Beginning in 2027, pursuant to HB 1001, Section 17. IC 36-7-2.3 - All building and Construction fees assessed and collected by a unit must be kept in the newly created Building and Construction Related Fees Fund (#1240) dedicated exclusively to reimbursing the actual costs incurred by the unit related to the imposition and calculation of the fee. Each fund must be maintained as a separate line item in the unit’s budget. Money in this fund may not, at any time, revert to the unit’s general fund or any other fund.

Legislation in 2025 and 2026 replaces the existing LIT structure with a new system starting in 2029 with first distributions occurring in 2030.

Under the new structure, the County Unit and municipalities with a population of at least 3,500 may adopt a local income tax rate of up to 1.2% that may be used for any purpose. The County may also adopt up to a 0.40% LIT for Fire Protection & EMS to be distributed to providers of those services. The County may also adopt LIT rates for non-qualifying or opted-in municipalities and certain non-municipal units. The total county expenditure LIT rate is capped at 2.90%, based on taxpayer residency.

The table below summarizes the new LIT rates for implementation in 2029. All current LIT rates (except Special Purpose) will expire on December 31, 2028.

The table below shows the County's current and estimated local income tax revenues. AGI estimates for 2027 - 2029 assumes an annual increase of approximately 6% based on the historical average growth between 2019 and 2026. Year 2030, assumes the County will adopt a rate of 0.9% for the County LIT Services in 2028 effective for distribution in 2030.