CHAPTER 11.1. DEPARTMENT OF PUBLIC UTILITIES OF CONSOLIDATED CITY

IC 8-1-11.1
    Chapter 11.1. Department of Public Utilities of Consolidated City

IC 8-1-11.1-1
Creation; board of trustees; directors; membership; appointment;qualifications; tenure; proceedings
    Sec. 1. (a) In addition to the other executive departments of aconsolidated city, there is hereby created in any such city adepartment of public utilities, which shall have as its head and beunder the general supervision and control of a board of seven (7)members, to be known as the "Board of Directors for Utilities," to beappointed annually by the board herein provided for and designatedas the "Board of Trustees for Utilities."
    (b) Said board of trustees for utilities shall consist of five (5)members.
    (c) All such trustees and all successors thereof shall hold overafter the expiration of their terms until their respective successorshave been duly appointed and have qualified.
    (d) At the expiration of the respective terms of each of themembers of the board of trustees, the said board of trustees shallnominate the successors thereof to membership on such board, eachof which nominees shall be appointed by the mayor of theconsolidated city within ten (10) days after receiving suchnominations, and such succeeding members shall serve for a term offour (4) years. In the event any person who has been appointed at anytime as a member of such board of trustees shall fail to qualify withinten (10) days after the mailing to him of notice of his appointment;or if any member after qualifying shall die, resign, vacate such officeby becoming a nonresident of such city, or be removed as hereinafterprovided; new members of such board of trustees shall be chosen tofill such vacancy in the same manner as is provided for the memberas to whom such vacancy occurs, and the member so chosen shallserve for the remainder of the term for which the member whoseplace is so filled was appointed.
    (e) No person shall be appointed as trustee who is less thanthirty-five (35) years of age, and who has not been a resident of suchcity for at least five (5) years immediately preceding hisappointment. If any such trustee shall cease to be a legal resident ofsaid city his membership on said board shall thereby terminate andbecome vacant.
    (f) Each member of such board of trustees for utilities, beforeentering upon his duties, shall take and subscribe an oath of office inthe usual form, to be indorsed upon the certificate of hisappointment, which shall be promptly filed with the clerk of thecity-county council.
    (g) A majority of all the members of said board of trustees forutilities shall be necessary to constitute a quorum.
    (h) Said board of trustees shall elect one (1) member thereof aspresident, one (1) as vice-president, and one (1) as secretary, whoshall serve from the date of their election until one (1) year from the

first day of January next following their election and until theirsuccessors are elected and have qualified.
    (i) Said board of trustees shall keep a record of their proceedings.The expense of the meetings and proceedings of said board and ofkeeping a record thereof and the salary of the members thereof shallbe paid upon a written request of the presiding officer and secretarythereof by the board of directors for utilities out of the fundsbelonging to said utility district. Each member of said board oftrustees for utilities shall receive as compensation for his services assuch a salary in the sum of fifty dollars ($50) per year.
    (j) The board of trustees for utilities shall meet annually on thefirst Monday of December of each year, at the principal office of saiddepartment of public utilities, for the purpose of transacting anybusiness pertaining to their duties, and for the purposes of electingofficers of such board of trustees and of selecting and appointingmembers of the board of directors for utilities, who shall serve forone (1) year from the first day of January following and until theirsuccessors are appointed and qualified.
    (k) All persons so selected and appointed as such directors and allthe successors thereof appointed at any time shall be chosen by amajority vote of all the members of said board of trustees. Said boardof trustees shall have power to remove summarily and at any timeany director and in such event, or if a vacancy occurs in said boardof directors from any cause, said board of trustees shall appoint asuccessor in like manner who shall serve for the balance of the termfor which the member whose place is so filled was appointed.
    (l) No person shall be appointed a member of said board ofdirectors for utilities unless he is a bona fide resident of said city andhas been such for five (5) years immediately preceding suchappointment, and is at least thirty-five (35) years of age. If any suchdirector shall cease to be a legal resident of said city during the termfor which he was appointed, his membership on such board shallthereby terminate and become vacant.
    (m) Each member of said board of directors for utilities beforeentering upon his duties shall take and subscribe an oath, to beindorsed upon the certificate of his appointment, which shall bepromptly filed with the clerk of the city-county council.
    (n) Each of said members of said board of directors, beforeentering upon his duties, shall execute a bond payable to the state ofIndiana, with surety to be approved by the mayor of said city, in thepenal sum of fifteen thousand dollars ($15,000), conditioned uponthe faithful performance of the duties of his office and the accountingfor all moneys and property that may come into his hands or underhis control. The cost of all such bonds shall be paid by thedepartment of public utilities of said city.
    (o) Any trustee may be removed from office for neglect of duty,incompetency, disability to perform his duties, or other good cause,by an order and judgment of the circuit or superior court of thecounty in which such city is located, in the following manner, to wit:An original complaint may be filed by either the mayor, or by a

