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Indiana General Assembly > Session > 1997 Special Session 1 > Enroll Bill 3 - Taxation, annexation, and finance Enroll Bill 3 - Taxation, annexation, and finance

First Special Session 110th General Assembly (1997)


PRINTING CODE. Amendments: Whenever an existing statute (or a section of the Indiana Constitution) is being amended, the text of the existing provision will appear in this style type, additions will appear in this style type, and deletions will appear in this style type.
Additions: Whenever a new statutory provision is being enacted (or a new constitutional provision adopted), the text of the new provision will appear in this style type. Also, the word NEW will appear in that style type in the introductory clause of each SECTION that adds a new provision to the Indiana Code or the Indiana Constitution.
Conflict reconciliation: Text in a statute in this style type or this style type reconciles conflicts between statutes enacted by the 1996 General Assembly.

SENATE ENROLLED ACT No. 3



     AN ACT to amend the Indiana Code concerning local government and taxation.

Be it enacted by the General Assembly of the State of Indiana:


SOURCE: IC 5-1.4-1-5; (97)LS8017.1. -->

    SECTION 1. IC 5-1.4-1-5 IS AMENDED TO READ AS FOLLOWS [EFFECTIVE UPON PASSAGE]: Sec. 5. "City" refers to:
         (1) a consolidated city; or
         (2) a city of the second class; or
        (3) a city with a population of more than four thousand two hundred (4,200) but less than five thousand (5,000) located in a county having a population of more than thirty-eight thousand five hundred (38,500) but less than thirty-nine thousand (39,000).

SOURCE: IC 5-1.4-1-10; (97)LS8017.2. -->

    SECTION 2. IC 5-1.4-1-10 IS AMENDED TO READ AS FOLLOWS [EFFECTIVE UPON PASSAGE]: Sec. 10. "Qualified entity" means the following:
        (1) The consolidated city or A city. of the second class.
        (2) The consolidated city's A county. or the second-class city's county.         (3) Any A special taxing district located wholly within the a county.
        (4) Any entity whose tax levies are subject to review and modification by the a city-county legislative body under IC 36-3-6-9.
        (5) In A political subdivision (as defined in IC 36-1-2-13 ) that is located wholly within any a county: having a population of:
            
(A) that has a population of:
                (i)
more than four hundred thousand (400,000) but less than seven hundred thousand (700,000); or
                (B) (ii) more than two hundred thousand (200,000) but less than three hundred thousand (300,000); or
             (B) containing a city that:
                (i) is described in section 5(3) of this chapter; and
                (ii) has a public improvement bond bank under this article.
        any other political subdivision (as defined in IC 36-1-2-13 ) located wholly within the county.
        (6) Any authority created under IC 36 that leases land or facilities to any qualified entity listed in subdivisions (1) through (5).
SOURCE: IC 5-1.4-2-1; (97)LS8017.3. -->

    SECTION 3. IC 5-1.4-2-1 IS AMENDED TO READ AS FOLLOWS [EFFECTIVE UPON PASSAGE]: Sec. 1. (a) In a consolidated city or second class city there is established a local public improvement bond bank, to be known as "The ______ (name of city) _______ Local Public Improvement Bond Bank", for:
         (1) the public purposes set out in this article; and
        (2) in the case of a city described in IC 5-1.4-1-5 (3), the additional public purposes of:
            (A) developing infrastructure;
            (B) promoting education and tourism; and
            (C) assisting economic development.
    (b) The bank is a body corporate and politic separate from the city in its corporate capacity.
    (c) The purpose of the bank is to buy and sell securities of qualified entities.
SOURCE: IC 5-1.4-2-1.5; (97)LS8017.4. -->

    SECTION 4. IC 5-1.4-2-1.5 IS ADDED TO THE INDIANA CODE AS A NEW SECTION TO READ AS FOLLOWS [EFFECTIVE UPON PASSAGE]: Sec. 1.5. The general assembly finds that the establishment of a local public improvement bond bank in a city described in IC 5-1.4-1-5 (3):
        (1) is necessary as a result of:
            (A) unique sources of revenues available to the city in relation to its budget;
            (B) extraordinary needs for infrastructure improvements in the city and in the county in which the city is located;
            (C) unprecedented opportunities for economic development, including tourism development; and
            (D) unique demands for education and workforce development, including facilities for providing education and training;
        (2) will afford the city the necessary flexibility to address the extraordinary demands and opportunities in a manner that will best serve the interests of the city and the state; and
        (3) constitutes an important public purpose and will protect and improve the health, safety, and welfare of the people of the city and the state.

SOURCE: IC 6-1.1-12.1-2; (97)LS8017.5. -->

    SECTION 5. IC 6-1.1-12.1-2 , AS AMENDED BY P.L.85-1995, SECTION 1, IS AMENDED TO READ AS FOLLOWS [EFFECTIVE JULY 1, 1997]: Sec. 2. (a) A designating body may find that a particular area within its jurisdiction is an economic revitalization area. However, the deduction provided by this chapter for economic revitalization areas not within a city or town shall not be available to retail businesses.
    (b) In a county containing a consolidated city or within a city or town, a designating body may find that a particular area within its jurisdiction is a residentially distressed area. Designation of an area as a residentially distressed area has the same effect as designating an area as an economic revitalization area, except that the amount of the deduction shall be calculated as specified in section 4.1 of this chapter and the deduction is allowed for five (5) years. In order to declare a particular area a residentially distressed area, the designating body must follow the same procedure that is required to designate an area as an economic revitalization area and must make all the following additional findings or all the additional findings described in subsection (c):
        (1) The area is comprised of parcels that are either unimproved or contain only one (1) or two (2) family dwellings or multifamily dwellings designed for up to four (4) families, including accessory buildings for those dwellings.
        (2) Any dwellings in the area are not permanently occupied and are:
            (A) the subject of an order issued under IC 36-7-9 ; or
            (B) evidencing significant building deficiencies.
        (3) Parcels of property in the area:
            (A) have been sold and not redeemed under IC 6-1.1-24 and IC 6-1.1-25 ; or
            (B) are owned by a unit of local government.
However, in a city in a county having a population of more than two hundred thousand (200,000) but less than three hundred thousand (300,000), the designating body is only required to make one (1) of the additional findings described in this subsection or one (1) of the additional findings described in subsection (c).
    (c) In a county containing a consolidated city or within a city or town, a designating body that wishes to designate a particular area a residentially distressed area may make the following additional findings as an alternative to the additional findings described in subsection (b):
        (1) A significant number of dwelling units within the area are not permanently occupied or a significant number of parcels in the area are vacant land.
        (2) A significant number of dwelling units within the area are:
            (A) the subject of an order issued under IC 36-7-9 ; or
            (B) evidencing significant building deficiencies.
        (3) The area has experienced a net loss in the number of dwelling units, as documented by census information, local building and demolition permits, or certificates of occupancy, or the area is owned by Indiana or the United States.
        (4) The area (plus any areas previously designated under this subsection) will not exceed ten percent (10%) of the total area within the designating body's jurisdiction.
However, in a city in a county having a population of more than two hundred thousand (200,000) but less than three hundred thousand (300,000), the designating body is only required to make one (1) of the additional findings described in this subsection as an alternative to one (1) of the additional findings described in subsection (b).
    (d) A designating body is required to attach the following conditions to the grant of a residentially distressed area designation:         (1) The deduction will not be allowed unless the dwelling is rehabilitated to meet local code standards for habitability.
        (2) If a designation application is filed, the designating body may require that the redevelopment or rehabilitation be completed within a reasonable period of time.
    (e) To make a designation described in subsection (a) or (b), the designating body shall use procedures prescribed in section 2.5 of this chapter.
    (f) The property tax deductions provided by sections 3 and 4.5 of this chapter are only available for property and new manufacturing equipment, respectively, within an area which the designating body finds to be an economic revitalization area.
    (g) The designating body may adopt a resolution establishing general standards to be used, along with the requirements set forth in the definition of economic revitalization area, by the designating body in finding an area to be an economic revitalization area. The standards must have a reasonable relationship to the development objectives of the area in which the designating body has jurisdiction. The following three (3) sets of standards may be established:
        (1) One (1) relative to the deduction under section 3 of this chapter for economic revitalization areas that are not residentially distressed areas.
        (2) One (1) relative to the deduction under section 3 of this chapter for residentially distressed areas.
        (3) One (1) relative to the deduction allowed under section 4.5 of this chapter.
    (h) A designating body may impose a fee for filing a designation application for a person requesting the designation of a particular area as an economic revitalization area. The fee may be sufficient to defray actual processing and administrative costs. However, the fee charged for filing a designation application for a parcel that contains one (1) or more owner-occupied, single-family dwellings may not exceed the cost of publishing the required notice.
    (i) In declaring an area an economic revitalization area, the designating body may:
        (1) limit the time period to a certain number of calendar years during which the area shall be so designated;
        (2) limit the type of deductions that will be allowed within the economic revitalization area to either the deduction allowed under section 3 of this chapter or the deduction allowed under section 4.5 of this chapter;         (3) limit the dollar amount of the deduction that will be allowed with respect to new manufacturing equipment if a deduction under this chapter had not been filed before July 1, 1987, for that equipment;
        (4) limit the dollar amount of the deduction that will be allowed with respect to redevelopment and rehabilitation occurring in areas that are designated as economic revitalization areas on or after September 1, 1988; or
        (5) impose reasonable conditions related to the purpose of this chapter or to the general standards adopted under subsection (g) for allowing the deduction for the redevelopment or rehabilitation of the property or the installation of the new manufacturing equipment.
To exercise one (1) or more of these powers a designating body must include this fact in the resolution passed under section 2.5 of this chapter.
    (j) Notwithstanding any other provision of this chapter, if a designating body limits the time period during which an area is an economic revitalization area, that limitation does not:
        (1) prevent a taxpayer from obtaining a deduction for new manufacturing equipment installed before January 1, 2006, but after the expiration of the economic revitalization area if:
            (A) the economic revitalization area designation expires after December 30, 1995; and
            (B) the new manufacturing equipment was described in a statement of benefits submitted to and approved by the designating body in accordance with section 4.5 of this chapter before the expiration of the economic revitalization area designation; or
        (2) limit the length of time a taxpayer is entitled to receive a deduction to a number of years that is less than the number of years designated under section 4 or 4.5 of this chapter.
    (k) Notwithstanding any other provision of this chapter, deductions:
        (1) that are authorized under section 3 of this chapter for property in an area designated as an urban development area before March 1, 1983, and that are based on an increase in assessed valuation resulting from redevelopment or rehabilitation that occurs before March 1, 1983; or
        (2) that are authorized under section 4.5 of this chapter for new manufacturing equipment installed in an area designated as an urban development area before March 1, 1983;
apply according to the provisions of this chapter as they existed at the time that an application for the deduction was first made. No deduction that is based on the location of property or new manufacturing equipment in an urban development area is authorized under this chapter after February 28, 1983, unless the initial increase in assessed value resulting from the redevelopment or rehabilitation of the property or the installation of the new manufacturing equipment occurred before March 1, 1983.
    (l) If property located in an economic revitalization area is also located in an allocation area (as defined in IC 36-7-14-39 or IC 36-7-15.1-26 ), an application for the property tax deduction provided by this chapter may not be approved unless the commission that designated the allocation area adopts a resolution approving the application.
SOURCE: IC 6-1.1-39-5; (97)LS8017.6. -->

