INDIANAPOLIS — The Indiana Economic Development Corporation (IEDC) praised the efforts of Gov. Eric J. Holcomb and the Indiana General Assembly to strengthen the state’s business-friendly environment and position Indiana for long-term economic growth and job creation. With the end of the 2021 legislative session, Holcomb signed multiple pieces of legislation that will support small businesses and Hoosier manufacturers, increase funding for direct flights, modernize Indiana’s tax code and enhance regional development, according to the IEDC.
“We are building on Indiana’s momentum and positive economic indicators by investing in our people and places,” Holcomb said in a news release. “These historic, strategic investments in our local communities will provide an incredible opportunity to create a collaborative future. I want to thank Indiana lawmakers for joining me in making these priorities a reality.”
An overview of legislation impacting economic development in Indiana is outlined below. More information on House Bill 1001 (state budget), House Enrolled Act 1004 (Small Business Restart Grants), House Bill 1418 (IEDC agency) and House Bill 1168 (electric vehicles) is available online.
Innovation & Entrepreneurship
Supporting small business relief: The Indiana Small Business Restart Grant program was expanded, adding $60 million in federal funding to support Hoosier small businesses impacted by the pandemic. Small businesses with fewer than 100 employees and less than $10 million in annual revenue can apply online now, and small businesses with fewer than 500 employees and less than $35 million in annual revenue can apply for an additional $30 million made available through the program’s counterpart — the Indiana Hospitality & Entertainment Grant. Eligibility details for both programs are available a backontrack.in.gov.
Helping entrepreneurs attract startup capital: Changes to the Venture Capital Investment (VCI) tax credit program aim to further spur venture capital activity by encouraging investments in minority- and women-owned Indiana businesses, expanding eligibility to Indiana investment funds, and increasing the annual program maximum from $12.5 million to $20 million. With this program expansion, individuals and corporations investing in qualified early stage firms and investment funds can now qualify for a 25% tax credit (up from 20%) on investments up to $1 million per company or a 30% tax credit (up from 20%) on investments up to $1.5 million for minority- and women-owned businesses. Additionally, individuals and corporations will now have the opportunity to invest in qualified Indiana-based investment funds on investments up to $5 million.
Advancing smart manufacturing and modernization: A new appropriation will fuel Manufacturing Readiness Grants to stimulate private sector investments that will modernize Indiana’s manufacturing sector, positioning Hoosier operations, and the industry overall, for future growth and prosperity. The state, which launched the grant program in 2020, has already awarded $6.7 million in matching grants to 87 manufacturers planning to invest more than $46.8 million in their operations. Now, an additional $10 million in matching grants will be available to encourage Indiana manufacturers to make long-term investments in new equipment, machinery and smart technologies.
Preparing Indiana’s automotive industry for the future: The creation of the Electric Vehicle (EV) Production Commission will help ensure that Indiana is prepared to play a leading role in advancing 21st Century automotive and mobility solutions. The commission will assess the state’s existing EV product facilities, identify opportunities for research and development, and evaluate opportunities and needs for training within Indiana’s EV industry.
Quality of Place & Talent
Encouraging regional development and placemaking: A key priority of Holcomb, the Regional Economic Acceleration and Development Initiative (READI) will dedicate $500 million to encourage long-term, transformational investments across the state to make Indiana cities and towns magnets for talent. Through the initiative, the state will partner with Indiana communities to carry out regional development plans that outline compelling, data-driven plans for attracting talent and accelerating economic growth. The IEDC will release more program details and timelines in the coming weeks.
Increasing global connectivity: The creation of the Direct Flight Fund will allocate $10 million to support direct, regional and international flights to and from Indiana, which will provide a critical link in connecting Hoosier companies, residents and tourists to markets and destinations around the world.
In 2020, Indiana set its fourth consecutive record-breaking year for economic development, securing 282 commitments from companies to locate or grow in Indiana. Together, these businesses plan to invest more than $5.6 billion in their Indiana operations and create up to 31,300 new Hoosier jobs over the next few years, marking the highest annual record for new job commitments since the IEDC was established in 2005.
In order to continue this momentum and advance economic development opportunities for years to come, the IEDC is committed to utilizing a comprehensive approach focused on advancing innovation and entrepreneurship, ensuring a diverse economic environment, creating the jobs of tomorrow, and retaining and attracting top talent by investing in quality of place.