CHAPTER 6. ISSUANCE OF BONDS
IC 21-34-6
Chapter 6. Issuance of Bonds
IC 21-34-6-1
Issuance and sale of bonds
Sec. 1. The board of trustees of a state educational institution mayborrow money and evidence the loans by the issuance and sale ofbonds of the board of trustees of the state educational institution toprovide funds with which to:
(1) pay part or all of the cost of any building facility, work, act,or undertaking authorized by IC 21-34-2, IC 21-34-3-1, orIC 21-34-3-3;
(2) pay part or all of the cost of acquiring (by purchase, lease,sublease, condemnation, trade, or otherwise) or improving realor personal property under IC 21-34-3-4; or
(3) perform the obligations of any joint-use agreements underIC 21-34-4.
As added by P.L.2-2007, SEC.275.
IC 21-34-6-2
Security of bonds
Sec. 2. Bonds and the interest on bonds may be secured by thefollowing:
(1) A pledge or mortgage of:
(A) any property, real or personal, used, acquired, or to beacquired and used for the purposes of this article; and
(B) the improvements made or to be made on the property.
However, no real estate, the title to which is on or after March10, 1965, in the name of the state for the use and benefit of theboard of trustees of a state educational institution or the stateeducational institution under its control, may not be pledged ormortgaged until the title to the real estate has been conveyed tothe board of trustees of the state educational institution underthis article.
(2) A pledge of the building facilities fees to be collected anddeposited in the building facilities fund.
(3) Subject to outstanding liens and encumbrances, and anycovenants, agreements, or encumbrances on the funds existingat the time of a pledge, a pledge of general student tuition feesor any other available funds from whatever source derived thatunder IC 21-34-5-5 may be used for any of the purposes of thisarticle.
(4) A pledge of any other money deposited in a buildingfacilities fund.
(5) A pledge of the proceeds of bonds issued under this article.
(6) Any one (1) or more of the ways described in this sectionthat the board of trustees of the issuing state educationalinstitution determines.
As added by P.L.2-2007, SEC.275.
IC 21-34-6-3
Liens
Sec. 3. The lien of the pledges or mortgages, to the extent of thelien, unless otherwise determined by the board of trustees of the stateeducational institution, is a first and primary lien for the payment ofthe bonds secured and the interest on the bonds.
As added by P.L.2-2007, SEC.275.
IC 21-34-6-4
Issuance of bonds; limitations on amount
Sec. 4. In authorizing the issuance of bonds for any buildingfacility or facilities, the board of the issuing state educationalinstitution may:
(1) limit the amount of bonds that may be issued as a first lienand charge against the property, fees, income, and funds; and
(2) provide, after the original issuance of bonds, for theissuance of additional bonds secured by the same lien toprovide funds to:
(A) pay the cost of acquiring, erecting, constructing,reconstructing, improving, rehabilitating, remodeling,repairing, completing, extending, enlarging, equipping, orfurnishing the building facility or facilities for which theoriginal bonds were issued;
(B) provide funds to pay the cost of additional buildingfacilities under this article; or
(C) perform actions under both clauses (A) and (B).
As added by P.L.2-2007, SEC.275.
IC 21-34-6-5
Additional bonds; terms and conditions of issuance
Sec. 5. Additional bonds:
(1) shall be issued on the terms and conditions that the board oftrustees of the issuing state educational institution determines;and
(2) may be:
(A) secured equally and ratably, without preference, priority,or distinction, with the original issue of bonds; or
(B) made junior to the original issue of bonds.
As added by P.L.2-2007, SEC.275.
IC 21-34-6-6
Issuance of bonds; purpose
Sec. 6. The board of trustees of a state educational institution mayissue bonds for the purpose of:
(1) reimbursing the state educational institution for fundsexpended or advanced for interim financing of the cost of anybuilding facility or facilities before the issuance of bonds forthe facility or facilities; or
(2) subject to existing covenants and agreements with theholders of the outstanding obligations: (A) funding outstanding obligations incurred or refundingoutstanding bonds issued either under:
(i) this article; or
(ii) other applicable law;
for building facilities approved by the governor and thebudget agency or its predecessor; or
(B) in part for funding or refunding purposes and in part forany other purpose authorized by this article; and
may secure the payment of the bonds as provided in this article.
As added by P.L.2-2007, SEC.275.
IC 21-34-6-7
Refunding bonds
Sec. 7. Refunding bonds may be exchanged for the bonds beingfunded or refunded or may be sold and the proceeds applied to thefunding or refunding.
As added by P.L.2-2007, SEC.275.
IC 21-34-6-8
Maximum amount of bonds
Sec. 8. Subject to any approval required under IC 21-34-10, bondsmay be issued in an amount or amounts that do not exceed themaximum amount determined by the board of trustees of the issuingstate educational institution.
As added by P.L.2-2007, SEC.275.