    SECTION 6. IC 6-1.1-39-5 IS AMENDED TO READ AS FOLLOWS [EFFECTIVE JULY 1, 1997]: Sec. 5. (a) A declaratory ordinance adopted under section 2 of this chapter and confirmed under section 3 of this chapter must include a provision with respect to the allocation and distribution of property taxes for the purposes and in the manner provided in this section. The allocation provision must apply to the entire economic development district. The allocation provisions 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 economic development district 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. However, if the effective date of the allocation provision of a declaratory ordinance is after March 1, 1985, and before January 1, 1986, and if an improvement to property was partially completed on March 1, 1985, the unit may provide in the declaratory ordinance that the taxes attributable to the assessed value of the property as finally determined for March 1, 1984, shall be allocated to and, when collected, paid into the funds of the respective taxing units.
        (2) Except as otherwise provided in this section, part or all of the property tax proceeds in excess of those described in subdivision (1), as specified in the declaratory ordinance, shall be allocated to the unit for the economic development district and, when collected, paid into a special fund established by the unit for that economic development district that may be used only to pay the principal of and interest on obligations owed by the unit under IC 4-4-8 for the financing of industrial development programs in, or serving, that economic development district. The amount not paid into the special fund shall be paid to the respective units in the manner prescribed by subdivision (1).
        (3) When the money in the fund is sufficient to pay all outstanding principal of and interest (to the earliest date on which the obligations can be redeemed) on obligations owed by the unit under IC 4-4-8 for the financing of industrial development programs in, or serving, that economic development district, money in the special fund in excess of that amount shall be paid to the respective taxing units in the manner prescribed by subdivision (1).
    (b) Property tax proceeds allocable to the economic development district under subsection (a)(2) must, subject to subsection (a)(3), be irrevocably pledged by the unit for payment as set forth in subsection (a)(2).
    (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 economic development district that is annexed by any taxing unit after the effective date of the allocation provision of the declaratory ordinance 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) Notwithstanding any other law, each assessor shall, upon petition of the fiscal body, reassess the taxable property situated upon or in, or added to, the economic development district effective on the next assessment date after the petition.
    (e) Notwithstanding any other law, the assessed value of all taxable property in the economic development district, for purposes of tax limitation, property tax replacement (except as provided in IC 6-1.1-21-3 (c), IC 6-1.1-21-4 (a)(3), and IC 6-1.1-21-5 (c)), and formulation 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.
    (f) The state board of accounts and state board of tax commissioners shall make the rules and prescribe the forms and procedures that they consider expedient for the implementation of this chapter. After each general reassessment under IC 6-1.1-4 , the state board of tax commissioners shall adjust the base assessed value one (1) time to neutralize any effect of the general reassessment on the property tax proceeds allocated to the district under this section. However, the adjustment may not include the effect of property tax abatements under IC 6-1.1-12.1.
    (g) As used in this section, "property taxes" means:
        (1) taxes imposed under this article on real property; and
        (2) any part of the taxes imposed under this article on depreciable personal property that the unit has by ordinance allocated to the economic development district. However, the ordinance may not limit the allocation to taxes on depreciable personal property with any particular useful life or lives.
If a unit had, by ordinance adopted before May 8, 1987, allocated to an economic development district property taxes imposed under IC 6-1.1 on depreciable personal property that has a useful life in excess of eight (8) years, the ordinance continues in effect until an ordinance is adopted by the unit under subdivision (2).
    (h) As used in this section, "base assessed value" means:
         (1) the net assessed value of all the property as finally determined for the assessment date immediately preceding the effective date of the allocation provision of the declaratory resolution, as adjusted under subsection (f); plus
         (2) to the extent that it is not included in subdivision (1), the net assessed value of property that is assessed as residential property under the rules of the state board of tax commissioners, as finally determined for any assessment date after the effective date of the allocation provision.
Subdivision (2) applies only to economic development districts established after June 30, 1997, and to additional areas established after June 30, 1997.
SOURCE: IC 8-1-2.3-6; (97)LS8017.7. -->

    SECTION 7. IC 8-1-2.3-6 , AS AMENDED BY P.L.79-1996, SECTION 1, IS AMENDED TO READ AS FOLLOWS [EFFECTIVE JULY 1, 1997]: Sec. 6. The boundaries of the assigned service areas of electricity suppliers may not be changed except under any one (1) of the following circumstances:
        (1) If a municipality which owns and operates an electric utility system and furnishes retail electric service to the public annexes area beyond the assigned service area of its municipally owned electric utility, and the ordinance providing for the annexation provides that the annexing city has developed a fiscal plan and has established a definite policy to furnish the territory to be annexed within a period of three (3) years governmental and proprietary services substantially equivalent in standard and scope to the governmental and proprietary services furnished by the annexing city to other areas of the city which have characteristics of topography, patterns of land utilization and population density similar to the territory to be annexed, then the municipally owned electric utility may petition the commission to change the assigned service area of the municipally owned electric utility to include the annexed area. A municipally owned electric utility shall exercise its right to petition the commission to change its assigned service area within sixty (60) days after annexation becomes final or lose its right under this subdivision. The commission shall rule on the petition of the municipally owned electric utility within ninety (90) days after its filing. If, upon notice and after hearing, the commission decides that it is in the public convenience and necessity for the municipally owned electric utility to render service to the annexed area, it shall order the assigned service area of the municipally owned electric utility to be changed to include the annexed area with the right to serve and immediate possession to the municipally owned electric utility. The commission order is enforceable in court pending an appeal of that order. An appellant from a court order enforcing a commission order under this subsection shall not be entitled to a stay of the court order pending appeal. In determining public convenience and necessity, the commission shall give consideration to all relevant matters, including but not limited to the following:
            (A) Preference of owners, occupiers, and consumers in the annexed area.
            (B) Ability of the municipally owned electric utility to render service after the assignment of service area.
            (C) Other utility services to be supplied in the annexed area by the municipality.
            (D) Proximity and capability of the service repair facilities of the electricity suppliers involved.
            (E) Preference of local government officials.
        However, this subdivision does not apply to incorporations, consolidations, mergers, or annexations that are under IC 36-4-3-4 (a)(3), IC 36-4-3-4 (b), IC 36-4-3-4 (g), IC 36-4-3-4 (h), or IC 36-4-3-4.1 , or that are not contiguous under IC 36-4-3-13 (b) or IC 36-4-3-13 (c). If any change in an assigned service area is ordered by the commission, all of the electric utility property of another electricity supplier which is devoted to retail electric service within such additional assigned service area shall be acquired at its then reproduction cost new depreciated value; in addition, the acquiring electricity supplier shall pay severance damages limited to, if applicable, the distribution and substation facilities dedicated to and located within the annexed area or relocated by reason of the annexation, or an amount equal to two and one-half (2 1/2) times the previous year's gross electric sales from the newly assigned service area, whichever is greater. If the parties do not agree on the amount the acquiring electricity supplier is to pay, then the commission shall determine said amount and order its payment in accordance with this subsection.
        (2) Upon mutual agreement of the affected electricity suppliers and approval of the commission.
        (3) In the case where a landowner owns a single tract of land which is intersected by the boundary lines of two (2) or more assigned service areas, and retail electric service can best be supplied by only one (1) electricity supplier, or in the case where a customer or customers which are housed in a single structure or which constitute a single governmental, industrial, or institutional operation, and the electricity suppliers involved are unable to agree which shall furnish the electric service, any of the electricity suppliers may submit the matter to the commission for its determination based upon public convenience and necessity. If, after notice and hearing, the commission determines that one (1) or more electricity suppliers are to supply the required retail electric service and the boundaries of an assigned service area are to be changed, the assigned service area maps of the electricity suppliers shall be changed to reflect the new boundaries.
SOURCE: IC 8-22-3.5-9; (97)LS8017.8. -->

    SECTION 8. IC 8-22-3.5-9 , AS AMENDED BY HEA 1206-1997, IS AMENDED TO READ AS FOLLOWS [EFFECTIVE JULY 1, 1997]: Sec. 9. (a) As used in this section, "base assessed value" means:
         (1) the net assessed value of all the tangible property as finally determined for the assessment date immediately preceding the effective date of the allocation provision of the commission's resolution adopted under section 5 of this chapter; plus
         (2) to the extent it is not included in subdivision (1), the net assessed value of property that is assessed as residential property under the rules of the state board of tax commissioners, as finally determined for any assessment date after the effective date of the allocation provision.
However, subdivision (2) applies only to an airport development zone established after June 30, 1997, and the portion of an airport development zone established before June 30, 1997, that is added to an existing airport development zone.

    (b) Except in a county described in section 1(5) of this chapter, a resolution adopted under section 5 of this chapter and confirmed under section 6 of this chapter must include a provision with respect to the allocation and distribution of property taxes for the purposes and in the manner provided in this section.
    (c) The allocation provision must:
        (1) apply to the entire airport development zone; and
        (2) require that any property tax on taxable tangible property subsequently levied by or for the benefit of any public body entitled to a distribution of property taxes in the airport development zone be allocated and distributed as provided in subsections (d) and (e).
    (d) Except in a county described in section 1(5) of this chapter, and as otherwise provided in this section, the proceeds of the taxes attributable to the lesser of:
        (1) the assessed value of the tangible property for the assessment date with respect to which the allocation and distribution is made; or
        (2) the base assessed value; shall be allocated and, when collected, paid into the funds of the respective taxing units.
    (e) Except in a county described in section 1(5) of this chapter, all of the property tax proceeds in excess of those described in subsection (d) shall be allocated to the eligible entity for the airport development zone and, when collected, paid into special funds as follows:
        (1) The commission may determine that a portion of tax proceeds shall be allocated to a training grant fund to be expended by the commission without appropriation solely for the purpose of reimbursing training expenses incurred by public or private entities in the training of employees for the qualified airport development project.
        (2) Except as provided in subsection (f), all remaining tax proceeds shall be allocated to a debt service fund and dedicated to the payment of principal and interest on revenue bonds of the airport authority for a qualified airport development project or to the payment of leases for a qualified airport development project.
    (f) Except in a county described in section 1(5) of this chapter, if the tax proceeds allocated to the debt service fund exceed the amount necessary to:
        (1) pay principal and interest on airport authority revenue bonds;
        (2) pay lease rentals on leases of a qualified airport development project; or
        (3) create, maintain, or restore a reserve for airport authority revenue bonds or for lease rentals or leases of a qualified airport development project;
the excess over that amount shall be paid to the respective taxing units in the manner prescribed by subsection (d).
    (g) Except in a county described in section 1(5) of this chapter, when money in the debt service fund is sufficient to pay all outstanding principal and interest (to the earliest date on which the obligations can be redeemed) on revenue bonds issued by the airport authority for the financing of qualified airport development projects and all lease rentals payable on leases of qualified airport development projects, money in the debt service fund in excess of that amount shall be paid to the respective taxing units in the manner prescribed by subsection (d).
    (h) Except in a county described in section 1(5) of this chapter, property tax proceeds allocable to the debt service fund under subsection (e)(2) must, subject to subsection (g), be irrevocably pledged by the eligible entity for the purpose set forth in subsection (e)(2).
    (i) Except in a county described in section 1(5) of this chapter, and notwithstanding any other law, each assessor shall, upon petition of the commission, reassess the taxable tangible property situated upon or in, or added to, the airport development zone effective on the next assessment date after the petition.
    (j) Except in a county described in section 1(5) of this chapter, and notwithstanding any other law, the assessed value of all taxable tangible property in the airport development zone, for purposes of tax limitation, property tax replacement, and formulation 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 tangible property as valued without regard to this section; or
        (2) the base assessed value.
SOURCE: IC 36-4-3-4; (97)LS8017.9. -->

