There are three weeks to go after another fast paced, eventful week comes to an end at the General Assembly. Monday will be the last day for bills to be heard in committee and Thursday will be a busy day as the third reading deadline will pressure legislators to finalize several complex bills. The last two weeks will be fully committed to conference committees where we anticipate most of the focus will remain on the budget, road funding, Airbnb, small cell structures, prekindergarten funding and alcohol related issues. There are several complex pieces of legislation remaining and a lot of negotiations to take place. Two of our top priority bills were amended in committee this week and will now move on to their respective chambers.
HB 1002, the road funding bill, was drastically modified by the Senate Tax & Fiscal committee and the difference of opinion on local need between the Senate and House is clear as night and day. It is important for you to read the information below to understand how the bill has changed and the Governor’s recent comments about his road funding priorities.
SB 213, the small cell structure bill, was the second bill amended in committee and we have a bit of good news to share on this bill. Our efforts to identify workable solutions towards a compromise paid off and the bill was vastly improved to maintain local control on critical aspects. The bill will still allow providers to locate in residential neighborhoods and downtowns; however, we regained a great deal of local control on aesthetics and creating protections for property owners in these areas.
Finally, an amendment was inserted into HB 1450 that retroactively nullifies certain annexation waivers, impacting agreements currently in place all around the state. We have communicated our serious concerns to Senator Hershman. After you read the information below we encourage you to contact your senators immediately to let them know about any waivers you have in place and how this legislation could negatively impact your community!
Property Tax Matters
- HB 1450 is a bill that contains several tax-related and local government issues. When it was heard in the Senate Tax and Fiscal Policy Committee this week, language was added to retroactively declare some annexation remonstrance waivers void.
- With this language, annexation remonstrance waivers signed after December 31, 1995 would be void if no annexation was started as of January 1, 2006.
- We believe many municipalities would have made different decisions at the time they extended services in exchange for a remonstrance waiver had they known those agreements would be declared void by the General Assembly in future years. We encourage you to contact your senator as soon as possible and ask them to support removing this language from the bill.
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- HB 1002 was amended in committee and the preliminary numbers are very concerning as locals will see a large reduction in funding from the original version introduced by the House.
- The Senate version of HB 1002 will also impact future revenue increases and increase dependency of local infrastructure on a depreciating resource, the gas tax. As we look for a long term dependable funding mechanism, the gas tax is not it.
- HB 1002 will be one of the final bills decided in conference committee along with the budget bill. The bill will be heard on 2nd and 3rd reading this coming week and then the intense negotiations begin.
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Small Cell Tower Regulation
- Senate Bill 213 was amended to address many of the concerns presented to the committee by Aim. The bill will now go to the full House where it will be debated for additional amendments. We believe this bill will be used for leverage during the conference committee process.
- We will continue to work with the providers to improve the language as the goal is to create a system that allows them to expand their service while protecting property owner investments and rights.
- The amended bill will now be presented to the full House of Representatives and we need our member’s assistance to explain the importance of local government oversight on the location and appearance of these structures.
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Short Term Rentals
- HB 1133 is the “Airbnb bill” that sets a statewide framework of regulation for short term rentals in Indiana. Unfortunately, it greatly restricts local governments’ ability to use customary planning and zoning, even in areas zoned for residential use only.
- Aim has been working with the bill’s proponents on amendments, and one will be offered by the bill’s author that makes it better by giving local governments permitting authority. However, that amendment still will not exclude areas zoned for residential use only from the restrictions in this bill.
- Please contact your senator and ask them to oppose HB 1133 unless an amendment is accepted that would exclude areas zoned for residential use only from this legislation, in addition to the amendment that gives locals permitting authority.
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Insurance Mandate for Reserve Police Officers
- HB 1555 was amended in committee this week with a new requirement for local units to provide disability insurance to reserve police officers.
- When the bill was introduced in the House several questions and concerns were raised about the unknown cost of an insurance policy and what policies are prohibited by statute. The author agreed to move the bill forward as an interim study committee.
- Please respond to our legislative team if this is of great concern for your community. We are gathering information from our members to share with legislators as we continue to research the impact.
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Language that Impacts Annexation Remonstrance Waivers Added to HB 1450
HB 1450 Property tax matters (Leonard, R-Huntington)
In the second half of each session, there are always several bills that start getting loaded up with a wide variety of provisions. HB 1450 is one of those bills and on Tuesday, negative annexation language was added via committee amendment.
It is very common for companies, developers, homebuilders, etc. to voluntarily enter into agreements with municipalities to waive their right to remonstrance against a future annexation in exchange for the extension of municipal sewer services to their properties. The language that was added on Tuesday, however, would void annexation remonstrance waivers signed after December 31, 1995 if no annexation was started as of January 1, 2006.
Annexation is a planning tool that is key to future growth, and retroactively voiding these waiver agreements disrupts decisions that were made in reliance on Indiana’s annexation laws. Aim spoke in opposition when it was presented, but this language was part of a larger amendment that contained many other provisions so it was not considered by the committee on its own merit.
This is a significant policy shift and we are asking the bill’s author, sponsor and other leading legislators to remove that language. Please contact your senator to let them know about this issue and ask them to support removing the retroactive annexation language.
Aim Position: Oppose Annexation Language
Local Road Funding Drastically Reduced
HB 1002 Transportation Infrastructure Funding (Soliday, R-Valparaiso; T. Brown, R-Crawfordsville; Steurewald, R-Avon; Sullivan, R-Evansville)
As expected, the Tax & Fiscal committee made very impactful changes to the original version of HB 1002, the long term road funding plan. Committee members accepted an amendment on Wednesday which made several modifications to the distribution of MVH funds, which are critical to accomplish local maintenance and preservation projects.