IC 21-34-6-9
Form; terms; conditions of bonds
Sec. 9. Bonds may be issued in the form and upon the terms andconditions, at the rate or rates of interest, and in the denominationsthat may be made convertible into different denominations as thegoverning board of the board of trustees of the state educationalinstitution determines by:
(1) the adoption of a resolution;
(2) approval of a form of trust indenture between the board oftrustees of the state educational institution and a designatedcorporate trustee; or
(3) both subdivisions (1) and (2).
As added by P.L.2-2007, SEC.275.
IC 21-34-6-10
Resolutions and indenture for bonds
Sec. 10. A resolution or indenture for bonds may includeprovisions for:
(1) protecting and enforcing the rights and remedies of theholders of the bonds being issued;
(2) covenants setting forth the duties of the state educationalinstitution and its officers in relation to:
(A) the acquisition, construction, operation, maintenance,use, and abandonment of the building facility; and (B) insurance of the building facility;
(3) the custody, safeguarding, application, and investment of allmoney;
(4) the rights and remedies of the trustee and the holders of thebonds being issued;
(5) the issuance of additional bonds as provided in theresolution or indenture; and
(6) other terms, conditions, and covenants as the board oftrustees of the state educational institution determine are proper,including provision for the establishment of a debt servicereserve by:
(A) the use of bond proceeds or other sources;
(B) the furnishing of an insurance policy, surety bond, orletter of credit; or
(C) any combination of clause (A) or (B).
As added by P.L.2-2007, SEC.275.
IC 21-34-6-11
Public sale of bonds
Sec. 11. Bonds must be sold at public or negotiated sale asprovided by IC 21-32-3.
As added by P.L.2-2007, SEC.275.
IC 21-34-6-12
Bonds and interest coupons
Sec. 12. All bonds and the interest coupons appertaining to bondsissued under this article must be negotiable instruments within themeaning and for all purposes under Indiana laws, subject only to theprovisions of the bonds for registration as to principal or as toprincipal and interest. Any bonds registered as to principal andinterest may be made convertible to bearer bonds with coupons.
As added by P.L.2-2007, SEC.275.
IC 21-34-6-13
Actions to contest the validity of bonds
Sec. 13. (a) An action to contest the validity of any bonds issuedunder this article may not be brought after the fifteenth dayfollowing:
(1) the first publication of notice of the sale or intent to sell thebonds under IC 21-32-3 if the bonds are sold at public sale; or
(2) the publication one (1) time in newspapers described inIC 21-32-3-3 of notice of execution and delivery of the contractof sale for the bonds if the bonds are sold at negotiated sale.
(b) The board of trustees of a state educational institution shallpublish notice under subsection (a)(2) if it sells bonds at negotiatedsale within thirty (30) days of execution of the contract of sale for thebonds.
As added by P.L.2-2007, SEC.275.
IC 21-34-6-14 Rates of interests of bonds
Sec. 14. The rate or rates of interest of bonds may be fixed orvariable. Variable rates shall be determined in the manner and inaccordance with the procedures set forth in the resolution orindenture authorizing the issuance of the bonds. Bonds bearing avariable rate of interest may be converted to bonds bearing a fixedrate or rates of interest to the extent and in the manner set forth in theresolution or indenture under which the bonds are issued.
As added by P.L.2-2007, SEC.275.
IC 21-34-6-15
Payment of interest
Sec. 15. Interest may be:
(1) payable semiannually, annually, or at any other interval orintervals as may be provided in the resolution or indenture; or
(2) compounded and paid at maturity or at any other times asspecified in the resolution or indenture.
As added by P.L.2-2007, SEC.275.
IC 21-34-6-16
Mandatory redemption
Sec. 16. Bonds may be made subject, at the option of the holders,to mandatory redemption by the board of trustees of the stateeducational institution at the times and under the circumstances setforth in the authorizing resolution or indenture.
As added by P.L.2-2007, SEC.275.
IC 21-34-6-17
Resolutions and indentures
Sec. 17. A resolution or indenture may contain provisionsregarding:
(1) the investment of money, sale, exchange, or disposal ofproperty; and
(2) the manner of authorizing and making payments,notwithstanding IC 5-13 or any general statute relating to thesematters.
As added by P.L.2-2007, SEC.275.
IC 21-34-6-18
Execution of bonds and coupons
Sec. 18. (a) Bonds and coupons appertaining to bonds shall beexecuted in the name of the issuing state educational institution bythe manual or facsimile signatures of the officer or officers of thestate educational institution that the board of trustees of the stateeducational institution designates.
(b) One (1) signature on the obligation must be manual and maybe either the signature of one (1) of the officers or of any trustee,fiscal agent, or other fiduciary charged with authenticating the bonds.
(c) The seal or a facsimile of the seal of the state educationalinstitution shall be affixed, imprinted, engraved, or otherwise
reproduced on each bond.
(d) If any officer whose manual or facsimile signature appears onany bond or coupon ceases to be an officer before the delivery of thebonds, the officer's signature is valid and sufficient for all purposesas if the officer had remained in office until delivery.
(e) The resolution or indenture under which the bonds are issuedmay provide for the authentication of the bonds by the trustee, fiscalagent, or other fiduciary designated in the resolution or indenture.
As added by P.L.2-2007, SEC.275.