First Regular Session of the 124th General Assembly (2025)
PRINTING CODE. Amendments: Whenever an existing statute (or a section of the Indiana
Constitution) is being amended, the text of the existing provision will appear in this style type,
additions will appear in this style type, and deletions will appear in this style type.
Additions: Whenever a new statutory provision is being enacted (or a new constitutional
provision adopted), the text of the new provision will appear in this style type. Also, the
word NEW will appear in that style type in the introductory clause of each SECTION that adds
a new provision to the Indiana Code or the Indiana Constitution.
Conflict reconciliation: Text in a statute in this style type or this style type reconciles conflicts
between statutes enacted by the 2024 Regular Session of the General Assembly.
HOUSE ENROLLED ACT No. 1601
AN ACT to amend the Indiana Code concerning economic
development.
Be it enacted by the General Assembly of the State of Indiana:
SECTION 1. IC 6-1.1-10-54 IS ADDED TO THE INDIANA CODE
AS A NEW SECTION TO READ AS FOLLOWS [EFFECTIVE
UPON PASSAGE]: Sec. 54. (a) As used in this section, "designating
body" means the fiscal body of:
(1) a county that does not contain a consolidated city; or
(2) a municipality.
(b) As used in this section, "eligible business" means an entity
that meets the following requirements:
(1) The entity is engaged in a business that:
(A) operates; or
(B) leases qualified property for use in;
one (1) or more facilities.
(2) The entity's qualified property is located at a facility in
Indiana.
(3) The entity, the lessor of qualified property (if the entity is
a lessee), and all lessees of qualified property invest in the
aggregate at least one hundred million dollars ($100,000,000)
in real and personal property at one (1) or more facilities in
Indiana after May 1, 2025.
(4) The average wage of employees who are located in the
county or municipality and engaged in the operation of the
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facility is at least one hundred twenty-five percent (125%) of
the county average wage for the county in which the facility
operates.
(c) As used in this section, "facility" has the meaning set forth
in IC 6-2.5-15-5.
(d) As used in this section, "fiscal body" has the meaning set
forth in IC 36-1-2-6.
(e) As used in this section, "municipality" has the meaning set
forth in IC 36-1-2-11.
(f) As used in this section, "qualified property" means quantum
safe fiber network equipment purchased after May 1, 2025, and
any additions to or replacements to such property.
(g) As used in this section, "quantum safe fiber network
equipment" has the meaning set forth in IC 6-2.5-15-13.3.
(h) A designating body may enter into an agreement with an
eligible business to grant the eligible business a property tax
exemption. In the case of a county, the exemption applies only to
qualified property that is located in unincorporated territory of the
county. In the case of a municipality, the exemption applies only to
qualified property that is located in the municipality. The property
tax exemption applies to the qualified property only if the
designating body and the eligible business enter into an agreement
concerning the property tax exemption. The agreement must
specify the duration of the property tax exemption. The agreement
may specify that if the ownership of qualified property is
transferred by an eligible business, the transferee is entitled to the
property tax exemption on the same terms as the transferor. If a
designating body enters into an agreement with an eligible
business, the qualified property owned by the eligible business is
exempt from property taxation as provided in the resolution and
the agreement.
(i) If a designating body enters into an agreement under
subsection (h) to provide a property tax exemption, the property
tax exemption continues for the period specified in the agreement.
SECTION 2. IC 6-2.5-15-0.5 IS ADDED TO THE INDIANA
CODE AS A NEW SECTION TO READ AS FOLLOWS
[EFFECTIVE UPON PASSAGE]: Sec. 0.5. As used in this chapter,
"advanced computing" means a computational method or
technology, including hardware, software, and quantum safe fiber
network equipment, that is designed, engineered, and installed to
solve large, complex problems or process large data sets, including
quantum computing, artificial intelligence, edge computing, and
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computational sets that use entanglement nodes that are beyond
the capability of classical digital computational computing.
