established for each county that imposes a tax. Any revenue
derived from the imposition of the tax by a county shall be
deposited in that county's account in the state general fund.
(b) Any income earned on money held in an account under
subsection (a) becomes a part of that account.
(c) Any revenue remaining in an account established under
subsection (a) at the end of a fiscal year does not revert to the state
general fund.
Sec. 2. The budget agency shall before May 1 of every
odd-numbered year publish an estimate of the statewide total
amount of certified distributions to be made under this article
during the following two (2) calendar years.
Sec. 3. The budget agency shall before May 1 of every
even-numbered year publish an estimate of the statewide total
amount of certified distributions to be made under this article
during the following calendar year.
Sec. 4. Revenue derived from the imposition of the tax shall, in
the manner prescribed by this chapter, be distributed to the county
that imposed it. The amount that is to be distributed to a county
during an ensuing calendar year equals the amount of tax revenue
that the budget agency determines has been:
(1) received from that county for a taxable year ending in a
calendar year preceding the calendar year in which the
determination is made; and
(2) reported on an annual return or amended return
processed by the department in the state fiscal year ending
before July 1 of the calendar year in which the determination
is made;
as adjusted (as determined after review of the recommendation of
the budget agency) for refunds of tax made in the state fiscal year.
Sec. 5. Before August 2 of each calendar year, the budget agency shall certify to the county auditor of each adopting county:
(1) the amount determined under section 4 of this chapter; and
(2) the amount of interest in the county's account that has accrued and has not been included in a certification made in a preceding year.
The amount certified is the county's certified distribution for the immediately succeeding calendar year. The amount certified shall be adjusted, as necessary, under sections 6, 7, and 8 of this chapter.
Sec. 6. The budget agency shall certify an amount less than the amount determined under section 5 of this chapter if the budget agency determines that the reduced distribution is necessary to offset overpayments made in a calendar year before the calendar year of the distribution. The budget agency may reduce the amount of the certified distribution over several calendar years so that any overpayments are offset over several years rather than in one (1) lump sum.
Sec. 7. The budget agency shall adjust the certified distribution of a county to correct for any clerical or mathematical errors made in any previous certification under this section. The budget agency may reduce the amount of the certified distribution over several calendar years so that any adjustment under this subsection is offset over several years rather than in one (1) lump sum.
Sec. 8. This section applies to a county that imposes, increases, decreases, or rescinds a tax or tax rate under this article before November 1 in the same calendar year in which the budget agency makes a certification under this section. The budget agency shall adjust the certified distribution of a county to provide for a distribution in the immediately following calendar year and in each calendar year thereafter. The budget agency shall provide for a full transition to certification of distributions as provided in section 4(1) through 4(2) of this chapter in the manner provided in section 6 of this chapter. If the county imposes, increases, decreases, or rescinds a tax or tax rate under this article after the date for which a certification under section 5 of this chapter is based, the budget agency shall adjust the certified distribution of the county after August 1 of the calendar year. The adjustment shall reflect any other adjustment required under sections 6 and 7 of this chapter. The adjusted certification shall be treated as the county's certified distribution for the immediately succeeding calendar year. The budget agency shall certify the adjusted certified distribution to the
county auditor for the county and provide the county council with
an informative summary of the calculations that revises the
informative summary provided in section 5 of this chapter and
reflects the changes made in the adjustment.
Sec. 9. The budget agency shall provide the county council with
an informative summary of the calculations used to determine the
certified distribution. The summary of calculations must include:
(1) the amount reported on individual income tax returns
processed by the department during the previous fiscal year;
(2) adjustments for over distributions in prior years;
(3) adjustments for clerical or mathematical errors in prior
years;
(4) adjustments for tax rate changes; and
(5) the amount of excess account balances to be distributed
under IC 6-3.5-6-17.3.
Sec. 10. The budget agency shall also certify information
concerning the part of the certified distribution that is attributable
to each of the following:
(1) The tax rate imposed under IC 6-3.6-5.
