Introduced Version
SENATE BILL No. 253
_____
DIGEST OF INTRODUCED BILL
Citations Affected: IC 6-1.1-12.1.
Synopsis: Economic revitalization area designations. Adds conditions
related to soil productivity and use of land for an agricultural purpose
that must be found by a designating body before land classified as
agricultural land for property tax purposes may be included within an
area sought to be designated as an economic revitalization area.
Effective: July 1, 2025.
Deery
January 13, 2025, read first time and referred to Committee on Tax and Fiscal Policy.
2025 IN 253—LS 6648/DI 129 Introduced
First Regular Session of the 124th General Assembly (2025)
PRINTING CODE. Amendments: Whenever an existing statute (or a section of the Indiana
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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.
SENATE BILL No. 253
A BILL FOR AN ACT to amend the Indiana Code concerning
taxation.
Be it enacted by the General Assembly of the State of Indiana:
1 SECTION 1. IC 6-1.1-12.1-1, AS AMENDED BY
2 P.L.178-2022(ts), SECTION 5, IS AMENDED TO READ AS
3 FOLLOWS [EFFECTIVE JULY 1, 2025]: Sec. 1. For purposes of this
4 chapter:
5 (1) "Economic revitalization area" means an area which is within
6 the corporate limits of a city, town, or county which has become
7 undesirable for, or impossible of, normal development and
8 occupancy because of a lack of development, cessation of growth,
9 deterioration of improvements or character of occupancy, age,
10 obsolescence, substandard buildings, or other factors which have
11 impaired values or prevent a normal development of property or
12 use of property. The term "economic revitalization area" also
13 includes:
14 (A) any area where a facility or a group of facilities that are
15 technologically, economically, or energy obsolete are located
16 and where the obsolescence may lead to a decline in
17 employment and tax revenues;
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1 (B) a residentially distressed area, except as otherwise
2 provided in this chapter; and
3 (C) an area of land classified as agricultural land for property
4 tax purposes that, as a condition of being designated an
5 economic revitalization area, will be predominately used for
6 agricultural purposes for a period specified by the designating
7 body.
8 (2) "City" means any city in this state, and "town" means any town
9 incorporated under IC 36-5-1.
10 (3) "New manufacturing equipment" means tangible personal
11 property that a deduction applicant:
12 (A) installs on or before the approval deadline determined
13 under section 9 of this chapter, in an area that is declared an
14 economic revitalization area in which a deduction for tangible
15 personal property is allowed;
16 (B) uses in the direct production, manufacture, fabrication,
17 assembly, extraction, mining, processing, refining, or finishing
18 of other tangible personal property, including but not limited
19 to use to dispose of solid waste or hazardous waste by
20 converting the solid waste or hazardous waste into energy or
21 other useful products;
22 (C) acquires for use as described in clause (B):
23 (i) in an arms length transaction from an entity that is not an
24 affiliate of the deduction applicant, if the tangible personal
25 property has been previously used in Indiana before the
26 installation described in clause (A); or
27 (ii) in any manner, if the tangible personal property has
28 never been previously used in Indiana before the installation
29 described in clause (A); and
30 (D) has never used for any purpose in Indiana before the
31 installation described in clause (A).
32 (4) "Property" means a building or structure, but does not include
33 land.
34 (5) "Redevelopment" means the construction of new structures,
35 in economic revitalization areas, either:
36 (A) on unimproved real estate; or
37 (B) on real estate upon which a prior existing structure is
38 demolished to allow for a new construction.
39 (6) "Rehabilitation" means the remodeling, repair, or betterment
40 of property in any manner or any enlargement or extension of
41 property.
42 (7) "Designating body" means the following:
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1 (A) For a county that does not contain a consolidated city, the
2 fiscal body of the county, city, or town.
