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Indiana Senate Bill SB0253

Indiana 2025 Regular Session

Indiana Senate Bill SB0253 Compare Versions

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22 Introduced Version
33 SENATE BILL No. 253
44 _____
55 DIGEST OF INTRODUCED BILL
66 Citations Affected: IC 6-1.1-12.1.
77 Synopsis: Economic revitalization area designations. Adds conditions
88 related to soil productivity and use of land for an agricultural purpose
99 that must be found by a designating body before land classified as
1010 agricultural land for property tax purposes may be included within an
1111 area sought to be designated as an economic revitalization area.
1212 Effective: July 1, 2025.
1313 Deery
1414 January 13, 2025, read first time and referred to Committee on Tax and Fiscal Policy.
1515 2025 IN 253—LS 6648/DI 129 Introduced
1616 First Regular Session of the 124th General Assembly (2025)
1717 PRINTING CODE. Amendments: Whenever an existing statute (or a section of the Indiana
1818 Constitution) is being amended, the text of the existing provision will appear in this style type,
1919 additions will appear in this style type, and deletions will appear in this style type.
2020 Additions: Whenever a new statutory provision is being enacted (or a new constitutional
2121 provision adopted), the text of the new provision will appear in this style type. Also, the
2222 word NEW will appear in that style type in the introductory clause of each SECTION that adds
2323 a new provision to the Indiana Code or the Indiana Constitution.
2424 Conflict reconciliation: Text in a statute in this style type or this style type reconciles conflicts
2525 between statutes enacted by the 2024 Regular Session of the General Assembly.
2626 SENATE BILL No. 253
2727 A BILL FOR AN ACT to amend the Indiana Code concerning
2828 taxation.
2929 Be it enacted by the General Assembly of the State of Indiana:
3030 1 SECTION 1. IC 6-1.1-12.1-1, AS AMENDED BY
3131 2 P.L.178-2022(ts), SECTION 5, IS AMENDED TO READ AS
3232 3 FOLLOWS [EFFECTIVE JULY 1, 2025]: Sec. 1. For purposes of this
3333 4 chapter:
3434 5 (1) "Economic revitalization area" means an area which is within
3535 6 the corporate limits of a city, town, or county which has become
3636 7 undesirable for, or impossible of, normal development and
3737 8 occupancy because of a lack of development, cessation of growth,
3838 9 deterioration of improvements or character of occupancy, age,
3939 10 obsolescence, substandard buildings, or other factors which have
4040 11 impaired values or prevent a normal development of property or
4141 12 use of property. The term "economic revitalization area" also
4242 13 includes:
4343 14 (A) any area where a facility or a group of facilities that are
4444 15 technologically, economically, or energy obsolete are located
4545 16 and where the obsolescence may lead to a decline in
4646 17 employment and tax revenues;
4747 2025 IN 253—LS 6648/DI 129 2
4848 1 (B) a residentially distressed area, except as otherwise
4949 2 provided in this chapter; and
5050 3 (C) an area of land classified as agricultural land for property
5151 4 tax purposes that, as a condition of being designated an
5252 5 economic revitalization area, will be predominately used for
5353 6 agricultural purposes for a period specified by the designating
5454 7 body.
5555 8 (2) "City" means any city in this state, and "town" means any town
5656 9 incorporated under IC 36-5-1.
5757 10 (3) "New manufacturing equipment" means tangible personal
5858 11 property that a deduction applicant:
5959 12 (A) installs on or before the approval deadline determined
6060 13 under section 9 of this chapter, in an area that is declared an
6161 14 economic revitalization area in which a deduction for tangible
6262 15 personal property is allowed;
6363 16 (B) uses in the direct production, manufacture, fabrication,
6464 17 assembly, extraction, mining, processing, refining, or finishing
6565 18 of other tangible personal property, including but not limited
6666 19 to use to dispose of solid waste or hazardous waste by
6767 20 converting the solid waste or hazardous waste into energy or
6868 21 other useful products;
6969 22 (C) acquires for use as described in clause (B):
7070 23 (i) in an arms length transaction from an entity that is not an
7171 24 affiliate of the deduction applicant, if the tangible personal
7272 25 property has been previously used in Indiana before the
7373 26 installation described in clause (A); or
7474 27 (ii) in any manner, if the tangible personal property has
7575 28 never been previously used in Indiana before the installation
7676 29 described in clause (A); and
7777 30 (D) has never used for any purpose in Indiana before the
7878 31 installation described in clause (A).
