About $5 million a year from tax collections would go toward paying off bonds over a 20-year period. The speedway would contribute about $2 million a year and would step in if the taxes failed to generate the expected allotment, Young said.
Track officials say improvements would include new video boards, better lighting and more modern grandstands at a cost of $70 million to $100 million.
"IMS is an enormous, 100-year-old facility. In addition to the many annual projects to maintain it, we need to make the Speedway more flexible, more modern and better positioned to attract more fans to IMS and Indiana," Jeff Belskus, CEO of the speedway, said in a statement.
"It's really about keeping this iconic facility competitive in the sports and entertainment world," Belskus said.
The bill's backers say it's needed to ensure Indiana remains competitive with new and improved race tracks across the country. The Indiana Motorsports Association said in a statement that state funding would boost the state's tourism and hospitality industries along with the overall economy.
"It is clear motorsports plays an important role in the success of the Indiana economy, and there is no place in the world better identified with our industry than the Indianapolis Motor Speedway," association executive director Tom Weisenbach said in a statement.
IMS officials said they began discussing possible state assistance with lawmakers about 18 months ago. Young introduced a similar bill last year that did not advance.
The speedway has not asked for public subsidies before, though the Indianapolis Colts and Indiana Pacers have received substantial government financing for new stadiums. The track has remained under the control of the Hulman family since 1945, when Tony Hulman purchased it.
Speedway officials said other U.S. racetracks have received public funding, including Texas Motor Speedway, which is getting more than $100 million.