3 (B) For a county containing a consolidated city, the
4 metropolitan development commission. The jurisdiction of the
5 designating body includes a rehabilitation or redevelopment
6 project under this chapter that falls within the boundaries of an
7 excluded city, as defined in IC 36-3-1-7.
8 (8) "Deduction application" means:
9 (A) the application filed in accordance with section 5 of this
10 chapter by a property owner who desires to obtain the
11 deduction provided by section 3 of this chapter;
12 (B) the application filed in accordance with section 5.4 of this
13 chapter by a person who desires to obtain the deduction
14 provided by section 4.5 of this chapter; or
15 (C) the application filed in accordance with section 5.3 of this
16 chapter by a property owner that desires to obtain the
17 deduction provided by section 4.8 of this chapter.
18 (9) "Designation application" means an application that is filed
19 with a designating body to assist that body in making a
20 determination about whether a particular area should be
21 designated as an economic revitalization area.
22 (10) "Hazardous waste" has the meaning set forth in
23 IC 13-11-2-99(a). The term includes waste determined to be a
24 hazardous waste under IC 13-22-2-3(b).
25 (11) "Solid waste" has the meaning set forth in IC 13-11-2-205(a).
26 However, the term does not include dead animals or any animal
27 solid or semisolid wastes.
28 (12) "New research and development equipment" means tangible
29 personal property that:
30 (A) a deduction applicant installs on or before the approval
31 deadline determined under section 9 of this chapter, in an
32 economic revitalization area in which a deduction for tangible
33 personal property is allowed;
34 (B) consists of:
35 (i) laboratory equipment;
36 (ii) research and development equipment;
37 (iii) computers and computer software;
38 (iv) telecommunications equipment; or
39 (v) testing equipment;
40 (C) the deduction applicant uses in research and development
41 activities devoted directly and exclusively to experimental or
42 laboratory research and development for new products, new
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1 uses of existing products, or improving or testing existing
2 products;
3 (D) the deduction applicant acquires for purposes described in
4 this subdivision:
5 (i) in an arms length transaction from an entity that is not an
6 affiliate of the deduction applicant, if the tangible personal
7 property has been previously used in Indiana before the
8 installation described in clause (A); or
9 (ii) in any manner, if the tangible personal property has
10 never been previously used in Indiana before the installation
11 described in clause (A); and
12 (E) the deduction applicant has never used for any purpose in
13 Indiana before the installation described in clause (A).
14 The term does not include equipment installed in facilities used
15 for or in connection with efficiency surveys, management studies,
16 consumer surveys, economic surveys, advertising or promotion,
17 or research in connection with literacy, history, or similar
18 projects.
19 (13) "New logistical distribution equipment" means tangible
20 personal property that:
21 (A) a deduction applicant installs on or before the approval
22 deadline determined under section 9 of this chapter, in an
23 economic revitalization area in which a deduction for tangible
24 personal property is allowed;
25 (B) consists of:
26 (i) racking equipment;
27 (ii) scanning or coding equipment;
28 (iii) separators;
29 (iv) conveyors;
30 (v) fork lifts or lifting equipment (including "walk
31 behinds");
32 (vi) transitional moving equipment;
33 (vii) packaging equipment;
34 (viii) sorting and picking equipment; or
35 (ix) software for technology used in logistical distribution;
36 (C) the deduction applicant acquires for the storage or
37 distribution of goods, services, or information:
38 (i) in an arms length transaction from an entity that is not an
39 affiliate of the deduction applicant, if the tangible personal
40 property has been previously used in Indiana before the
41 installation described in clause (A); and
42 (ii) in any manner, if the tangible personal property has
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1 never been previously used in Indiana before the installation