SECTION 3. IC 6-2.5-15-3, AS ADDED BY P.L.256-2019,
SECTION 2, IS AMENDED TO READ AS FOLLOWS [EFFECTIVE
UPON PASSAGE]: Sec. 3. As used in this chapter, "eligible data
center costs" means expenditures made:
(1) after December 31, 2018, for the development, acquisition,
construction, and operation of a facility to be used as a qualified
data center, including costs of land, buildings, site improvements,
modular data centers, computer data center equipment acquisition
and permitting, lease payments, site characterization and
assessment, engineering, and design used directly and exclusively
in a qualified data center; or
(2) after May 1, 2025, for the development, acquisition,
construction, and operation of a facility to be used as part of
a quantum computing research, advanced computing, and
defense infrastructure network that is connected by quantum
safe fiber network equipment and used for quantum research
or advanced computing at, or related to, a qualified military
installation in Indiana or the I-Light network, including costs
of all quantum safe fiber network equipment, rights-of-way,
conduit, other required access, land, buildings, site
improvements, modular data centers, computer data center
equipment acquisition and permitting, lease payments, site
characterization and assessment, engineering, and design used
directly and exclusively as part of a quantum computing
research, advanced computing, and defense infrastructure
network.
SECTION 4. IC 6-2.5-15-5, AS ADDED BY P.L.256-2019,
SECTION 2, IS AMENDED TO READ AS FOLLOWS [EFFECTIVE
UPON PASSAGE]: Sec. 5. As used in this chapter, "facility" means
one (1) or more tracts of land in Indiana and:
(1) a structure or building contained on the land used
specifically for:
(A) quantum research or commercialization;
(B) quantum safe fiber network equipment;
(C) advanced computing;
(D) quantum research or advanced computing for the
defense industry;
(E) the qualified equipment that is placed in the structure
or building; or
(F) one (1) or more quantum safe fiber networks;
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including any structures and personal property contained on
the land that is required to operate a quantum safe fiber
network; and
(2) any structures and personal property contained on the land for
the operation of a data center;
in either a single location or multiple distributed locations.
SECTION 5. IC 6-2.5-15-5.7 IS ADDED TO THE INDIANA
CODE AS A NEW SECTION TO READ AS FOLLOWS
[EFFECTIVE UPON PASSAGE]: Sec. 5.7. As used in this chapter,
"I-Light" has the meaning set forth in IC 8-1-32.7-3.
SECTION 6. IC 6-2.5-15-6.5 IS ADDED TO THE INDIANA
CODE AS A NEW SECTION TO READ AS FOLLOWS
[EFFECTIVE UPON PASSAGE]: Sec. 6.5. As used in this chapter,
"interest in a quantum computing research, advanced computing,
and defense infrastructure network" means an entity that is the
owner of, the operator of, or a qualified colocation tenant in, any
element of a quantum safe fiber network or a quantum computing,
advanced computing, and defense infrastructure network.
(b) The term includes an interest in a portion of a quantum
computing research, advanced computing, and defense
infrastructure network.
SECTION 7. IC 6-2.5-15-7, AS ADDED BY P.L.256-2019,
SECTION 2, IS AMENDED TO READ AS FOLLOWS [EFFECTIVE
UPON PASSAGE]: Sec. 7. As used in this chapter, "operator" means
an entity, other than an owner or a qualified colocation tenant,
operating a data center or a quantum computing research, advanced
computing, and defense infrastructure network pursuant to a lease
or other contract with the owner or a lessor. The term includes a
licensed property management company, a property lessor, or any other
individual or entity responsible for the control, oversight, or
maintenance of a facility. The term also includes an affiliate of an
operator.