majority of the city-county council against any such trustee settingforth the charges preferred, and the cause shall be placed on theadvanced calendar and be tried as other civil causes are tried, by thecourt, without the intervention of a jury. If such charges be sustained,the court shall declare such office vacant. The judgment of said courtshall be final and no appeal shall lie therefrom by any party.
    (p) Said board of trustees shall have power to adopt rules,regulations and by-laws for their own governance, and may meetregularly or specially as often as necessary to transact any businessor duties imposed upon them under this chapter or any other statute.
    (q) In the event such city shall acquire in any manner hereinprovided more than one (1) such public utility and the propertythereof, said board of trustees may add to such board of directorsfrom time to time one (1) or more additional members, increasingsuch board to not exceed a total of eleven (11) members; whichmembers shall be appointed and shall serve under all the provisionsherein governing the appointment, terms and duties of such board ofdirectors for utilities.
As added by Acts 1981, P.L.11, SEC.43.

IC 8-1-11.1-2
Board of directors; appointment of officers; compensation;meetings; employee bonds
    Sec. 2. (a) The members of such board of directors for utilitiesshall hold a meeting on the second Monday of January of each yearfor the purpose of organization and to elect officers for the ensuingyear. They shall choose one (1) of their members president, anothervice-president, another secretary, and another treasurer, who shallperform the duties usually pertaining to those offices. Such officersso chosen shall serve from the date of their election until theirsuccessors are duly elected and qualified.
    (b) The members of such board of directors for utilities shall eachbe paid a salary for their services as such directors at the rate of sixhundred dollars ($600) per annum during the period of service. Amajority of the members of said board of directors shall constitute aquorum, and the concurrence of a majority of such membership shallbe necessary to any action of such board. Such board of directorsshall hold an annual meeting on the second Monday of January ofeach year, at the general offices of such board, and such other regularmeetings at such times as it may determine, and upon such notice asit may fix, by rule or regulation. It shall be authorized to make suchby-laws and regulations as it may deem necessary for the safe,economical and efficient management and protection of theproperties entrusted to its care. Such board of directors shall requireany officer or employee having custody of funds to give bond in suchreasonable amount as the board may prescribe, the expense of whichbonds shall be paid by the department of public utilities of such city.
As added by Acts 1981, P.L.11, SEC.43.

IC 8-1-11.1-3 Board of directors; powers and duties
    Sec. 3. (a) The board of directors for utilities shall have, withinand outside such city as provided in this chapter, the exclusivegovernment, management, regulation, and control of all publicutilities consisting of any waterworks, gasworks, electric light works,heating and power plants of any kind or character, telephone andother systems of communication, and local transportation systems ofany kind operated upon, above, or below any street or territory withinthe city, or outside the city within the limits authorized by law, andall property held by and relating or belonging thereto. Any of whichpublic utilities any such city may acquire or construct for the serviceof the public as consumers, users, or patrons, and including anypublic utility and all property which such city may hold as trustee forthe benefit of the inhabitants of such city. Such board of directorsmay furnish and sell service and products of and make all necessaryconstruction, reconstruction, repairs, renewals, enlargements,extensions, or additions to any such plant or property of any suchpublic utility so owned or at any time so held in trust, which in thejudgment of the board of directors is desirable or necessary for theproper conduct of such business and the proper serving of theinhabitants of the city and adjacent, contiguous, or suburbancommunities or territory within the county wherein such city issituated and served, or reasonably capable of being served, in anymanner by or with respect to any such utility.
    (b) The board of directors may lease any such utility property fora term not exceeding thirty-five (35) years to any person, partnership,limited liability company, or corporation, and without the approvalof the commission, such lease to be upon such terms and conditionsas the board may deem to be to the best interest of such city and thecity's inhabitants. No such lease shall be valid or effective until it hasbeen approved by the board of trustees and duly ratified andapproved by an ordinance of the city. The board and the city-countylegislative body must each vote such approval by a two-thirds (2/3)vote of their total membership. In any such lease an option may begiven to such lessee to extend the same for a period not to exceed ten(10) additional years.
    (c) In connection with the duties devolving upon such board ofdirectors in the government, management, regulation, control, andoperation of all such utilities, it may act as follows:
        (1) To condemn, appropriate, lease, rent, purchase, and holdany real estate, rights-of-way, materials, or personal propertywithin such city or within five (5) miles of the corporate limitsof the city needed for the proper giving of service by any suchutility to the inhabitants of the city and the communitycontiguous thereto and served from any such utility plant.
        (2) To design, order, contract for, and construct any and allnecessary or desirable extensions of or additions to any utilityplant and property owned or so held in trust by the city, and toenter into all necessary contracts with reference thereto, andwith reference to the purchase of materials and supplies needed