2 described in clause (A); and
3 (D) the deduction applicant has never used for any purpose in
4 Indiana before the installation described in clause (A).
5 (14) "New farm equipment" means tangible personal property
6 that:
7 (A) a deduction applicant installs after June 30, 2022, and on
8 or before the approval deadline determined under section 9 of
9 this chapter, in an area that will be predominately used for
10 agricultural purposes for a period specified by the designating
11 body as a condition of being declared an economic
12 revitalization area;
13 (B) is used in the direct production, extraction, harvesting, or
14 processing of agricultural commodities for sale on land
15 classified as agricultural land for property tax purposes;
16 (C) was acquired for use as described in clause (B) in an arms
17 length transaction from an entity that is not an affiliate of the
18 deduction applicant; and
19 (D) the deduction applicant never used for any purpose in
20 Indiana before the installation described in clause (A).
21 (15) "New agricultural improvement" means any improvement
22 made to land classified as agricultural land for tax purposes that
23 is placed in service after December 31, 2022, and that will be
24 predominately used for agricultural purposes for a period
25 specified by the designating body as a condition of being declared
26 an economic revitalization area. The term includes a barn, grain
27 bin, or silo.
28 (16) "New information technology equipment" means tangible
29 personal property that:
30 (A) a deduction applicant installs on or before the approval
31 deadline determined under section 9 of this chapter, in an
32 economic revitalization area in which a deduction for tangible
33 personal property is allowed;
34 (B) consists of equipment, including software, used in the
35 fields of:
36 (i) information processing;
37 (ii) office automation;
38 (iii) telecommunication facilities and networks;
39 (iv) informatics;
40 (v) network administration;
41 (vi) software development; and
42 (vii) fiber optics;
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1 (C) the deduction applicant acquires in an arms length
2 transaction from an entity that is not an affiliate of the
3 deduction applicant; and
4 (D) the deduction applicant never used for any purpose in
5 Indiana before the installation described in clause (A).
6 (17) "Deduction applicant" means an owner of tangible personal
7 property who makes a deduction application.
8 (18) "Affiliate" means an entity that effectively controls or is
9 controlled by a deduction applicant or is associated with a
10 deduction applicant under common ownership or control, whether
11 by shareholdings or other means.
12 (19) "Eligible vacant building" means a building that:
13 (A) is zoned for commercial or industrial purposes; and
14 (B) is unoccupied for at least one (1) year before the owner of
15 the building or a tenant of the owner occupies the building, as
16 evidenced by a valid certificate of occupancy, paid utility
17 receipts, executed lease agreements, or any other evidence of
18 occupation that the department of local government finance
19 requires.
20 (20) "Soil productivity factor" refers to the factor used for
21 each type or classification of soil under IC 6-1.1-4-13(c) that
22 is used in determining the true tax value of agricultural land.
23 SECTION 2. IC 6-1.1-12.1-2, AS AMENDED BY P.L.105-2022,
24 SECTION 34, IS AMENDED TO READ AS FOLLOWS [EFFECTIVE
25 JULY 1, 2025]: Sec. 2. (a) A designating body may, subject to
26 subsection (l), find that a particular area within its jurisdiction is an
27 economic revitalization area. However, the deduction provided by this
28 chapter for economic revitalization areas not within a city or town shall
29 not be available to retail businesses.
30 (b) In a county containing a consolidated city or within a city or
31 town, a designating body may find that a particular area within its
32 jurisdiction is a residentially distressed area. Designation of an area as
33 a residentially distressed area has the same effect as designating an
34 area as an economic revitalization area, except that the amount of the
35 deduction shall be calculated as specified in section 4.1 of this chapter
36 and the deduction is allowed for not more than the number of years
37 specified by the designating body under section 17 of this chapter. In
38 order to declare a particular area a residentially distressed area, the
39 designating body must follow the same procedure that is required to
40 designate an area as an economic revitalization area and must make all
41 the following additional findings or all the additional findings
42 described in subsection (c):
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1 (1) The area is comprised of parcels that are either unimproved or
2 contain only one (1) or two (2) family dwellings or multifamily
3 dwellings designed for up to four (4) families, including accessory
4 buildings for those dwellings.
