Minimum guaranteed credit; adjustment of credits and
distributions
Effective 1-1-2006.
Sec. 2.5. (a) Annually, before the department determines the
eligible property tax replacement amount for a year under section 3
of this chapter and the department of local government finance
makes its certification under section 3(b) of this chapter, the budget
agency shall determine the sum of the following:
(1) One billion one hundred twenty-one million seven hundred
thousand dollars ($1,121,700,000).
(2) An amount equal to the net amount of revenue, after
deducting collection allowances and refunds, that the budget
agency estimates will be collected in a particular calendar year
from the part of the gross retail and use tax rate imposed under
IC 6-2.5 equal to one percent (1%).
The estimate made under this subsection must be consistent with the
latest technical forecast of state revenues that is prepared for
distribution to the general assembly and the general public and
available to the budget agency at the time that the estimate is made.
(b) The department may not distribute eligible property tax
replacement amounts and eligible homestead credit replacement
amounts for a year under this chapter that, in the aggregate, is less
than the amount computed under subsection (a).
(c) Annually, before the department determines the eligible
property tax replacement amount for a year under section 3 of this
chapter and the department of local government finance makes its
certification under section 3(b) of this chapter, the budget agency
shall determine whether the total amount of property tax replacement
credits granted in Indiana under section 5 of this chapter and
homestead credits granted in Indiana under IC 6-1.1-20.9-2 for a
year, determined without applying subsection (b), will be less than
the amount determined under subsection (b). The budget agency shall
give notice of its determination to the members of the board and, in
an electronic format under IC 5-14-6, the general assembly. If the
budget agency determines that the amount determined under
subsection (b) will not be exceeded in a particular year, the board
shall increase for that year the percentages used to determine a
taxpayer's property tax replacement credit amount and the homestead
credit percentage applicable under IC 6-1.1-20.9-2 so that the total
amount of property tax replacement credits granted in Indiana under
section 5 of this chapter and homestead credits granted in Indiana
under IC 6-1.1-20.9-2 at least equals the amount determined under
subsection (b). In making adjustments under this subsection, the
board shall increase percentages in the following order until the total
of property tax replacement credits granted under section 5 of this
chapter and homestead credits granted under IC 6-1.1-20.9-2 for the
year at least equals the amount determined under subsection (b):
(1) The homestead credit percentage specified in
IC 6-1.1-20.9-2 until the homestead percentage reaches the
lesser of:
(A) thirty percent (30%); or
(B) the percentage at which the total of property tax
replacement credits granted under section 5 of this chapter
and homestead credits granted under IC 6-1.1-20.9-2 for the
year at least equals the amount determined under subsection
(b).
(2) If the amount determined under subsection (b) is not
exceeded after increasing the homestead percentage under
subdivision (1), the board shall increase the property tax
replacement credit percentage specified in section 2(j)(1) and
2(l)(1) of this chapter until the property tax replacement
percentage reaches the lesser of:
(A) seventy percent (70%); or
(B) the percentage at which the total of property tax
replacement credits granted under section 5 of this chapter
and homestead credits granted under IC 6-1.1-20.9-2 for the
year, as adjusted under this subsection, at least equals the
amount determined under subsection (b).
(3) If the amount determined under subsection (b) is not
exceeded after making all possible increases in credit
percentages under subdivisions (1) and (2), the board shall
increase the property tax replacement credit percentages
specified in section 2(j)(2), 2(j)(3), 2(l)(2), and 2(l)(3) of this
chapter to the percentage at the total of property tax
replacement credits granted under section 5 of this chapter and
homestead credits granted under IC 6-1.1-20.9-2 for the year, as
adjusted under this subsection, at least equals the amount
determined under subsection (b).
(d) The adjusted percentages set under subsection (c):
(1) are the percentages that apply under:
(A) section 5 of this chapter to determine a taxpayer's
property tax replacement credit amount; and
(B) IC 6-1.1-20.9-2 to determine a taxpayer's homestead
credit; and
(2) must be used by the:
(A) department in estimating the eligible property tax
replacement amount under section 3 of this chapter; and
(B) department of local government finance in making its
certification under section 3(b) of this chapter;
and for all other purposes under this chapter and IC 6-1.1-20.9
related to distributions under this chapter;
for the particular year covered by a budget agency's determination
under subsection (c).
As added by P.L.246-2005, SEC.65.
Last modified: May 28, 2006