(2) Each tax rate imposed under IC 6-3.6-6.
(3) Each tax rate imposed under IC 6-3.6-7.
The amount certified shall be adjusted to reflect any adjustment in
the certified distribution under this chapter.
Sec. 11. The information described in sections 9 and 10 of this
chapter must be certified to the county auditor and to the
department of local government finance not later than the later of
the following:
(1) September 1 of each calendar year.
(2) Thirty (30) days after the adopting body certifies a new
rate to the budget agency.
Sec. 12. One-twelfth (1/12) of each adopting county's certified
distribution for a calendar year shall be distributed from its
account established under this chapter to the appropriate county
treasurer on the first regular business day of each month of that
calendar year.
Sec. 13. All distributions from an account established under this
chapter shall be made by warrants issued by the auditor of state to
the treasurer of state ordering the appropriate payments.
Sec. 14. Before October 2 of each year, the budget agency shall
submit a report to each county auditor indicating the balance in
the county's special account as of the cutoff date set by the budget
agency.
Sec. 15. (a) If the budget agency determines that the balance in a county account exceeds one hundred fifty percent (150%) of the certified distributions to be made to the county in the ensuing year, the budget agency shall make a supplemental distribution to the county from the county's special account.
(b) A supplemental distribution described in subsection (a) must be:
(1) made in January of the ensuing calendar year; and
(2) allocated in the same manner as certified distributions for deposit in a civil unit's rainy day fund established under IC 36-1-8-5.1. However, the part of a supplemental distribution that is attributable to an additional rate authorized under this article:
(A) shall be used for the purpose specified in the statute authorizing the additional rate; and
(B) is not required to be deposited in the unit's rainy day fund.
The amount of the supplemental distribution is equal to the amount by which the balance in the county account exceeds one hundred fifty percent (150%) of the certified distributions to be made to the county in the ensuing year.
(c) A determination under this section must be made before October 2.
Sec. 16. Upon receipt, each monthly payment of a county's certified distribution or supplemental distribution shall be allocated and distributed to the appropriate entities in accordance with this article and the allocation ordinances adopted under this article.
Chapter 10. Permitted Expenditures
Sec. 1. This chapter is not an exhaustive list of the purposes for which revenue raised under IC 6-3.6-5 may be expended.
Sec. 2. (a) A county may use revenue allocated for economic development purposes under IC 6-3.6-5-9 for the purposes described in this section.
(b) A county may fund the operation of a public transportation corporation as provided in an election, if any, made by the county fiscal body under IC 36-9-4-42 from revenues described in subsection (a).
Sec. 3. (a) Marion County may use revenue allocated for economic development purposes under IC 6-3.6-5-9 for the purposes described in this section.
(b) A county may fund the operation of a public library in a
county containing a consolidated city as provided in an election, if
any, made by the county fiscal body under IC 36-3-7-6 from
revenues described in subsection (a).
Sec. 4. (a) Marion County may use revenue allocated for
economic development purposes under IC 6-3.6-5-9 for the
purposes described in this section.
(b) A county may make payments permitted under
IC 36-7-14-25.5 or IC 36-7-15.1-17.5 from revenues described in
subsection (a).
Sec. 5. (a) Marion County may use revenue allocated for
economic development purposes under IC 6-3.6-5-9 for the
purposes described in this section.
(b) The county fiscal body may pledge revenues described in
subsection (a) to the payment of bonds or lease rentals to finance
a qualified economic development tax project under IC 36-7-27 in
that county or in any other county if the county fiscal body
determines that the project will promote significant opportunities
for the gainful employment or retention of employment of the
county's residents.
Sec. 6. (a) This section applies to LaPorte County if:
(1) the county fiscal body has adopted an ordinance under
IC 36-7.5-2-3(e) providing that the county is joining the
northwest Indiana regional development authority; and
(2) the fiscal body of the city described in IC 36-7.5-2-3(e) has
adopted an ordinance under IC 36-7.5-2-3(e) providing that
the city is joining the development authority.
