The theme of yesterday’s column in the morning paper by Mr. Tully was that, despite all the bad publicity, the General Assembly is actually considering some "good" legislation. He indicates, by number, eight such bills.
Unfortunately, the very first bill he mentions, HB 1207, has the possibility of becoming a real lemon! The bill would allow, he says, "...development districts, funded by taxes collected within them, for downtown Main Streets in small Indiana communities."
The bill, as written, applies to communities of 20,000 or less and limits application on both a time and geographic basis. Sounds pretty good, until one reads the actual wording of the bill.
What we are not told is that the bill inserts state collected sales taxes into a TIF-type operation in place of property taxes. Where TIF areas now operate, governmental units basing their revenues on property taxes are the fall guys. This bill will hand the tab to the entire state.
The calculation and distribution by the state is somewhat complicated for this essay to attempt. We’ll just skip to the description of who gets the money and how it is to be used.
"Sec. 10(a) "The fiscal officer of an adopting municipality shall establish a district fund to receive money distributed to the adopting municipality under section 9 of this chapter.
10(b) Money deposited in the district fund may be used by the adopting municipality for any of the following: (Our emphasis)
10(b)-1 Improvements in the district.
10(b)-2 Payments of principal, interest and other financing....
10(b)-3 Lease rental payments...."
It struck us as interesting that there is no mention of what individual or body, under what circumstances or legal provisions, the money may be spent, especially for something as general and undefined as "improvements in the district."
Obviously, as written, the bill does not apply to Indianapolis. But it sets a framework and a precedent which may eventually be as widely abused as is current TIF policy. With state funds!