    SECTION 9. IC 36-4-3-4 , AS AMENDED BY P.L.79-1996, SECTION 2, IS AMENDED TO READ AS FOLLOWS [EFFECTIVE JULY 1, 1997]: Sec. 4. (a) The legislative body of a municipality may, by ordinance annex any of the following:
        (1) Territory that is contiguous to the municipality.
        (2) Territory that is not contiguous to the municipality and is occupied by a municipally owned or operated airport or landing field.
        (3) Territory that is not contiguous to the municipality but is found by the legislative body to be occupied by a municipally owned or regulated sanitary landfill, golf course, or hospital. However, if territory annexed under this subsection ceases to be used as a municipally owned or regulated sanitary landfill, golf course, or hospital for at least one (1) year, the territory reverts to the jurisdiction of the unit having jurisdiction before the annexation if the unit that had jurisdiction over the territory still exists. If the unit no longer exists, the territory reverts to the jurisdiction of the unit that would currently have jurisdiction over the territory if the annexation had not occurred. The clerk of the municipality shall notify the offices required to receive notice of a disannexation under section 19 of this chapter when the territory reverts to the jurisdiction of the unit having jurisdiction before the annexation.     (b) This subsection applies to municipalities in a county having a population of:
        (1) more than seventy-three thousand (73,000) but less than seventy-five thousand (75,000);
        (2) more than sixty thousand (60,000) but less than sixty-five thousand (65,000);
        (3) more than forty-one thousand (41,000) but less than forty-two thousand five hundred (42,500);
        (4) more than thirty-eight thousand three hundred (38,300) but less than thirty-eight thousand five hundred (38,500);
        (5) more than thirty-five thousand four hundred (35,400) but less than thirty-six thousand (36,000);
        (6) more than twenty-four thousand eight hundred (24,800) but less than twenty-five thousand (25,000); or
        (7) more than twenty-two thousand (22,000) but less than twenty-three thousand (23,000); or
         (8) more than two hundred thousand (200,000) but less than three hundred thousand (300,000).
Except as provided in subsection (c), the legislative body of a municipality to which this subsection applies may, by ordinance annex territory that is not contiguous to the municipality, has its entire area not more than two (2) miles from the municipality's boundary, is to be used for an industrial park containing one (1) or more businesses, and is either owned by the municipality or by a property owner who consents to the annexation. However, if territory annexed under this subsection is not used as an industrial park within five (5) years after the date of passage of the annexation ordinance, or if the territory ceases to be used as an industrial park for at least one (1) year, the territory reverts to the jurisdiction of the unit having jurisdiction before the annexation if the unit that had jurisdiction over the territory still exists. If the unit no longer exists, the territory reverts to the jurisdiction of the unit that would currently have jurisdiction over the territory if the annexation had not occurred. The clerk of the municipality shall notify the offices entitled to receive notice of a disannexation under section 19 of this chapter when the territory reverts to the jurisdiction of the unit having jurisdiction before the annexation.
     (c) A city in a county with a population of more than two hundred thousand (200,000) but less than three hundred thousand (300,000) may not annex territory as prescribed in subsection (b) until the territory is zoned by the county for industrial purposes.
    (c) (d) Notwithstanding any other law, territory that is annexed under subsection (b) or (g) is not considered a part of the municipality for the purposes of:
        (1) annexing additional territory:
             (A) in a county that is not described by clause (B); or
            (B) in a county having a population of more than two hundred thousand (200,000) but less than three hundred thousand (300,000), unless the boundaries of the noncontiguous territory become contiguous to the city, as allowed by Indiana law;

        (2) expanding the municipality's extraterritorial jurisdictional area; or
        (3) changing an assigned service area under IC 8-1-2.3-6 (1).
    (d) (e) As used in this section, "airport" and "landing field" have the meanings prescribed by IC 8-22-1.
    (e) (f) As used in this section, "hospital" has the meaning prescribed by IC 16-18-2-179 (b).
    (f) (g) An ordinance adopted under this section must assign the territory annexed by the ordinance to at least one (1) municipal legislative body district.
    (g) (h) This subsection applies to a municipality having a population of more than thirty-two thousand (32,000) but less than thirty-three thousand (33,000) that is located within a county having a population of more than seventy-three thousand (73,000) but less than seventy-five thousand (75,000). The legislative body of a municipality may, by ordinance, annex territory that:
        (1) is not contiguous to the municipality;
        (2) has its entire area not more than eight (8) miles from the municipality's boundary;
        (3) does not extend more than:
            (A) one and one-half (1 1/2) miles to the west;
            (B) three-fourths (3/4) mile to the east;
            (C) one-half (1/2) mile to the north; or
            (D) one-half (1/2) mile to the south;
        of an interchange of an interstate highway (as designated by the federal highway authorities) and a state highway (as designated by the state highway authorities); and
        (4) is owned by the municipality or by a property owner that consents to the annexation.
SOURCE: IC 36-4-3-4.5; (97)LS8017.10. -->

    SECTION 10. IC 36-4-3-4.5 IS AMENDED TO READ AS FOLLOWS [EFFECTIVE JULY 1, 1997]: Sec. 4.5. Section 4(f) 4(g) of this chapter does not apply to a town that has abolished town legislative body districts under IC 36-5-2-4.1.
SOURCE: IC 36-4-3-5; (97)LS8017.11. -->

    SECTION 11. IC 36-4-3-5 IS AMENDED TO READ AS FOLLOWS [EFFECTIVE JULY 1, 1997]: Sec. 5. (a) If the owners of land located outside of but contiguous to a municipality want to have territory containing that land annexed to the municipality, they may file with the legislative body of the municipality a petition:
        (1) signed by at least:
            (A) fifty-one percent (51%) of the owners of land in the territory sought to be annexed; or
            (B) the owners of seventy-five percent (75%) of the total assessed value of the land for property tax purposes; and
        (2) requesting an ordinance annexing the area described in the petition.
    (b) If the legislative body fails to pass the ordinance within sixty (60) days after the date of filing of a petition under subsection (a), the petitioners may file a duplicate copy of the petition in the circuit or superior court of a county in which the territory is located, and shall include a written statement of why the annexation should take place. Notice of the proceedings, in the form of a summons, shall be served on the municipality named in the petition. The municipality is the defendant in the cause and shall appear and answer.
     (c) The court shall hear and determine the petition without a jury, and shall order the proposed annexation to take place only if the evidence introduced by the parties establishes that:
        (1) essential municipal services and facilities are not available to the residents of the territory sought to be annexed;
        (2) the municipality is physically and financially able to provide municipal services to the territory sought to be annexed;
        (3) the population density of the territory sought to be annexed is at least three (3) persons per acre; and
        (4) the territory sought to be annexed is contiguous to the municipality.
If the evidence does not establish all four (4) of the preceding factors, the court shall deny the petition and dismiss the proceeding.
    (c) (d) This subsection does not apply to a town that has abolished town legislative body districts under IC 36-5-2-4.1. An ordinance adopted under this section must assign the territory annexed by the ordinance to at least one (1) municipal legislative body district.
     (e) In a county having a population of more than two hundred thousand (200,000) but less than three hundred thousand (300,000), the court shall hear and determine the petition without a jury and shall order the proposed annexation to take place only if the evidence introduced by the parties establishes that:
        (1) essential city services and facilities are or can be made available to the residents of the territory sought to be annexed;
        (2) the city is physically and financially able to provide city services to the territory sought to be annexed; and
        (3) the territory sought to be annexed is contiguous to the city.
If the evidence does not establish all three (3) of the preceding factors, the court shall deny the petition and dismiss the proceeding.

SOURCE: IC 36-4-3-8.5; (97)LS8017.12. -->

    SECTION 12. IC 36-4-3-8.5 , AS AMENDED BY P.L.231-1996, SECTION 2, IS AMENDED TO READ AS FOLLOWS [EFFECTIVE JULY 1, 1997]: Sec. 8.5. (a) A municipality may, in an ordinance adopted under section 3 or 4 of this chapter, abate a portion of the property tax liability under IC 6-1.1 for municipal purposes for all property owners in the annexed territory.
    (b) An ordinance adopted under subsection (a) must provide the following:
        (1) A tax abatement program that is in effect for not more than three (3) taxable years after an annexation occurs.
        (2) Except single family residential property described by subdivision (3), a tax abatement for all classes of property that does not exceed:
            (A) seventy-five percent (75%) of a taxpayer's liability in the first year of the abatement program;
            (B) fifty percent (50%) of a taxpayer's liability in the second year of the abatement program; and
            (C) twenty-five percent (25%) of a taxpayer's liability in the third year of the abatement program.
         (3) For a county having a population of more than two hundred thousand (200,000) but less than three hundred thousand (300,000), a tax abatement for single family residential property that does not exceed:             (A) ninety percent (90%) of a taxpayer's liability in the first year of the abatement program;
            (B) eighty percent (80%) of a taxpayer's liability in the second year of the abatement program;
            (C) sixty percent (60%) of a taxpayer's liability in the third year of the abatement program;
            (D) forty percent (40%) of a taxpayer's liability in the fourth year of the abatement program; and
            (E) twenty percent (20%) of a taxpayer's liability in the fifth year of the abatement program.