(b) The:
(1) county may use revenue allocated for economic
development purposes under IC 6-3.6-5-9; and
(2) county or a city may use its certified shares;
for the purposes described in this section.
(c) A county or city may use revenue described in subsection (b)
for making transfers required by IC 36-7.5-4-2.
(d) This subsection applies if the county economic development
income tax rate under IC 6-3.5-7 (repealed) was increased in
LaPorte County after June 30, 2006. Three million five hundred
thousand dollars ($3,500,000) of the revenue from the tax imposed
under IC 6-3.6-5 shall be used by the county to make the county's
transfer required by IC 36-7.5-4-2. This amount shall be paid by
the county treasurer to the treasurer of the northwest Indiana
regional development authority under IC 36-7.5-4-2 from the
revenue allocated for economic development purposes under
IC 6-3.6-5-9.
Sec. 7. (a) This section applies to the following counties:
(1) Porter County.
(2) Lake County.
(b) The:
(1) county may use revenue allocated for economic
development purposes under IC 6-3.6-5-9; and
(2) county or a city may use its certified shares;
for the purposes described in this section.
(c) A county or city may use revenue described in subsection (b)
for making transfers required by IC 36-7.5-4-2.
(d) This subsection applies if the county economic development
income tax rate was increased in Porter County after April 30,
2005. Three million five hundred thousand dollars ($3,500,000) of
the revenue from the tax imposed under IC 6-3.6-5 shall be used by
the county to make the county's transfer required by IC 36-7.5-4-2.
This amount shall be paid by the county treasurer to the treasurer
of the northwest Indiana regional development authority under
IC 36-7.5-4-2 from the revenue allocated for economic
development purposes under IC 6-3.6-5-9. If Porter County ceases
to be a member of the northwest Indiana regional development
authority under IC 36-7.5 but two (2) or more municipalities in the
county have become members of the northwest Indiana regional
development authority as authorized by IC 36-7.5-2-3(i), the
county treasurer shall continue to transfer the three million five
hundred thousand dollars ($3,500,000) to the treasurer of the
northwest Indiana regional development authority under
IC 36-7.5-4-2 from the revenue allocated for economic
development purposes under IC 6-3.6-5-9.
Sec. 8. (a) This section applies to all counties.
(b) The:
(1) county may use revenue allocated for economic
development purposes under IC 6-3.6-5-9; and
(2) county or a city may use its certified shares;
for the purposes described in this section.
(c) A county, city, or town may use revenue described in
subsection (b) for any combination of the following purposes:
(1) To pay 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.
(2) For the retirement of bonds under section 9 of this chapter for economic development projects.
(3) For leases under section 10 of this chapter, or for leases or bonds entered into or issued prior to the date the economic development income tax (repealed) was imposed if the purpose of the lease or bonds would have qualified as a purpose under this article at the time the lease was entered into or the bonds were issued.
(4) 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.
(5) The retirement of bonds issued under any provision of Indiana law for a capital project.
(6) The payment of lease rentals under any statute for a capital project.
(7) Contract payments to a nonprofit corporation whose primary corporate purpose is to assist government in planning and implementing economic development projects.
(8) Operating expenses of a governmental entity that plans or implements economic development projects.
(9) Funding of a revolving fund established under IC 5-1-14-14.
(10) For a regional venture capital fund established under section 13 of this chapter or a local venture capital fund established under section 14 of this chapter.
Sec. 9. (a) The fiscal body of a county, city, or town may issue bonds payable from revenue described in section 8(b) of this chapter. The bonds must be for economic development projects.
(b) The fiscal body of a county, city, or town may issue bonds payable from revenue described in section 8(b) of this chapter for any capital project for which the fiscal body is authorized to issue general obligation bonds. The bonds issued under this section may be payable from the tax if the county option income tax (repealed), the county adjusted gross income tax (repealed), or a tax under IC 6-3.6-5 is also in effect in the county at the time the bonds are issued.
