Ind. Code ch. 36-7-40

Ind. Code ch. 36-7-40
in effect

Ind. Code § 36-7-40-1 Application of chapter

Sec. 1. This chapter applies to a first class city. As added by P.L.201-2023, SEC.279.

Ind. Code § 36-7-40-2 "Board"

Sec. 2. As used in this chapter, "board" refers to an economic enhancement district board established under section 5 of this chapter. As added by P.L.201-2023, SEC.279.

Ind. Code § 36-7-40-3 "Economic enhancement project"

Sec. 3. As used in this chapter, "economic enhancement project" means the following: (1) Providing security for public areas, including installing and maintaining exterior cameras directly linked with the Indianapolis metropolitan police department central control. (2) Employing safety ambassadors to: (A) deter panhandling and other nuisance behavior; (B) assist with directions and information; (C) facilitate open communications with police to report ongoing issues; (D) provide safety escort services; and (E) maintain a network of communication throughout the downtown area by engaging with private and public security companies. (3) Cleaning and maintaining sidewalks, including picking up litter, removing graffiti, and power washing. (4) Conducting extensive outreach to unsheltered homeless individuals. (5) Funding facility operations for a low barrier shelter for homeless individuals. (6) Designing, landscaping, beautifying, or maintaining public areas. (7) Supporting business development. As added by P.L.201-2023, SEC.279. Amended by P.L.169-2024, SEC.1.

Ind. Code § 36-7-40-3.5 Public hearing on proposed economic enhancement district; hearing requirements

Sec. 3.5. (a) Before an economic enhancement district may be established under this chapter, the clerk of the city-county council shall, in the manner provided by IC 5-3-1, publish notice of a hearing on the proposed economic enhancement district. The clerk of the city-county council shall mail a copy of the notice to each owner of real property within the proposed economic enhancement district. The notice must include the boundaries of the proposed district, a description of the proposed economic enhancement projects, the proposed formula for determining the percentage of the total benefit to be received by each parcel of real property, and the hearing date. The date of the hearing may not be more than sixty (60) days after the date on which the notice is mailed. (b) At the public hearing under subsection (a), the legislative body shall hear all owners of real property in the proposed district (who appear and request to be heard) upon the questions of: (1) the sufficiency of the notice; (2) whether the proposed economic enhancement projects are of public utility and benefit; (3) whether the formula to be used for the assessment of special benefits is appropriate; and (4) whether the district contains all, or more or less than all, of the property specially benefitted by the proposed economic enhancement projects. As added by P.L.169-2024, SEC.2.

Ind. Code § 36-7-40-4 Adoption of ordinance establishing economic enhancement district; ordinance requirements

Sec. 4. After conducting a hearing under section 3.5 of this chapter, the legislative body of a city may adopt an ordinance on or before December 31, 2024, establishing a special assessment district known as the economic enhancement district. The adopting ordinance must contain the following: (1) The boundaries of the proposed economic enhancement district, which may exceed the boundaries of the Mile Square area of the city. However, the boundary must be the same distance in length on all sides compared to the center of the city, but may not exceed a two (2) mile square. (2) A finding that the proposed economic enhancement projects will provide special benefits to all property owners of the economic enhancement district. (3) A finding that excludes the following types of properties from the assessment of benefits: (A) Any property that receives a homestead standard deduction under IC 6-1.1-12-37. (B) Any property that is used for multi-unit residential housing. (C) Any property that is used for single-unit residential housing. However, notwithstanding the exclusion provisions, an owner of property described in clause (A), (B), or (C) and the owner of any property located outside the economic enhancement district may voluntarily opt-in to include their property in the economic enhancement district assessment of benefits by notifying the county auditor in writing. If a property that is opted into the economic enhancement district assessment of benefits is subsequently sold, the new owner of the property shall have the opportunity to determine whether or not they will opt-in to include the property in the economic enhancement district assessment of benefits. A determination to opt-in to the economic enhancement district assessment of benefits is binding until a property is sold. (4) The formula to be used for the assessment of benefits, which shall be as follows: (A) The annual special benefits assessment shall be calculated in a manner that will generate an amount not to exceed five million five hundred thousand dollars ($5,500,000). (B) For each taxable property in the district, the special benefits assessment shall be calculated as follows: (i) Residential properties shall be assessed a flat fee of two hundred fifty dollars ($250) each. (ii) All other nonresidential taxable property shall be assessed at a rate equal to the total budget amount minus the total amount raised from residential properties divided by the total assessed value of all the nonresidential taxable property in the district. This fraction shall be considered the economic enhancement district assessment rate. The economic enhancement district assessment rate shall be multiplied by the assessed value of any nonresidential taxable property to determine that property's assessment. (5) An expiration date of the economic enhancement district, which may not be later than ten (10) years from the date of the adoption of the ordinance and may not be renewed. The adopting ordinance must establish an economic enhancement district board. As added by P.L.201-2023, SEC.279. Amended by P.L.9-2024, SEC.555; P.L.136-2024, SEC.55; P.L.169-2024, SEC.3.

