§ 36-7-30-25 — Allocation areas; allocation and distribution of property taxes

Note: This version of section effective until 7-1-2027. See also
following version of this section, effective 7-1-2027.
Sec. 25. (a) The following definitions apply
throughout this section:
(1) "Allocation area" means that part of a military base reuse area
to which an allocation provision of a declaratory resolution
adopted under section 10 of this chapter refers for purposes of
distribution and allocation of property taxes.
(2) "Base assessed value" means, subject to subsection (i):
(A) the net assessed value of all the property as finally
determined for the assessment date immediately preceding the
adoption date of the allocation provision of the declaratory
resolution, as adjusted under subsection (h); plus
(B) to the extent that it is not included in clause (A) or (C), the
net assessed value of any and all parcels or classes of parcels
identified as part of the base assessed value in the declaratory
resolution or an amendment thereto, as finally determined for
any subsequent assessment date; plus
(C) to the extent that it is not included in clause (A) or (B), the
net assessed value of property that is assessed as residential
property under the rules of the department of local government
finance, within the allocation area, as finally determined for the
current assessment date.
Clause (C) applies only to allocation areas established in a
military reuse area after June 30, 1997, and to the part of an
allocation area that was established before June 30, 1997, and that
is added to an existing allocation area after June 30, 1997.
(3) "Property taxes" means taxes imposed under IC 6-1.1 on real
property.
(b) A declaratory resolution adopted under section 10 of this chapter
before the date set forth in IC 36-7-14-39(b) pertaining to declaratory
resolutions adopted under IC 36-7-14-15 may include a provision with
respect to the allocation and distribution of property taxes for the
purposes and in the manner provided in this section. A declaratory
resolution previously adopted may include an allocation provision by
the amendment of that declaratory resolution in accordance with the
procedures set forth in section 13 of this chapter. The allocation
provision may apply to all or part of the military base reuse area. The
allocation provision must require that any property taxes subsequently
levied by or for the benefit of any public body entitled to a distribution
of property taxes on taxable property in the allocation area be allocated
and distributed as follows:
(1) Except as otherwise provided in this section, the proceeds of
the taxes attributable to the lesser of:
(A) the assessed value of the property for the assessment date
with respect to which the allocation and distribution is made; or
(B) the base assessed value;
shall be allocated to and, when collected, paid into the funds of
the respective taxing units.
(2) The excess of the proceeds of the property taxes imposed for
the assessment date with respect to which the allocation and
distribution are made that are attributable to taxes imposed after
being approved by the voters in a referendum or local public
question conducted after April 30, 2010, not otherwise included
in subdivision (1) shall be allocated to and, when collected, paid
into the funds of the taxing unit for which the referendum or local
public question was conducted.
(3) Except as otherwise provided in this section, property tax
proceeds in excess of those described in subdivisions (1) and (2)
shall be allocated to the military base reuse district and, when
collected, paid into an allocation fund for that allocation area that
may be used by the military base reuse district and only to do one
(1) or more of the following:
(A) Pay the principal of and interest and redemption premium
on any obligations incurred by the military base reuse district
or any other entity for the purpose of financing or refinancing
military base reuse activities in or directly serving or benefiting
that allocation area.
(B) Establish, augment, or restore the debt service reserve for
bonds payable solely or in part from allocated tax proceeds in
that allocation area or from other revenues of the reuse
authority, including lease rental revenues.
(C) Make payments on leases payable solely or in part from
allocated tax proceeds in that allocation area.
(D) Reimburse any other governmental body for expenditures
made for local public improvements (or structures) in or
directly serving or benefiting that allocation area.
(E) Pay expenses incurred by the reuse authority, any other
department of the unit, or a department of another
governmental entity for local public improvements or structures
that are in the allocation area or directly serving or benefiting
the allocation area, including expenses for the operation and
maintenance of these local public improvements or structures
if the reuse authority determines those operation and
maintenance expenses are necessary or desirable to carry out
the purposes of this chapter.
(F) Reimburse public and private entities for expenses incurred
in training employees of industrial facilities that are located:
(i) in the allocation area; and
(ii) on a parcel of real property that has been classified as
industrial property under the rules of the department of local
government finance.
However, the total amount of money spent for this purpose in
any year may not exceed the total amount of money in the
allocation fund that is attributable to property taxes paid by the
industrial facilities described in this clause. The
reimbursements under this clause must be made not more than
three (3) years after the date on which the investments that are
the basis for the increment financing are made.
(G) Expend money and provide financial assistance as
authorized in section 9(a)(25) of this chapter.
Except as provided in clause (E), the allocation fund may not be
used for operating expenses of the reuse authority.
(4) Except as provided in subsection (g), before July 15 of each
year the reuse authority shall do the following:
(A) Determine the amount, if any, by which property taxes
payable to the allocation fund in the following year will exceed
the amount of property taxes necessary to make, when due,
principal and interest payments on bonds described in
subdivision (3) plus the amount necessary for other purposes
described in subdivision (3).
(B) Provide a written notice to the county auditor, the fiscal
body of the unit that established the reuse authority, and the
officers who are authorized to fix budgets, tax rates, and tax
levies under IC 6-1.1-17-5 for each of the other taxing units that
is wholly or partly located within the allocation area. The notice
must:
(i) state the amount, if any, of excess property taxes that the
reuse authority has determined may be paid to the respective