7979 32 (4) "Property" means a building or structure, but does not include
8080 33 land.
8181 34 (5) "Redevelopment" means the construction of new structures,
8282 35 in economic revitalization areas, either:
8383 36 (A) on unimproved real estate; or
8484 37 (B) on real estate upon which a prior existing structure is
8585 38 demolished to allow for a new construction.
8686 39 (6) "Rehabilitation" means the remodeling, repair, or betterment
8787 40 of property in any manner or any enlargement or extension of
8888 41 property.
8989 42 (7) "Designating body" means the following:
9090 2025 IN 253—LS 6648/DI 129 3
9191 1 (A) For a county that does not contain a consolidated city, the
9292 2 fiscal body of the county, city, or town.
9393 3 (B) For a county containing a consolidated city, the
9494 4 metropolitan development commission. The jurisdiction of the
9595 5 designating body includes a rehabilitation or redevelopment
9696 6 project under this chapter that falls within the boundaries of an
9797 7 excluded city, as defined in IC 36-3-1-7.
9898 8 (8) "Deduction application" means:
9999 9 (A) the application filed in accordance with section 5 of this
100100 10 chapter by a property owner who desires to obtain the
101101 11 deduction provided by section 3 of this chapter;
102102 12 (B) the application filed in accordance with section 5.4 of this
103103 13 chapter by a person who desires to obtain the deduction
104104 14 provided by section 4.5 of this chapter; or
105105 15 (C) the application filed in accordance with section 5.3 of this
106106 16 chapter by a property owner that desires to obtain the
107107 17 deduction provided by section 4.8 of this chapter.
108108 18 (9) "Designation application" means an application that is filed
109109 19 with a designating body to assist that body in making a
110110 20 determination about whether a particular area should be
111111 21 designated as an economic revitalization area.
112112 22 (10) "Hazardous waste" has the meaning set forth in
113113 23 IC 13-11-2-99(a). The term includes waste determined to be a
114114 24 hazardous waste under IC 13-22-2-3(b).
115115 25 (11) "Solid waste" has the meaning set forth in IC 13-11-2-205(a).
116116 26 However, the term does not include dead animals or any animal
117117 27 solid or semisolid wastes.
118118 28 (12) "New research and development equipment" means tangible
119119 29 personal property that:
120120 30 (A) a deduction applicant installs on or before the approval
121121 31 deadline determined under section 9 of this chapter, in an
122122 32 economic revitalization area in which a deduction for tangible
123123 33 personal property is allowed;
124124 34 (B) consists of:
125125 35 (i) laboratory equipment;
126126 36 (ii) research and development equipment;
127127 37 (iii) computers and computer software;
128128 38 (iv) telecommunications equipment; or
129129 39 (v) testing equipment;
130130 40 (C) the deduction applicant uses in research and development
131131 41 activities devoted directly and exclusively to experimental or
132132 42 laboratory research and development for new products, new
133133 2025 IN 253—LS 6648/DI 129 4
134134 1 uses of existing products, or improving or testing existing
135135 2 products;
136136 3 (D) the deduction applicant acquires for purposes described in
137137 4 this subdivision:
138138 5 (i) in an arms length transaction from an entity that is not an
139139 6 affiliate of the deduction applicant, if the tangible personal
140140 7 property has been previously used in Indiana before the
141141 8 installation described in clause (A); or
142142 9 (ii) in any manner, if the tangible personal property has
143143 10 never been previously used in Indiana before the installation
144144 11 described in clause (A); and
145145 12 (E) the deduction applicant has never used for any purpose in
146146 13 Indiana before the installation described in clause (A).