        (3) (4) The procedure by which an eligible property owner receives a tax abatement under this section.
SOURCE: IC 36-4-3-13; (97)LS8017.13. -->

    SECTION 13. IC 36-4-3-13 , AS AMENDED BY HEA 1700-1997, IS AMENDED TO READ AS FOLLOWS [EFFECTIVE JULY 1, 1997]: Sec. 13. (a) Except as provided in subsection (e), at the hearing under section 12 of this chapter, the court shall order a proposed annexation to take place if the following requirements are met:
        (1) The requirements of either subsection (b) or (c).
        (2) The requirements of subsection (d).
    (b) The requirements of this subsection are met if the evidence establishes the following:
        (1) That the territory sought to be annexed is contiguous to the municipality.
        (2) One (1) of the following:
            (A) The resident population density of the territory sought to be annexed is at least three (3) persons per acre.
            (B) Sixty percent (60%) of the territory is subdivided.
            (C) The territory is zoned for commercial, business, or industrial uses.
    (c) The requirements of this subsection are met if the evidence establishes the following:
        (1) That the territory sought to be annexed is contiguous to the municipality as required by section 1.5 of this chapter, except that at least one-fourth (1/4), instead of one-eighth (1/8), of the aggregate external boundaries of the territory sought to be annexed must coincide with the boundaries of the municipality.
        (2) That the territory sought to be annexed is needed and can be used by the municipality for its development in the reasonably near future.
    (d) The requirements of this subsection are met if the evidence establishes that the municipality has developed a written fiscal plan and has established a definite policy, by resolution of the legislative body, as of the date of passage of the annexation ordinance. The resolution must show the following:
        (1) The cost estimates of planned services to be furnished to the territory to be annexed.
        (2) The method or methods of financing the planned services.
        (3) The plan for the organization and extension of services.
        (4) That planned services of a noncapital nature, including police protection, fire protection, street and road maintenance, and other noncapital services normally provided within the corporate boundaries, will be provided to the annexed territory within one (1) year after the effective date of annexation, and that they will be provided in a manner equivalent in standard and scope to those noncapital services provided to areas within the corporate boundaries that have similar topography, patterns of land use, and population density. However, in a county having a population of more than two hundred thousand (200,000) but less than three hundred thousand (300,000), the resolution of a city must show that these services will be provided in a manner equivalent in standard and scope to those noncapital services provided to areas within the corporate boundaries, regardless of similar topography, patterns of land use, or population density.
        (5) That services of a capital improvement nature, including street construction, street lighting, sewer facilities, water facilities, and stormwater drainage facilities, will be provided to the annexed territory within three (3) years after the effective date of the annexation, in the same manner as those services are provided to areas within the corporate boundaries, that have similar topography, patterns of land use, and population density, and in a manner consistent with federal, state, and local laws, procedures, and planning criteria. However, in a county having a population of more than two hundred thousand (200,000) but less than three hundred thousand (300,000), the resolution of a city must show that these services will be provided to the annexed territory within four (4) years after the effective date of the annexation and in the same manner as those services are provided to areas within the corporate boundaries, regardless of similar topography, patterns of land use, or population density.
        (6) The plan for hiring the employees of other governmental entities whose jobs will be eliminated by the proposed annexation, although the municipality is not required to hire any employees.
    (e) This subsection applies only to cities located in a county having a population of more than two hundred thousand (200,000) but less than three hundred thousand (300,000). However, this subsection does not apply if on April 1, 1993, the entire boundary of the territory that is proposed to be annexed was contiguous to territory that was within the boundaries of one (1) or more municipalities. At the hearing under section 12 of this chapter, the court shall do the following:
        (1) Consider evidence on the conditions listed in subdivision (2).
        (2) Order a proposed annexation not to take place if the court finds that all of the following conditions exist in the territory proposed to be annexed:
            (A) The following services are adequately furnished by a provider other than the municipality seeking the annexation:
                (i) Police and fire protection.
                (ii) Street and road maintenance.
            (B) The annexation will have a significant financial impact on the residents or owners of land.
            (C) One (1) of the following opposes the annexation:
                (i) A majority of the owners of land in the territory proposed to be annexed.
                (ii) The owners of more than seventy-five percent (75%) in assessed valuation of the land in the territory proposed to be annexed.
            Evidence of opposition may be expressed by any owner of land in the territory proposed to be annexed.
    (f) The federal census data established by IC 1-1-4-5 (17) shall be used as evidence of resident population density for purposes of subsection (b)(2)(A), but this evidence may be rebutted by other evidence of population density.
SOURCE: IC 36-4-3-16; (97)LS8017.14. -->

    SECTION 14. IC 36-4-3-16 IS AMENDED TO READ AS FOLLOWS [EFFECTIVE JULY 1, 1997]: Sec. 16. (a) Within one (1) year after the expiration of:
        (1) the one (1) year period for implementation of planned services of a noncapital nature under section 13(d)(4) of this chapter; or
        (2) the three (3) year period for the implementation of planned services of a capital improvement nature under section 13(d)(5) of this chapter; or
        (3) the four (4) year period for the implementation of planned services of a capital improvement nature under section 13(d)(5) of this chapter by a city for annexed territory in a county having a population of more than two hundred thousand (200,000) but less than three hundred thousand (300,000);

any person who pays taxes on property located within the annexed territory may file a complaint alleging injury resulting from the failure of the municipality to implement the plan. The complaint must name the municipality as defendant and shall be filed with the circuit or superior court of the county in which the annexed territory is located.
    (b) The court shall hear the case within sixty (60) days without a jury. In order to be granted relief, the plaintiff must establish one (1) of the following:
        (1) That the municipality has without justification failed to implement the plan required by section 13 of this chapter within the specific time limit for implementation after annexation.
        (2) That the municipality has not provided police protection, fire protection, sanitary sewers, and water for human consumption within the specific time limit for implementation, unless one (1) of these services is being provided by a separate taxing district or by a privately owned public utility.
        (3) That the annexed territory is not receiving governmental and proprietary services substantially equivalent in standard and scope to the services provided by the municipality to other areas of the municipality that have topography, patterns of land use, and population density similar to the annexed territory. However, in a county having a population of more than two hundred thousand (200,000) but less than three hundred thousand (300,000), the plaintiff must establish that the annexed territory is not receiving governmental and proprietary services substantially equivalent in standard and scope to the services provided by the city regardless of similar topography, patterns of land use, or population density.
    (c) The court may:
        (1) grant an injunction prohibiting the collection of taxes levied by the municipality on the plaintiff's property located in the annexed territory;
        (2) award damages to the plaintiff not to exceed one and one-fourth (1 1/4) times the taxes collected by the municipality for the plaintiff's property located in the annexed territory;
        (3) order the annexed territory or any part of it to be disannexed from the municipality;
        (4) order the municipality to submit a revised fiscal plan for providing the services to the annexed territory within time limits set up by the court; or
        (5) grant any other appropriate relief.
    (d) A change of venue from the county is not permitted for an action brought under this section.
    (e) If the court finds for the plaintiff, the defendant shall pay all court costs and reasonable attorney's fees as approved by the court.
    (f) The provisions of this chapter that apply to territory disannexed by other procedures apply to territory disannexed under this section.
SOURCE: IC 36-7-14-39; (97)LS8017.15. -->

    SECTION 15. IC 36-7-14-39 , AS AMENDED BY P.L.85-1995, SECTION 40, IS AMENDED TO READ AS FOLLOWS [EFFECTIVE JULY 1, 1997]: Sec. 39. (a) As used in this section:
    "Allocation area" means that part of a blighted area to which an allocation provision of a declaratory resolution adopted under section 15 of this chapter refers for purposes of distribution and allocation of property taxes.
    "Base assessed value" means the following:
        (1) If an allocation provision is adopted after June 30, 1995, in a declaratory resolution or an amendment to a declaratory resolution establishing an economic development area:
            (A) the net assessed value of all the property as finally determined for the assessment date immediately preceding the effective 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), the net assessed value of property that is assessed as residential property under the rules of the state board of tax commissioners, as finally determined for any assessment date after the effective date of the allocation provision.
         (2) If an allocation provision is adopted after June 30, 1997, in a declaratory resolution or an amendment to a declaratory resolution establishing a blighted area:
            (A) the
net assessed value of all the property as finally determined for the assessment date immediately preceding the effective 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), the net assessed value of property that is assessed as residential property under the rules of the state board of tax commissioners, as finally determined for any assessment date after the effective date of the allocation provision.

         (3) If:
            (A) an allocation provision adopted before June 30, 1995, in a declaratory resolution or an amendment to a declaratory resolution establishing a blighted area expires after June 30, 1997; and
            (B) after June 30, 1997, a new allocation provision is included in an amendment to the declaratory resolution;
        the net assessed value of all the property as finally determined for the assessment date immediately preceding the effective date of the allocation provision adopted after June 30, 1997, as adjusted under subsection (h).