Ind. Code § 36-7-40-5 Appointment of board members; staff support

Sec. 5. (a) An ordinance adopted under section 4 of this chapter must establish an economic enhancement board consisting of nine (9) members to be appointed as follows: (1) Two (2) members appointed by the legislative body of the city. (2) One (1) member appointed by the mayor of the city. (3) Four (4) members appointed by the governor. One (1) of the members appointed under this subdivision must represent the business community and own real property located within the economic enhancement district. (4) One (1) member of the state senate appointed by the president pro tempore. (5) One (1) member of the house of representatives appointed by the speaker. A majority of the board members must own real property within the economic enhancement district. Each board member shall serve a term of one (1) year from the first day of January after the board member's appointment and until the board member's successor is appointed and qualified. (b) A proposal before the board must receive at least six (6) votes to authorize action by the board. (c) Downtown Indy, Inc., or its successor organization, shall provide staff support to the economic enhancement board. (d) The members appointed under subsection (a)(4) and (a)(5) may not receive compensation for service on the board. As added by P.L.201-2023, SEC.279. Amended by P.L.169-2024, SEC.4.

Ind. Code § 36-7-40-6 Imposition of special benefits assessment; apportionment of benefits; public hearing

Sec. 6. (a) The board, after approval of the legislative body of the city and subject to section 13 of this chapter, may impose an annual special benefits assessment on all of the taxable real property of the economic enhancement district based on the relative benefits to be received by each type of property. The benefits accruing to parcels of real property within an economic enhancement district may be apportioned among those parcels on any basis reasonably representative of the diffusion of benefits from the economic enhancement projects, including but not limited to the following: (1) Proximity of the parcel to the projects. (2) Accessibility of the parcel to the projects. (3) True cash value of the parcels. (4) True cash value of any improvement on the parcel. (5) Age of any improvement on the parcel. (6) Other similar factors. The apportionment of benefits under this subsection may be adjusted by zone or land use as provided in subsections (c) and (d). (b) Upon determining the proposed assessment for each parcel, the board shall promptly mail notice to each owner of property to be assessed. This notice must: (1) set forth the amount of the proposed special assessment; (2) state that the proposed special assessment on each parcel of real property in the economic enhancement district is on file and may be seen in the board's office; (3) set forth the time and place where the board will hold a public hearing to hear any owner of assessed real property regarding their proposed assessment; and (4) state that the board, after hearing evidence, may decrease, or leave unchanged, the special assessment on any parcel. The notices must be deposited in the mail not later than twenty (20) days before the hearing date. The notices to the owners must be addressed as the names and addresses appear on the tax duplicates and the records of the county auditor. (c) If the benefit of the economic enhancement project varies from one (1) area to another within the economic enhancement district, up to three (3) zones may be established within the economic enhancement district to delineate the approximate difference in beneficial impact, and benefits may be apportioned accordingly. (d) In order to encourage the retention or development of various land uses within the economic enhancement district, assessments may be adjusted according to the zoning classification of the property. (e) Each special assessment is a lien on the real property that is assessed, second only to ad valorem property taxes levied on that property. (f) After the public hearing is conducted under subsection (b), the board shall certify to the county auditor the schedule of special assessments of benefits. For purposes of providing substantiation of the deductibility of a special assessment for federal adjusted gross income tax purposes under Section 164 of the Internal Revenue Code, the board shall, to the extent practicable, supplement the schedule of special assessments provided to the county auditor with a statement that identifies the part of each special assessment that is allocable to interest, maintenance, and repair charges. If the board provides the county auditor with the statement, the county auditor shall show, on the tax statement, the part of the special assessment that is for interest and maintenance and repair items separately from the remainder of the special assessment. (g) Not later than thirty (30) days after the county auditor receives the certification of final scheduled assessments for the completion of the economic enhancement projects, the county auditor shall deliver a copy of the certificate to the county treasurer. Each year, the county treasurer shall add the full annual assessment due in that year to the tax statements of the person owning the property affected by the assessment, designating it in a manner distinct from general taxes. (h) The proceeds of the special benefits assessments shall be deposited into a special fund known as the economic enhancement district project fund, and shall be used by the board solely to finance economic enhancement projects in or directly serving or benefiting the economic enhancement district. Any money earned from investment of money in the fund becomes a part of the fund. As added by P.L.201-2023, SEC.279.

