Introduced Version
SENATE BILL No. 516
_____
DIGEST OF INTRODUCED BILL
Citations Affected: IC 4-3-28; IC 5-28; IC 36-7-32.5-12.
Synopsis: Economic development and small business innovation.
Establishes the office of small business and innovation (office).
Requires the office to: (1) develop and administer programs to support
the growth of small business, entrepreneurship, and innovation in
Indiana; (2) direct and oversee programs and sources of funding related
to the growth of small business, entrepreneurship, technology, and
innovation in Indiana; (3) work to strengthen policies and programs
supporting the growth of entrepreneurship in Indiana; (4) operate the
Indiana economic development corporation's Connect IND interactive
portal as a hub for entrepreneurs to access federal, state, and local
resources; (5) promote Indiana's small business and entrepreneurial
support resources by creating toolkits and other digital assets to assist
entrepreneurs and small businesses in the navigation of the resources;
(6) coordinate with state agencies and other state funded entities to
align services and programs related to entrepreneurship and starting
and scaling a business; (7) work with funded entities on identifying
strategies and metrics around the disbursement of funds to measure
funds reaching rural communities and other underrepresented
socioeconomic communities; (8) work with stakeholders and
organizations supporting entrepreneurship to enhance learning and
skills, provide technical support, and expand access to resources for
entrepreneurs across Indiana; and (9) develop and administer programs
to support and encourage youth entrepreneurship, including supporting
students and teachers in fostering entrepreneurial skills. Requires the
office to submit to the governor, the secretary of commerce, and the
general assembly an annual state of entrepreneurship report. Provides
for appointment to the board of the Indiana economic development
(Continued next page)
Effective: July 1, 2025.
Buchanan
January 16, 2025, read first time and referred to Committee on Commerce and Technology.
2025 IN 516—LS 7310/DI 120 Digest Continued
corporation (IEDC) of two nonvoting, advisory members who are
members of the general assembly. Requires the IEDC, before
purchasing land in a county that exceeds 100 acres, to first give notice
to the county or municipality, or both, in which the land is located not
later than 30 days before the closing date for the purchase. Requires the
IEDC to include in its annual economic incentives and compliance
report a determination of the total aggregate amount of incentives
granted by the IEDC in the previous two years compared to the total
number of new jobs created by the recipients of the incentives during
that two year period. Provides that a school corporation that receives
a transfer of incremental property tax revenue from a local innovation
development district fund may use those funds with no restrictions or
specified uses.
2025 IN 516—LS 7310/DI 1202025 IN 516—LS 7310/DI 120 Introduced
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.
SENATE BILL No. 516
A BILL FOR AN ACT to amend the Indiana Code concerning state
and local administration.
Be it enacted by the General Assembly of the State of Indiana:
1 SECTION 1. IC 4-3-28 IS ADDED TO THE INDIANA CODE AS
2 A NEW CHAPTER TO READ AS FOLLOWS [EFFECTIVE JULY
3 1, 2025]:
4 Chapter 28. Office of Small Business and Innovation
5 Sec. 1. As used in this chapter, "director" refers to the director
6 of the office of small business and innovation appointed under
7 section 4 of this chapter.
8 Sec. 2. As used in this chapter, "office" refers to the office of
9 small business and innovation established by section 3 of this
10 chapter.
11 Sec. 3. The office of small business and innovation is established.
12 Sec. 4. (a) The governor shall appoint an individual to be the
13 director of the office of small business and innovation.
14 (b) The director:
15 (1) serves at the governor's pleasure;
2025 IN 516—LS 7310/DI 120 2
1 (2) is entitled to receive compensation in an amount set by the
2 governor subject to the approval of the budget agency under
3 IC 4-12-1-13; and
4 (3) is responsible to the governor.
5 (c) The director is the chief executive and administrative officer
6 of the office.
7 (d) The director may appoint employees in the manner provided
8 by IC 4-15-2.2 and fix their compensation, subject to the approval
9 of the budget agency under IC 4-12-1-13.
10 (e) The director may delegate the director's authority to the
11 appropriate office staff.