        (2) (4) Except as provided in subdivision (3), (5), for all other allocation areas, the net assessed value of all the property as finally determined for the assessment date immediately preceding the effective date of the allocation provision of the declaratory resolution, as adjusted under subsection (h).
        (3) (5) If an allocation area established in an economic development area before July 1, 1995, is expanded after June 30, 1995, the definition in subdivision (1) applies to the expanded portion of the area added after June 30, 1995.
         (6) If an allocation area established in a blighted area before July 1, 1997, is expanded after June 30, 1997, the definition in subdivision (2) applies to the expanded portion of the area added after June 30, 1997.
    Except as provided in section 39.3 of this chapter, "property taxes" means taxes imposed under IC 6-1.1 on real property. However, upon approval by a resolution of the redevelopment commission adopted before June 1, 1987, "property taxes" also includes taxes imposed under IC 6-1.1 on depreciable personal property. If a redevelopment commission adopted before June 1, 1987, a resolution to include within the definition of property taxes taxes imposed under IC 6-1.1 on depreciable personal property that has a useful life in excess of eight (8) years, the commission may by resolution determine the percentage of taxes imposed under IC 6-1.1 on all depreciable personal property that will be included within the definition of property taxes. However, the percentage included must not exceed twenty-five percent (25%) of the taxes imposed under IC 6-1.1 on all depreciable personal property.
    (b) A declaratory resolution adopted under section 15 of this chapter before January 1, 2006, 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 before January 1, 2006, in accordance with the procedures required for its original adoption. A declaratory resolution or an amendment that establishes an allocation provision after June 30, 1995, must specify an expiration date for the allocation provision that may not be more than thirty (30) years after the date on which the allocation provision is established. However, if bonds or other obligations that were scheduled when issued to mature before the specified expiration date and that are payable only from allocated tax proceeds with respect to the allocation area remain outstanding as of the expiration date, the allocation provision does not expire until all of the bonds or other obligations are no longer outstanding. The allocation provision may apply to all or part of the blighted 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) Except as otherwise provided in this section, property tax proceeds in excess of those described in subdivision (1) shall be allocated to the redevelopment district and, when collected, paid into an allocation fund for that allocation area that may be used by the redevelopment district only to do one (1) or more of the following:
            (A) Pay the principal of and interest on any obligations payable solely from allocated tax proceeds which are incurred by the redevelopment district for the purpose of financing or refinancing the redevelopment of 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.
            (C) Pay the principal of and interest on bonds payable from allocated tax proceeds in that allocation area and from the special tax levied under section 27 of this chapter.
            (D) Pay the principal of and interest on bonds issued by the unit to pay for local public improvements in or serving that allocation area.
            (E) Pay premiums on the redemption before maturity of bonds payable solely or in part from allocated tax proceeds in that allocation area.
            (F) Make payments on leases payable from allocated tax proceeds in that allocation area under section 25.2 of this chapter.
            (G) Reimburse the unit for expenditures made by it for local public improvements (which include buildings, parking facilities, and other items described in section 25.1(a) of this chapter) in or serving that allocation area.
            (H) Reimburse the unit for rentals paid by it for a building or parking facility in or serving that allocation area under any lease entered into under IC 36-1-10.
            (I) Pay all or a portion of a property tax replacement credit to taxpayers in an allocation area as determined by the redevelopment commission. This credit equals the amount determined under the following STEPS for each taxpayer in a taxing district (as defined in IC 6-1.1-1-20 ) that contains all or part of the allocation area:
            STEP ONE: Determine that part of the sum of the amounts under IC 6-1.1-21-2 (g)(1)(A), IC 6-1.1-21-2 (g)(2), IC 6-1.1-21-2 (g)(3), IC 6-1.1-21-2 (g)(4), and IC 6-1.1-21-2 (g)(5) that is attributable to the taxing district.
            STEP TWO: Divide:
                (A) that part of twenty percent (20%) of each county's total county tax levy payable that year as determined under IC 6-1.1-21-4 that is attributable to the taxing district; by
                (B) the STEP ONE sum.
            STEP THREE: Multiply:
                (A) the STEP TWO quotient; times
                (B) the total amount of the taxpayer's property taxes levied in the taxing district that have been allocated during that year to an allocation fund under this section.
            If not all the taxpayers in an allocation area receive the credit in full, each taxpayer in the allocation area is entitled to receive the same proportion of the credit. A taxpayer may not receive a credit under this section and a credit under section 39.5 of this chapter in the same year.
            (J) Pay expenses incurred by the redevelopment commission for local public improvements that are in the allocation area or serving the allocation area. Public improvements include buildings, parking facilities, and other items described in section 25.1(a) of this chapter.
            (K) 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 state board of tax commissioners.
            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 within three (3) years after the date on which the investments that are the basis for the increment financing are made.
        The allocation fund may not be used for operating expenses of the commission.
        (3) Except as provided in subsection (g), before July 15 of each year the commission shall do the following:
            (A) Determine the amount, if any, by which property taxes payable to the allocation fund in the following year the base assessed value when multiplied by the estimated tax rate of the allocation area will exceed the amount of assessed value needed to produce the property taxes necessary to make, when due, principal and interest payments on bonds described in subdivision (2) plus the amount necessary for other purposes described in subdivision (2).
            (B) Notify the county auditor of the amount, if any, of the amount of excess property taxes assessed value that the commission has determined may be paid allocated to the respective taxing units in the manner prescribed in subdivision (1). The commission may not authorize a payment an allocation of assessed value to the respective taxing units under this subdivision if to do so would endanger the interests of the holders of bonds described in subdivision (2) or lessors under section 25.3 of this chapter. Property taxes received by a taxing unit under this subdivision are eligible for the property tax replacement credit provided under IC 6-1.1-21.
    (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 any 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 redevelopment district under subsection (b)(2) may, subject to subsection (b)(3), be irrevocably pledged by the redevelopment district for payment as set forth in subsection (b)(2).
    (e) Notwithstanding any other law, each assessor shall, upon petition of the redevelopment commission, 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 formulation 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 4-4-6.1 , 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)(2) shall establish an allocation fund for the purposes specified in subsection (b)(2) 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) from property located in the enterprise zone that exceeds the amount sufficient for the purposes specified in subsection (b)(2) for the year. The amount sufficient for purposes specified in subsection (b)(2) for the year shall be determined based on the pro rata portion of such current property tax proceeds from the portion 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 has no obligations, bonds, or leases payable from allocated tax proceeds under subsection (b)(2) shall establish a special zone fund and deposit all the property tax proceeds in excess of those described in subsection (b)(1) in the fund derived from property tax proceeds in excess of those described in subsection (b)(1) from property located in the enterprise zone. 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)(2), except that where reference is made in subsection (b)(2) to allocation area it shall refer for purposes of payments from the special zone fund only to that portion of the allocation area that is also located in the enterprise zone. Those programs shall reserve at least one-half (1/2) of their enrollment in any session for residents of the enterprise zone.
    (h) The state board of accounts and state board of tax commissioners shall make the rules and prescribe the forms and procedures that they consider expedient for the implementation of this chapter. After each general reassessment under IC 6-1.1-4 , the state board of tax commissioners shall adjust the base assessed value one (1) time to neutralize any effect of the general reassessment on the property tax proceeds allocated to the redevelopment district under this section. However, the adjustment may not include the effect of property tax abatements under IC 6-1.1-12.1 , and the adjustment may not produce less property tax proceeds allocable to the redevelopment district under subsection (b)(2) than would otherwise have been received if the general reassessment had not occurred. The state board of tax commissioners may prescribe procedures for county and township officials to follow to assist the state board in making the adjustments.
SOURCE: IC 36-7-14.5-12.5; (97)LS8017.16. -->

    SECTION 16. IC 36-7-14.5-12.5 , AS AMENDED BY P.L.26-1995, SECTION 5, IS AMENDED TO READ AS FOLLOWS [EFFECTIVE JULY 1, 1997]: Sec. 12.5. (a) This section applies only to an authority in a county having a United States government military base that is scheduled for closing or is completely or partially inactive or closed.
    (b) In order to accomplish the purposes set forth in section 11(b) of this chapter, an authority may create an economic development area:
        (1) by following the procedures set forth in IC 36-7-14-41 for the establishment of an economic development area by a redevelopment commission; and
        (2) with the same effect as if the economic development area was created by a redevelopment commission.
However, an authority may not include in an economic development area created under this section any area that was declared a blighted area, an urban renewal area, or an economic development area under IC 36-7-14.
    (c) In order to accomplish the purposes set forth in section 11(b) of this chapter, an authority may do the following in a manner that serves an economic development area created under this section:         (1) Acquire by purchase, exchange, gift, grant, condemnation, or lease, or any combination of methods, any personal property or interest in real property needed for the redevelopment of economic development areas located within the corporate boundaries of the unit.
        (2) Hold, use, sell (by conveyance by deed, land sale contract, or other instrument), exchange, lease, rent, or otherwise dispose of property acquired for use in the redevelopment of economic development areas on the terms and conditions that the authority considers best for the unit and the unit's inhabitants.
        (3) Sell, lease, or grant interests in all or part of the real property acquired for redevelopment purposes to any other department of the unit or to any other governmental agency for public ways, levees, sewerage, parks, playgrounds, schools, and other public purposes on any terms that may be agreed on.
        (4) Clear real property acquired for redevelopment purposes.
        (5) Repair and maintain structures acquired for redevelopment purposes.
        (6) Remodel, rebuild, enlarge, or make major structural improvements on structures acquired for redevelopment purposes.
        (7) Survey or examine any land to determine whether the land should be included within an economic development area to be acquired for redevelopment purposes and to determine the value of that land.
        (8) Appear before any other department or agency of the unit, or before any other governmental agency in respect to any matter affecting:
            (A) real property acquired or being acquired for redevelopment purposes; or
            (B) any economic development area within the jurisdiction of the authority.
        (9) Institute or defend in the name of the unit any civil action, but all actions against the authority must be brought in the circuit or superior court of the county where the authority is located.
        (10) Use any legal or equitable remedy that is necessary or considered proper to protect and enforce the rights of and perform the duties of the authority.         (11) Exercise the power of eminent domain in the name of and within the corporate boundaries of the unit subject to the same conditions and procedures that apply to the exercise of the power of eminent domain by a redevelopment commission under IC 36-7-14.
        (12) Appoint an executive director, appraisers, real estate experts, engineers, architects, surveyors, and attorneys.
        (13) Appoint clerks, guards, laborers, and other employees the authority considers advisable, except that those appointments must be made in accordance with the merit system of the unit if such a system exists.
        (14) Prescribe the duties and regulate the compensation of employees of the authority.
        (15) Provide a pension and retirement system for employees of the authority by using the public employees' retirement fund or a retirement plan approved by the United States Department of Housing and Urban Development.
        (16) Discharge and appoint successors to employees of the authority subject to subdivision (13).
        (17) Rent offices for use of the department or authority, or accept the use of offices furnished by the unit.
        (18) Equip the offices of the authority with the necessary furniture, furnishings, equipment, records, and supplies.
        (19) Design, order, contract for, and construct, reconstruct, improve, or renovate the following:
            (A) Any local public improvement or structure that is necessary for redevelopment purposes or economic development within the corporate boundaries of the unit.
            (B) Any structure that enhances development or economic development.
        (20) Contract for the construction, extension, or improvement of pedestrian skyways (as defined in IC 36-7-14-12.2 (c)).
        (21) Accept loans, grants, and other forms of financial assistance from, or contract with, the federal government, the state government, a municipal corporation, a special taxing district, a foundation, or any other source.
        (22) Make and enter into all contracts and agreements necessary or incidental to the performance of the duties of the authority and the execution of the powers of the authority under this chapter.
        (23) Take any action necessary to implement the purpose of the authority.
        (24) Provide financial assistance, in the manner that best serves the purposes set forth in section 11(b) of this chapter, including grants and loans, to enable private enterprise to develop, redevelop, and reuse military base property or otherwise enable private enterprise to provide social and economic benefits to the citizens of the unit.
    (d) An authority may designate all or a portion of an economic development area created under this section as an allocation area by following the procedures set forth in IC 36-7-14-39 for the establishment of an allocation area by a redevelopment commission. The allocation provision may modify the definition of "property taxes" under IC 36-7-14-39 (a) to include taxes imposed under IC 6-1.1 on the depreciable personal property located and taxable on the site of operations of designated taxpayers in accordance with the procedures applicable to a commission under IC 36-7-14-39.3. IC 36-7-14-39.3 applies to such a modification. An allocation area established by an authority under this section is a special taxing district authorized by the general assembly to enable the unit to provide special benefits to taxpayers in the allocation area by promoting economic development that is of public use and benefit. For allocation areas established for an economic development area created under this section after June 30, 1997, and to the expanded portion of an allocation area for an economic development area that was established before June 30, 1997, and that is expanded under this section after June 30, 1997, the net assessed value of property that is assessed as residential property under the rules of the state board of tax commissioners, as finally determined for any assessment date, must be allocated. All of the provisions of IC 36-7-14-39 , IC 36-7-14-39.1 , and IC 36-7-14-39.5 apply to an allocation area created under this section, except that the authority shall be vested with the rights and duties of a commission as referenced in those sections, and except that, notwithstanding IC 36-7-14-39 (b)(2), property tax proceeds paid into the allocation fund may be used by the authority only to do one (1) or more of the following:
        (1) Pay the principal of and interest and redemption premium on any obligations incurred by the special taxing district or any other entity for the purpose of financing or refinancing military base reuse activities in or serving or benefitting that allocation area.         (2) Establish, augment, or restore the debt service reserve for obligations payable solely or in part from allocated tax proceeds in that allocation area or from other revenues of the authority (including lease rental revenues).
        (3) Make payments on leases payable solely or in part from allocated tax proceeds in that allocation area.
        (4) Reimburse any other governmental body for expenditures made by it for local public improvements or structures in or serving or benefitting that allocation area.
        (5) Pay all or a portion of a property tax replacement credit to taxpayers in an allocation area as determined by the authority. This credit equals the amount determined under the following STEPS for each taxpayer in a taxing district (as defined in IC 6-1.1-1-20 ) that contains all or part of the allocation area:
            STEP ONE: Determine that part of the sum of the amounts under IC 6-1.1-21-2 (g)(1)(A), IC 6-1.1-21-2 (g)(2), IC 6-1.1-21-2 (g)(3), IC 6-1.1-21-2 (g)(4), and IC 6-1.1-21-2 (g)(5) that is attributable to the taxing district.
            STEP TWO: Divide:
                (A) that part of the twenty percent (20%) of each county's total county tax levy payable that year as determined under IC 6-1.1-21-4 that is attributable to the taxing district; by
                (B) the STEP ONE sum.
            STEP THREE: Multiply:
                (A) the STEP TWO quotient; by
                (B) the total amount of the taxpayer's property taxes levied in the taxing district that have been allocated during that year to an allocation fund under this section.
        If not all the taxpayers in an allocation area receive the credit in full, each taxpayer in the allocation area is entitled to receive the same proportion of the credit. A taxpayer may not receive a credit under this section and a credit under IC 36-7-14-39.5 in the same year.
        (6) Pay expenses incurred by the authority for local public improvements or structures that are in the allocation area or serving or benefitting the allocation area.
        (7) Reimburse public and private entities for expenses incurred in training employees of industrial facilities that are located:             (A) in the allocation area; and
            (B) on a parcel of real property that has been classified as industrial property under the rules of the state board of tax commissioners.
        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 clause (B). The reimbursements under this subdivision must be made within three (3) years after the date on which the investments that are the basis for the increment financing are made. The allocation fund may not be used for operating expenses of the authority.
    (e) In addition to other methods of raising money for property acquisition, redevelopment, or economic development activities in or directly serving or benefitting an economic development area created by an authority under this section, and in anticipation of the taxes allocated under subsection (d), other revenues of the authority, or any combination of these sources, the authority may, by resolution, issue the bonds of the special taxing district in the name of the unit. Bonds issued under this section may be issued in any amount without limitation. The following apply if such a resolution is adopted:
        (1) The authority shall certify a copy of the resolution authorizing the bonds to the municipal or county fiscal officer, who shall then prepare the bonds. The seal of the unit must be impressed on the bonds, or a facsimile of the seal must be printed on the bonds.
        (2) The bonds must be executed by the appropriate officer of the unit and attested by the unit's fiscal officer.
        (3) The bonds are exempt from taxation for all purposes.
        (4) Bonds issued under this section may be sold at public sale in accordance with IC 5-1-11 or at a negotiated sale.
        (5) The bonds are not a corporate obligation of the unit but are an indebtedness of the taxing district. The bonds and interest are payable, as set forth in the bond resolution of the authority:
            (A) from the tax proceeds allocated under subsection (d);
            (B) from other revenues available to the authority; or
            (C) from a combination of the methods stated in clauses (A) and (B).
        (6) Proceeds from the sale of bonds may be used to pay the cost of interest on the bonds for a period not to exceed five (5) years from the date of issuance.
        (7) Laws relating to the filing of petitions requesting the issuance of bonds and the right of taxpayers to remonstrate against the issuance of bonds do not apply to bonds issued under this section.
        (8) If a debt service reserve is created from the proceeds of bonds, the debt service reserve may be used to pay principal and interest on the bonds as provided in the bond resolution.
        (9) If bonds are issued under this chapter that are payable solely or in part from revenues to the authority from a project or projects, the authority may adopt a resolution or trust indenture or enter into covenants as is customary in the issuance of revenue bonds. The resolution or trust indenture may pledge or assign the revenues from the project or projects. The resolution or trust indenture may also contain any provisions for protecting and enforcing the rights and remedies of the bond owners as may be reasonable and proper and not in violation of law, including covenants setting forth the duties of the authority. The authority may establish fees and charges for the use of any project and covenant with the owners of any bonds to set those fees and charges at a rate sufficient to protect the interest of the owners of the bonds. Any revenue bonds issued by the authority that are payable solely from revenues of the authority shall contain a statement to that effect in the form of bond.
    (f) Notwithstanding section 8(a) of this chapter, an ordinance adopted under section 11(b) of this chapter may provide, or be amended to provide, that the board of directors of the authority shall be composed of not fewer than three (3) nor more than seven (7) members, who must be residents of the unit appointed by the executive of the unit.
    (g) The acquisition of real and personal property by an authority under this section is not subject to the provisions of IC 36-1-9 , IC 36-1-10.5 , IC 36-7-14-19 , or any other statutes governing the purchase of property by public bodies or their agencies.
    (h) An authority may negotiate for the sale, lease, or other disposition of real and personal property without complying with the provisions of IC 36-1-11 , IC 36-7-14-22 , or any other statute governing the disposition of public property.
    (i) Notwithstanding any other law, utility services provided within an economic development area established under this section are subject to regulation by the appropriate regulatory agencies unless the utility service is provided by a utility that provides utility service solely within the geographic boundaries of an existing or a closed military installation, in which case the utility service is not subject to regulation for purposes of rate making, regulation, service delivery, or issuance of bonds or other forms of indebtedness. However, this exemption from regulation does not apply to utility service if the service is generated, treated, or produced outside the boundaries of the existing or closed military installation.
SOURCE: IC 36-7-15.1-26; (97)LS8017.17. -->

