CHAPTER 7. DEBT SERVICE LEVY
IC 20-46-7
Chapter 7. Debt Service Levy
IC 20-46-7-1
"Fund"
Sec. 1. As used in this chapter, "fund" refers to the debt servicefund.
As added by P.L.2-2006, SEC.169.
IC 20-46-7-2
"Levy"
Sec. 2. As used in this chapter, "levy" refers to a levy imposedunder this chapter.
As added by P.L.2-2006, SEC.169.
IC 20-46-7-3
"Obligation"
Sec. 3. As used in this chapter, "obligation" refers to anyobligation that is permitted or required by law to be paid from thefund under IC 20-40-9 or another law.
As added by P.L.2-2006, SEC.169.
IC 20-46-7-4
Duty; levy
Sec. 4. The governing body of each school corporation shallestablish a levy in every calendar year sufficient to pay allobligations.
As added by P.L.2-2006, SEC.169.
IC 20-46-7-5
Conditions; levy in excess of advertised levy
Sec. 5. If the advertised levy is insufficient to produce revenue tomeet all obligations for any calendar year, the department of localgovernment finance may establish a levy greater than advertised ifnecessary to meet the school corporation's obligations.
As added by P.L.2-2006, SEC.169.
IC 20-46-7-6
Levy; advance from state
Sec. 6. An amount equal to deductions made or to be made in thecurrent year for the payment of principal and interest on anadvancement from any state fund (including the common school fundand the veterans memorial school construction fund) may beincluded in a levy and appropriated and paid to the general fund.
As added by P.L.2-2006, SEC.169.
IC 20-46-7-7
Levy; advance; common school fund
Sec. 7. A school corporation receiving an advancement:
(1) under IC 20-49-2 may annually levy a tax for the fund as
provided in IC 20-49-2-16;
(2) for a school building construction program may annuallylevy a tax for the fund as provided in IC 20-49-4-21; or
(3) for an educational technology program may annually levy atax for the fund as provided in IC 20-49-4-22.
As added by P.L.2-2006, SEC.169.
IC 20-46-7-8
Department of local government finance approval of schoolcorporation indebtedness; exemption for school bus purchases orleases from the Indiana bond bank
Sec. 8. (a) This section does not apply to the following:
(1) Bonds or lease rental agreements for which a schoolcorporation:
(A) after June 30, 2008, makes a preliminary determinationas described in IC 6-1.1-20-3.1 or IC 6-1.1-20-3.5 or adecision as described in IC 6-1.1-20-5; or
(B) in the case of bonds or lease rental agreements notsubject to IC 6-1.1-20-3.1, IC 6-1.1-20-3.5, or IC 6-1.1-20-5,adopts a resolution or ordinance authorizing the bonds orlease rental agreement after June 30, 2008.
(2) Repayment from the debt service fund of loans made afterJune 30, 2008, for the purchase of school buses underIC 20-27-4-5.
(b) A school corporation must file a petition requesting approvalfrom the department of local government finance to:
(1) incur bond indebtedness;
(2) enter into a lease rental agreement; or
(3) repay from the debt service fund loans made for thepurchase of school buses under IC 20-27-4-5;
not later than twenty-four (24) months after the first date ofpublication of notice of a preliminary determination underIC 6-1.1-20-3.1(2), unless the school corporation demonstrates thata longer period is reasonable in light of the school corporation's factsand circumstances.
(c) A school corporation must obtain approval from thedepartment of local government finance before the schoolcorporation may:
(1) incur the indebtedness;
(2) enter into the lease agreement; or
(3) repay the school bus purchase loan.
(d) This restriction does not apply to property taxes that a schoolcorporation levies to pay or fund bond or lease rental indebtednesscreated or incurred before July 1, 1974. In addition, this restrictiondoes not apply to a lease agreement or a purchase agreement enteredinto between a school corporation and the Indiana bond bank for thelease or purchase of a school bus under IC 5-1.5-4-1(a)(5), if thelease agreement or purchase agreement conforms with the schoolcorporation's ten (10) year school bus replacement plan approved bythe department of local government finance under IC 21-2-11.5-3.1
(before its repeal) or IC 20-46-5.
(e) This section does not apply to school bus purchase loans madeby a school corporation that will be repaid solely from the generalfund of the school corporation.
As added by P.L.2-2006, SEC.169. Amended by P.L.192-2006,SEC.11; P.L.224-2007, SEC.116; P.L.146-2008, SEC.509.
IC 20-46-7-8.5
Review and approval by department of local government financenot required for certain bonds, leases, or other obligations
Sec. 8.5. (a) Notwithstanding any other provision, review by thedepartment of local government finance and approval by thedepartment of local government finance are not required before aschool corporation may issue or enter into bonds, a lease, or anyother obligation, if the school corporation:
(1) after June 30, 2008, makes a preliminary determination asdescribed in IC 6-1.1-20-3.1 or IC 6-1.1-20-3.5 or a decision asdescribed in IC 6-1.1-20-5; or
(2) in the case of bonds, leases, or other obligations not subjectto IC 6-1.1-20-3.1, IC 6-1.1-20-3.5, or IC 6-1.1-20-5, adopts aresolution or ordinance authorizing the bonds, lease rentalagreement, or other obligations after June 30, 2008.
(b) A school corporation is not required to obtain the approval ofthe department of local government finance before the schoolcorporation may repay from the debt service fund any loans madeafter June 30, 2008, for the purchase of school buses underIC 20-27-4-5.