taxing units in the manner prescribed in subdivision (1); or
(ii) state that the reuse authority has determined that there are
no excess property tax proceeds that may be allocated to the
respective taxing units in the manner prescribed in
subdivision (1).
The county auditor shall allocate to the respective taxing units
the amount, if any, of excess property tax proceeds determined
by the reuse authority. The reuse authority may not authorize a
payment to the respective taxing units under this subdivision if
to do so would endanger the interest of the holders of bonds
described in subdivision (3) or lessors under section 19 of this
chapter.
(c) For the purpose of allocating taxes levied by or for any taxing
unit or units, the assessed value of taxable property in a territory in the
allocation area that is annexed by a taxing unit after the effective date
of the allocation provision of the declaratory resolution is the lesser of:
(1) the assessed value of the property for the assessment date with
respect to which the allocation and distribution is made; or
(2) the base assessed value.
(d) Property tax proceeds allocable to the military base reuse district
under subsection (b)(3) may, subject to subsection (b)(4), be
irrevocably pledged by the military base reuse district for payment as
set forth in subsection (b)(3).
(e) Notwithstanding any other law, each assessor shall, upon
petition of the reuse authority, reassess the taxable property situated
upon or in or added to the allocation area, effective on the next
assessment date after the petition.
(f) Notwithstanding any other law, the assessed value of all taxable
property in the allocation area, for purposes of tax limitation, property
tax replacement, and the making of the budget, tax rate, and tax levy
for each political subdivision in which the property is located is the
lesser of:
(1) the assessed value of the property as valued without regard to
this section; or
(2) the base assessed value.
(g) If any part of the allocation area is located in an enterprise zone
created under IC 5-28-15, the unit that designated the allocation area
shall create funds as specified in this subsection. A unit that has
obligations, bonds, or leases payable from allocated tax proceeds under
subsection (b)(3) shall establish an allocation fund for the purposes
specified in subsection (b)(3) and a special zone fund. Such a unit
shall, until the end of the enterprise zone phase out period, deposit each
year in the special zone fund any amount in the allocation fund derived
from property tax proceeds in excess of those described in subsection
(b)(1) and (b)(2) from property located in the enterprise zone that
exceeds the amount sufficient for the purposes specified in subsection
(b)(3) for the year. The amount sufficient for purposes specified in
subsection (b)(3) for the year shall be determined based on the pro rata
part of such current property tax proceeds from the part of the
enterprise zone that is within the allocation area as compared to all
such current property tax proceeds derived from the allocation area. A
unit that does not have obligations, bonds, or leases payable from
allocated tax proceeds under subsection (b)(3) shall establish a special
zone fund and deposit all the property tax proceeds in excess of those
described in subsection (b)(1) and (b)(2) that are derived from property
in the enterprise zone in the fund. The unit that creates the special zone
fund shall use the fund (based on the recommendations of the urban
enterprise association) for programs in job training, job enrichment,
and basic skill development that are designed to benefit residents and
employers in the enterprise zone or other purposes specified in
subsection (b)(3), except that where reference is made in subsection
(b)(3) to allocation area it shall refer for purposes of payments from the
special zone fund only to that part of the allocation area that is also
located in the enterprise zone. The programs shall reserve at least
one-half (1/2) of their enrollment in any session for residents of the
enterprise zone.
(h) After each reassessment of real property in an area under the
county's reassessment plan under IC 6-1.1-4-4.2, the department of
local government finance shall adjust the base assessed value one (1)
time to neutralize any effect of the reassessment of the real property in
the area on the property tax proceeds allocated to the military base
reuse district under this section. After each annual adjustment under IC 6-1.1-4-4.5, the department of local government finance shall adjust the
base assessed value to neutralize any effect of the annual adjustment on
the property tax proceeds allocated to the military base reuse district
under this section. However, the adjustments under this subsection may
not include the effect of property tax abatements under IC 6-1.1-12.1,
and these adjustments may not produce less property tax proceeds
allocable to the military base reuse district under subsection (b)(3) than
would otherwise have been received if the reassessment under the
county's reassessment plan or annual adjustment had not occurred. The
department of local government finance may prescribe procedures for
county and township officials to follow to assist the department in
making the adjustments.
(i) If the reuse authority adopts a declaratory resolution or an
amendment to a declaratory resolution that contains an allocation
provision and the reuse authority makes either of the filings required
under section 12(c) or 13(f) of this chapter after the first anniversary of
the effective date of the allocation provision, the auditor of the county
in which the military base reuse district is located shall compute the
base assessed value for the allocation area using the assessment date
immediately preceding the later of:
(1) the date on which the documents are filed with the county
auditor; or
(2) the date on which the documents are filed with the department
of local government finance.
(j) For an allocation area established after June 30, 2024,
"residential property" refers to the assessed value of property that is
allocated to the one percent (1%) homestead land and improvement
categories in the county tax and billing software system, along with the
residential assessed value as defined for purposes of calculating the
rate for the local income tax property tax relief credit designated for
residential property under IC 6-3.6-5-6(d)(3).

Legislative History

As added by P.L.26-1995, SEC.14. Amended by P.L.255-1997(ss), SEC.18; P.L.90-2002, SEC.486; P.L.192-2002(ss), SEC.185; P.L.4-2005, SEC.141; P.L.154-2006, SEC.79; P.L.146-2008, SEC.770; P.L.104-2010, SEC.2; P.L.203-2011, SEC.19; P.L.112-2012, SEC.59; P.L.95-2014, SEC.7; P.L.86-2018, SEC.347; P.L.214-2019, SEC.47; P.L.257-2019, SEC.137; P.L.156-2020, SEC.142; P.L.174-2022, SEC.74.