    SECTION 17. IC 36-7-15.1-26 , AS AMENDED BY P.L.85-1995, SECTION 41, IS AMENDED TO READ AS FOLLOWS [EFFECTIVE JULY 1, 1997]: Sec. 26. (a) As used in this section:
    "Allocation area" means that part of a blighted area to which an allocation provision of a resolution adopted under section 8 of this chapter refers for purposes of distribution and allocation of property taxes.
    "Base assessed value" means the following:
        (1) If an allocation provision is adopted after June 30, 1995, in a declaratory resolution or an amendment to a declaratory resolution establishing an economic development area:
            (A) the net assessed value of all the property as finally determined for the assessment date immediately preceding the effective 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), the net assessed value of property that is assessed as residential property under the rules of the state board of tax commissioners, as finally determined for any assessment date after the effective date of the allocation provision.
         (2) If an allocation provision is adopted after June 30, 1997, in a declaratory resolution or an amendment to a declaratory resolution establishing a blighted area:
            (A) the
net assessed value of all the property as finally determined for the assessment date immediately preceding the effective 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), the net assessed value of property that is assessed as residential property under the rules of the state board of tax commissioners, as finally determined for any assessment date after the effective date of the allocation provision.

         (3) If:
            (A) an allocation provision adopted before June 30, 1995, in a declaratory resolution or an amendment to a declaratory resolution establishing a blighted area expires after June 30, 1997; and
            (B) after June 30, 1997, a new allocation provision is included in an amendment to the declaratory resolution;
        the net assessed value of all the property as finally determined for the assessment date immediately preceding the effective date of the allocation provision adopted after June 30, 1997, as adjusted under subsection (h).

        (2) (4) Except as provided in subdivision (3), (5), for all other allocation areas, the net assessed value of all the property as finally determined for the assessment date immediately preceding the effective date of the allocation provision of the declaratory resolution, as adjusted under subsection (h).
        (3) (5) If an allocation area established in an economic development area before July 1, 1995, is expanded after June 30, 1995, the definition in subdivision (1) applies to the expanded portion of the area added after June 30, 1995.
         (6) If an allocation area established in a blighted area before July 1, 1997, is expanded after June 30, 1997, the definition in subdivision (2) applies to the expanded portion of the area added after June 30, 1997.
    Except as provided in section 26.2 of this chapter, "property taxes" means taxes imposed under IC 6-1.1 on real property. However, upon approval by a resolution of the redevelopment commission adopted before June 1, 1987, "property taxes" also includes taxes imposed under IC 6-1.1 on depreciable personal property. If a redevelopment commission adopted before June 1, 1987, a resolution to include within the definition of property taxes taxes imposed under IC 6-1.1 on depreciable personal property that has a useful life in excess of eight (8) years, the commission may by resolution determine the percentage of taxes imposed under IC 6-1.1 on all depreciable personal property that will be included within the definition of property taxes. However, the percentage included must not exceed twenty-five percent (25%) of the taxes imposed under IC 6-1.1 on all depreciable personal property.
    (b) A resolution adopted under section 8 of this chapter before January 1, 2006, 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 resolution previously adopted may include an allocation provision by the amendment of that resolution before January 1, 2006, in accordance with the procedures required for its original adoption. A declaratory resolution or an amendment that establishes an allocation provision after June 30, 1995, must specify an expiration date for the allocation provision that may not be more than thirty (30) years after the date on which the allocation provision is established. However, if bonds or other obligations that were scheduled when issued to mature before the specified expiration date and that are payable only from allocated tax proceeds with respect to the allocation area remain outstanding as of the expiration date, the allocation provision does not expire until all of the bonds or other obligations are no longer outstanding. The allocation provision may apply to all or part of the blighted 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) Except as otherwise provided in this section, property tax proceeds in excess of those described in subdivision (1) shall be allocated to the redevelopment district and, when collected, paid into a special fund for that allocation area that may be used by the redevelopment district only to do one (1) or more of the following:
            (A) Pay the principal of and interest on any obligations payable solely from allocated tax proceeds that are incurred by the redevelopment district for the purpose of financing or refinancing the redevelopment of 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.
            (C) Pay the principal of and interest on bonds payable from allocated tax proceeds in that allocation area and from the special tax levied under section 19 of this chapter.
            (D) Pay the principal of and interest on bonds issued by the consolidated city to pay for local public improvements in that allocation area.
            (E) Pay premiums on the redemption before maturity of bonds payable solely or in part from allocated tax proceeds in that allocation area.
            (F) Make payments on leases payable from allocated tax proceeds in that allocation area under section 17.1 of this chapter.
            (G) Reimburse the consolidated city for expenditures for local public improvements (which include buildings, parking facilities, and other items set forth in section 17 of this chapter) in that allocation area.
            (H) Reimburse the unit for rentals paid by it for a building or parking facility in that allocation area under any lease entered into under IC 36-1-10.
            (I) 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 state board of tax commissioners.
            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 within three (3) years after the date on which the investments that are the basis for the increment financing are made.
        The special fund may not be used for operating expenses of the commission.
        (3) Before July 15 of each year, the commission shall do the following:
            (A) Determine the amount, if any, by which property taxes payable to the allocation fund in the following year the base assessed value when multiplied by the estimated tax rate of the allocated area will exceed the amount of assessed value needed to provide the property taxes necessary to make, when due, principal and interest payments on bonds described in subdivision (2) plus the amount necessary for other purposes described in subdivision (2) and subsection (g).
            (B) Notify the county auditor of the amount, if any, of excess property taxes assessed value that the commission has determined may be paid allocated to the respective taxing units in the manner prescribed in subdivision (1).
        The commission may not authorize a payment an allocation to the respective taxing units under this subdivision if to do so would endanger the interests of the holders of bonds described in subdivision (2). Property taxes received by a taxing unit under this subdivision are eligible for the property tax replacement credit provided under IC 6-1.1-21.
    (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 any taxing unit after the effective date of the allocation provision of the 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 redevelopment district under subsection (b)(2) may, subject to subsection (b)(3), be irrevocably pledged by the redevelopment district for payment as set forth in subsection (b)(2).
    (e) Notwithstanding any other law, each assessor shall, upon petition of the commission, 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 formulation 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 4-4-6.1 , 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)(2) shall establish an allocation fund for the purposes specified in subsection (b)(2) 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 the amount in the allocation fund derived from property tax proceeds in excess of those described in subsection (b)(1) from property located in the enterprise zone that exceeds the amount sufficient for the purposes specified in subsection (b)(2) for the year. A unit that has no obligations, bonds, or leases payable from allocated tax proceeds under subsection (b)(2) shall establish a special zone fund and deposit all the property tax proceeds in excess of those described in subsection (b)(1) in the fund derived from property tax proceeds in excess of those described in subsection (b)(1) from property located in the enterprise zone. The unit that creates the special zone fund shall use the fund, based on the recommendations of the urban enterprise association, for one (1) or more of the following purposes:
        (1) To pay for programs in job training, job enrichment, and basic skill development designed to benefit residents and employers in the enterprise zone. The programs must reserve at least one-half (1/2) of the enrollment in any session for residents of the enterprise zone.
        (2) To make loans and grants for the purpose of stimulating business activity in the enterprise zone or providing employment for enterprise zone residents in the enterprise zone. These loans and grants may be made to the following:
            (A) Businesses operating in the enterprise zone.
            (B) Businesses that will move their operations to the enterprise zone if such a loan or grant is made.
        (3) To provide funds to carry out other purposes specified in subsection (b)(2). However, where reference is made in subsection (b)(2) to the allocation area, the reference refers for purposes of payments from the special zone fund only to that portion of the allocation area that is also located in the enterprise zone.
    (h) The state board of accounts and state board of tax commissioners shall make the rules and prescribe the forms and procedures that they consider expedient for the implementation of this chapter. After each general reassessment under IC 6-1.1-4 , the state board of tax commissioners shall adjust the base assessed value one (1) time to neutralize any effect of the general reassessment on the property tax proceeds allocated to the redevelopment district under this section. However, the adjustment may not include the effect of property tax abatements under IC 6-1.1-12.1 , and the adjustment may not produce less property tax proceeds allocable to the redevelopment district under subsection (b)(2) than would otherwise have been received if the general reassessment had not occurred. The state board of tax commissioners may prescribe procedures for county and township officials to follow to assist the state board in making the adjustments.
SOURCE: IC 36-7-30-25; (97)LS8017.18. -->

