CHAPTER 9. INDUSTRIAL DEVELOPMENT PROGRAM AND FUND
IC 5-28-9
Chapter 9. Industrial Development Program and Fund
IC 5-28-9-1
"Enterprise zone"
Sec. 1. As used in this chapter, "enterprise zone" means anenterprise zone created under IC 5-28-15 (or IC 4-4-6.1 before itsrepeal).
As added by P.L.4-2005, SEC.34.
IC 5-28-9-2
"Governing body"
Sec. 2. As used in this chapter, "governing body" means thelegislative body of a city, town, or county, an economic developmentcommission, or a board administering the affairs of a special taxingdistrict.
As added by P.L.4-2005, SEC.34.
IC 5-28-9-3
"Industrial development program"
Sec. 3. As used in this chapter, "industrial development program"means a program designed to aid the growth of industry in Indianaand includes the:
(1) construction of airports, airport facilities, and touristattractions;
(2) construction, extension, or completion of sewerlines,waterlines, streets, sidewalks, bridges, roads, highways, publicways, and information and high technology infrastructure;
(3) leasing or purchase of property, both real and personal; and
(4) preparation of surveys, plans, and specifications for theconstruction of publicly owned and operated facilities, utilities,and services.
As added by P.L.4-2005, SEC.34.
IC 5-28-9-4
"Information and high technology infrastructure"
Sec. 4. As used in this chapter, "information and high technologyinfrastructure" includes, but is not limited to, fiber optic cable andother infrastructure that supports high technology growth and thepurchase and installation of fiber optic cable and other infrastructure.
As added by P.L.4-2005, SEC.34.
IC 5-28-9-5
"Minority enterprise small business investment company"
Sec. 5. As used in this chapter, "minority enterprise smallbusiness investment company" means an investment companylicensed under 15 U.S.C. 681(D).
As added by P.L.4-2005, SEC.34.
IC 5-28-9-6
"Qualified entity"
Sec. 6. As used in this chapter, "qualified entity" means a city, atown, a county, an economic development commission, or a specialtaxing district.
As added by P.L.4-2005, SEC.34.
IC 5-28-9-7
"Small business investment company"
Sec. 7. As used in this chapter, "small business investmentcompany" means an investment company licensed under 15 U.S.C.691 et seq. or a successor statute.
As added by P.L.4-2005, SEC.34.
IC 5-28-9-8
Findings
Sec. 8. The general assembly finds that:
(1) areas in Indiana have insufficient employment opportunitiesand insufficient diversification of industry;
(2) these conditions are harmful to the health, prosperity,economic stability, and general welfare of these areas and, ifnot remedied, will be detrimental to the development of theseareas; and
(3) the use of money under this chapter and the fostering ofindustrial development programs serves a public purpose.
As added by P.L.4-2005, SEC.34.
IC 5-28-9-9
Fund established; purpose; administration
Sec. 9. (a) The industrial development fund is established withinthe state treasury. Loans may be made to qualified entities, smallbusiness investment companies, and minority enterprise smallbusiness investment companies in accordance with this chapter andthe policies and guidelines adopted under it.
(b) The fund consists of appropriations from the general assemblyand loan repayments.
(c) The corporation and the state board of finance shall jointlyadminister the fund. The following may be paid from money in thefund:
(1) Expenses of administering the fund.
(2) Nonrecurring administrative expenses incurred to carry outthe purposes of this chapter.
(d) Earnings from loans made under this chapter shall bedeposited in the fund.
(e) The treasurer of state shall invest the money in the fund notcurrently needed to meet the obligations of the fund in the samemanner as other public funds may be invested. Interest that accruesfrom these investments shall be deposited in the fund.
(f) The corporation, subject to the approval of the state board offinance, may adopt policies and guidelines for the proper
administration of the fund and this chapter. The corporation mayemploy personnel necessary to efficiently administer this chapter.
As added by P.L.4-2005, SEC.34.
IC 5-28-9-10
Loans for approved programs; amount restriction; limitations
Sec. 10. (a) Two million dollars ($2,000,000) in the industrialdevelopment fund does not revert to the state general fund butconstitutes a revolving fund to be used exclusively for the purpose ofthis chapter. The corporation, subject to the approval of the stateboard of finance, may order the auditor of state to make an approvedloan from the revolving fund to a qualified entity (including thepurchase of bonds of the qualified entity), a small businessinvestment company, or a minority enterprise small businessinvestment company.
(b) A qualified entity may borrow funds from the corporationunder this chapter and shall use the loan proceeds to institute andadminister an approved industrial development program. Thecombined amount of outstanding loans to any one (1) program maynot exceed one million dollars ($1,000,000). However, the onemillion dollar ($1,000,000) restriction in this subsection does notapply to an approved industrial development program in an economicdevelopment district established by a qualified entity underIC 6-1.1-39. A loan made under this chapter to an economicdevelopment commission is not a loan to or an obligation of thequalified entity that formed the commission, if the repayment of theloan is limited to a specified revenue source under section 15 of thischapter.
(c) A small business investment company or a minority enterprisesmall business investment company may use the loan proceeds forany lawful purpose.