147147 14 The term does not include equipment installed in facilities used
148148 15 for or in connection with efficiency surveys, management studies,
149149 16 consumer surveys, economic surveys, advertising or promotion,
150150 17 or research in connection with literacy, history, or similar
151151 18 projects.
152152 19 (13) "New logistical distribution equipment" means tangible
153153 20 personal property that:
154154 21 (A) a deduction applicant installs on or before the approval
155155 22 deadline determined under section 9 of this chapter, in an
156156 23 economic revitalization area in which a deduction for tangible
157157 24 personal property is allowed;
158158 25 (B) consists of:
159159 26 (i) racking equipment;
160160 27 (ii) scanning or coding equipment;
161161 28 (iii) separators;
162162 29 (iv) conveyors;
163163 30 (v) fork lifts or lifting equipment (including "walk
164164 31 behinds");
165165 32 (vi) transitional moving equipment;
166166 33 (vii) packaging equipment;
167167 34 (viii) sorting and picking equipment; or
168168 35 (ix) software for technology used in logistical distribution;
169169 36 (C) the deduction applicant acquires for the storage or
170170 37 distribution of goods, services, or information:
171171 38 (i) in an arms length transaction from an entity that is not an
172172 39 affiliate of the deduction applicant, if the tangible personal
173173 40 property has been previously used in Indiana before the
174174 41 installation described in clause (A); and
175175 42 (ii) in any manner, if the tangible personal property has
176176 2025 IN 253—LS 6648/DI 129 5
177177 1 never been previously used in Indiana before the installation
178178 2 described in clause (A); and
179179 3 (D) the deduction applicant has never used for any purpose in
180180 4 Indiana before the installation described in clause (A).
181181 5 (14) "New farm equipment" means tangible personal property
182182 6 that:
183183 7 (A) a deduction applicant installs after June 30, 2022, and on
184184 8 or before the approval deadline determined under section 9 of
185185 9 this chapter, in an area that will be predominately used for
186186 10 agricultural purposes for a period specified by the designating
187187 11 body as a condition of being declared an economic
188188 12 revitalization area;
189189 13 (B) is used in the direct production, extraction, harvesting, or
190190 14 processing of agricultural commodities for sale on land
191191 15 classified as agricultural land for property tax purposes;
192192 16 (C) was acquired for use as described in clause (B) in an arms
193193 17 length transaction from an entity that is not an affiliate of the
194194 18 deduction applicant; and
195195 19 (D) the deduction applicant never used for any purpose in
196196 20 Indiana before the installation described in clause (A).
197197 21 (15) "New agricultural improvement" means any improvement
198198 22 made to land classified as agricultural land for tax purposes that
199199 23 is placed in service after December 31, 2022, and that will be
200200 24 predominately used for agricultural purposes for a period
201201 25 specified by the designating body as a condition of being declared
202202 26 an economic revitalization area. The term includes a barn, grain
203203 27 bin, or silo.
204204 28 (16) "New information technology equipment" means tangible
205205 29 personal property that:
206206 30 (A) a deduction applicant installs on or before the approval
207207 31 deadline determined under section 9 of this chapter, in an
208208 32 economic revitalization area in which a deduction for tangible
209209 33 personal property is allowed;
210210 34 (B) consists of equipment, including software, used in the
211211 35 fields of:
212212 36 (i) information processing;
213213 37 (ii) office automation;
214214 38 (iii) telecommunication facilities and networks;
215215 39 (iv) informatics;
216216 40 (v) network administration;
217217 41 (vi) software development; and
218218 42 (vii) fiber optics;
219219 2025 IN 253—LS 6648/DI 129 6
220220 1 (C) the deduction applicant acquires in an arms length
221221 2 transaction from an entity that is not an affiliate of the
222222 3 deduction applicant; and
223223 4 (D) the deduction applicant never used for any purpose in
224224 5 Indiana before the installation described in clause (A).