12 Sec. 5. The office shall do the following:
13 (1) Develop and administer programs to support the growth
14 of small business, entrepreneurship, and innovation in
15 Indiana.
16 (2) Direct and oversee programs and sources of funding
17 related to the growth of small business, entrepreneurship,
18 technology, and innovation in Indiana, including the
19 following:
20 (A) The technology development grant fund established
21 under IC 5-28-10.
22 (B) The entrepreneur and enterprise district pilot program
23 established under IC 5-28-15.5.
24 (C) The Indiana twenty-first century research and
25 technology fund established under IC 5-28-16.
26 (D) Small business development under IC 5-28-17.
27 (E) The small business development fund established under
28 IC 5-28-18.
29 (F) The small and minority business financial assistance
30 program established under IC 5-28-20.
31 (G) The small business incubator program established
32 under IC 5-28-21.
33 (H) The capital access program established under
34 IC 5-28-29.
35 (I) The small business innovation voucher program
36 established under IC 5-28-40.
37 (J) The venture capital investment tax credit established
38 under IC 6-3.1-24.
39 (K) Certified technology parks under IC 36-7-32.
40 (3) Work to strengthen policies and programs supporting the
41 growth of entrepreneurship in Indiana.
42 (4) Operate the Indiana economic development corporation's
2025 IN 516—LS 7310/DI 120 3
1 Connect IND interactive portal as a hub for entrepreneurs to
2 access federal, state, and local resources.
3 (5) Promote Indiana's small business and entrepreneurial
4 support resources by creating toolkits and other digital assets
5 to assist entrepreneurs and small businesses in the navigation
6 of the resources.
7 (6) Coordinate with state agencies and other state funded
8 entities to align services and programs related to
9 entrepreneurship and starting and scaling a business.
10 (7) Work with funded entities on identifying strategies and
11 metrics around the disbursement of funds to measure funds
12 reaching rural communities and other underrepresented
13 socioeconomic communities.
14 (8) Work with stakeholders and organizations supporting
15 entrepreneurship to enhance learning and skills, provide
16 technical support, and expand access to resources for
17 entrepreneurs across Indiana.
18 (9) Develop and administer programs to support and
19 encourage youth entrepreneurship, including supporting
20 students and teachers in fostering entrepreneurial skills.
21 (10) Submit to the governor, the secretary of commerce, and
22 the general assembly an annual state of entrepreneurship
23 report as described in section 6 of this chapter. The report to
24 the general assembly must be in an electronic format under
25 IC 5-14-6.
26 Sec. 6. Beginning in state fiscal year 2028, and each state fiscal
27 year thereafter, on or before November 1 the office shall submit to
28 the governor, the secretary of commerce, and the general assembly
29 a state of entrepreneurship report that includes the following:
30 (1) A survey incorporating feedback from entrepreneurs and
31 stakeholders that includes regional and demographic group
32 diversity information from across Indiana regarding
33 Indiana's entrepreneurial landscape and barriers to starting
34 a business.
35 (2) Data on new business creation in Indiana, including
36 economic impact information and the number of jobs created.
37 (3) Data and metrics from funded entities on the impact and
38 reach of programming, including impact on rural
39 communities and other underrepresented socioeconomic
40 communities.
41 (4) The number, total dollar amount, and percentage of state
42 contracts awarded to businesses that have been in operation
2025 IN 516—LS 7310/DI 120 4
1 for not more than five (5) years.
2 (5) Recommendations on improving access to state contracts
3 for businesses that have been in operation for not more than
4 five (5) years.
5 (6) Recommendations on streamlining or reducing regulations
6 for new businesses across state agencies.
7 (7) Recommendations on improving overall entrepreneurship
8 in Indiana, including identifying challenges and barriers to
9 entrepreneurship.
10 (8) Any additional information deemed necessary by the office
11 to provide an accurate depiction of the condition of
12 entrepreneurship in Indiana.
13 Sec. 7. The office may adopt rules under IC 4-22-2 to carry out
14 the duties, purposes, and functions of this chapter.