(d) Notwithstanding any other law (including IC 5-1-11), the loanto a qualified entity under this section may be directly negotiatedwith the corporation without public sale of bonds or other evidencesof indebtedness of the qualified entity.
As added by P.L.4-2005, SEC.34.
IC 5-28-9-11
Industrial development programs
Sec. 11. A qualified entity may institute and administer anindustrial development program that is approved by ordinance orresolution adopted by the governing body of the qualified entity andapproved by the corporation.
As added by P.L.4-2005, SEC.34.
IC 5-28-9-12
Loans to qualified entities; conditions
Sec. 12. (a) The state board of finance and the corporation shallauthorize the making of a loan to a qualified entity under this chapteronly when all the following conditions exist: (1) An application for the loan has been submitted by thequalified entity, in a verified petition, to the state board offinance and the corporation in the manner and form as the stateboard of finance and the corporation direct. The applicationmust set forth all the following:
(A) The need for the program and the need for funds forinstituting and administering the program.
(B) An engineering estimate of the cost of the proposedprogram acceptable to the state board of finance and thecorporation.
(C) The amount of money needed.
(D) Other information that is requested by the state board offinance and the corporation.
(2) The proposed program has been approved by the state boardof finance and the corporation, which they may do only if theyhave determined that the program is based on sound engineeringprinciples and is in the interest of industrial development.
(3) The loan does not exceed one hundred percent (100%) ofthe cost to the qualified entity of an approved program, with thecost of the program to be based on an estimate made by acompetent engineering authority and approved by thecorporation.
(4) The qualified entity has agreed to furnish assurance,satisfactory to the state board of finance and the corporation,that the qualified entity will operate and maintain the program,after completion, in a satisfactory manner.
(b) The state board of finance and the corporation shall authorizea loan to a small business investment company or minority enterprisesmall business investment company under this chapter only if:
(1) the small business investment company or minorityenterprise small business investment company has loaned to orinvested in a business located in an enterprise zone for apurpose directly related to the enterprise zone an amount that isat least twice the amount of the requested loan; and
(2) the small business investment company or minorityenterprise small business investment company has submitted anapplication, before the beginning of the phase out period of theenterprise zone, to the state board of finance and thecorporation that shows the amount of the loan requested andother information that is requested by the state board of financeand the corporation.
As added by P.L.4-2005, SEC.34.
IC 5-28-9-13
Participation in program or project by entity; share of cost
Sec. 13. (a) The qualified entity may provide labor, equipment,and materials from any source at its disposal for such a program, andparticipation in accomplishment of the project or projects may be:
(1) evaluated by the state board of finance and the corporation;and (2) computed as a part or all of the share of cost that thequalified entity is required to pay toward the total cost of theproject or projects for which the loan is obtained.
(b) When participation as described in this section is authorized,the participation must be under direction of the governing body, andwhen cash amounts are included in the qualified entity's share oftotal cost, the cost amounts shall be provided in the usual andaccepted manner for the financing of the affairs of the qualifiedentity. Costs of engineering and legal services to the borrower maybe regarded as a part of the total cost of the project.
As added by P.L.4-2005, SEC.34.
IC 5-28-9-14
Priority rating of applicant for loan
Sec. 14. (a) The state board of finance and the corporation shalldetermine and ascribe to an applicant for a loan a priority rating. Therating must be based primarily on the need of the qualified entity fora proposed program or on the need of the small business investmentcompany or minority enterprise small business investment companyfor the loan as the need is related to the needs of other applicants forloans.
(b) The qualified entities, small business investment companies,or minority enterprise small business investment companies with thehighest priority rating shall be given first consideration when loansare made under this chapter. The loans shall be made in descendingorder as shown by the priority ratings.
As added by P.L.4-2005, SEC.34.
IC 5-28-9-15
Loans; restrictions; ordinance requirement
Sec. 15. (a) A loan made under this chapter is subject to thefollowing restrictions:
(1) The repayment period may not exceed fifteen (15) years.
(2) The interest rate is to be set by the state board of finance atthe time the loan is approved.
(3) Interest reverts to the industrial development fundestablished by this chapter.
(4) The loan must be repaid in installments, including intereston the unpaid balance, according to a repayment scheduleapproved by the state board of finance for that loan. However,on the approval of the state board of finance, the repayment ofprincipal may be deferred for a period not to exceed two (2)years.
(5) Subject to subsection (b), the repayment of the loan may belimited to a specified revenue source of the qualified entity and,if limited, is not a general obligation of the unit and is payablesolely from the specified revenue source.
(6) If the qualified entity levies a tax to repay the loan, the firstinstallment of the loan is due from funds received from the firstlevy. (7) If prepayment of the loan is made, a penalty may not becharged.
(b) A qualified entity may borrow money under this chapter onlyunder an ordinance adopted under IC 36-1-3-6 as follows:
(1) If the qualified entity is a city, town, or county, by thequalified entity.
(2) If the qualified entity is an economic developmentcommission, by the city, town, or county that established theeconomic development commission.
(3) If the qualified entity is a special taxing district establishedby the city, town, or county, by the city, town, or county thatestablished the special taxing district.