225225 6 (17) "Deduction applicant" means an owner of tangible personal
226226 7 property who makes a deduction application.
227227 8 (18) "Affiliate" means an entity that effectively controls or is
228228 9 controlled by a deduction applicant or is associated with a
229229 10 deduction applicant under common ownership or control, whether
230230 11 by shareholdings or other means.
231231 12 (19) "Eligible vacant building" means a building that:
232232 13 (A) is zoned for commercial or industrial purposes; and
233233 14 (B) is unoccupied for at least one (1) year before the owner of
234234 15 the building or a tenant of the owner occupies the building, as
235235 16 evidenced by a valid certificate of occupancy, paid utility
236236 17 receipts, executed lease agreements, or any other evidence of
237237 18 occupation that the department of local government finance
238238 19 requires.
239239 20 (20) "Soil productivity factor" refers to the factor used for
240240 21 each type or classification of soil under IC 6-1.1-4-13(c) that
241241 22 is used in determining the true tax value of agricultural land.
242242 23 SECTION 2. IC 6-1.1-12.1-2, AS AMENDED BY P.L.105-2022,
243243 24 SECTION 34, IS AMENDED TO READ AS FOLLOWS [EFFECTIVE
244244 25 JULY 1, 2025]: Sec. 2. (a) A designating body may, subject to
245245 26 subsection (l), find that a particular area within its jurisdiction is an
246246 27 economic revitalization area. However, the deduction provided by this
247247 28 chapter for economic revitalization areas not within a city or town shall
248248 29 not be available to retail businesses.
249249 30 (b) In a county containing a consolidated city or within a city or
250250 31 town, a designating body may find that a particular area within its
251251 32 jurisdiction is a residentially distressed area. Designation of an area as
252252 33 a residentially distressed area has the same effect as designating an
253253 34 area as an economic revitalization area, except that the amount of the
254254 35 deduction shall be calculated as specified in section 4.1 of this chapter
255255 36 and the deduction is allowed for not more than the number of years
256256 37 specified by the designating body under section 17 of this chapter. In
257257 38 order to declare a particular area a residentially distressed area, the
258258 39 designating body must follow the same procedure that is required to
259259 40 designate an area as an economic revitalization area and must make all
260260 41 the following additional findings or all the additional findings
261261 42 described in subsection (c):
262262 2025 IN 253—LS 6648/DI 129 7
263263 1 (1) The area is comprised of parcels that are either unimproved or
264264 2 contain only one (1) or two (2) family dwellings or multifamily
265265 3 dwellings designed for up to four (4) families, including accessory
266266 4 buildings for those dwellings.
267267 5 (2) Any dwellings in the area are not permanently occupied and
268268 6 are:
269269 7 (A) the subject of an order issued under IC 36-7-9; or
270270 8 (B) evidencing significant building deficiencies.
271271 9 (3) Parcels of property in the area:
272272 10 (A) have been sold and not redeemed under IC 6-1.1-24 and
273273 11 IC 6-1.1-25; or
274274 12 (B) are owned by a unit of local government.
275275 13 However, in a city in a county having a population of more than two
276276 14 hundred fifty thousand (250,000) and less than three hundred thousand
277277 15 (300,000), the designating body is only required to make one (1) of the
278278 16 additional findings described in this subsection or one (1) of the
279279 17 additional findings described in subsection (c).
280280 18 (c) In a county containing a consolidated city or within a city or
281281 19 town, a designating body that wishes to designate a particular area a
282282 20 residentially distressed area may make the following additional
283283 21 findings as an alternative to the additional findings described in
284284 22 subsection (b):
285285 23 (1) A significant number of dwelling units within the area are not
286286 24 permanently occupied or a significant number of parcels in the
287287 25 area are vacant land.
288288 26 (2) A significant number of dwelling units within the area are:
289289 27 (A) the subject of an order issued under IC 36-7-9; or
290290 28 (B) evidencing significant building deficiencies.
