The Indiana Senate Appropriations Committee this morning unanimously passed a bill that would capture state tax money generated at Indianapolis Motor Speedway and give it back to the track to improve the facility.
The bill would create a special taxing district to capture state sales, income and corporate taxes generated from the track and surrounding land owned by IMS. It passed in the committee by an 11-0 vote, and will be heard by the full Senate next week before making its way through the House.
The plan would fund up to $100 million in improvements at the track. The bill would tap $5 million a year in tax collections to pay off bonds over 20 years, with the Speedway paying about $2 million a year.
If the measure is signed into law, the Indiana Finance Authority will oversee the distribution of funds to the Speedway.
“I’ve reached the conclusion in my own mind … this is an investment that will be profitable to the state,” said Sen. Luke Kenley, R-Noblesville.
Kenley pointed out that IMS would not receive the full $5 million annually if that much is not generated in state taxes from the venue. He emphasized that the deal will push the Speedway to grow its business to maximize the incentive.
Hulman & Co. CEO Mark Miles and IMS CEO Jeff Belskus attended the hearing to explain why taxpayer assistance is needed.
Miles and Belskus said competition from tracks in other states has increased dramatically over the last decade, emphasizing that many of the tracks, including venues in Missouri, Illinois, Wisconsin, Iowa and Kentucky, are the beneficiaries of tax dollars to help support maintenance and operations.
At this morning’s hearing, Belskus said the Speedway actually plans $120 million in capital improvements, and that some of those efforts will be rolled out this spring.
The bill had wide support from lawmakers in Thursday's hearing, with many speaking fondly of childhood memories at the Speedway, and several noting how much IMS has meant and still means to Indianapolis’ and Indiana’s global brand image.
In addition, Sen. Mike Young, a Republican whose district includes Speedway, pointed out the enormous economic impact the 104-year-old facility has on Indianapolis and the entire state. He also said that no property taxes will be given to IMS, so the measure would not affect local school funding.
Miles noted that the motorsports industry—of which the Speedway is a big part—has a $510 million economic impact on the state.