(4) If the qualified entity is a special taxing district that was notestablished by a city, town, or county, by the county in whichthe special taxing district is located.
If repayment of the loan is to be from a specified revenue sourceunder subsection (a)(5), the ordinance must state the revenue sourceand must state that the qualified entity is not obligated to pay theprincipal or interest on the loan except from the specified revenuesource. An ordinance may not provide for repayment from aspecified revenue source if the repayment would impair the qualifiedentity's contract with an owner of outstanding obligations payablefrom the specified revenue source.
(c) Notwithstanding any other law, the qualified entity may enterinto loans under this chapter without obtaining the approval of anyother body.
As added by P.L.4-2005, SEC.34.
IC 5-28-9-16
Revenue to pay annual loan installment and interest; levy of tax
Sec. 16. A qualified entity receiving a loan under this chapter maylevy an annual tax on personal and real property located within thequalified entity's geographical limits for industrial developmentpurposes, in addition to any other tax authorized by statute to belevied for such purposes, at a rate that will produce sufficientrevenue to pay the annual installment and interest on a loan madeunder this chapter. The tax may be in addition to the maximumannual rates prescribed by IC 6-1.1-18, IC 6-1.1-18.5, and otherstatutes.
As added by P.L.4-2005, SEC.34. Amended by P.L.2-2006, SEC.34;P.L.146-2008, SEC.40.
IC 5-28-9-17
Failure to repay money lent; action to recover
Sec. 17. (a) If a qualified entity fails to make repayment of moneylent under this chapter or is in any way indebted to the industrialdevelopment fund for any amounts incurred or accrued, the amountpayable may be:
(1) withheld by the auditor of state, as set forth in the loanagreement with the qualified entity, from any money payable to
the qualified entity and transferred to the fund; or
(2) recovered in an action by the state on relation of thecorporation, prosecuted by the attorney general, in the circuit orsuperior court of the county in which the qualified entity islocated.
(b) If a small business investment company or a minorityenterprise small business investment company fails to makerepayment of money lent under this chapter or is in any way indebtedto the industrial development fund for any amounts incurred oraccrued, the amount payable may be recovered in an action by thestate on relation of the company, prosecuted by the attorney general,in the circuit or superior court of the county in which the smallbusiness investment company or minority enterprise small businessinvestment company is located.
As added by P.L.4-2005, SEC.34.
IC 5-28-9-18
Appropriation
Sec. 18. There is appropriated annually to the corporation fromthe state general fund, from money not otherwise appropriated, anamount sufficient to administer this chapter, subject to the approvalof the budget committee.
As added by P.L.4-2005, SEC.34.
IC 5-28-9-19
Sale of notes or other debt obligations by a county, city, or town;deposit and use of proceeds
Sec. 19. (a) The corporation, with the approval of the state boardof finance, may sell to a person (including the board for depositories)the notes or other debt obligations issued by a county, city, or townunder this chapter or IC 6-1.1-39 for any borrowing from theindustrial development fund under this chapter.
(b) A sale by the corporation of a note or another debt obligationof a county, city, or town as authorized by subsection (a) shall bemade:
(1) without recourse against the corporation, the state board offinance, or the industrial development fund; and
(2) on the other terms and conditions that the corporation, withthe approval of the state board of finance, establishes.
(c) A purchaser of a note or another debt obligation succeeds toall the rights, entitlements, conditions, and limitations under the noteor other debt obligation. However, section 17 of this chapter does notapply to a note or another debt obligation that has been sold undersubsection (a).
(d) After a sale of a note or another debt obligation, thecorporation, the state board of finance, and the industrialdevelopment fund have no right, title, or interest in or to the note ordebt obligation.
(e) The proceeds from a sale of a note or another debt obligationshall be deposited in the industrial development fund to be used
exclusively for the purpose of this chapter.
As added by P.L.4-2005, SEC.34.
IC 5-28-9-20
Loan with simultaneous or successive sale of note or otherobligation; legal investments
Sec. 20. (a) For industrial development projects (as defined inIC 4-4-10.9-11(a)) that have a cost of the project (as defined inIC 4-4-10.9-5) greater than one hundred million dollars($100,000,000), the corporation may coordinate a loan to a county,city, or town under this chapter that is to be funded under IC 6-1.1-39with a simultaneous or successive sale of the note or other debtobligation issued or to be issued by the county, city, or town toevidence the borrowing under this chapter. For such a coordinated orsimultaneous lending and sale, the sale proceeds may be applied tothe funding of the loan to the county, city, or town.
(b) Notes or other debt obligations of a county, city, or town thatmay be sold by the corporation under this section or section 19 ofthis chapter are declared to be legal investments for:
(1) all insurance companies and associations and other personscarrying on an insurance business; and
(2) all banks, bankers, banking associations, trust companies,savings associations including savings and loan associations,building and loan associations, investment companies, and otherpersons carrying on a banking business.
These entities may invest their funds, including capital, in the notesor other debt obligations, notwithstanding any law to the contrary.
As added by P.L.4-2005, SEC.34. Amended by P.L.1-2006, SEC.127.