15 SECTION 2. IC 5-28-4-2, AS AMENDED BY P.L.237-2017,
16 SECTION 15, IS AMENDED TO READ AS FOLLOWS [EFFECTIVE
17 JULY 1, 2025]: Sec. 2. (a) The board is composed of the following
18 members: none of whom may be members of the general assembly:
19 (1) The governor.
20 (2) Eleven (11) individuals appointed by the governor.
21 (3) The members (if any) appointed by the governor under
22 subsection (c).
23 (4) Two (2) nonvoting, advisory members who are members
24 of the general assembly appointed under subsection (d).
25 The individuals appointed under subdivision (2) and the individuals
26 appointed under subsection (c) must be employed in or retired from the
27 private or nonprofit sector or academia and may not be members of
28 the general assembly.
29 (b) When making appointments under subsection (a)(2), the
30 governor shall appoint the following:
31 (1) At least five (5) members belonging to the same political party
32 as the governor.
33 (2) At least three (3) members who belong to a major political
34 party (as defined in IC 3-5-2-30) other than the party of which the
35 governor is a member.
36 (c) In addition to the members appointed under subsection (a)(2),
37 the governor may appoint not more than three (3) additional members
38 to the board. If the governor appoints more than one (1) additional
39 member to the board under this subsection, at least one (1) of the
40 additional members must belong to a major political party (as defined
41 in IC 3-5-2-30) other than the party of which the governor is a member.
42 (d) The members described in subsection (a)(4) are appointed as
2025 IN 516—LS 7310/DI 120 5
1 follows:
2 (1) The speaker of the house of representatives shall appoint
3 one (1) individual who is a member of the house of
4 representatives.
5 (2) The president pro tempore of the senate shall appoint one
6 (1) individual who is a member of the senate.
7 (e) The following apply to the members appointed under
8 subsection (d):
9 (1) A member appointed under subsection (d):
10 (A) serves at the pleasure of the member's appointing
11 authority; and
12 (B) may be reappointed to successive terms.
13 (2) A vacancy in an appointment under subsection (d)(1) shall
14 be filled by the speaker of the house of representatives.
15 (3) A vacancy in an appointment under subsection (d)(2) shall
16 be filled by the president pro tempore of the senate.
17 (4) An individual appointed to fill a vacancy in an
18 appointment under subsection (d) serves for the unexpired
19 term of the individual's predecessor.
20 SECTION 3. IC 5-28-4-3, AS AMENDED BY P.L.237-2017,
21 SECTION 16, IS AMENDED TO READ AS FOLLOWS [EFFECTIVE
22 JULY 1, 2025]: Sec. 3. (a) Except as provided in subsection (d), the
23 term of office of an appointed member of the board is four (4) years.
24 (b) Each member appointed under section 2(a)(2) or 2(c) of this
25 chapter holds office for the term of appointment and continues to serve
26 after expiration of the appointment until a successor is appointed and
27 qualified. A member is eligible for reappointment.
28 (c) Members of the board appointed under section 2(a)(2) or 2(c) of
29 this chapter serve at the pleasure of the governor.
30 (d) This subsection applies to a member of the board appointed
31 under section 2(d) of this chapter. The initial term of a member
32 expires June 30, 2027. The term of a member appointed thereafter
33 is two (2) years and expires June 30 of the odd-numbered year.
34 SECTION 4. IC 5-28-4-5, AS ADDED BY P.L.4-2005, SECTION
35 34, IS AMENDED TO READ AS FOLLOWS [EFFECTIVE JULY 1,
36 2025]: Sec. 5. (a) The members of the board who are not members of
37 the general assembly:
38 (1) are entitled to a salary per diem for attending meetings equal
39 to the per diem provided by law for members of the general
40 assembly; The members of the board and
41 (2) are also entitled to receive reimbursement for traveling
42 expenses as provided under IC 4-13-1-4 and other expenses
2025 IN 516—LS 7310/DI 120 6
1 actually incurred in connection with the members' duties as
2 approved by the budget agency.