SECTION 8. IC 6-2.5-15-9, AS ADDED BY P.L.256-2019,
SECTION 2, IS AMENDED TO READ AS FOLLOWS [EFFECTIVE
UPON PASSAGE]: Sec. 9. As used in this chapter, "qualified
colocation tenant" means an entity that contracts with the owner or
operator of a:
(1) qualified data center; or
(2) quantum computing, advanced computing, and defense
infrastructure network;
that is certified under this chapter to use or occupy all or part of the
data center or quantum computing, advanced computing, and
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defense infrastructure network for a period of two (2) or more years.
SECTION 9. IC 6-2.5-15-11, AS ADDED BY P.L.256-2019,
SECTION 2, IS AMENDED TO READ AS FOLLOWS [EFFECTIVE
UPON PASSAGE]: Sec. 11. As used in this chapter, "qualified data
center equipment" means data center equipment or quantum
computing research, advanced computing, and defense
infrastructure network equipment located at in a qualified data center
or a quantum computing research, advanced computing, and
defense infrastructure network.
SECTION 10. IC 6-2.5-15-13, AS ADDED BY P.L.256-2019,
SECTION 2, IS AMENDED TO READ AS FOLLOWS [EFFECTIVE
UPON PASSAGE]: Sec. 13. As used in this chapter, "qualified
investment" means, with respect to a:
(1) qualified data center, the aggregate nonduplicative eligible
data center costs expended by any entity with an interest in the
qualified data center; or
(2) quantum computing research, advanced computing, and
defense infrastructure network, the aggregate nonduplicative
eligible costs expended by any entity with an interest in the
quantum computing research, advanced computing, and
defense infrastructure network.
SECTION 11. IC 6-2.5-15-13.2 IS ADDED TO THE INDIANA
CODE AS A NEW SECTION TO READ AS FOLLOWS
[EFFECTIVE UPON PASSAGE]: Sec. 13.2. As used in this chapter,
"quantum safe fiber network" means a fiber network that includes
each of the following attributes:
(1) A deployed fiber infrastructure comprised of:
(A) standard single mode optical fibers (G.652.D) that are
compliant with the federal Trade Agreements Act of 1979
(Public Law 96-39, 93 Stat. 144, as amended);
(B) flexgrid reconfigurable photonic layer; and
(C) only coherent optical transponders with FIPS 140-3
certified L1 encryption (OTNsec) with support for external
key from quantum key distribution servers that are
compliant with the federal Trade Agreements Act of 1979
(Public Law 96-39, 93 Stat. 144, as amended);
on electronics and glass.
(2) A fiber infrastructure that is connected to:
(A) a military installation of the United States of America;
(B) the Indiana National Guard;
(C) another military outlet or I-Light; or
(D) an institution of higher learning conducting quantum
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computing research or advanced computing research.
(3) A network engineered with physical intermediate access
points (nodes) not more than sixty (60) miles apart.
(4) A network with physical intermediate access points
(nodes) equipped with physical access control and remote
monitoring.
(5) A network with quantum key distribution (QKD) servers
deployed on every fiber span.
(6) A network that is not used for residential broadband and
limited in use to less fifteen percent (15%) for commercial
broadband (ISP) applications.
(7) A network that complies with the federal Trade
Agreements Act of 1979 (Public Law 96-39, 93 Stat. 144) as
amended.
SECTION 12. IC 6-2.5-15-13.3 IS ADDED TO THE INDIANA
CODE AS A NEW SECTION TO READ AS FOLLOWS
[EFFECTIVE UPON PASSAGE]: Sec. 13.3. (a) As used in this
chapter, "quantum safe fiber network equipment" means optical
gear, transmission equipment, fiber, computer equipment,
software, or any other equipment or software of any type
purchased or leased for the processing, storage, retrieval,
communication, or transmission of data over a quantum safe fiber
network that:
(1) is preapproved by the corporation;
(2) adheres to all compliance standards of the federal Trade
Agreements Act of 1979 (Public Law 96-39, 93 Stat. 144, as
amended) throughout the entire network, including all access
physical intermediate access points (nodes);
(3) has a manufacturing origin point in North America;
(4) uses only coherent optics with FIPS 140-3 certified
encryption technology; and
(5) supports quantum safe algorithms that are compliant with
National Institute of Standards and Technology of the United
States Department of Commerce requirements, including
post-quantum cryptography and other post quantum resistant
cryptography implementations.