The amendment also delayed the adoption of several revenue raising mechanisms which in turn prevent local units from accessing that new revenue past 2017. We now wait for a new fiscal statement to be released by Legislative Services Agency but the initial impact to locals appears to be a decrease of several hundred million dollars from the introduced version. The amendment also reverts the INDOT Community Crossings local match from the current 80/20 match in the bill to the existing 50/50 match. This was a disappointing reversal to the plan as many smaller rural communities are incapable of committing enough funds to submit a grant application for a large scale infrastructure investment. During his regularly scheduled Thursday press event, Speaker Brian Bosma said, “We will stay here until we have a long term plan and I live local.” When Senate President David Long was asked about the Senate proposals ability to meet the states $1.2 billion need he said, “…our plan gets us about $650MM.”
Additional comments were made by Governor Eric Holcomb on Friday afternoon that he is supportive of local funding somewhere between the House and Senate plan and that $200MM will get us to a point where the state and locals are splitting the cost 50/50. What seems to be off the table moving forward is the cigarette tax increase, shifting the sales tax and doing nothing. There is still a lot of room for compromise but the question of how we meet a $1.2 billion state need and a $775MM local need is looking less clear.
We are optimistic that a compromise will be found during conference committee, however, next week will be an imperative time as the bill progresses through the Senate. Local officials will play an important role over the next two weeks remaining engaged with legislators and supporting additional local funding.
Aim Position: Support
Small Cell Towers Bill Modified by House Committee
SB 213 Support Structures for Wireless Facilities (Hershman, R-Buck Creek)
SB 213 was presented to the House Utilities, Energy and Telecommunications committee on March 15th and it was back in committee this Wednesday to be amended prior to a committee vote. Several improvements were made to the bill, which passed out of the committee 11-2. While the vote appears to be a strong indication of support, remarks were made by several committee members who stated the bill needs additional protections for residential areas. Several members also commented that this bill doesn’t get us to where we need to be but that we don’t need to be there this year.
The amendment removed language preventing local units from enforcing aesthetic standards on new structures, which was one of our primary concerns. The amendment also allows for some collocation requirements, increased permit fees, and local control on additional setback and fall zone restrictions.
There are several concerns with the original bill that have not been addressed and we will continue to emphasis those concerns as the bill is heard by all House members. Most importantly is providing home owners with some notification that a small cell structure will be installed in the right of way adjoining their property. We also believe there is support to help local governments ensure structures in a public right of way will not delay a public works project or burden the local unit with any cost for movement of that structure.
This bill continues to move in the right direction for protecting local control and oversight on the placement and appearance of these structures. As anticipated this bill will go to conference committee, however we believe there will be little support in the House if the bill is to become less restrictive so the support is there to maintain current protections in the House version.
Legislation to Restrict Local Control over Short Term Rentals
HB 1133 Preemption of Local Bans on Short Term Rentals (Lehman, R-Berne)
HB 1133 addresses the practice of home-sharing in Indiana through online platforms like Airbnb, VRBO, HomeAway, etc. In addition to pre-empting locals’ ability to ban short term renting, it also establishes a statewide framework that significantly restricts the ability of local governments to respond to this practice through planning and zoning.
Aim has actively lobbied for amendments that would provide a better balance for local governments. The bill’s author has prepared a 2nd reading amendment that makes this legislation more palatable by giving local governments statutory authority to set up a permitting system to require owners to receive a local permit in order to legally offer a home as a short term rental. However, it still would not allow local governments to have appropriate planning and zoning authority.
When Airbnb operators are renting out homes to a different set of renters every few days, that’s not just a home anymore, it’s an unregulated hotel (especially when the home is just an investment property for a commercial operator who does not live there at all). When homebuyers purchase homes in areas zoned for residential use only, they expect that their local government has the ability to enforce that use. But under this legislation, local governments have no ability to enforce customary residential zoning uses in neighborhoods.
Zoning is an inherently local function and it is critical for local governments to retain the ability to respond to what their constituents expect and demand. Please contact your senator and ask them to oppose HB 1133 unless an amendment is accepted that would exclude areas zoned for residential use only, in addition to the amendment that gives locals permitting authority.
Aim Position: Oppose
Reserve Officer Benefits
HB 1555 Police Reserve Officers (Mayfield, R-Martinsville)
The language within HB 1555 has been proposed by Representative Peggy Mayfield for several years, though it has failed to pass as legislation. This year, however, the author of the bill agreed to modify it to an interim study committee and the bill advanced to the Senate with our support. When the bill was presented before the Senate Pension and Labor committee this week, the author offered an amendment to reinsert the language requiring disability insurance coverage for reserve police officers. The challenge with this legislation is that most insurance providers will not offer insurance coverage to an individual that is not a full time employee of the local unit. This requirement applies to a local unit regardless of how many hours the officer provides service. A local unit with an insurance carrier who will not offer coverage to a reserve officer may need to acquire a supplemental policy for coverage to meet this mandate. This requirement has an unknown fiscal impact to local units and a side effect of this legislation is that smaller communities who rely on reserve officers may have to decrease their use due to budgetary restraints.
We are gathering information from members who utilize reserve officers to clarify what their current insurance policies cover, what the associated cost are and if this will cause a large impact on public safety budgets.