5 (2) Any dwellings in the area are not permanently occupied and
6 are:
7 (A) the subject of an order issued under IC 36-7-9; or
8 (B) evidencing significant building deficiencies.
9 (3) Parcels of property in the area:
10 (A) have been sold and not redeemed under IC 6-1.1-24 and
11 IC 6-1.1-25; or
12 (B) are owned by a unit of local government.
13 However, in a city in a county having a population of more than two
14 hundred fifty thousand (250,000) and less than three hundred thousand
15 (300,000), the designating body is only required to make one (1) of the
16 additional findings described in this subsection or one (1) of the
17 additional findings described in subsection (c).
18 (c) In a county containing a consolidated city or within a city or
19 town, a designating body that wishes to designate a particular area a
20 residentially distressed area may make the following additional
21 findings as an alternative to the additional findings described in
22 subsection (b):
23 (1) A significant number of dwelling units within the area are not
24 permanently occupied or a significant number of parcels in the
25 area are vacant land.
26 (2) A significant number of dwelling units within the area are:
27 (A) the subject of an order issued under IC 36-7-9; or
28 (B) evidencing significant building deficiencies.
29 (3) The area has experienced a net loss in the number of dwelling
30 units, as documented by census information, local building and
31 demolition permits, or certificates of occupancy, or the area is
32 owned by Indiana or the United States.
33 (4) The area (plus any areas previously designated under this
34 subsection) will not exceed ten percent (10%) of the total area
35 within the designating body's jurisdiction.
36 However, in a city in a county having a population of more than two
37 hundred fifty thousand (250,000) and less than three hundred thousand
38 (300,000), the designating body is only required to make one (1) of the
39 additional findings described in this subsection as an alternative to one
40 (1) of the additional findings described in subsection (b).
41 (d) A designating body is required to attach the following conditions
42 to the grant of a residentially distressed area designation:
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1 (1) The deduction will not be allowed unless the dwelling is
2 rehabilitated to meet local code standards for habitability.
3 (2) If a designation application is filed, the designating body may
4 require that the redevelopment or rehabilitation be completed
5 within a reasonable period of time.
6 (e) To make a designation described in subsection (a) or (b), the
7 designating body shall use procedures prescribed in section 2.5 of this
8 chapter, and, in the case of a designation under subsection (a), the
9 designating body must also make the findings required by
10 subsection (l).
11 (f) The property tax deductions provided by section 3, 4.5, or 4.8 of
12 this chapter are only available within an area which the designating
13 body finds to be an economic revitalization area.
14 (g) The designating body may adopt a resolution establishing
15 general standards to be used, along with the requirements set forth in
16 the definition of economic revitalization area, by the designating body
17 in finding an area to be an economic revitalization area. The standards
18 must have a reasonable relationship to the development objectives of
19 the area in which the designating body has jurisdiction. The following
20 five (5) sets of standards may be established:
21 (1) One (1) relative to the deduction under section 3 of this
22 chapter for economic revitalization areas that are not residentially
23 distressed areas.
24 (2) One (1) relative to the deduction under section 3 of this
25 chapter for residentially distressed areas.
26 (3) One (1) relative to the deduction allowed under section 4.5 of
27 this chapter.
28 (4) One (1) relative to the deduction allowed under section 4.8 of
29 this chapter.
30 (5) One (1) relative to property granted a deduction for an
31 agricultural purpose.
32 (h) A designating body may impose a fee for filing a designation
33 application for a person requesting the designation of a particular area
34 as an economic revitalization area. The fee may be sufficient to defray
35 actual processing and administrative costs. However, the fee charged
36 for filing a designation application for a parcel that contains one (1) or
37 more owner-occupied, single-family dwellings may not exceed the cost
38 of publishing the required notice.
