2017 Mid-Session Legislative Update

bill status as of 1/27/2017

AIC tracking 400+ total bills out of over 1200 bills filed in the

Indiana General Assembly

Road Funding

• Last year, based on 2009 data, AIC identified the need for local roads to be $500M in new funding annually and ongoing

• Last year’s HB 1001 included increased funding from the state that averages around $100M per year from sales tax on gasoline.

• That funding came in the form of the Community Crossings grant program, which provided up to $1M to 81 counties.

• FIRSST Task Force met over the summer to examine the long term need and revenue options for both state and local road networks

LTAP Report on Local Roads and Bridges

• To apply for the Community Crossings grants, units had to provide a asset management plan to assess the status of their infrastructure

• Purdue’s Local Technical Assistance Program coordinated this data and published a report on the status of local infrastructure statewide

• County pavement averaged a 4.5/10, with 40% poor

• Nearly half of local bridges are either structurally deficient, functionally obsolete, or both

• Report updates estimated annual, increased need for local units at $530M just to maintain the poor status of local infrastructure

• To bring local roads to average of even 20% poor, and eliminate deficient and obsolete bridges over 10 years, $1B extra is needed yearly

HB 1002 in Dollars and Cents

• HB 1002 includes the House Republican road funding plan

• Would increase local road funding by over $340M annually by FY 17

• Would increase INDOT funding by $835M by FY 17

• Increases gasoline, diesel, and special fuel taxes by 10 cents/gal and indexes for future growth • (last per gallon gas tax increase was 2003, Diesel last increase 1988)

• Increases registration fee by $15; to increase Community Crossings

• Shifts all taxes paid at pump to transportation system uses by FY 21

• $150 fee on electric vehicles

House Bill 1002 cont’d

• Extends period to adopt wheel tax to November 1, from July 1

• Expands Community Crossings local match source to any fund authorized to be expended for road and bridge purposes

• Changes Community Crossings match to 80/20 from 50/50

• Lowers municipal wheel tax population req’mt from 10k to 5k

• Authorizes Weigh-in-Motion program for State Police

• Funds continued LTAP research on local roads thru asset mgmt plans

• Requires INDOT to conduct a feasibility study of existing interstates

• Removes prohibition of tolling without future legislative authority

• Requires INDOT to research Vehicle Miles Travelled (VMT) taxation

House Bill 1002 cont’d

• Establishes a 100% federal fund swap program to provide state dollars to local units instead of federal dollars • Frees local units from many expensive and burdensome federal regulations

• Will provide 20% or more project savings on road and bridge projects

• Intent to fund same purposes that federal $ provides for, but with greater efficiency in both spending and project time lines

• Requires INDOT to establish metrics for local roads and bridges • Compare Indiana conditions to those in other similar states

• Develop goals to ensure local asset conditions are in top 25% of similar states

• Develop a state and local asset prioritization system and project priority list

• Safety, Congestion, Environment, Economics, Cost, etc.

• General Assembly may not approve or disapprove projects on priority list

Market Segmentation

• Last year, SEA 308 passed to allow Assessors the ability to narrow the universe of comparable properties for tax valuation purposes by use of Market Segmentation

• DLGF has been in the process of drafting a new rule which defines Market Segmentation and describes its use • AIC and Assessors’ Assn are providing written feedback

• Howard County has appealed the decision of Indiana Tax Court about assessment of a Kohl’s store; AIC has submitted amicus brief

• Combination of Supreme Court decisions and DLGF rule will take time to sort out, but will determine future of assessment practices

Assessment Issues

• HB 1198 clarifies that $50 penalty for failure to appear at PTBOA is at Assessors’ option, not required

• HB 1299 allows county to be reimbursed by other units for legal costs associated with defending assessment appeals

• HB 1371 returns to cost approach to determine tax value, less depreciation; requires land value to be same as vacant land; + more

• HB 1402 requires that certain outdoor signs be excluded from tax assessment of land upon which the signs stand

• SB 164 eliminates trending, but retains reassessment

Assessment Issues

• SB 350 parcel characteristics may only be changed at reassessment; splits cost of appraisal b/w county and taxpayer, + other changes

• SB 386 requires exchange of evidence prior to PTBOA hearing

• SB 449 limits compensation options for personal prop tax audits

• SB 501 is extensive re-write of property tax appeals process

• SB 512 allows taxing units to opt out of any new TIF zones

• SB 559 provides property tax exemption for non-profit landlords who rent to low income tenants

State and Local Finance

• HB 1017 Doubles state salary stipend for County Highway Engineers

• HB 1120 Requires that LOIT trust fund recipients who had a special LOIT rate in place would receive extra $ to make special rate whole

• HB 1141/SB 128 allows local options for funding state road projects; incl. voluntary property tax payments and property tax referenda

• HB 1156 requires a county with two PSAPs to split county payment between the two based on call volume

• HB 1381 allows local units to intercept state income tax returns

• HB 1512 increases Engineer stipend and sets Supervisor stipend for those that complete LTAP road scholar program

Taxation and Fees

• HB 1201/SB 155 would require a state PILOT for state owned lands

• HB 1279/HB1350 alters admissions tax status quo for riverboats

• HB 1311 lowers “floor” on business personal property depreciation from 30% to 20% over 10 years; ~$130M impact by 2027

• HB 1348 allows local service fees on tax exempt property

• HB 1410/SB 415 eliminates mortgage deduction in favor of increased homestead deduction

• HB 1414 sunsets current LIT law and re-establishes in 2021 with new format and caps for expenditure rates and property tax relief

Taxation and Fees

• HB 1450 is DLGF agency bill with long list of changes to local government taxation and functionality

• HB 1501 allows rural entrepreneurship development incentives (READI) funded by local income tax increment increases

