April 23, 2021
The Big Issues
- The final $36B budget passed on Thursday. It includes several notable provisions of interest to cities and towns:
o $250M for broadband deployment grants.
o $10M for body camera grants to be used for purchasing new camera equipment.
o $7M for law enforcement training grants.
o $100M to the Water Infrastructure Revolving Loan Fund and an additional $60M in water and infrastructure grants.
o $60M for the Next Level Trails Program.
- The Senate and House versions of the budget included $150M for the Regional Economic Acceleration Development Initiative (READI) grant program. This was increased to $500M in the final version of the budget.
o This is a program similar in concept to the Regional Cities Initiative.
o It is open to more than just RDAs, as other qualified regional economic development bodies will be eligible.
o The program will be administered through the IEDC and will require regional economic development plans that align with statewide economic development priorities.
o In addition to this regional funding source, the LIT rate for RDAs was increased from 0.05% to 0.5% to provide some long-run funding for these initiatives.
- Many of these initiatives were funded using one-time federal dollars through the American Rescue Plan Act. We are appreciative to the General Assembly for funding so many important priorities for local governments.
- HB 1437 creates a framework for members of local governing bodies to participate in public meetings virtually under a locally-adopted policy and in compliance with certain state-set guardrails. We are pleased to report that it was signed into law by Governor Holcomb this week, and is already in effect as law.
- Under this new law, a governing body must adopt a local policy in order to allow members of the body to participate in public meetings virtually. The law contains several state-set guardrails that must be met (e.g., limiting the number of meetings that any one member can attend virtually each year unless there are extenuating circumstances and requiring at least 50% of the members to be in person). A local policy can be more strict than the state law, but not less strict.
- In the coming weeks, Aim will be providing a comprehensive summary of the law and a template policy you may use as a starting point when considering whether to integrate this new ability into your public meetings. Please note that under this law, you can still use fully virtual meetings under a declared disaster emergency, as many of you have been doing throughout the pandemic. If you want to continue offering virtual meetings in some form once the emergency expires, it’s prudent to begin the process of preparing your written policy.
BUSINESS PERSONAL PROPERTY TAX
- SB 336 would increase the business personal property tax exemption to $80,000 (from $40,000), allowing more businesses to be exempt from the tax, increasing tax rates on other properties, and increasing circuit breaker losses to local units. The bill passed the Senate 38-11 and the House 68-19 this week.
- The originally introduced version contained far more significant language that eliminated the depreciation floor on new business personal property, but those provisions were removed in the first half of session. The House Ways & Means Committee also amended the mechanics of the bill, which lowers the fiscal impact to local units as compared to the Senate-passed version. In its final form, this bill would cause about a $7.9M statewide hit to local governments. You can see the county-by-county estimated revenue losses here.
- Although the impact is lessened, the bill still represents a “chipping away” at the BPPT without an identified state revenue replacement plan. Several key lawmakers continue to indicate an interest in phasing out or eliminating the BPPT in a future session.
ELECTRONIC PUBLIC NOTICES
- SB 332 would allow some of the public notices currently required to be published in the local paper to be published on the local unit’s website instead.
- Under SB 332, if a notice is required to be published 2 or more times in a local paper, the local unit would still have to publish the first notice in the paper but could choose to post any subsequent notices on the unit’s official website instead.
- Aim supports this bill as a first step toward modernizing public noticing. The bill, authored by Sen. Jim Buck (R-Kokomo), passed the Senate 35-14 and the House 51-40. It will now move to the Governor for his consideration.
WASTEWATER TASK FORCE
- SB 348 creates an 18-member task force to examine statewide wastewater issues including consolidation, acquisition, and lifecycle management, and to develop a long-term plan to address wastewater needs in Indiana.
- The membership of this task force will include 12 legislators and 6 others appointed by the Governor. The Governor’s appointments must include one member specifically representing municipalities served by a wastewater operator that is not under the jurisdiction of the IURC. This bill was also amended to create a water infrastructure grant program, which likely will be a compliment to the $60M provided in the budget for water infrastructure grants.
- SB 348, authored by Senator Eric Koch (R-Bedford), passed the Senate with a vote of 49-0 and passed the House with a vote of 82-9.
AN AIM LEGISLATIVE MOMENT
“Just a few things to keep in mind [about the American Rescue Plan Act]. First, go to our website and on our homepage where you will find a lot of information. First, make sure you have adopted the proper ordinance. There are a lot of sample ordinances going around our listserv and our website. The second step is dependant upon on the size of your community. If you’re under 50,000 population, you need a DUNS number to accept the revenue from the state. Your money will go to the state first and be redistributed back out to each of you individually. If you’re over 50,000 population, you have to have a DUNS number and you have to be registered and have an active SAM registration. Follow the links on our website.”
– Matt Greller, Aim CEO
Our Legislative Summary Sponsors
Please click on the logos below to learn more about our sponsors.