39 (i) In declaring an area an economic revitalization area, the
40 designating body may:
41 (1) limit the time period to a certain number of calendar years
42 during which the economic revitalization area shall be so
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1 designated;
2 (2) limit the type of deductions that will be allowed within the
3 economic revitalization area to the deduction allowed under
4 section 3 of this chapter, the deduction allowed under section 4.5
5 of this chapter, the deduction allowed under section 4.8 of this
6 chapter, or any combination of these deductions;
7 (3) limit the dollar amount of the deduction that will be allowed
8 with respect to new manufacturing equipment, new farm
9 equipment, new research and development equipment, new
10 logistical distribution equipment, and new information technology
11 equipment;
12 (4) limit the dollar amount of the deduction that will be allowed
13 with respect to redevelopment and rehabilitation occurring in
14 areas that are designated as economic revitalization areas;
15 (5) limit the dollar amount of the deduction that will be allowed
16 under section 4.8 of this chapter with respect to the occupation of
17 an eligible vacant building; or
18 (6) impose reasonable conditions related to the purpose of this
19 chapter or to the general standards adopted under subsection (g)
20 for allowing the deduction for the redevelopment or rehabilitation
21 of the property or the installation of the new manufacturing
22 equipment, new farm equipment, new research and development
23 equipment, new logistical distribution equipment, or new
24 information technology equipment.
25 To exercise one (1) or more of these powers, a designating body must
26 include this fact in the resolution passed under section 2.5 of this
27 chapter.
28 (j) Notwithstanding any other provision of this chapter, if a
29 designating body limits the time period during which an area is an
30 economic revitalization area, that limitation does not:
31 (1) prevent a taxpayer from obtaining a deduction for new
32 manufacturing equipment, new farm equipment, new research and
33 development equipment, new logistical distribution equipment, or
34 new information technology equipment installed on or before the
35 approval deadline determined under section 9 of this chapter, but
36 after the expiration of the economic revitalization area if the new
37 manufacturing equipment, new farm equipment, new research and
38 development equipment, new logistical distribution equipment, or
39 new information technology equipment was described in a
40 statement of benefits submitted to and approved by the
41 designating body in accordance with section 4.5 of this chapter
42 before the expiration of the economic revitalization area
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1 designation; or
2 (2) limit the length of time a taxpayer is entitled to receive a
3 deduction to a number of years that is less than the number of
4 years designated under section 17 of this chapter.
5 (k) In addition to the other requirements of this chapter, if property
6 located in an economic revitalization area is also located in an
7 allocation area (as defined in IC 36-7-14-39 or IC 36-7-15.1-26), a
8 taxpayer's statement of benefits concerning that property may not be
9 approved under this chapter unless a resolution approving the
10 statement of benefits is adopted by the legislative body of the unit that
11 approved the designation of the allocation area.
12 (l) This subsection applies to a designation under subsection (a)
13 occurring after June 30, 2025, that proposes to include land
14 classified as agricultural land for property tax purposes (referred
15 to as "agricultural land" in this subsection) within an economic
16 revitalization area. Before the designating body may make a
17 designation under subsection (a) that includes agricultural land,
18 the designating body must find that either of the following
19 conditions is met:
20 (1) The agricultural land sought to be designated as an
21 economic revitalization area has an average soil productivity
22 factor of less than one (1). In determining the average soil
23 productivity factor under this subdivision, the designating
24 body shall also consider the application of any influence factor
25 that applies to the agricultural land.
26 (2) The agricultural land sought to be designated as an
27 economic revitalization area will be predominately used for
28 an agricultural purpose, including a new agricultural
29 improvement or a new farm improvement.
30 If the designating body finds that neither the condition required
31 under subdivision (1) nor (2) is met, the designating body may not
32 include the agricultural land within the economic revitalization
33 area. The findings required by this subsection are in addition to the
34 other requirements of this chapter.
35 (m) In making the findings required by subsection (l), the
36 designating body shall consider the information contained in a
37 designation application (if a designation application is filed) and all
38 other pertinent information.
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