(b) The term includes the following:
(1) Installed quantum-safe optical gear and federal Trade
Agreements Act of 1979 (Public Law 96-39, 93 Stat. 144, as
amended) compliant American-made fiber optic cable.
(2) Servers, routers, connections, monitoring and security
systems, and other enabling machinery, equipment, and
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hardware, regardless of whether the property is affixed to or
incorporated into real property.
(3) Equipment used in the operation of computer equipment
or software or for the benefit of a quantum computing
research, advanced computing, and defense infrastructure
network, including component parts, installations,
refreshments, replacements, and upgrades, regardless of
whether the property is affixed to or incorporated into real
property.
(4) All equipment necessary for the transformation,
generation, distribution, or management of electricity that is
required to operate advanced computer or quantum
computer server equipment, including substations,
generators, uninterruptible energy equipment, supplies,
conduit, fuel piping and storage, cabling, duct banks, switches,
switchboards, batteries, testing equipment, and backup
generators.
(5) All equipment necessary to cool and maintain a controlled
environment for the operation of the computer servers and
other components of a quantum fiber network, including
chillers, mechanical equipment, refrigerant piping, fuel piping
and storage, adiabatic and free cooling systems, cooling
towers, water softeners, air handling units, indoor direct
exchange units, fans, ducting, and filters.
(6) All water conservation systems, including facilities or
mechanisms that are designed to collect, conserve, and reuse
water required for the infrastructure of a quantum fiber
network.
(7) All computer server equipment, chassis, networking
equipment, switches, racks, fiber optic and copper cabling,
trays, and conduit required for a quantum fiber network.
(8) All conduit, ducting, and fiber optic and copper cabling
required for a quantum fiber network.
(9) All monitoring equipment and security systems.
(10) All software required for the operation, development,
and maintenance of a quantum fiber network.
(11) All intangible rights to use conduit or existing fibers
directly related to a quantum fiber network.
(12) All tangible and intangible personal property that is
required for operation of each intermediate access point
(node) connected to a quantum fiber network, excluding
property used in the administration of the facility.
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(13) Other tangible and intangible personal property that is
essential to the operations of a quantum fiber network,
excluding property used in the administration of the facility.
(14) All electricity used by qualified quantum fiber network
equipment, excluding electricity used in the administration of
the facility.
SECTION 13. IC 6-2.5-15-13.4 IS ADDED TO THE INDIANA
CODE AS A NEW SECTION TO READ AS FOLLOWS
[EFFECTIVE UPON PASSAGE]: Sec. 13.4. As used in this chapter,
"quantum computing research, advanced computing, and defense
infrastructure network" means the quantum safe fiber network
between two (2) or more facilities using qualified equipment to
create and connect qualified facilities to a quantum safe fiber
network that create a minimum qualified investment of at least
fifty million dollars ($50,000,000) on or before the fifth anniversary
of the issuance of the specific transaction award certificate by the
corporation. The term includes the land, buildings, site
improvements, permitting, lease payments, site characterization
and assessment, engineering and design, quantum safe fiber
network equipment, rights-of-way, and any other required access,
used directly to be a part of:
(1) a qualified advanced computing or a qualified quantum
computing research initiative within Indiana;
(2) the deployment or expansion of advanced computing,
within Indiana;
(3) the expansion of the defense industry within Indiana; or
(4) the quantum computing research, advanced computing
and defense infrastructure network connected to and used
for:
(A) quantum research (including computing,
communication, and networking);
(B) advanced computing; or
(C) defense infrastructure network;
at or related to the federal or state of Indiana military
installations, research universities, I-Light, or any other
Department of Defense or Indiana National Guard
installation within Indiana.