    SECTION 18. IC 36-7-30-25 , AS ADDED BY P.L.26-1995, SECTION 14, IS AMENDED TO READ AS FOLLOWS [EFFECTIVE JULY 1, 1997]: 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:
            (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 state board of tax commissioners, as finally determined for any assessment date after the effective date of the allocation provision.
        Clause (C) applies only to allocation areas established in a military reuse area after June 30, 1997, and to the portion 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) Except as otherwise provided in this section, property tax proceeds in excess of those described in subdivision (1) 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 all or a part of a property tax replacement credit to taxpayers in an allocation area as determined by the reuse authority. This credit equals the amount determined under the following STEPS for each taxpayer in a taxing district (as defined in IC 6-1.1-1-20 ) that contains all or part of the allocation area:
            STEP ONE: Determine that part of the sum of the amounts under IC 6-1.1-21-2 (g)(1)(A), IC 6-1.1-21-2 (g)(2), IC 6-1.1-21-2 (g)(3), IC 6-1.1-21-2 (g)(4), and IC 6-1.1-21-2 (g)(5) that is attributable to the taxing district.
            STEP TWO: Divide:
                (i) that part of the twenty percent (20%) of each county's total county tax levy payable that year as determined under IC 6-1.1-21-4 that is attributable to the taxing district; by
                (ii) the STEP ONE sum.
            STEP THREE: Multiply:
                (i) the STEP TWO quotient; times
                (ii) the total amount of the taxpayer's property taxes levied in the taxing district that have been allocated during that year to an allocation fund under this section.
            If not all the taxpayers in an allocation area receive the credit in full, each taxpayer in the allocation area is entitled to receive the same proportion of the credit. A taxpayer may not receive a credit under this section and a credit under section 27 of this chapter in the same year.
            (F) Pay expenses incurred by the reuse authority for local public improvements or structures that were in the allocation area or directly serving or benefiting the allocation area.
            (G) 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 state board of tax commissioners.
            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.
        The allocation fund may not be used for operating expenses of the reuse authority.
        (3) 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 (2) plus the amount necessary for other purposes described in subdivision (2).
            (B) Notify the county auditor of the amount, if any, of the amount 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). 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 (2) or lessors under section 19 of this chapter. Property taxes received by a taxing unit under this subdivision are eligible for the property tax replacement credit provided under IC 6-1.1-21.
    (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)(2) may, subject to subsection (b)(3), be irrevocably pledged by the military base reuse district for payment as set forth in subsection (b)(2).
    (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 4-4-6.1 , 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)(2) shall establish an allocation fund for the purposes specified in subsection (b)(2) 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) from property located in the enterprise zone that exceeds the amount sufficient for the purposes specified in subsection (b)(2) for the year. The amount sufficient for purposes specified in subsection (b)(2) 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)(2) shall establish a special zone fund and deposit all the property tax proceeds in excess of those described in subsection (b)(1) 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)(2), except that where reference is made in subsection (b)(2) to allocation area it shall refer for purposes of payments from the special zone fund only to that portion 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 general reassessment under IC 6-1.1-4 , the state board of tax commissioners shall adjust the base assessed value one (1) time to neutralize any effect of the general reassessment on the property tax proceeds allocated to the military base reuse district under this section. However, the adjustment may not include the effect of property tax abatements under IC 6-1.1-12.1 , and the adjustment may not produce less property tax proceeds allocable to the military base reuse district under subsection (b)(2) than would otherwise have been received if the general reassessment had not occurred. The state board of tax commissioners may prescribe procedures for county and township officials to follow to assist the state board in making the adjustments.
SOURCE: IC 36-7-31; (97)LS8017.19. -->

    SECTION 19. IC 36-7-31 IS ADDED TO THE INDIANA CODE AS A NEW CHAPTER TO READ AS FOLLOWS [EFFECTIVE UPON PASSAGE]:
     Chapter 31. Professional Sports Development Area in a County Containing a Consolidated City
    Sec. 1. This chapter applies only to a county having a consolidated city.
     Sec. 2. As used in this chapter, "budget agency" means the budget agency established by IC 4-12-1.
    Sec. 3. As used in this chapter, "budget committee" has the meaning set forth in IC 4-12-1-3.
    Sec. 4. As used in this chapter, "capital improvement board" refers to the capital improvement board of managers established by IC 36-10-9-3.
    Sec. 5. As used in this chapter, "commission" refers to the metropolitan development commission acting as the redevelopment commission of a consolidated city.
    Sec. 6. As used in this chapter, "covered taxes" means the following:
        (1) The state gross retail tax imposed under IC 6-2.5-2-1 or use tax imposed under IC 6-2.5-3-2.
        (2) An adjusted gross income tax imposed under IC 6-3-2-1 on an individual.
        (3) A county option income tax imposed under IC 6-3.5-6.
        (4) A food and beverage tax imposed under IC 6-9.
    Sec. 7. As used in this chapter, "department" refers to the department of state revenue.
    Sec. 8. As used in this chapter, "tax area" means a geographic area established by a commission as a professional sports development area under section 14 of this chapter.
    Sec. 9. As used in this chapter, "taxpayer" means a person that is liable for a covered tax.
    Sec. 10. A commission may establish as part of a professional sports development area any facility:
        (1) that is used in the training of a team engaged in professional sporting events; or
        (2) that is:
            (A) financed in whole or in part by notes or bonds issued by a political subdivision or issued under IC 36-10-9 or IC 36-10-9.1 ; and
            (B) used to hold a professional sporting event.
The tax area may include a facility described in this section and any parcel of land on which the facility is located. An area may contain noncontiguous tracts of land within the county.
    Sec. 11. (a) A tax area must be initially established before July 1, 1999, according to the procedures set forth for the establishment of an economic development area under IC 36-7-15.1. A tax area may be changed or the terms governing the tax area revised in the same manner as the establishment of the initial tax area.
    (b) In establishing the tax area, the commission must make the following findings instead of the findings required for the establishment of economic development areas:
        (1) That a project to be undertaken or that has been undertaken in the tax area is for a facility at which a professional sporting event will be held.
        (2) That the project to be undertaken or that has been undertaken in the tax area will benefit the public health and welfare and will be of public utility and benefit.
        (3) That the project to be undertaken or that has been undertaken in the tax area will protect or increase state and local tax bases and tax revenues.
    (c) The tax area established by the commission under this chapter is a special taxing district authorized by the general assembly to enable the county to provide special benefits to taxpayers in the tax area by promoting economic development that is of public use and benefit.

    Sec. 12. Upon adoption of a resolution establishing a tax area under section 14 of this chapter, the commission shall submit the resolution to the budget committee for review and recommendation to the budget agency. The budget committee shall meet not later than ten (10) days after receipt of a resolution and shall make a recommendation on the resolution to the budget agency.
     Sec. 13. (a) The budget agency must approve the resolution before covered taxes may be allocated under section 14.
    (b) When considering a resolution, the budget committee and the budget agency must make the following findings:
        (1) The cost of the facility and facility site specified under the resolution exceeds one hundred thousand dollars ($100,000).
        (2) The project specified in the resolution is economically sound and will benefit the people of Indiana by protecting or increasing state and local tax bases and tax revenues for at least the duration of the tax area established under this chapter.
        (3) The political subdivisions effected by the project specified in the resolution have committed significant resources towards completion of the improvement.
    (c) Revenues from the tax area may not be allocated until the budget agency approves the resolution.
    Sec. 14. (a) A tax area must be established by resolution. A resolution establishing a tax area must provide for the allocation of covered taxes attributable to a taxable event or covered taxes earned in the tax area to the
professional sports development area fund established for the county. The allocation provision must apply to the entire tax area. The resolution must provide that the tax area terminates not later than December 31, 2027.     (b) All of the salary, wages, bonuses, and other compensation that are:
        (1) paid during a taxable year to a professional athlete for professional athletic services;
        (2) taxable in Indiana; and
        (3) earned in the tax area;
shall be allocated to the tax area if the professional athlete is a member of a team that plays the majority of the professional athletic events that the team plays in Indiana in the tax area.
    (c) The total amount of state revenue captured by the tax area may not exceed five million dollars ($5,000,000) per year for twenty (20) consecutive years.
    (d) The resolution establishing the tax area must designate the facility and the facility site for which the tax area is established and covered taxes will be used.
    (e) The department may adopt rules under IC 4-22-2 and guidelines to govern the allocation of covered taxes to a tax area.
    Sec. 15. When the commission adopts an allocation provision, the commission shall notify the department by certified mail of the adoption of the provision and shall include with the notification a complete list of the following:
        (1) Employers in the tax area.
        (2) Street names and the range of street numbers of each street in the tax area.
The commission shall update the list before July 1 of each year.
    Sec. 16. A professional sports development area fund for the county is established. The fund shall be administered by the department. Money in the fund does not revert to the state general fund at the end of a state fiscal year.
    Sec. 17. Covered taxes attributable to a taxing area established under section 14 of this chapter shall be deposited in the professional sports development area fund for the county.
    Sec. 18. On or before the twentieth day of each month, all amounts held in the professional sports development area fund for the county shall be distributed to the capital improvement board.
    Sec. 19. The department shall notify the county auditor of the amount of taxes to be distributed to the capital improvement board.
    Sec. 20. All distributions from the
professional sports development area fund for the county shall be made by warrants issued by the auditor of state to the treasurer of state ordering those payments to the capital improvement board.
    Sec. 21. The capital improvement board may use money distributed from the fund only to construct and equip a capital improvement that is used for a professional sporting event, including the financing or refinancing of a capital improvement or the payment of lease payments for a capital improvement.
    Sec. 22. The capital improvement board shall repay to the professional sports development area fund any amount that is distributed to the capital improvement board and used for:
        (1) a purpose that is not described in section 21 of this chapter; or
        (2) a facility or facility site other than the facility and facility site to which covered taxes are designated under the resolution described in section 14 of this chapter.
The department shall distribute the covered taxes repaid to the professional sports development area fund under this section proportionately to the funds and the political subdivisions that would have received the covered taxes if the covered taxes had not been allocated to the tax area under this chapter.
    Sec. 23. This chapter expires December 31, 2027.

