The Indiana General Assembly wrapped up its 2019 session the final week of April. Their chief accomplishment was the approval of the state’s biennial budget, in the amount of $34.6 billion. Other key items included teacher and DCS Funding, and the Hate Crimes Bill. The South Bend Regional Chamber had several bills we were tracking closely related to economic development, and we want to share a couple of updates on how those bills fared.
Regional Cities 2.0 Funding
This made no progress during the 2019 session and no money was included in the biennial budget. We believe there is a likelihood something gets included in the 2021 budget bill that will guide state investments in 2022 and 2023. We believe all regional cities 1.0 projects will be completed, and the state will be better positioned to analyze the full impact of the investments that were made. We’ll continue to advocate for this over the several years and utilize Ball State to measure the impact of the projects included as part of the original grant.
Regional Development Tax Credit
This was approved as a part of Senate Bill 563 and signed into law by Governor Holcomb on May 1. We’re grateful for the support of the General Assembly and Governor and believe this presents a new tool community’s can utilize when redeveloping key projects. While it does not follow a process similar to the regional cities program as we had suggested, there are provisions that require the project aligns with the community’s development plans, evidence of support from the local communities, residents, businesses, and private organizations, and barriers to redevelopment. The IEDC will administrate, they will be developing rules that better define the program in the coming months. This is an important win, a big thanks to the Regional Development Authority and others in our region who have supported this provision.
South Shore Railroad
At the 11th hour, a major change was initiated and approved related to the Northern Indiana Commuter Transportation District (NITCD) Board, this is the leadership for the South Shore. While it caught us all off guard and reduces the number of people from our county involved, from what we’ve seen, we don’t see it being a negative. The governor will appoint one person from St. Joseph County to be part of the leadership, the same as for each of the other counties. Our focus on the South Shore now shifts to the federal government, where President Trump, Speaker Pelosi and Senate Majority Leader McConnell are working to advance an infrastructure bill that would provide important funding for both the double track and South Bend station relocation projects. We’re utilizing our D.C. connections to help advance that. If there is any concern, it is that in Indiana the West Lake corridor is on a “faster track” than the double track project. We’d like to see the double track project on that “faster track too.
Data Center Bill, House Bill 1405
A bill designed to support the growth of data centers in Indiana has passed the Indiana General Assembly and was signed into law by the governor on May 5. House Bill 1405 provides a state sale and use tax exemption for the purchase of certain equipment for data centers depending on the developer's investment in the project. As part of the bill, the electricity used by qualified data centers will also be exempt from the state's sales tax. The Senate included a "Buy Indiana" amendment which provides an additional exemption for construction costs if 75 percent of the construction materials and labor are sourced from Indiana vendors. This bill is important to the South Bend area given our recent successes with data center project like Data Realty and the Union Station Technology Center. We believe this shows the data industry that Indiana is very serious about becoming their destination of choice for expansion.
Investment Hub Proposal
This is an initiative that would give cities/towns/counties the ability to come together and institute a Food & Beverage Tax, half of which would be utilized for local projects, half of which would go to the RDA. This will receive additional study this coming summer.
A big thanks to the members of the Indiana General Assembly for their work on behalf of our region, and for their efforts to make sure local leaders knew what was happening at the Statehouse. The Chamber hosted three Third House meetings and a Legislative Preview, which gave the local community several important opportunities to convey key priorities and hear more about what was happening at the Statehouse.