SECTION 14. IC 6-2.5-15-14, AS ADDED BY P.L.256-2019,
SECTION 2, IS AMENDED TO READ AS FOLLOWS [EFFECTIVE
UPON PASSAGE]: Sec. 14. (a) A qualified data center user or a
quantum computing research, advanced computing, and defense
infrastructure network operator that holds an interest in a qualified
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data center or an interest in a quantum computing research,
advanced computing, and defense infrastructure network may
apply to the corporation for a specific transaction award certificate to
make purchases, other than the purchase of utilities described in
IC 6-2.5-4-5, that are exempt under this chapter. The request must be
on a form prescribed by the corporation.
(b) The corporation has exclusive authority over issues related to
issuing a specific transaction award certificate.
(c) If the corporation issues a specific transaction award certificate
under this chapter, the certificate must state that the facility is a
qualified data center or a quantum computing research, advanced
computing, and defense infrastructure network, as applicable.
(d) A specific transaction award certificate issued by the corporation
shall expire not later than:
(A) (1) twenty-five (25) years after the date of issuance; or
(B) (2) in the case of a qualified data center user, fifty (50)
years after the date of issuance if the qualified investment is seven
hundred fifty million dollars ($750,000,000) or greater; or
(3) in the case of a quantum computing research, advanced
computing, and defense infrastructure network operator, fifty
(50) years after the date of issuance if the qualified investment
is fifty million dollars ($50,000,000) or greater within three (3)
years of the issuance of the transaction award certificate.
SECTION 15. IC 6-2.5-15-15, AS ADDED BY P.L.256-2019,
SECTION 2, IS AMENDED TO READ AS FOLLOWS [EFFECTIVE
UPON PASSAGE]: Sec. 15. The following apply if the corporation
approves an application for a specific transaction award certificate:
(1) The corporation shall require the qualified data center user or
quantum computing research, advanced computing, and
defense infrastructure network operator, as applicable, to
enter into an agreement with the corporation as a condition of
receiving a specific transaction award certificate under this
chapter.
(2) The agreement with the corporation must include:
(A) a detailed description of the project that is the subject of
the agreement that includes documentation of compliance
with the requirement that the investment be specific to
infrastructure for the Indiana defense industry or
quantum computing research or advanced computing;
(B) the duration of the specific transaction award certificate
and the first taxable year for which the award provided by this
chapter may be used; and
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(C) a requirement that the qualified data center user or
quantum computing research, advanced computing, and
defense infrastructure network operator, as applicable,
annually report to the corporation on the amount of taxes that
were not paid by the qualified data center user or quantum
computing research, advanced computing, and defense
infrastructure network operator in connection with the
purchase of data center equipment or quantum computing
research, advanced computing, and defense infrastructure
network equipment, as applicable.
SECTION 16. IC 6-2.5-15-16, AS ADDED BY P.L.256-2019,
SECTION 2, IS AMENDED TO READ AS FOLLOWS [EFFECTIVE
UPON PASSAGE]: Sec. 16. The sale of qualified data center or
quantum computing research, advanced computing, and defense
infrastructure network equipment is exempt from the state gross
retail tax if the qualified data center equipment or quantum
computing research, advanced computing, and defense
infrastructure network equipment, as applicable:
(1) is sold to a qualified data center user or a quantum
computing research, advanced computing, and defense
infrastructure network approved by the corporation under this
chapter; and
(2) will be located in a qualified data center, or is a part of a
quantum safe fiber network or is a part of a quantum
computing research, advanced computing, and defense
infrastructure network.
