Indiana § 36-4-3-4.2 - County infrastructure reimbursement

§ 36-4-3-4.2. County infrastructure reimbursement

Sec. 4.2. (a) As used in this section, "infrastructure" means the capital improvements that comprise:

(1) a sanitary sewer system or wastewater treatment facility;

(2) a building and appurtenances;

(3) a park or recreational facility;

(4) a road, street, highway, or bridge; or

(5) a water treatment, water storage, or water distribution facility.

(b) This section applies:

(1) only to an annexation for which an annexation ordinance is adopted after June 30, 2015; and

(2) if there is debt, evidenced by bonds, leases, or other obligations, that is outstanding on infrastructure on the date that the annexation becomes effective.

(c) This subsection applies if:

(1) the municipality takes ownership of infrastructure located within the annexation territory, or part of an item of infrastructure, owned by the county; and

(2) the outstanding debt is payable from property taxes or from revenue bonds or obligations.

The annexing municipality is liable to the county for reimbursements only if the municipality assumes ownership or partial ownership of the infrastructure. If the municipality assumes ownership or partial ownership of the infrastructure, the municipality shall reimburse the county for the appropriate share of the remaining debt that is payable by the county from property taxes or revenues. The county and the annexing municipality shall enter into an interlocal agreement under IC 36-1-7 regarding the allocation of the debt and reimbursement terms.

(d) This subsection applies if the local income tax under IC 6-3.6 has been pledged by the county to pay outstanding debt on infrastructure located within the county. To offset the change in local income tax distributions that will occur after the annexation, the annexing municipality is liable to the county for reimbursements in the amount that represents part of the outstanding debt on the infrastructure until the debt is fully paid. The amount that the municipality is required to reimburse the county is the percent of the total county income tax distribution that is indebted, multiplied by the amount of local income tax revenue for the distribution year that is shifted from the county to the municipality as a result of the annexation.

(e) Reimbursements received by a county under this section shall be deposited in the appropriate debt service fund.

As added by P.L.228-2015, SEC.7. Amended by P.L.197-2016, SEC.122.