It’s been a great week at the Statehouse for Indiana’s cities and towns.  Passage of a long-term road funding bill that will make a real difference on the quality of our state’s infrastructure for years to come was certainly the peak.  Other causes for optimism came when our legislative team and membership rallied to defeat a terrible anti-annexation bill that would have given county commissioners final say over a municipality’s proposed annexation, and an anti-TIF bill that would have taken the deciding vote on economic development decisions out of the hands of city and town executives was recommitted to a different committee where it is very unlikely to receive a hearing.  While there were certainly some lows and causes for great concern still remain over bills that attempt to significantly wrestle away local control, we believe Aim’s approach of working more strategically and cooperatively with lawmakers is helping make the case that Indiana benefits from strong, vibrant cities and towns.


Road Funding

  • On Thursday, HB 1002 passed out of the House of Representatives by a vote of 61-36. The bill now moves to the Senate where we foresee the likelihood of several modifications to the current plan.
  • The comprehensive long term funding bill now moves on to the Senate sponsors; Senator Mike Crider, Homeland Security and Transportation Chairman, and Senator Luke Kenley, Appropriation’s Chairman. Senator Kenley has voiced support to address the large funding gap needed to properly maintain our state and local infrastructure needs.
  • Local officials should continue to show support for a long term funding plan and to continue to highlight the local need in your community. The final details on any agreed upon plan likely won’t happen until the last days of session.
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Small Cell Tower Regulation

  • SB 213 will restrict local control and permitting of telecommunication projects to be collocated or maintained on existing wireless structures as well as their placement in public right of ways.
  • Municipal constituents expect their local government has the ability to protect their property rights through planning, zoning and right of way protections. This new process will allow communication service providers to locate these structures in locations that were once protected through planning, zoning or by ordinance.
  • SB 213 passed out of the Senate Utilities committee and will be heard before the Senate next week. We believe the bill will be voted out of the Senate and negotiations will continue in the House.
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Stormwater Fee Exemptions

  • Stormwater fees are user fees that support important stormwater infrastructure in cities, towns, and counties.
  • SB 502 would wholly exempt three classes of using from paying stormwater fees – churches, schools and ag land property taxpayers.
  • Although the bill will not be moved for a vote in committee this year, the Chairman of the Senate Utilities Committee will be taking testimony on the issue on Thursday, February 23. If you have data or information that would help us explain the negative impact of this legislation, please email the Aim legislative team.
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Land Banks

  • Senate Bill 310 would allow 3rd class cities to establish land banks to manage and improve the marketability of distressed properties to return them to productive, tax-paying status.
  • The framework in Senate Bill 310 mirrors legislation from last year that passed unanimously to give 2nd class cities land banking authority.
  • The bill was heard two weeks ago and Aim testified in opposition. We expect the bill to be amended and voted upon in committee on Tuesday of next week.
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DLGF Contract Upload Requirement Modification

  • HB 1450, a DLGF comprehensive bill, was previously heard in Ways and Means. It will be coming back for review by the committee on Monday and for amend and vote.
  • The bill contains a provision to modify last year’s contract upload bill, SB 327. The language currently in HB 1450 makes the contract upload requirement only applicable to contracts of $50,000 or more and excludes employment contracts.
  • Sen. Hershman carried SB 310 in the Senate, where it passed 48-0. This legislation has good momentum, so we are hopeful for the bill’s success this year.
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Road Funding Bill Cruises on to Senate

HB 1002 Transportation Infrastructure Funding (Soliday, R-Valparaiso; T. Brown, R-Crawfordsville; Steurewald, R-Avon; Sullivan, R-Evansville)

HB 1002 cleared a major hurdle on Thursday as it passed out of the House of Representatives by a vote of 61-36. Two additional amendments were accepted to the bill that will have minimal impact on the projected revenue increases. The first amendment will end the annual gas tax one cent index increase in the year 2024, which will require lawmakers to reexamine the stability of the gas tax at that time. The resulting fiscal impact for local units will be felt in 2025 when the purchasing power of the gas tax will once again begin to decline. The second amendment will prevent tolling along interstates that are located within 75 miles of a bridge that is currently being tolled. The debate on tolling is still very early and revenue sharing with local units has not yet been discussed, so there is no fiscal impact on locals from this change.

Rep. Ed Soliday, Aim’s 2016 Legislator of the Year, said, “This comprehensive bill is backed by years of data, providing funding for state and local infrastructure without creating unnecessary debt.”

What remains in the bill are several revenue mechanisms for local government that will address our annual maintenance shortfall of $773 million. The gas tax increases are expected to grow local MVH and LRS funds by as much as 40%. The vehicle infrastructure fee will also increase the revenue available in the Community Crossings program by $90 million bringing the annual grant funds to $190 million. HB 1002 will also reduce the required local match on this program to an 80/20 match, helping local road funding dollars go further.

We anticipate a vigorous debate on HB 1002 in the Senate where committee hearings will begin in early March. Aim members should continue to engage their legislators, both those who supported and opposed the bill, as the debate on the final legislation will continue until the last days of session.