291291 29 (3) The area has experienced a net loss in the number of dwelling
292292 30 units, as documented by census information, local building and
293293 31 demolition permits, or certificates of occupancy, or the area is
294294 32 owned by Indiana or the United States.
295295 33 (4) The area (plus any areas previously designated under this
296296 34 subsection) will not exceed ten percent (10%) of the total area
297297 35 within the designating body's jurisdiction.
298298 36 However, in a city in a county having a population of more than two
299299 37 hundred fifty thousand (250,000) and less than three hundred thousand
300300 38 (300,000), the designating body is only required to make one (1) of the
301301 39 additional findings described in this subsection as an alternative to one
302302 40 (1) of the additional findings described in subsection (b).
303303 41 (d) A designating body is required to attach the following conditions
304304 42 to the grant of a residentially distressed area designation:
305305 2025 IN 253—LS 6648/DI 129 8
306306 1 (1) The deduction will not be allowed unless the dwelling is
307307 2 rehabilitated to meet local code standards for habitability.
308308 3 (2) If a designation application is filed, the designating body may
309309 4 require that the redevelopment or rehabilitation be completed
310310 5 within a reasonable period of time.
311311 6 (e) To make a designation described in subsection (a) or (b), the
312312 7 designating body shall use procedures prescribed in section 2.5 of this
313313 8 chapter, and, in the case of a designation under subsection (a), the
314314 9 designating body must also make the findings required by
315315 10 subsection (l).
316316 11 (f) The property tax deductions provided by section 3, 4.5, or 4.8 of
317317 12 this chapter are only available within an area which the designating
318318 13 body finds to be an economic revitalization area.
319319 14 (g) The designating body may adopt a resolution establishing
320320 15 general standards to be used, along with the requirements set forth in
321321 16 the definition of economic revitalization area, by the designating body
322322 17 in finding an area to be an economic revitalization area. The standards
323323 18 must have a reasonable relationship to the development objectives of
324324 19 the area in which the designating body has jurisdiction. The following
325325 20 five (5) sets of standards may be established:
326326 21 (1) One (1) relative to the deduction under section 3 of this
327327 22 chapter for economic revitalization areas that are not residentially
328328 23 distressed areas.
329329 24 (2) One (1) relative to the deduction under section 3 of this
330330 25 chapter for residentially distressed areas.
331331 26 (3) One (1) relative to the deduction allowed under section 4.5 of
332332 27 this chapter.
333333 28 (4) One (1) relative to the deduction allowed under section 4.8 of
334334 29 this chapter.
335335 30 (5) One (1) relative to property granted a deduction for an
336336 31 agricultural purpose.
337337 32 (h) A designating body may impose a fee for filing a designation
338338 33 application for a person requesting the designation of a particular area
339339 34 as an economic revitalization area. The fee may be sufficient to defray
340340 35 actual processing and administrative costs. However, the fee charged
341341 36 for filing a designation application for a parcel that contains one (1) or
342342 37 more owner-occupied, single-family dwellings may not exceed the cost
343343 38 of publishing the required notice.
344344 39 (i) In declaring an area an economic revitalization area, the
345345 40 designating body may:
346346 41 (1) limit the time period to a certain number of calendar years
347347 42 during which the economic revitalization area shall be so
348348 2025 IN 253—LS 6648/DI 129 9
349349 1 designated;
350350 2 (2) limit the type of deductions that will be allowed within the
351351 3 economic revitalization area to the deduction allowed under
352352 4 section 3 of this chapter, the deduction allowed under section 4.5
353353 5 of this chapter, the deduction allowed under section 4.8 of this
354354 6 chapter, or any combination of these deductions;
355355 7 (3) limit the dollar amount of the deduction that will be allowed
356356 8 with respect to new manufacturing equipment, new farm
357357 9 equipment, new research and development equipment, new
358358 10 logistical distribution equipment, and new information technology
359359 11 equipment;
360360 12 (4) limit the dollar amount of the deduction that will be allowed
361361 13 with respect to redevelopment and rehabilitation occurring in
362362 14 areas that are designated as economic revitalization areas;
363363 15 (5) limit the dollar amount of the deduction that will be allowed
364364 16 under section 4.8 of this chapter with respect to the occupation of
365365 17 an eligible vacant building; or
366366 18 (6) impose reasonable conditions related to the purpose of this
367367 19 chapter or to the general standards adopted under subsection (g)
368368 20 for allowing the deduction for the redevelopment or rehabilitation
369369 21 of the property or the installation of the new manufacturing
370370 22 equipment, new farm equipment, new research and development
371371 23 equipment, new logistical distribution equipment, or new
372372 24 information technology equipment.