SECTION 17. IC 6-2.5-15-17, AS ADDED BY P.L.256-2019,
SECTION 2, IS AMENDED TO READ AS FOLLOWS [EFFECTIVE
UPON PASSAGE]: Sec. 17. A qualified data center user or a
quantum computing research, advanced computing, and defense
infrastructure network operator is not entitled to the exemption
provided by section 16 of this chapter unless the qualified data center
user or the quantum computing research, advanced computing, and
defense infrastructure network operator provides the seller with an
exemption certificate on a form prescribed by the department and a
copy of the specific transaction award certificate issued by the
corporation. In the case of utilities described in IC 6-2.5-4-5, the
qualified data center user may issue an exemption certificate on a form
prescribed by the department and a copy of the specific transaction
award certificate issued by the corporation to cover all utility purchases
from that seller. However, for the corporation to issue a specific
transaction award certificate for utilities described in IC 6-2.5-4-5, the
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qualified data center user must agree to report and remit use tax under
this article to the department on the part of the utility purchases used
for administration of the facility.
SECTION 18. IC 6-2.5-15-18, AS ADDED BY P.L.256-2019,
SECTION 2, IS AMENDED TO READ AS FOLLOWS [EFFECTIVE
UPON PASSAGE]: Sec. 18. (a) This section does not apply to a
qualified data center user that is a qualified colocation tenant.
(b) (a) If the corporation determines that a qualified data center user
or a quantum computing research, advanced computing, and
defense infrastructure network operator that did not pay taxes as a
result of the award provided under this chapter, and is not entitled to
the award because of the qualified data center user's noncompliance
with the requirements of the sales tax award certificate agreement or
this chapter, the corporation shall, after giving the qualified data center
user or the operator an opportunity to explain the noncompliance:
(1) notify the department of the noncompliance; and
(2) request the department to impose an assessment on the
qualified data center user or the quantum computing research,
advanced computing, and defense infrastructure network
operator in an amount that may not exceed the sum of the taxes
not paid as a result of the exemption provided under this chapter
together with interest and penalties required or permitted by law.
(c) (b) Notwithstanding the provisions of IC 6-8.1-5-2, an
assessment under subsection (b) (a) is considered timely if the
department issues a proposed assessment:
(1) not later than one hundred eighty (180) days from the date the
department is notified of the noncompliance; or
(2) the date on which a proposed assessment could otherwise be
issued in a timely manner under IC 6-8.1-5-2;
whichever is later.
SECTION 19. IC 6-2.5-15-19, AS ADDED BY P.L.256-2019,
SECTION 2, IS AMENDED TO READ AS FOLLOWS [EFFECTIVE
UPON PASSAGE]: Sec. 19. Except as provided in section 18 of this
chapter, if the corporation approves a qualified data center user's or a
quantum computing research, advanced computing, and defense
infrastructure network operator's application to receive a specific
transaction award certificate and enters into an agreement with the
qualified data center user or the quantum computing research,
advanced computing, and defense infrastructure network operator
for a specific transaction award certificate, the corporation's
certification of the qualified data center or the quantum computing
research, advanced computing, and defense infrastructure network
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remains in effect, even if there is a future transfer, sale, or disposition,
directly or indirectly, of the qualified data center or the quantum
computing research, advanced computing, and defense
infrastructure network. A subsequent owner shall enter into an
agreement with the corporation before the subsequent owner is entitled
to receive a specific transaction award certificate for the remainder of
the eligibility period.
SECTION 20. IC 6-2.5-15-20, AS ADDED BY P.L.256-2019,
SECTION 2, IS AMENDED TO READ AS FOLLOWS [EFFECTIVE
UPON PASSAGE]: Sec. 20. Beginning in 2030, and every ten (10)
years thereafter, the corporation shall submit to the legislative council
in an electronic format under IC 5-14-6 an economic and fiscal impact
study evaluating the statewide impact of data center investments and
quantum computing research, advanced computing, and defense
infrastructure network investments in Indiana.
SECTION 21. An emergency is declared for this act.
HEA 1601 — Concur Speaker of the House of Representatives
President of the Senate
President Pro Tempore
Governor of the State of Indiana
Date: Time:
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