Aim Position: Support

 

Small Cell Towers, Coming to a Neighborhood Near You

SB 213 Support Structures for Wireless Facilities (Hershman, R-Buck Creek)

In order to address increasing demand for broadband coverage and the expansion of 5G service in Indiana these “small cell towers” address service density issues where an addition of a macro cell tower is not possible. In comparison to a 200 foot macro tower, these small towers will have a maximum height of 50 feet and include additional ground level equipment facilities with a volume up to 28 cubic feet. These structures will tower above residential homes and create eyesores in areas where local governments have invested to create aesthetically attractive business areas. The goal of the communication service providers is to locate these structures in residential neighborhoods and dense urban downtown areas. We believe that is still feasible without removing local decision making from the process and allowing an inverse taking of local right of way.

The bill makes several changes by expanding the ability of communication service provider’s to place equipment on municipally owned utility poles, traffic signals and informational signage. We have heard from many municipalities that while the providers currently have the ability to collocate their preference is to place their own tower where they desire it, not to collocate.

However the more concerning part of the bill is amendment language that was accepted into the bill during Senate Utilities Committee on Thursday. Local units will lose nearly all control through zoning, planning and right of way ordinances to determine the appropriate location of these structures. Aim strongly opposes the elimination of local government oversight which impacts our ability to protect the vested property rights of homeowners and businesses.

Aim will continue to address our concerns on preempting local control through planning, zoning and right of way protections. We believe the intent of the bill can be met without the current impact of removing all local oversight. The bill passed out of the Utilities Committee by a vote of 8-2 and we anticipate it will be voted out of the Senate next week where Republicans have a 41-9 majority.

Aim Position: Oppose

   

Bill Would Exempt Agricultural Land, Churches and Schools from Stormwater Fees

SB 502 Stormwater Fee Exemptions (Freeman, R-Indianapolis; Doriot, R-Elkhart)

A bill has been introduced that prohibit municipalities and counties from assessing stormwater fees on: 1) property where religious services are held regularly; 2) property that belongs to a school corporation and is used for educational purposes; and 3) property that is assessed as agricultural land for property tax purposes. Although the exact fiscal impact would depend on how many of these properties would be exempt under SB 502, we do know there are hundreds of thousands of parcels that would no longer be assessed a fee. In 2015 Pay 2016, there were 37,629 exempt religious parcels, 1,845 public schools and 196,314 agricultural parcels.

In 2015, about $80M of revenue was raised from stormwater fees statewide. In most cases, this revenue supports important infrastructure projects that have already been bonded. Especially in areas with large amounts of these exempt users, municipalities would be forced to shift the burden to all other users – even though the users that would be exempt under this bill are often the biggest contributors to stormwater problems.

Fortunately, SB 502 will not be moved for a vote in committee this session, but the Chairman of the Senate Utilities Committee is taking testimony. Therefore, it is important for us to make a strong case for why this is not good public policy, in the event the bill is brought back again in future sessions. If you have stormwater fee data to share with us that we could use to illustrate the negative impact of this legislation, please email the Aim legislative team.

Aim Position: Oppose 

 

Bill Would Allow 3rd Class Cities to Establish Land Banks

SB 310 Land Banks (Hershman, R-Buck Creek; Holdman, R-Markle; Lanane, D-Anderson)

Many cities and towns throughout the state struggle to deal with problem properties that are unsafe, abandoned or vacant. Landbanking is a tool that can be used by government units to acquire these problem properties that the private market is unable or unwilling to buy and turnaround.

The ability for local units to establish land banks requires statutory authorization. In Indiana, counties, Indianapolis and 2nd class cities currently have this authorization, and several have already seen important successes with their programs. Authorizing legislation such as this often proceeds on a piece-by-piece basis, and we are glad to see this extended to 3rd class cities this session with Senate Bill 310.

The bill passed the Senate unanimously this week, and we will continue to advocate for its passage in the House.

Aim Position: Support

     

Contract Upload Requirement Passed in 2016 to be Modified

HB 1450 Property Tax Matters (Leonard, R-Huntington)

HB 1450 is the Department of Local Government Finance’s clean-up bill. There are several measures included in the bill Aim is tracking. One important measure that Aim requested as part of our 2017 legislative initiatives is that the contract upload law that passed last year be amended.

Last year, SB 327 passed which required local government units to upload to the Indiana transparency portal a copy of all contracts which exceeded the lesser of 10% of the political subdivision’s property tax levy or $50,000. While we did not oppose the bill when it passed because we thought it was a positive step toward greater transparency, we thought the requirement would only apply on a going forward basis for all new contracts signed. This was also the way it was discussed in the committee hearings. However, after the bill’s passage, the DLGF released its interpretation of the law. The DLGF required local units to upload all contracts that were currently in effect not just new contracts. This meant that our city and town personnel had to go back to their files and archives, locate previously signed contracts that were in effect and upload them to Gateway.

The language currently in HB 1450 makes the contract upload requirement only applicable to contracts of $50,000 or more and excludes employment contracts. We expect the bill to be amended on Monday in the Ways and Means Committee to make it clear that it does not apply retroactively to previously signed contracts and applies only to new contracts signed on a going forward basis.

Aim Position: Support

 

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