SOURCE: IC 36-7-31.3; (97)LS8017.20. -->

    SECTION 20. IC 36-7-31.3 IS ADDED TO THE INDIANA CODE AS A NEW CHAPTER TO READ AS FOLLOWS [EFFECTIVE UPON PASSAGE]:
     Chapter 31.3. Professional Sports Development Area
    Sec. 1. This chapter applies only to a city or a county without a consolidated city that has a professional sports franchise playing the majority of its home games in a facility owned by the city, the county, a school corporation
, or a board under IC 36-10-8 , IC 36-10-10 , or IC 36-10-11.
    Sec. 2. As used in this chapter, "budget agency"
means the budget agency established by IC 4-12-1.
    Sec. 3. As used in this chapter, "budget committee" has the meaning set forth in IC 4-12-1-3.
    Sec. 4. As used in this chapter, "covered taxes" means the following:
        (1) The state gross retail tax imposed under IC 6-2.5-2-1 or use tax imposed under IC 6-2.5-3-2.
        (2) An adjusted gross income tax imposed under IC 6-3-2-1 on an individual.
        (3) A county option income tax imposed under IC 6-3.5.         (4) A food and beverage tax imposed under IC 6-9.
    Sec. 5. As used in this chapter, "department" refers to the department of state revenue.
    Sec. 6. As used in this chapter, "tax area" means a geographic area established as a professional sports and convention development area under section 10 of this chapter.
    Sec. 7. As used in this chapter, "taxpayer" means a person that is liable for a covered tax.
    Sec. 8. A city or county legislative body may establish as part of a professional sports and convention development area any facility that is:
        (1) owned by the city, the
county, a school corporation, or a board under IC 36-10-8 , IC 36-10-10 , or IC 36-10-11 and used by a professional sports franchise; or
        (2) owned by the city, the county, or
a board under IC 36-10-8 , IC 36-10-10 , or IC 36-10-11 and used for convention or tourism related events.
The tax area may include only facilities described in this section and any parcel of land on which the facility is located. An area may contain noncontiguous tracts of land within the city or county.
    Sec. 9. (a) A tax area must be initially established by resolution before July 1, 1999, according to the procedures set forth for the establishment of an economic development area under IC 36-7-14. A tax area may be changed or the terms governing the tax area revised in the same manner as the establishment of the initial tax area.
    (b) In establishing the tax area, the city or county legislative body must make the following findings instead of the findings required for the establishment of economic development areas:
        (1) There is a capital improvement that will be undertaken or has been undertaken in the tax area for a facility that is used:
            (A) by a professional sports franchise; or
            (B) for convention or tourism related events.
        (2) The capital improvement that will be undertaken or that has been undertaken in the tax area will benefit the public health and welfare and will be of public utility and benefit.
        (3) The capital improvement that will be undertaken or that has been undertaken in the tax area will protect or increase state and local tax bases and tax revenues.
    (c) The tax area established under this chapter is a special taxing district authorized by the general assembly to enable the county to provide special benefits to taxpayers in the tax area by promoting economic development that is of public use and benefit.

    Sec. 10. (a) A tax area must be established by resolution. A resolution establishing a tax area must provide for the allocation of covered taxes attributable to a taxable event or covered taxes earned in the tax area to the professional sports and convention development area fund established for the city or county. The allocation provision must apply to the entire tax area. The resolution must provide the tax area terminates not later than December 31, 2027.
    (b) In addition to subsection (a), all of the salary, wages, bonuses, and other compensation that are:
        (1) paid during a taxable year to a professional athlete for professional athletic services;
        (2) taxable in Indiana; and
        (3) earned in the tax area;
shall be allocated to the tax area if the professional athlete is a member of a team that plays the majority of the professional athletic events that the team plays in Indiana in the tax area.
    (c) The total amount of state revenue captured by the tax area may not exceed five dollars ($5) per resident of the city or county per year for twenty (20) consecutive years.
    (d) The resolution establishing the tax area must designate the facility or proposed facility and the facility site for which the tax area is established.
    (e) The department may adopt rules under IC 4-22-2 and guidelines to govern the allocation of covered taxes to a tax area.
    Sec. 11. Upon adoption of a resolution establishing a tax area under section 10 of this chapter, the city or county legislative body shall submit the resolution to the budget committee for
review and recommendation to the budget agency.
    Sec. 12. (a) The budget agency must approve the resolution before covered taxes may be allocated under section 10 of this chapter.
    (b) When considering a resolution, the budget committee and the budget agency must make the following findings:
        (1) The cost of the facility and facility site specified under the resolution exceeds ten thousand dollars ($10,000).
        (2) The capital improvement specified under the resolution is economically sound and will benefit the people of Indiana by protecting or increasing state and local tax bases and tax revenues for at least the duration of the tax area established under this chapter.
        (3) The political subdivisions affected by the capital improvement specified under the resolution have committed significant resources towards completion of the improvement.
    (c) Revenues from the tax area may not be allocated until the budget agency
approves the resolution.
    Sec. 13. When the city or county legislative body adopts an allocation provision, the county auditor shall notify the department by certified mail of the adoption of the provision and shall include with the notification a complete list of the following:
        (1) Employers in the tax area.
        (2) Street names and the range of street numbers of each street in the tax area.
The county auditor shall update the list before July 1 of each year.
    Sec. 14. If a tax area is established under section 10 of this chapter, a state fund known as the professional sports and convention development area fund is established for that tax area. The fund shall be administered by the department. Money in the fund does not revert to the state general fund at the end of a state fiscal year.
    Sec. 15. Covered taxes attributable to a taxing area under section 10 of this chapter shall be deposited in the professional sports and convention development area fund.
    Sec. 16. On or before the twentieth day of each month, all amounts held in the professional sports and convention development area fund shall be distributed to the county treasurer.
    Sec. 17. The department shall notify the county auditor of the amount of taxes to be distributed to the
county treasurer.
    Sec. 18. All distributions from the
professional sports and convention development area fund for the county shall be made by warrants issued by the auditor of state to the treasurer of state ordering those payments to the county treasurer.
    Sec. 19. The resolution establishing the tax area must designate the use of the funds. The funds are to be used only for:
        (1) a capital improvement that will construct or equip a facility:
            (A) owned by the city, the
county, a school corporation, or a board under IC 36-10-8 , IC 36-10-10 , or IC 36-10-11 and used by a professional sports franchise; or
            (B) owned by the city, the
county, or a board under IC 36-10-8 , IC 36-10-10 , or IC 36-10-11 and used for convention and tourism related events; or
        (2) the financing or refinancing of a capital improvement described in subdivision (1) or the payment of lease payments for a capital improvement described in subdivision (1).
    Sec. 20. The city or county legislative body shall repay to the professional sports development area fund any amount that is distributed to the city or county legislative body and used for:
        (1) a purpose that is not described in this chapter; or
        (2) a facility or facility site other than the facility and facility site to which covered taxes are designated under the resolution described in section 10 of this chapter.
The department shall distribute the covered taxes repaid to the professional sports development area fund under this section proportionately to the funds and the political subdivisions that would have received the covered taxes if the covered taxes had not been allocated to the tax area under this chapter.
    Sec. 21. This chapter expires December 31, 2027.

SOURCE: IC 36-10-9-6; (97)LS8017.21. -->

    SECTION 21. IC 36-10-9-6 IS AMENDED TO READ AS FOLLOWS [EFFECTIVE UPON PASSAGE]: Sec. 6. The board may, acting under the title "capital improvement board of managers of __________ county", do the following:
        (1) Acquire by grant, purchase, gift, devise, lease, condemnation, or otherwise, and hold, use, sell, lease, or dispose of, real and personal property and all property rights and interests necessary or convenient for the exercise of its powers under this chapter.
        (2) Construct, reconstruct, repair, remodel, enlarge, extend, or add to any capital improvement built or acquired by the board under this chapter.
        (3) Control and operate a capital improvement, including letting concessions and leasing all or part of the capital improvement.
        (4) Fix charges and establish rules governing the use of a capital improvement.
        (5) Accept gifts or contributions from individuals, corporations, limited liability companies, partnerships, associations, trusts, or political subdivisions, foundations, and funds, loans, or advances on the terms that the board considers necessary or desirable from the United States, the state, and any political subdivision or department of either, including entering into and carrying out contracts and agreements in connection with this subdivision.
        (6) Exercise within and in the name of the county the power of eminent domain under general statutes governing the exercise of the power for a public purpose.
        (7) Receive and collect money due for the use or leasing of a capital improvement and from concessions and other contracts, and expend the money for proper purposes.
        (8) Receive excise taxes, income taxes, and ad valorem property taxes and expend the money for operating expenses, payments of principal or interest of bonds or notes issued under this chapter, and for all or part of the cost of a capital improvement.
        (9) Retain the services of architects, engineers, accountants, attorneys, and consultants and hire employees upon terms and conditions established by the board, so long as any employees or members of the board authorized to receive, collect, and expend money are covered by a fidelity bond, the amount of which shall be fixed by the board. Funds may not be disbursed by an employee or member of the board without prior specific approval by the board.
        (10) Provide coverage for its employees under IC 22-3 and IC 22-4.
        (11) Purchase public liability and other insurance considered desirable.
        (12) Make and enter into all contracts and agreements necessary or incidental to the performance of its duties and the execution of its powers under this chapter, including the enforcement of them.
        (13) Sue and be sued in the name and style of "capital improvement board of managers of ___________ county" (including the name of the county), service of process being had by leaving a copy at the board's office.
        (14) Prepare and publish descriptive material and literature relating to the facilities and advantages of a capital improvement and do all other acts that the board considers necessary to promote and publicize the capital improvement, including the convention and visitor industry, and serve the commercial, industrial, and cultural interests of Indiana and its citizens. The board may assist, cooperate, and fund governmental, public, and private agencies and groups for these purposes.
        (15) Enter into leases of capital improvements and sell or lease property under IC 36-10-9.1.
SOURCE: ; (97)LS8017.22. -->

    SECTION 22. [EFFECTIVE UPON PASSAGE]: The provisions of this act are severable in the manner provided by IC 1-1-1-8 (b).
    
SECTION 23. An emergency is declared for this act.