• SB 158 eliminates collection of county wheel tax in a municipality if that muni has own wheel tax; but no longer gets share of county tax

• SB 163 requires mandatory sharing of public safety LIT w/ townships who provide public safety services

Taxation and Fees

• HB 1351/SB 308 changes tax location of rental equipment to home office instead of location of use

• SB 455 updates tax administration of mobile homes

• SB 465 shifts SWMD funding from property tax to flat or user fee

• SB 505 sets predictable fees for recorded documents, + other

• SB 512 reduces sheriff’s service of process fee from $25 to $13, but allows for collection more than once per case

Property Tax Issues

• HB 1046 requires that AV cannot increase more than 3% annually following a successful tax appeal

• HB 1056 allows a unit to adopt AV increase limits on homesteads owned by low-income owners in Neighborhood Enhancement Zones

• HB 1247 allows county or LIT council to adopt a minimum property tax replacement fee of between $100 and $400

• HB 1257 eliminates AV cap on disabled veteran property tax deduction

• HB 1506 limits homestead deductions to no more than 75% of AV

• SB 331 req’s double check of homestead AV by DLGF if >10% increase

State Government Oversight

• HB 1031/SB 159 allows State Examiner to call a local official to State Audit Committee if an audit finding is not corrected in timely manner

• HB 1133 limits local unit authority to ban short term rentals (AirBNB)

• HB 1160 requires a study on effectiveness of Indiana Tax Court

• HB 1182 allows State Examiner to hire Dir of Special Investigations who would have police powers

• HB 1226 requires construction projects to use PVC piping

• HB 1275 allows social events to be held in heritage barns without regard to fire, building, or safety codes

State Government Oversight

• HB 1452 eliminates authority to establish a separate schedule of document fees and amends sheriff’s service of process fees; raises to $5 (from $1) fee for authentication of copy in record

• HB 1508/HB 1594 deducts part of LIT from county that fails to follow req’mts of accreditation for Veteran Service Officers and sets minimum office hours for VSOs

• HB 1555 requires workers comp insurance for reserve officers

• HB 1597 requires referenda on wind turbine zoning, minimum setbacks, and conflict of interest disclosures

State Government Oversight

• SB 126 would outlaw campaign donations from contractors, etc. during pending solicitation or after contract award

• SB 348 preempts local ordinances governing size of political signage

• SB 502 eliminates local storm water fees for agricultural, religious, or school property

• SB 558 outlaws local zoning ordinances that establish rental rates for private real estate, + other local preemption

Criminal Justice • HB 1006 extends Justice Reinvestment Act grants to mental health and

addiction services for misdemeanors

• HB 1261 allows optional video enforcement of speed violations in construction work zones

• HB 1405 allows county to request 50% reimbursement for indigent defense (increase from current 40%)

• HB 1420 transfers DOC oversight of jails to new jail standards committee and allows them to provide inspections etc. which would be paid for by new $15 jail booking fee

• HB 1438 allows counties and cities to approve syringe exchange programs for not longer than two years

Criminal Justice

• HB 1444 increases criminal and civil penalty for ransomware attacks

• HB 1514 creates law enforcement body camera fund; sets $5 fee on all violations of ordinances or infractions

• SB 140 creates law enforcement equipment matching grant fund (no$)

• SB 228 establishes presumption that suspect should be released without bail unless pose risk of flight or danger

• SB 419 allows county to select CMHC recipient of mandatory tax levy

Annexation and Gov’t Reduction

• HB 1232 would eliminate township boards and transfer fiscal oversight of townships to county fiscal body

• HB 1404 allows expanded merger of municipality and township for voting purposes but would still receive county services

• SB 381 would grant county commissioners approval authority over annexations within their county

Elections and Clerk Fees • HB 1093 negates “scratch” votes when straight ticket is selected

• HB 1329 requires mail-in absentee voters to include a copy of ID

• HB 1472 eliminates straight ticket voting and provides for special election in vacant legislative seats, unless in last year of term

• HB 1522 removes deduction of document storage fee; fee to certify records increases from $1 to $5, + keep 3% probation user fees

• SB 107 returns straight ticket voter intent law to pre-2016 change

• SB 417 changes in-person absentee process for E poll book counties

• SB 442 Sec of State bill with numerous changes to election laws, incl. voter list maintenance, use of voting system purchase fund, recounts, declaration of candidacy rules, in-person absentee voting, etc.

Tax Sales and Land Issues • HB 1295 allows option to increase minimum land value at which fiscal

body must approve sale, and decrease value at which may be offered to adjacent land owner

• HB 1296 gives a lien to tax certificate holder who improves property

• HB 1505 clarifies that interest on drain construction loans should not include penalties for late payment

• HB 1536 increases burden of proof on a person wishing to challenge validity of tax sale and eliminates conflicts re: cause numbers

• SB 152 eliminates blight registry

• SB 297 reduces redemption period from 1 year to 6 months

Other Issues

• HB 1116 allows a local official to voluntarily waive their salary

• HB 1121 provides land owners w/ vested right to use of property; would allow lawsuits against gov’t if land use rights were violated and property value decreased (+ punitive damages allowed)

• HB 1272 allows that public notice considered valid if unit takes all necessary steps to post, yet newspaper fails to actually publish

• HB 1341 allows local gov’t to adopt regional rural strategic development plan + allows rural broadband lease and operation

• At least 10 different bills changing civil forfeiture laws

Contact Information

David Bottorff dbottorff@indianacounties.org

Ryan Hoff rhoff@indianacounties.org

Christine Traina

ctraina@indianacounties.org

www.indianacounties.org

mailto:dbottorff@indianacounties.orgmailto:rhoff@indianacounties.orgmailto:ctraina@indianacounties.orghttp://www.indianacounties.org/