(c) This subsection applies after June 30, 2008. Notwithstandingany other provision, review by the department of local governmentfinance and approval by the department of local government financeare not required before a school corporation may construct, alter, orrepair a capital project.
As added by P.L.146-2008, SEC.510.
IC 20-46-7-9
Review by department of local government finance
Sec. 9. (a) This section applies only to an obligation subject tosection 8 of this chapter. This section does not apply to bondedindebtedness or lease rental agreements for which a schoolcorporation:
(1) after June 30, 2008, makes a preliminary determination asdescribed in IC 6-1.1-20-3.1 or IC 6-1.1-20-3.5 or a decision asdescribed in IC 6-1.1-20-5; or
(2) in the case of bonds or lease rental agreements not subjectto IC 6-1.1-20-3.1, IC 6-1.1-20-3.5, or IC 6-1.1-20-5, adopts aresolution or ordinance authorizing the bonds or lease rentalagreement after June 30, 2008.
(b) The department of local government finance may:
(1) approve;
(2) disapprove; or (3) modify then approve;
a school corporation's proposed lease rental agreement, bond issue,or school bus purchase loan. Before the department of localgovernment finance approves or disapproves a proposed lease rentalagreement, bond issue, or school bus purchase loan, the departmentof local government finance may seek the recommendation of the taxcontrol board.
(c) The department of local government finance shall render adecision not more than three (3) months after the date the departmentof local government finance receives a request for approval undersection 8 of this chapter. However, the department of localgovernment finance may extend this three (3) month period by anadditional three (3) months if, at least ten (10) days before the end ofthe original three (3) month period, the department of localgovernment finance sends notice of the extension to the executiveofficer of the school corporation.
As added by P.L.2-2006, SEC.169. Amended by P.L.224-2007,SEC.117; P.L.146-2008, SEC.511.
IC 20-46-7-10
Approval; required study of classroom space
Sec. 10. (a) This section applies only to an obligation describedin section 8 of this chapter. This section does not apply to bondedindebtedness or lease rental agreements for which the schoolcorporation:
(1) after June 30, 2008, makes a preliminary determination asdescribed in IC 6-1.1-20-3.1 or IC 6-1.1-20-3.5 or a decision asdescribed in IC 6-1.1-20-5; or
(2) in the case of bonds or lease rental agreements not subjectto IC 6-1.1-20-3.1, IC 6-1.1-20-3.5, or IC 6-1.1-20-5, adopts aresolution or ordinance authorizing the bonds or lease rentalagreement after June 30, 2008.
(b) The department of local government finance may not approvea school corporation's proposed lease rental agreement or bond issueto finance the construction of additional classrooms unless the schoolcorporation first:
(1) establishes that additional classroom space is necessary; and
(2) conducts a feasibility study, holds public hearings, and hearspublic testimony on using a twelve (12) month school term(instead of the nine (9) month school term (as defined inIC 20-30-2-7)) rather than expanding classroom space.
(c) A taxpayer may petition for judicial review of the finaldetermination of the department of local government finance underthis section. The petition must be filed in the tax court not more thanthirty (30) days after the department of local government financeenters its order under this section.
As added by P.L.2-2006, SEC.169. Amended by P.L.224-2007,SEC.118; P.L.146-2008, SEC.512.
IC 20-46-7-11 Approval; factors considered; no authority to review or approvefinancing
Sec. 11. (a) The department of local government finance indetermining whether to approve or disapprove a school buildingconstruction project shall consider the following factors:
(1) The current and proposed square footage of school buildingspace per student.
(2) Enrollment patterns within the school corporation.
(3) The age and condition of the current school facilities.
(4) The cost per square foot of the school building constructionproject.
(5) The effect that completion of the school buildingconstruction project would have on the school corporation's taxrate.
(6) Any other pertinent matter.
(b) The authority of the department of local government financeto determine whether to approve or disapprove a school buildingconstruction project does not after June 30, 2008, include theauthority to review or approve the financing of the school buildingconstruction project.
As added by P.L.2-2006, SEC.169. Amended by P.L.146-2008,SEC.513; P.L.182-2009(ss), SEC.358.
IC 20-46-7-12
Maximum term of bonds
Sec. 12. Except as provided by IC 5-1-14-10, the maximum termor repayment period for bonds issued by a school corporation for aschool building construction project may not exceed twenty (20)years after the date of the issuance of the bonds.
As added by P.L.2-2006, SEC.169. Amended by P.L.146-2008,SEC.514.
IC 20-46-7-13
Annual review
Sec. 13. The department of local government finance shallannually conduct the review of debt service obligations (as definedin IC 20-48-1-11) required in IC 20-48-1-11.
As added by P.L.2-2006, SEC.169.
IC 20-46-7-14
Payments toward principal required on at least annual basis
Sec. 14. After May 15, 2007, the department of local governmentfinance may not approve under section 9 of this chapter a schoolcorporation's proposed:
(1) bond issue that does not provide for payments toward theprincipal of the bonds on at least an annual basis in the amountdetermined under the rules or guidelines adopted by thedepartment of local government finance;
(2) lease rental agreement that does not provide for repaymentstoward the present asset value of the lease at its inception on at
least an annual basis in the amount determined under the rulesor guidelines adopted by the department of local governmentfinance; or
(3) debt service fund loan to purchase school buses that doesnot provide for payments toward the principal of the loan on atleast an annual basis in the amount determined under the rulesor guidelines adopted by the department of local governmentfinance.
As added by P.L.224-2007, SEC.119.