HB 1561 — Tax increment financing.

Summary

Provides that a redevelopment commission may use money from certain funds for the purpose of paying more toward debt service obligations, in order to retire debt service earlier, regardless of whether that use is listed in the redevelopment commission's annual spending plan. Provides that a redevelopment commission making accelerated debt payments may retain the assessed value associated with the original debt service schedule. Provides that early debt retirement applies only if the early defeasance of debt is allowed according to the bond issuance documents. Provides that allocated property tax proceeds that are otherwise authorized to be expended for purposes related to a redevelopment project that is located outside the boundaries of the allocation area may be expended for those purposes only if the redevelopment commission immediately at the conclusion of a public hearing adopts a declaratory resolution, and the applicable legislative body votes to approve the declaratory resolution that finds that it has been clearly demonstrated that the expenditure: (1) will directly benefit the allocation area; or (2) will result in the creation or retention of jobs in the private sector and provide an estimate of how many jobs will be created or retained over a specified time period. Provides that the expenditure allowance does not apply to any transfer of property tax proceeds to a school corporation, an accredited or nonaccredited public or private school, or a charter school. Prohibits a redevelopment commission from adopting an amendment to a declaratory resolution that contains an allocation area provision that extends the expiration date of the allocation area provision. Provides that after the expiration of a previous allocation area provision, a redevelopment commission may adopt a declaratory resolution, or an amendment to a declaratory resolution, that contains a new allocation area provision with a new expiration date, and for which the county auditor in which the unit is located shall compute the base assessed value for the allocation area using the assessment date immediately preceding the effective date of the new allocation provision of the declaratory resolution or amendment. Allows a redevelopment commission to, pursuant to the approval of the local legislative body, create an account for a specific infrastructure purpose. Requires a redevelopment commission to provide to the unit's executive and fiscal body an analysis of revenues and expenditures on a per allocation basis and correlate the analysis with the required spending plan. Provides that in jurisdictions where a redevelopment commission has not returned any amount of assessed value in the preceding three years, the redevelopment commission must identify relief measures that could be implemented to alleviate taxpayer burdens. Exempts jurisdictions where the excess assessed value determined by a redevelopment commission is expected to generate less than 200% of the amount of allocated tax proceeds necessary to make, when due, principal and interest payments on certain bonds plus the amount for certain other purposes. Requires a redevelopment commission to report its findings in its annual report. Requires a redevelopment commission to include an invitation to overlapping taxing units to participate in the hearing regarding the redevelopment project. Requires the redevelopment commission to include a record of overlapping taxing unit attendance in its annual report to the department of local government finance. Provides that the adoption of a declaratory resolution and subsequent legislative body approval are not required if the expenditures for purposes related to a redevelopment project that is located outside the boundaries of the allocation area are for: (1) infrastructure; (2) utilities; (3) drainage; or (4) environmental remediation. Enumerates permissible infrastructure maintenance expenditures. Provides that a redevelopment commission may use its discretion, where excess assessed value amounts are not already explicitly set aside for use within the current calendar year for a purpose under a current development plan, to allocate excess assessed value amounts to the respective taxing units rather than reserving those excess assessed value amounts for future or indefinite purposes. Provides that, with regard to the prohibition of a redevelopment commission adopting an amendment to a declaratory judgment that contains an allocation area provision that extends the expiration date of the allocation area provision, a redevelopment commission is not prevented from removing parcels from an existing allocation area before its expiration date or adding parcels to a new allocation area.

Bill Text

Action History

1. February 19, 2025

   Second reading: ordered engrossed

2. February 17, 2025

   Committee report: amend do pass, adopted

3. February 13, 2025

   Representatives Judy and Pryor added as coauthors

4. January 21, 2025

   First reading: referred to Committee on Ways and Means

5. January 21, 2025

   Authored by Representative Clere

6. January 21, 2025

   Coauthored by Representative Dant Chesser

Sponsors

• Cherrish Pryor · Cosponsor
• Chris Judy · Cosponsor
• Edward Clere · Primary
• Wendy Dant Chesser · Cosponsor

Subjects