Proposals receive extensive comment

Two bills authored by local legislators saw extensive discussion in committee Wednesday.

State Sen. Travis Holdman’s Senate Bill 61 regarding tourism improvement districts was subject to about 40 minutes of testimony and questions in the Indiana House Ways and Means Committee while State Rep. Matt Lehman’s House Bill 1160 regarding civil proceeding advance payment contracts heard more than an hour of discussion Wednesday by the Indiana Senate Judiciary Committee. 

Holdman’s Senate Bill 228, which addresses various tax matters, also came before the Ways and Means Committee with no questions or testimony.

All three could be brought to a committee vote next week.

SB 61 from Holdman (R-Markle), who represents all of Jay, Blackford, Adams and Wells counties as well as part of Allen County, would allow for petitions to create tourism improvement districts that would utilize a tax rate to generate funds for marketing and/or development. The senator noted various “guardrails” in the legislation, including that it does not include residential properties, has a 10-year sunset, is not renewable and requires signatures of 65% of business owners and assessed value within the proposed district in order to move forward.

He noted that 23 states already offer such districts, with Texas and California leading the way.

“It’s been interesting to look because there’s a good mix of red states and blue states,” Holdman said.

Representatives of the Indiana Chamber of Commerce, Indiana Restaurant and Lodging Association and Indiana Tourism Association testified in favor of the measure, with Natalie Robinson, state director for the National Federation of Independent Businesses, spoke in opposition.

Those in favor said tourism improvement districts would serve to support tourism and provide a new funding source for quality of life and quality of place improvements. Robinson expressed concern that such districts and their related taxes would be a burden on small business owners, not all of whom would benefit from them.

“These districts essentially create a tax on top of a tax,” she said.

There were also some questions from legislators regarding Marian County, which is currently exempt from the legislation because it is addressed in other measures.

Rep. Ben Smaltz (R-Auburn) suggested that an alternative would be to increase caps on already existing taxes such as the innkeepers tax and food and beverage tax. Patrick Tamm of the restaurant and lodging association cautioned that hotel taxes in Indiana are already among the highest in the nation.

Lehman (R-Berne), who represents the northern third of Jay County along with Adams and Wells counties, said HB 1160 has three main goals:

•to keep foreign money out of litigation process

•to prohibit funders from having access to proprietary data

•to bar funders from influencing direction of a suit

Representatives from the Insurance Institute of Indiana, Indiana Chamber of Commerce and Indiana Manufacturers Association testified in favor of the bill while Brent Huber of Indianapolis law firm Ice Miller testified against.

Those in favor said the bill will regulate commercial financing of lawsuits and ensure that the system is not being misused. Huber proposed that the legislation be narrowed to address only “foreign entities of concern” as determined by various federal agencies.

Sen. Greg Taylor (D-Indianapolis) also questioned the wisdom of legislation that would prevent a plaintiff from sharing information regarding the suit if they so desire.

Lehman ultimately expressed concern that lawsuits are seen as an investment opportunity.

“We’re talking about the judicial branch of our government,” he said. “When did the judicial branch or our government become a financial hedge? That’s what I’m trying to prevent here.”

SB 228 has five major provisions: removing a transaction threshold for out-of-state retail merchants as a requirement for registering with the state department of revenue; eliminating the requirement for a utility study as part of the requirement to apply for a utility sales tax exemption; clarifying the statute of limitations of periodic taxes; requiring that taxes collected by sheriffs through tax warrants be distributed by electronic transfer; and allowing the department to share certain private information with tax preparers and software companies in cases in which the department believes fraudulent returns have been filed.

All proposed state legislation can be reviewed at iga.in.gov.