Indiana bill calls for creation of tourism improvement districts

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A bill being considered at the Indiana Statehouse by the Senate Tax and Fiscal Policy Committee would allow communities throughout the state to establish tourism improvement districts designed to help market and develop their areas.

Senate Bill 61, authored by Sen. Travis Holdman, R-Markle, provides the opportunity for a petition to be created that would spell out the details of the district, which would then need to be approved by the local legislative body.

Funds raised through the district could be used for capital investments in the geographic area outlined in the district or to support marketing efforts aimed at attracting more visitors to the area.

Carrie Lambert, executive director of the Indiana Tourism Association, said the effort is one that has been in the works for several years.

“The goal was for this to be enabling legislation that locally could be passed,” Lambert told our partners at the IBJ. “It gets a majority of the assessments that a majority of businesses would approve, and they would then be a part of saying how those funds would be used to market or develop their community.”

The petition for a tax improvement district would outline how much the businesses or property owners in the proposed area would be assessed, as well as specifically what those funds would be used for. It would also specify the length of time the district would exist.

“You really have to define the benefit, what the plan is actually going to be for those folks to actually elect to do to have that assessment upon them,” Patrick Tamm, CEO of the Indiana Restaurant & Lodging Association, told the committee on Tuesday.

A petition must have approval from at least 50% of the businesses or property owners who would be paying the special non-tax assessment before going before the local legislative body.

Lambert said the funds generated from the special assessment could come from a variety of sources from the participating businesses.

“If it’s an actual business, it could be based on how much sales come in, and what percentage that potentially would be assessed on top of that,” she said. Big hotel rooms, it could be based on the number of rooms. There’s a lot of flexibility and enabling language that a local community can go back and look at.”

The Indiana Tourism Association says the funds will be used to “provide services desired by, and directly benefitting, the businesses in the district.” Examples could be leveraging new development for sports tourism growth, new nightlife amenities, new retail districts, and venue capital improvements.

The organization notes that there are currently more than 200 tourism improvement districts in 21 states that, collectively, are generating over $500 million for supplemental tourism promotion and development.

Kentucky is the only state neighboring Indiana that has a TID law in place, though the other neighboring states are also considering establishing them.

Members of the committee questioned how a tourism improvement district would affect existing TIF districts or professional sports districts. Tamm said the assessments made through a TID would come in addition to those districts and would not have an impact on the funds raised through them.

Lambert noted that having a TID in place would particularly benefit smaller communities with fewer resources.

“Out of the 92 counties, we have about 70 that are represented within our membership, and not all of them have an opportunity to tap into other resources,” she said. “Our goal is to really be able to maximize it statewide and have that opportunity there. We recognize that there’s different needs in different communities, and having this availability available to all is certainly a great opportunity.”

Part of the process also includes the creation of a board that includes individuals representing the impacted businesses.

“It creates more conversation, more dialogue, more unity, if you will, at the local level for those efforts,” Tamm said. “At the same time, though, it’s still overseen by duly elected bodies as well, whether that’s a city council, whether that’s a county council as well.”

The committee did not vote on the bill during Tuesday’s meeting. Holdman, who chairs the committee, said they wanted to provide lawmakers more opportunity to ask questions about the proposal.

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3 thoughts on “Indiana bill calls for creation of tourism improvement districts

  1. This is actually a good bill to help market Indiana and rebrand itself. Most people that don’t know much about Indiana only think
    there’s the Indy500 and sporting events. This is a chance for many communities throughout the state to get tourist to pay attention to more things to do all around Indiana. If done correctly, this could definitely be a huge boost to the economy state wide.

  2. This doesn’t seem too far off or different of what the legislatures just heard people lobby against creating (the Mile Square Tax District) an EED. Fine let this pass – have the mile square district that the tax is on now roll up into this legislation and TID. Because that is what the goal of that Mile-Square taxable district is to make it more welcoming, pleasant and enjoyable downtown for tourists and residents. No? An trying to invest in more projects to make it look nice that are also capital projects, just like this bill for a TID???

  3. I can see it now…we’ll have mountains for skiing and wintersports, raging white water rivers for canoeing and kayaking. Maybe a glacier on the mountains feeding those rivers…almost no limitation on the imagination of how to develop new tourism destinations in Indiana.
    I know each little community and township is special to someone, for some reason. But for most folks, there is little in the way of natural landscape features or local historical tradition to make these towns have appeal. It’s not the East Coast, or the gun slinging towns of the west and southwest, where history abounds. Kentucky has the bourbon trail…will Indiana have the KKK Legacy Trail? We can barely make French Lick work…what is the reason to go to Sheridan (don’t get me wrong, I like Sheridan. I have family there, and I drive past it regularly without complaint). But other than some high school basketball and football championships, what’s there?
    Agree with the comment on this program and the Indy tax. The key difference, of course, is that this tourism program is slated to provide boondoggle dollars to the supermajority Republican members to take home to their districts, just as they take home excess road dollars. All to the detriment of Marion County.

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