373373 25 To exercise one (1) or more of these powers, a designating body must
374374 26 include this fact in the resolution passed under section 2.5 of this
375375 27 chapter.
376376 28 (j) Notwithstanding any other provision of this chapter, if a
377377 29 designating body limits the time period during which an area is an
378378 30 economic revitalization area, that limitation does not:
379379 31 (1) prevent a taxpayer from obtaining a deduction for new
380380 32 manufacturing equipment, new farm equipment, new research and
381381 33 development equipment, new logistical distribution equipment, or
382382 34 new information technology equipment installed on or before the
383383 35 approval deadline determined under section 9 of this chapter, but
384384 36 after the expiration of the economic revitalization area if the new
385385 37 manufacturing equipment, new farm equipment, new research and
386386 38 development equipment, new logistical distribution equipment, or
387387 39 new information technology equipment was described in a
388388 40 statement of benefits submitted to and approved by the
389389 41 designating body in accordance with section 4.5 of this chapter
390390 42 before the expiration of the economic revitalization area
391391 2025 IN 253—LS 6648/DI 129 10
392392 1 designation; or
393393 2 (2) limit the length of time a taxpayer is entitled to receive a
394394 3 deduction to a number of years that is less than the number of
395395 4 years designated under section 17 of this chapter.
396396 5 (k) In addition to the other requirements of this chapter, if property
397397 6 located in an economic revitalization area is also located in an
398398 7 allocation area (as defined in IC 36-7-14-39 or IC 36-7-15.1-26), a
399399 8 taxpayer's statement of benefits concerning that property may not be
400400 9 approved under this chapter unless a resolution approving the
401401 10 statement of benefits is adopted by the legislative body of the unit that
402402 11 approved the designation of the allocation area.
403403 12 (l) This subsection applies to a designation under subsection (a)
404404 13 occurring after June 30, 2025, that proposes to include land
405405 14 classified as agricultural land for property tax purposes (referred
406406 15 to as "agricultural land" in this subsection) within an economic
407407 16 revitalization area. Before the designating body may make a
408408 17 designation under subsection (a) that includes agricultural land,
409409 18 the designating body must find that either of the following
410410 19 conditions is met:
411411 20 (1) The agricultural land sought to be designated as an
412412 21 economic revitalization area has an average soil productivity
413413 22 factor of less than one (1). In determining the average soil
414414 23 productivity factor under this subdivision, the designating
415415 24 body shall also consider the application of any influence factor
416416 25 that applies to the agricultural land.
417417 26 (2) The agricultural land sought to be designated as an
418418 27 economic revitalization area will be predominately used for
419419 28 an agricultural purpose, including a new agricultural
420420 29 improvement or a new farm improvement.
421421 30 If the designating body finds that neither the condition required
422422 31 under subdivision (1) nor (2) is met, the designating body may not
423423 32 include the agricultural land within the economic revitalization
424424 33 area. The findings required by this subsection are in addition to the
425425 34 other requirements of this chapter.
426426 35 (m) In making the findings required by subsection (l), the
427427 36 designating body shall consider the information contained in a
428428 37 designation application (if a designation application is filed) and all
429429 38 other pertinent information.
430430 2025 IN 253—LS 6648/DI 129