First Regular Session 118th General Assembly (2013)


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    HOUSE ENROLLED ACT No. 1067



     AN ACT to amend the Indiana Code concerning local government.

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

SOURCE: IC 36-9-42.2; (13)HE1067.1.1. -->
    SECTION 1. IC 36-9-42.2 IS ADDED TO THE INDIANA CODE AS A NEW CHAPTER TO READ AS FOLLOWS [EFFECTIVE JULY 1, 2013]:
     Chapter 42.2. Federal Fund Exchange Program
    Sec. 1. As used in this chapter, "department" refers to the Indiana department of transportation established by IC 8-23-2-1.
    Sec. 2. As used in this chapter, "eligible entity" means a county or municipality that receives, directly or indirectly, federal funds.
    Sec. 3. As used in this chapter, "federal funds" means funds received by an eligible entity through the federal surface transportation program.
    Sec. 4. As used in this chapter, "program" refers to the federal fund exchange program established by section 5 of this chapter.
    Sec. 5. The federal fund exchange program is established to provide eligible entities and the department with greater flexibility in funding transportation projects. The department shall administer the program.
    Sec. 6. The department shall determine the amount of state funds available for the program. In making the determination, the department shall consider the following:
        (1) Whether adequate state funds are available to fund the program without putting at risk other transportation

activities or projects needing state funds.
        (2) Whether the department can readily and effectively use federal funds received through the program.
    Sec. 7. An eligible entity is eligible to participate in the program upon entering into an exchange agreement with the department. The department shall consider the following before entering into an exchange agreement with an eligible entity:
        (1) The amount of federal funds the
eligible entity wants to exchange and the proposed exchange rate.
        (2) A brief description of each project the eligible entity wants to fund, including the estimated cost of the project.
        (3) The benefit to a project described in subdivision (2) from the removal of federal funding, due to the project's size, type, location, or other features.
        (4) The availability of state funds.
Subject to section 7.5 of this chapter, an eligible entity may enter into an exchange agreement with respect to a project at any time during the project development process.
    Sec. 7.5. (a) The department may enter into an exchange agreement only if the exchange agreement is first approved by the office of management and budget and the attorney general.
    (b) The executive of an eligible entity may enter into an exchange agreement on behalf of the eligible entity. However, the executive of an eligible entity may enter into an exchange agreement only if the exchange agreement is first approved by the fiscal body of the eligible entity.
    Sec. 8. An exchange agreement must provide the following:
        (1) The eligible entity may exchange only federal funds for state funds.
        (2) The eligible entity may use state funds only for a capital project that will fulfill the purpose of the original federal project award and that is approved by the department.
        (3) If the eligible entity uses state funds to replace local funds in order to use the local funds for purposes unrelated to transportation, the eligible entity:
            (A) must repay the state funds to the department; and
            (B) may not participate in the program during the succeeding fiscal year.
        (4) An exchange rate of not less than seventy-five cents ($0.75) of state funds for each one dollar ($1) of federal funds.
        (5) The eligible entity agrees to provide local matching funds equal to not less than ten percent (10%) of the estimated

project cost.
        (6) The department will disburse the state funds to the eligible entity on a reimbursement basis.
    Sec. 9. Not later than November 1 of each year, the department shall submit a report on the program to the general assembly in an electronic format under IC 5-14-6. A report submitted under this section must include:
        (1) a summary of the exchange agreements entered into during the previous state fiscal year; and
        (2) a status report on the implementation of projects funded through the program.
    Sec. 10. An eligible entity that participates in the program shall comply with applicable public purchasing laws and competitive bidding requirements with respect to projects funded through the program.
    Sec. 11. The department may adopt rules under IC 4-22-2 to implement this chapter.


HEA 1067 _ Concur

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