LEGISLATIVE SERVICES AGENCY
OFFICE OF FISCAL AND MANAGEMENT ANALYSIS
FISCAL IMPACT STATEMENT
LS 6634 NOTE PREPARED: Dec 26, 2024
BILL NUMBER: HB 1322 BILL AMENDED:
SUBJECT: Blockchain Technology; State Investment in Bitcoin.
FIRST AUTHOR: Rep. Criswell BILL STATUS: As Introduced
FIRST SPONSOR:
FUNDS AFFECTED:XGENERAL IMPACT: State
XDEDICATED
FEDERAL
Summary of Legislation: The bill provides that not later than March 1, 2026, the Department of
Administration (IDOA) shall issue a request for information for purposes of exploring how the use of
blockchain technology could be used by a state agency to: (1) achieve greater cost efficiency and cost
effectiveness; and (2) improve consumer convenience, experience, data security, and data privacy. The bill
requires the IDOA to compile a report concerning the request for information and submit the report to the
Legislative Council not later than October 1, 2026.
It allows funds held by the Public Employees' Retirement Fund, the State Teachers' Retirement Fund, or
public officers of the state to be invested in certain bitcoin exchange traded funds (ETFs).
Effective Date: July 1, 2025.
Explanation of State Expenditures: Department of Administration: There would be an increase in IDOA
workload, and potentially expenditures, to issue a RFI concerning blockchain technology and to produce and
deliver the required report. A position could be filled temporarily by a consultant, or a FTE could be hired.
Expenditures could be $117,300 in FY 2026 and $118,400 in FY 2027 for an additional FTE. The estimate
includes base salary and fringe benefits. The base salary of the position is based on existing IDOA
procurement consultant salaries as of August 2024.
Other State Agencies: The bill allows the Indiana Public Retirement System (INPRS) and Treasurer of State
(TOS) to invest in bitcoin ETFs. This could require additional expenditure in updating software and
generating expertise in digital currency trading. These responsibilities fall within the routine functions of
these agencies. The administrative costs of managing investments under INPRS are paid from the respective
pension funds.
Additional Information - Typically, expertise for an RFI process comes from the state agency requesting the
RFI and not the IDOA. The bill provides a list of agencies that would participate in the RFI. If the Secretary
of State (SOS), Family and Social Services Administration (FSSA), Department of Workforce Development
(DWD), or Department of Child Services (DCS) does not have the expertise to assist in the RFI process, the
HB 1322 1 IDOA would likely need an additional procurement position with blockchain technology expertise to
complete the bill's requirements. The additional funds and resources required to accomplish the bill's
requirements could be supplied through existing staff and resources currently being used in another program
or with new appropriations. Ultimately, the source of funds and resources required to satisfy the requirements
of this bill may depend on further legislative and/or administrative actions.
Explanation of State Revenues: The bill defines “bitcoin” and states that an "approved bitcoin exchange
traded fund" means a spot bitcoin exchange traded fund that has been approved for listing on national
securities exchanges by the United States Securities and Exchange Commission under 15 U.S.C. 78f(b)(2).
In January 2024, the U.S. Securities and Exchange Commission approved the first bitcoin spot ETFs. These
ETFs provide investors with direct exposure to bitcoin without the complexities of owning the digital
currency directly or managing a wallet. The bill provides that the board of trustees of the INPRS and
Treasurer of State may invest or reinvest funds that are available for investment in approved bitcoin spot
ETFs. Allowing state fiscal officers to invest in the bitcoin spot ETFs will change the risk and return profile
of the underlying investments. The bill would have an indeterminable impact on investment returns for the
funds managed by these state agencies. The fiscal impact will depend on whether the investment managers
choose to invest in bitcoin spot ETFs and the future return on those investment.
Explanation of Local Expenditures: The bill allows a county treasurer or a fiscal officer of any political
subdivision other than a county to invest or reinvest in a bitcoin spot ETF. These investments may require
updating software and developing expertise related to investment in digital currencies. These responsibilities
fall within the routine functions of these local officers.
Explanation of Local Revenues: This bill would have an indeterminable impact on investment returns for
the funds managed by the local officers who invest or reinvest in bitcoin spot ETFs. (See Explanation of State
Revenues.)
State Agencies Affected: IDOA, FSSA, SOS, DWD, DCS, TOS, INPRS.
Local Agencies Affected: All local units.
Information Sources: Molly Timperman, Communications/Legislative Director, Indiana Department of
Administration; State Staffing Table August 2024 (for salary estimate); INPRS. Investment Policy
Statement. https://www.in.gov/inprs/files/INPRS_IPS.pdf ; U.S. Security and Exchange Commission,
Statement on the Approval of Spot Bitcoin Exchange-Traded Products
https://www.sec.gov/newsroom/speeches-statements/gensler-statement-spot-bitcoin-011023
Fiscal Analyst: Randhir Jha, 317-232-9556.
HB 1322 2