Those of us who spend our winter days roaming the halls of the Statehouse look forward to session’s halfway mark – when viable bills cross chambers, accompanied by a short respite in legislative activity – with great anticipation. The same anticipation, say, as Bad Bunny fans awaiting his Sunday Super Bowl halftime show.

But like the special effects that tend to adorn those halftime shows, this year’s Statehouse break is merely a mirage.

Bills are moving with such speed and ferocity that this week’s legislative halftime brought no slowing of activity nor break in debate. Thankfully for our Legislative Update subscribers, that means we have plenty of pre-reading to offer you before Sunday’s big game (or big concert, ads bonanza, or snack buffet, depending on your interests).

Find your favorite spot on the sofa to read this week’s play-by-play and warm up that perch for your Sunday afternoon viewing.  

In today’s Legislative Update:

• Get in Formation (Legislative Mechanics)
• NFL vs. Teams (State vs. Local Control: Housing Edition)
• Playing Under the Cap (Fiscal Issues)
• Signing Bonus (Regional Economic Development)

Get in Formation

You’ll notice a legislative trend this week that’s almost as obvious as the many celebrity cameos slated for this year’s Super Bowl ads. The key elements from bills that died before halftime are being resurrected into omnibus bills. We’ll talk about two of those mega-bills – HB 1210 (the fiscal issues bill) and SB 281 (the regional economic development bill) in more detail.

🏠 But first, let’s catch up on the housing debate.

NFL vs. Teams

HB 1001 – Republican Rep. Doug Miller’s pro-housing supply legislation – is generating a debate spicier than our favorite Super Bowl chicken wings. At the heart of the issue is a common theme: local autonomy versus state control.

⬆️ The Upshot: As a reminder, the bill aims to make it easier—and more predictable—to build new homes, while adding transparency around local housing outcomes. The bill nudges local zoning to better match adopted comprehensive plans. Starting in 2027, if a city or town updates its plan but doesn’t bring zoning into alignment within a year, proposed projects would be approved if they comply with either the plan or the zoning code – a move designed to keep projects moving. The bill also puts guardrails on local fees and expands where housing can be built by default. Most affordable housing developments would be allowed to be built “by right” on property owned by religious institutions. And unless a community opts out by ordinance, the bill sets statewide “default” zoning rules that limit parking minimums and restrict overly large lot-sizes, density, and site standards—changes designed to lower costs and increase supply.

💬 The Debate: Local elected officials are pushing back against the bill. In an IndyStar op-ed published this week, more than three dozen Central Indiana mayors, town managers, county commissioners, and council presidents called HB 1001 “a one-size-fits-all mandate that treats local planning as the problem to be solved.” They argue that the state is exerting too much control over what should be a local process with lots of public input. While affordable housing is a problem that needs to be addressed, they say the answer is reforming permitting, investing in local infrastructure in growing communities, and setting and rewarding production targets.  

🏈 For NFL skeptics who think teams need more autonomy to innovate, this local control argument will resonate (revenue sharing, amirite?).

But others assert, to the contrary, the state needs to intervene if we’re going to take meaningful steps toward solving the housing crisis. In another Star piece, urban planner and Downtown Indianapolis resident Jeffrey Tompkins argued that local zoning regulations have become too burdensome in restricting the type of housing we can build and the supply of housing available, which limits supply and increases prices. He calls HB 1001 “the abundance agenda Indiana needs,” noting that it not only eliminates unnecessary red tape – for example, stringent requirements with adding accessory dwelling units – it also increases transparency by requiring locals to opt out of more relaxed designed standards, parking requirements, and lot sizes – which also means they must explain their position.

➡️ What’s Next: The bill has been referred to the Senate Judiciary Committee.

Playing Under the Cap

Speaking of local governments’ frustration with the state, remember SEA 1? Last year’s property tax reform legislation will reduce the tax burden for homeowners while also decreasing property tax revenue for local governments. However, to offset some of that lost revenue, the bill also shifts part of the local tax burden from property taxes to local income taxes (LIT). It raises the county LIT expenditure cap to 2.9%, allows larger cities and towns to adopt their own LIT rates, and restructures how LIT is shared among counties, municipalities, and other local units. This gives locals more tools to replace revenue, but it also sets up difficult local decisions about income tax increases and how revenue is divided.

🎯 Enter HB 1210, which, among other things, attempts to clean up some of the quirks that accompanied SEA 1. Here is what the bill, authored by Republican Rep. Craig Snow, does, in four plays:

• SEA 1 Fixes: It delays the LIT changes in SEA 1 from going into effect from 2028 to 2029. Importantly, it also guarantees that if a municipality does not renew its LIT rate each year, the rate will automatically default to what’s needed to cover debt service.
• Tourism Improvement District: The bill also enables local governments to create Tourism Improvement Districts, which capture fees from businesses to support marketing and promotion of tourism in the surrounding area. Creating these districts would require a petition, hearing, and local ordinance, and as with their kindred spirits, Economic Improvement or Enhancement Districts, apartments and homesteads would be excluded from the fees.
  • 🏈 Chamber member fan favorite? We heard directly from some members in our policy survey about the need for these districts and their importance to Indy, so we know at least some of you will be cheering on this development with us. Go team!
• Restrictions on Restrictions: Both Fishers and Carmel have passed ordinances capping rental properties to 10% of neighborhood homes and requiring rental property owners to get city permits to rent. These policies are aimed at limiting the presence of large, out-of-state investors in these communities, but critics say they limit accessibility and affordable housing. HB 1210 would pre-empt local communities from being able to put those restrictions in place.
• DLGF Requirements: Our legislative agenda included an ask that the legislature require the state’s Department of Local Government Finance to annually update the cost tables that assessors use to determine assessed valuations on which property taxes are based. To date, the bill does not contain this provision.

Signing Bonus

SB 281 has become the vehicle for a slate of provisions to fuel regional economic development. Authored by Republican Sens. Greg Goode and Ryan Mishler and Democratic Sen. David Niezgodski, the bill puts more structure, accountability, and resources behind regional economic development, while giving the state flexibility to support large, high-impact projects that span multiple communities.

🖼️ Big Picture: The bill authorizes the Indiana Economic Development Corporation (IEDC) to award up to $50 million per fiscal year in redevelopment tax credits for projects that align with approved regional development plans and have a recommendation from a regional development authority (RDA). Importantly, it also:

• Defines who qualifies as a “development authority.” RDAs – like our own Central Indiana Regional Development Authority (CIRDA) – are explicitly eligible. The bill also requires regional development plans to be more detailed, laying out the region’s overall economic strategy, a list of priority projects, expected returns on investment, and how local governments and partners are expected to participate.
• In addition, the bill allows a development authority to create a regional development advisory council, with members appointed by county executives, the Governor, legislative leaders, and mayors—ensuring both state-level and local voices are represented. These bodies aren’t currently charged with an explicit scope in the bill.
• SB 281 gives the State Budget Agency flexibility to increase funding for the Deal Closing Fund – an economic development tool created in 2023 designed to attract high-impact businesses to the state. That increase would be subject to Budget Committee review, with the goal of helping Indiana stay competitive when closing major economic development deals. In the words of Cuba Gooding Jr., Show Me the Money! (We couldn’t resist.)

That’s all for this week’s update. Keep following along to see if our legislative predictions are more on point than our Grammy picks were last week. 

As for the outcome of Sunday’s game? As Colts fans, we can borrow the words of Tom Brady and say we don’t have a dog in the fight. Hopefully, our take will land with less controversy.

Until next week.