(c) If there are bonds outstanding that have been issued under this section, or leases in effect under section 10 of this chapter, the adopting body may not reduce the tax imposed under IC 6-3.6-5 or an allocation under IC 6-3.6-5-9 or certified shares pledged to repay bonds, as appropriate, below a rate that would produce one
and twenty-five hundredths (1.25) times the total of the highest
annual debt service on the bonds to their final maturity, plus the
highest annual lease payments, unless:
(1) the body that imposed a tax under IC 6-3.6-5; or
(2) any city, town, or county;
pledges all or a portion of its certified share for the life of the bonds
or the term of the lease, in an amount that is sufficient, when
combined with the amount pledged by the city, town, or county
that issued the bonds, to produce one and twenty-five hundredths
(1.25) times the total of the highest annual debt service plus the
highest annual lease payments.
(d) For purposes of subsection (c), the determination of a tax
rate sufficient to produce one and twenty-five hundredths (1.25)
times the total of the highest annual debt service plus the highest
annual lease payments shall be based on an average of the
immediately preceding three (3) years tax collections, if the tax has
been imposed for the last preceding three (3) years. If the tax has
not been imposed for the last preceding three (3) years, the body
that imposed the tax may not reduce the rate below a rate that
would produce one and twenty-five hundredths (1.25) times the
total of the highest annual debt service, plus the highest annual
lease payments, based upon a study by a qualified public
accountant or financial advisor.
(e) IC 6-1.1-20 does not apply to the issuance of bonds under this
section.
(f) Bonds issued under this section may be sold at a public sale
in accordance with IC 5-1-11 or may be sold at a negotiated sale.
(g) After a sale of bonds under this section, the county auditor
shall prepare a debt service schedule for the bonds.
(h) The general assembly covenants that it will not repeal or
amend this article in a manner that would adversely affect owners
of outstanding bonds issued, or payment of any lease rentals due,
under this section.
Sec. 10. (a) A county, city, or town may enter into a lease with
a leasing body (as defined in IC 5-1-1-1) of any property that could
be financed with the proceeds of bonds issued under this chapter
with a lessor for a term not to exceed fifty (50) years, and the lease
may provide for payments from revenues described in section 8(b)
of this chapter, any other revenue available to the unit, or any
combination of these sources.
(b) A lease may provide that payments by the unit to the lessor
are required only to the extent and only for the period that the
lessor is able to provide the leased facilities in accordance with the
lease. The terms of each lease must be based upon the value of the
facilities leased and may not create a debt of the unit for purposes
of the Constitution of the State of Indiana.
(c) A lease may be entered into by the executive of the unit only
after a public hearing at which all interested parties are provided
the opportunity to be heard. After the public hearing, the executive
may approve the execution of the lease on behalf of the unit if the
executive finds that the service to be provided throughout the term
of the lease will serve the public purpose of the unit and is in the
best interests of its residents. Any lease approved by the executive
must also be approved by an ordinance of the fiscal body of the
unit.
(d) Upon execution of a lease providing for payments by the unit
in whole or in part from revenues described in section 8(b) of this
chapter and upon approval of the lease by the unit's fiscal body,
the executive of the unit shall publish notice of the execution of the
lease and its approval in accordance with IC 5-3-1.
(e) Except as provided in this section, no approvals of any
governmental body or agency are required before the unit enters
into a lease under this section.
(f) An action to contest the validity of the lease or to enjoin the
performance of any of its terms and conditions must be brought
within thirty (30) days after the publication of the notice of the
execution and approval of the lease.