Ind. Code § 36-7-40-6.5 Person engaged in renting or furnishing lodgings for periods of less than 30 days; fee

Sec. 6.5. A person who is: (1) engaged in the business of renting or furnishing, for periods of less than thirty (30) days, any lodgings: (A) in any hotel, motel, inn, tourist camp, tourist cabin, or any other place in which lodgings are regularly furnished for a consideration; and (B) that are located in an economic enhancement district established under this chapter; and (2) liable for a special benefits assessment under this chapter for the property described in subdivision (1); may charge a fee of not more than one dollar ($1) per night to each person who rents the lodgings described in subdivision (1) to be used toward payment of the special benefits assessment. As added by P.L.230-2025, SEC.145.

Ind. Code § 36-7-40-7 Annual budget; expenditures

Sec. 7. (a) Not later than November 1 of each year, the board shall prepare and submit to the city fiscal body a budget for the following calendar year governing the board's projected expenditures from the economic enhancement district project fund. The city fiscal body may approve, modify, or reject the proposed budget. (b) The board may make an expenditure from the economic enhancement district project fund only if the expenditure is approved by the city fiscal body in its review of the board's budget or is otherwise approved by the city fiscal body. As added by P.L.201-2023, SEC.279.

Ind. Code § 36-7-40-8 Compliance with requirements for contracting for public works

Sec. 8. The board shall comply with IC 36-1-12 when contracting for public works. As added by P.L.201-2023, SEC.279.

Ind. Code § 36-7-40-9 Leases or contracted agreements

Sec. 9. The board may enter into lease or contractual agreements, or both, with governmental, not-for-profit, or other private entities for the purpose of carrying out economic enhancement projects. The term of any lease or contractual agreement may not exceed the expiration date of the economic enhancement district ordinance under section 4 of this chapter. As added by P.L.201-2023, SEC.279. Amended by P.L.9-2024, SEC.556; P.L.169-2024, SEC.5.

Ind. Code § 36-7-40-10 Disposal of assets and liabilities upon repeal of ordinance

Sec. 10. If the ordinance that established an economic enhancement district is repealed, the assets and liabilities of the economic enhancement district shall be disposed of in the manner determined by the city. However, liabilities incurred by the economic enhancement district are not an obligation of the city and are payable only from the special benefits assessments and other revenues of the economic enhancement district. As added by P.L.201-2023, SEC.279.

Ind. Code § 36-7-40-11 Annual report to city fiscal body

Sec. 11. The board shall submit an annual report to the city fiscal body not later than June 30 of each year. The report must summarize the board's activities and expenditures during the preceding calendar year. As added by P.L.201-2023, SEC.279.

Ind. Code § 36-7-40-12 Power of the board to finance projects

Sec. 12. Subject to section 13 of this chapter, after approval of the city fiscal body, the board may issue revenue bonds, whose term may not exceed the expiration date of the economic enhancement district ordinance under section 4 of this chapter, payable from special benefits assessment revenues or other revenues of the economic enhancement district to finance an economic enhancement project. As added by P.L.201-2023, SEC.279. Amended by P.L.169-2024, SEC.6.

Ind. Code § 36-7-40-13 Failure to comply with statutory requirements

Sec. 13. If the board fails to comply with a requirement under this chapter, the board may not issue revenue bonds and a special assessment may not be assessed within the economic enhancement district. As added by P.L.201-2023, SEC.279.

Ind. Code § 36-7-40-14 Ordinance adopted before P.L.169-2024 void; new ordinance

Sec. 14. If the legislative body of a city has adopted an ordinance to establish an economic enhancement district under this chapter before March 15, 2024 (the effective date of P.L.169-2024), that ordinance shall be void, but may be revised and reenacted by the legislative body of the city by the adoption of a new ordinance under section 4 of this chapter, which must comply with the provisions of this chapter as amended by P.L.169-2024. As added by P.L.169-2024, SEC.7. Amended by P.L.1-2025, SEC.238.
Source: Open US Law by Vaquill AI (CC BY 4.0)URL: https://iga.in.gov/laws/2026/ic/titles/36Fetched: 10/17/2026