3 (b) Each member of the board who is a member of the general
4 assembly is entitled to receive the same per diem, mileage, and
5 travel allowances paid to legislative members of interim study
6 committees established by the legislative council. Per diem,
7 mileage, and travel allowances paid under this subsection shall be
8 paid from appropriations made to the legislative council or the
9 legislative services agency.
10 SECTION 5. IC 5-28-4-6, AS AMENDED BY P.L.237-2017,
11 SECTION 17, IS AMENDED TO READ AS FOLLOWS [EFFECTIVE
12 JULY 1, 2025]: Sec. 6. (a) The following constitutes a quorum for the
13 transaction of business by the board of the corporation:
14 (1) Seven (7) voting members of the board, if:
15 (A) no additional members are appointed under section 2(c) of
16 this chapter; or
17 (B) one (1) additional member is appointed under section 2(c)
18 of this chapter.
19 (2) Eight (8) voting members of the board, if either two (2) or
20 three (3) additional members are appointed under section 2(c) of
21 this chapter.
22 (b) The following number of affirmative votes is necessary for
23 action to be taken by the board:
24 (1) The affirmative vote of at least seven (7) members, if:
25 (A) no additional members are appointed under section 2(c) of
26 this chapter; or
27 (B) one (1) additional member is appointed under section 2(c)
28 of this chapter.
29 (2) The affirmative vote of at least eight (8) members, if either
30 two (2) or three (3) additional members are appointed under
31 section 2(c) of this chapter.
32 (c) Members of the board may not vote by proxy.
33 SECTION 6. IC 5-28-5-2, AS ADDED BY P.L.4-2005, SECTION
34 34, IS AMENDED TO READ AS FOLLOWS [EFFECTIVE JULY 1,
35 2025]: Sec. 2. (a) Subject to subsection (b), the corporation is granted
36 all powers necessary or appropriate to carry out the corporation's public
37 and corporate purposes under this chapter.
38 (b) Before the corporation may purchase land in a county that
39 in total exceeds one hundred (100) acres whether acquired in one
40 (1) transaction or a series of transactions, the corporation must
41 first give notice to the county or municipality, or both, in which the
42 land is located not later than thirty (30) days before the closing
2025 IN 516—LS 7310/DI 120 7
1 date for the purchase or purchases.
2 SECTION 7. IC 5-28-28-9, AS AMENDED BY P.L.145-2016,
3 SECTION 22, IS AMENDED TO READ AS FOLLOWS [EFFECTIVE
4 JULY 1, 2025]: Sec. 9. (a) The economic incentives and compliance
5 report required under section 5 of this chapter must include an annual
6 report containing summary statistics on the effectiveness of and
7 compliance with all incentives granted by the corporation. The report
8 required by this section must:
9 (1) describe:
10 (1) (A) the overall compliance with the terms and conditions
11 of incentives provided; and
12 (2) (B) penalties imposed for failure to comply with the terms
13 and conditions of incentives provided; and
14 (2) provide a determination of the total aggregate amount of
15 incentives granted by the corporation in the previous two (2)
16 years compared to the total number of new jobs created by
17 the recipients of the incentives during that two (2) year
18 period.
19 The report must also be submitted to the general assembly in an
20 electronic format under IC 5-14-6.
21 (b) Upon request, the corporation shall make available:
22 (1) information specifying each person's compliance with its
23 incentive agreement and any incentive that had to be reduced or
24 paid back as a result of noncompliance with an incentive
25 agreement;
26 (2) information stating, for each incentive recipient, the total
27 incentive provided for each job created, computed from the date
28 the incentive is granted through June 30 of the year of the report;
29 (3) information concerning all waivers or modifications under
30 section 8 of this chapter; and
31 (4) information describing all hearings and determinations under
32 IC 5-28-6-6.
33 SECTION 8. IC 36-7-32.5-12, AS AMENDED BY P.L.123-2024,
34 SECTION 20, IS AMENDED TO READ AS FOLLOWS [EFFECTIVE
35 JULY 1, 2025]: Sec. 12. (a) If the total costs and benefits of the
36 proposed investment of an innovation development district are
37 expected to be an amount less than two billion dollars
38 ($2,000,000,000), the following apply:
39 (1) The executive, or, if applicable, the executives, and the
40 corporation shall enter into an agreement establishing the terms
41 and conditions governing the innovation development district in
42 accordance with this section.