(g) If a unit exercises an option to buy a leased facility from a
lessor, the unit may subsequently sell the leased facility, without
regard to any other statute, to the lessor at the end of the lease
term at a price set forth in the lease or at fair market value
established at the time of the sale by the executive of the unit
through auction, appraisal, or arms length negotiation. If the
facility is sold at auction, after appraisal, or through negotiation,
the unit shall conduct a hearing after public notice in accordance
with IC 5-3-1 before the sale. Any action to contest the sale must be
brought within fifteen (15) days of the hearing.
Sec. 11. Notwithstanding any other law, if a civil taxing unit
desires to issue obligations, or enter into leases, payable wholly or
in part by the taxes imposed under IC 6-3.6-5 or IC 6-3.6-7 (but not
IC 6-3.6-6), the obligations of the civil taxing unit or any lessor may
be sold at public sale in accordance with IC 5-1-11 or at negotiated
sale.
Sec. 12. (a) A pledge of revenues from a tax imposed under
IC 6-3.6-5 or IC 6-3.6-7 (but not IC 6-3.6-6) is enforceable in
accordance with IC 5-1-14.
(b) With respect to obligations for which a pledge has been
made under IC 6-3.6-5 or IC 6-3.6-7 (but not IC 6-3.6-6), the
general assembly covenants with the county and the purchasers or
owners of those obligations that this article will not be repealed or
amended in any manner that will adversely affect the tax collected
under this article as long as the principal of or interest on those
obligations is unpaid.
Sec. 13. (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.
The fostering of economic development and the development of
new technology under this section or section 14 of this chapter 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 described in section
8(b) of 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) Revenues described in section 8(b) of 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 provide that:
(1) each of the participating units is represented by at least
one (1) member of the governing board; and
(2) the membership of the governing board is established on
a bipartisan basis so that the number of the members of the
governing board who are members of one (1) political party
may not exceed the number of members of the governing
board required to establish a quorum.
(g) A majority of the governing board constitutes a quorum, and
the concurrence of a majority of the governing board is necessary
to authorize any action.
(h) 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.
(i) A majority of members of a governing board of a regional
venture capital fund established under this section must have at
least five (5) years of experience in business, finance, or venture
capital.
(j) 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.
(k) 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.
(8) Funding small business development with respect to:
(A) prototype products or processes;
(B) marketing studies to determine the feasibility of new
products or processes; or
(C) business plans for the development and production of
new products or processes.
Sec. 14. (a) The fiscal body of a county or municipality may, by
resolution, establish a local venture capital fund.
(b) A unit establishing a local venture capital fund under
subsection (a) may deposit the following in the fund:
(1) Revenues described in section 8(b) of this chapter.
(2) The proceeds of public or private grants.
(c) A local 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.
(d) The fiscal body of a unit establishing a local venture capital
fund under subsection (a) shall establish the terms for the
administration of the local venture capital fund. The terms must
include the following:
(1) The membership of the governing board.
(2) The amount of the 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.
(e) A unit establishing a local venture capital fund under subsection (a) must be represented by at least one (1) member of the governing board.
(f) The membership of the governing board must be established on a bipartisan basis so that the number of the members of the governing board who are members of one (1) political party may not exceed the number of members of the governing board required to establish a quorum.
(g) A majority of the governing board constitutes a quorum, and the concurrence of a majority of the governing board is necessary to authorize any action.
(h) The terms established under subsection (d) for the administration of the local venture capital fund must be submitted to the Indiana economic development corporation for approval before a unit may contribute to the fund.
(i) A majority of members of a governing board of a local venture capital fund established under this section must have at least five (5) years of experience in business, finance, or venture capital.
(j) 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 unit establishing the local venture capital fund.
(2) To attract a major new business enterprise to the unit.
(3) To develop, retain, or expand a significant business enterprise in the unit.
(k) The expenditures of a borrower or grantee of money from a local 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.
(8) Funding small business development with respect to:
(A) prototype products or processes;
(B) marketing studies to determine the feasibility of new products or processes; or
(C) business plans for the development and production of new products or processes.
(b) This SECTION expires January 1, 2014.
