Committee advances amended Tax and Fiscal Policy bill after debates on retirement, childcare and franchise-fee provisions

The Tax and Fiscal Policy Committee voted to report an amended version of House Bill 1427 to the full chamber after a multi-hour hearing that covered dozens of changes to state tax code and local fiscal practice.

The amendment, labeled Amendment Number 37, packages a wide set of adjustments to state tax law and administrative practice, including a change allowing some counties to take loans up to 10 years (instead of five), technical corrections tied to the Indiana Board of Tax Review, clarifying procedures for the Department of Local Government Finance and Department of Education on charter school property-tax-sharing language from 2023, and the permanent authorization of negotiated bond sales previously carried under a sunset. It also contains a mix of locally targeted measures: franchise-fee reductions, changes to innkeepers and food-and-beverage tax allocations for specific localities, and language addressing classification of farmland used for solar arrays.

Why the committee looked closely: several provisions prompted extended debate and public testimony because of potential impacts on local government revenue or because the changes alter long-standing local administration.

Key contentious items discussed

- Continuing care retirement communities (CCRCs): The amendment includes language deeming parts of buildings owned by nonprofit entities that are registered as CCRCs or as licensed residential health facilities to be used for charitable purposes and therefore exempt from property taxes. Heather Harris, representing LeadingAge Indiana, said the association has tracked this issue for three years and told the committee, “There are 52,” referring to the number of CCRCs in the state. Justin Kimbrell, CEO of Grace Village in Winona Lake, testified that an assessor’s recent determination that his nonprofit community owed property tax would have imposed about $150,000 to $200,000 in annual costs on his facility. Bartholomew County Assessor Jenny Whipple testified in opposition and urged that exemption decisions remain a local determination, saying CCRCs “are not one size fits all” and that some facilities charge large entrance and monthly fees.

- Employer-provided childcare exemption: The amendment would allow a property tax exemption for a parcel where an employer provides childcare for employees (limited to children under age 6 and to employees’ children unless other agreements exist). Several committee members raised concerns that the change acts as a subsidy to individual employers rather than addressing childcare supply broadly; Representative Snow said policymakers intended the change to “incent” more employers to provide childcare so employees could return to work. The Indiana Manufacturers Association supported the childcare provision as a tool to expand access.

- Franchise-fee reductions: The amendment reduces municipal franchise fees charged to cable and telecommunications providers by one percentage point at most levels (for example, a 5% fee would drop to 4%). Municipal representatives warned the change could significantly reduce local revenue used for right-of-way maintenance and other services.

- Classification of farmland used for solar: The amendment clarifies when land used for solar generation should be classified as agricultural property or utility property; committee members noted current county inconsistency in classifying leases, purchases or easements when utilities or third parties install arrays on farmland.

- Technical and administrative clarifications: Amendment 37 clarifies who is responsible for uploading certain contracts (the fiscal officer rather than executive officers), eases proof requirements when taxpayers pay property taxes through third-party check processors (so a timely-transmitted payment can be accepted even without a postmark), and authorizes the fiscal officer of units served by volunteer fire departments to make certain distributions.

Testimony and local concerns

Public testimony focused primarily on the continuing-care provision. Heather Harris and Justin Kimbrell argued the amendment provides needed statewide clarity and would prevent assessors from reversing a long-standing treatment of nonprofit CCRCs as charitable. Kimbrell said his nonprofit community would face “about $150,000 to $200,000 a year” in additional costs if assessed. County assessors and others — including Bartholomew County Assessor Jenny Whipple — urged that exemption determinations remain a local matter and pointed to court precedent that looks to actual property use, not only an owner’s 501(c)(3) status. Legal representatives and associations cautioned the committee that the constitutional standard for charitable-use exemptions is use of the property and not simply corporate form.

Other stakeholders testified on discrete provisions: municipal and town representatives opposed the franchise-fee reduction because of local revenue impacts; the Northwest Indiana Regional Development Authority reminded the committee it is due repayment of roughly $3 million in funds by a date extended by the amendment; municipal and assessor groups supported technical clarifications to filing and review deadlines.

Votes and next steps

The committee voted to report the amended bill to the floor. During the committee roll call the chair stated the bill would move to the floor; the roll-call discussion and recorded explanations of votes are in the transcript. Committee members said they would continue work on some provisions — particularly the CCRC exemption and the childcare provision — before second reading.

What the bill does not yet decide

The amendment sets statewide rules in several places but leaves other decisions to local governments: it permits (but does not require) certain local property-tax relief authorizations, and it clarifies administrative processes without drafting the final local implementation details. The committee’s action sends the amended bill to the full chamber for further debate and possible modification there.

Ending

Committee members and witnesses requested follow-up items, including lists of the 52 CCRCs and data on admissions and fee structures for those facilities, which advocates said they would supply. Lawmakers said they planned additional hearings and floor-level debate before final passage.