2025 IN 516—LS 7310/DI 120 8
1 (2) If the executive, or, if applicable, the executives, and the
2 corporation cannot enter into an agreement under subdivision (1),
3 the designation of territory under section 9 of this chapter is no
4 longer effective and the innovation development district may not
5 be designated or otherwise established under this chapter.
6 (b) The agreement must include the following provisions:
7 (1) A description of the area, including a list of all parcels to be
8 included within the innovation development district.
9 (2) Covenants and restrictions, if any, upon all or a part of the
10 properties contained within the innovation development district
11 and terms of enforcement of any covenants or restrictions.
12 (3) The due diligence and financial commitments of any party to
13 the agreement and of any owner or developer of property within
14 the innovation development district.
15 (4) The financial projections of the innovation development
16 district.
17 (5) The proposed use of the:
18 (A) net increment; and
19 (B) incremental property tax amount described in section 14(c)
20 of this chapter;
21 that is captured within the innovation development district.
22 (6) The aggregate percentage of annual incremental property tax
23 revenue that will be transferred to the city, town, county, or school
24 corporation, or, if applicable, the cities, towns, counties, or school
25 corporations, under section 19(e) of this chapter. The aggregate
26 percentage transferred may not be less than twelve percent (12%)
27 of the annual amount of incremental property tax revenue
28 deposited in the local innovation development district fund
29 established by section 19 of this chapter. A school corporation
30 that receives a portion of the aggregate percentage of
31 incremental property tax revenue transferred under this
32 chapter may use those funds with no restrictions or specified
33 uses.
34 (7) Subject to the limitations of this chapter, the duration of the
35 designation of an area as an innovation development district.
36 (8) The terms of enforcement of the agreement, which may
37 include the definition of events of default, cure periods, legal and
38 equitable remedies and rights, and penalties and damages, actual
39 or liquidated, upon the occurrence of an event of default.
40 (9) The public facilities to be developed for the innovation
41 development district and the estimated costs of those public
42 facilities.
2025 IN 516—LS 7310/DI 120 9
1 (c) If an innovation development district will include territory
2 located in an existing allocation area described in section 10(b) of this
3 chapter, the executive, or, if applicable, the executives, and the
4 corporation shall enter into an agreement establishing the terms and
5 conditions governing the innovation development district in accordance
6 with this section. The agreement must include the following provisions:
7 (1) The provisions listed in subsection (b)(1) through (b)(9).
8 (2) A provision prohibiting the city, county, town, or other entity
9 that established the applicable existing allocation area described
10 in section 10(b) of this chapter from incurring any additional
11 obligations that require a pledge of future incremental property
12 tax revenue to be paid from the applicable existing allocation area
13 described in section 10(b) of this chapter without first obtaining
14 the consent of the corporation.
15 (3) A provision requiring the maintenance of all applicable
16 property tax records for the parcel or parcels located within the
17 innovation development district during the term of the innovation
18 development district.
19 If the executive, or, if applicable, the executives, and the corporation
20 cannot enter into an agreement under this subsection, the designation
21 of territory under section 9 of this chapter is no longer effective and the
22 innovation development district may not be designated or otherwise
23 established under this chapter.
24 (d) An executive may discuss the terms of an agreement described
25 in this section and hold a meeting as an executive session under
26 IC 5-14-1.5-6.1 with:
27 (1) in the case of a city other than a consolidated city, the
28 common council;
29 (2) in the case of a consolidated city, or a county having a
30 consolidated city, the city-county council;
31 (3) in the case of a town, the town council; and
32 (4) in the case of a county that does not have a consolidated city,
33 the board of county commissioners.
34 (e) Within fifteen (15) days of entering into an agreement under
35 subsection (a), the corporation shall submit a written report on the
36 agreement to the budget committee.
37 (f) Neither an executive nor the corporation may exercise the power
38 of eminent domain within an innovation development district.
2025 IN 516—LS 7310/DI 120