for the operation of any such plant or plants, in accordance withsuch rules as may be adopted by such board of directors, andwithout the necessity of advertising for bids, or without suchother restrictions as are imposed by any law of Indiana withreference to the letting of contracts for work, material, orsupplies by municipal bodies or other governmental agencies.
        (3) To sell any products or byproducts, and enter into executorycontracts for the sale, to anyone whatsoever and without anyrestriction concerning the taking of bids therefor or otherwise.
        (4) To operate any such plant or plants, to receive and collectall money due on account of such operation or otherwiserelating to such plant or plants or business and in connectiontherewith to employ such managers, superintendents, assistantmanagers, assistant superintendents, engineers, attorneys,auditors, clerks, foremen, and other employees necessary for theproper carrying on and operation of any such utility plant orplants and the business and to fix the compensation of all suchemployees. No contract of employment shall be made for alonger fixed period than four (4) years. However, a contract ofemployment may be extended or renewed from time to timethereafter. The directors may elect from their membership anexecutive committee consisting of not more than three (3), whomay be assigned to the supervision of any one (1) or more ofsuch utilities and who shall, in the intervals between themeetings of the directors, exercise all the powers and duties ofthe directors, all of their acts to be subject, however, to theapproval of the directors, and to fix any such additionalcompensation to the members of the executive committee, inaddition to their salaries as directors, as shall be reasonable.The additional compensation shall be fixed by a resolution ofthe directors entered of record at the time of the appointment ofthe executive committee. Whenever any such city shall acquire,hold, own, or so hold in trust for the city's inhabitants more thanone (1) such public utility and the property of the city, suchboard of directors shall have power to select additionalexecutive committees from their membership in the samemanner and with the same power as the executive committeefirst selected, which committee may be assigned by such boardto any such utilities deemed necessary. In the selection ofemployees, other than managers, superintendents, assistantmanagers, assistant superintendents, engineers, attorneys, andauditors, the board of directors shall provide for a merit systemof employment to be determined by competitive examination,except as to unskilled and common laborers, in which political,religious, or other personal affiliations may not be considered.In selecting managers the directors shall consider character,training, and general expert and executive fitness andexperience for the position in the particular utility to whichsuch manager is to be assigned, as the necessary requirementsfor appointment.        (5) To rent such offices and other real estate and property forthe conduct of the business of such utility or utilities as may bedeemed needful and enter into contracts with reference to therental and use of the offices, real estate, and property. No suchcontract shall be made for a longer period than ten (10) years.
        (6) In the event there be an open mortgage upon any utilityproperty acquired by any such city, either in absolute ownershipor in trust, by the terms of which mortgage additional bondsmay be taken down from the trustee under such mortgage tomeet in whole or in part the cost of extensions andimprovements to the mortgaged property, the board of directorsmay perform all things necessary in order to secure the benefitof such mortgage provisions and to enable the escrow bondsheld by the trustee under any such mortgage to be taken downand sold in order to defray the cost of any extensions andbetterments to such property and to sell any such bonds so takendown for the purpose of assisting in defraying the costs of anysuch extensions or betterments to such property.
        (7) To take over, adopt, and assume the performance of theprovisions of any lease under which any utility property may beheld at the time of the acquisition of any utility by any suchcity, either in absolute ownership or in trust and to take any andall steps necessary to perform and fulfill the terms of any suchlease, and to obtain and preserve the benefits from the lease. Inthe event there be any outstanding open mortgage upon theproperty covered by such lease so taken over under theprovisions of which bonds may be withdrawn from the trusteeunder such mortgage for the purpose of paying all or part of thecost of additions to the property covered by such mortgage, todo all things necessary in order to secure the benefit of suchmortgage provisions and to enable the escrow bonds held by thetrustee under any such mortgage to be taken down and sold inorder to defray the cost of any extensions and betterments tosuch leased property and to sell any such bonds so taken downfor the purpose of assisting in defraying the costs of any suchextensions or betterments to such leased property.
        (8) To preserve the corporate organization of any companyengaged in the mining of coal, or any other commercial ormanufacturing business, the stock of which may be owned byany utility whose property and assets may be taken over by anysuch city, either in absolute ownership or in trust and inconnection with the taking of the property by the city to causethe stock of any such company to be issued in the name of theboard of directors for utilities except as to qualifying shares fordirectors and to cause such qualifying shares to be issued in thenames of such individuals as the board of directors may nameand to vote any such stock for the election of directors, whomay be members of such board of trustees for utilities.However, no member of such board of directors shall receiveany compensation, directly or indirectly, as a director, officer,

or employee of any such company, other than the compensationprovided in this chapter as a member of the board of directorsfor utilities. Through the control thus given of any company, theboard of directors for utilities shall be authorized to do allthings necessary to cause any such coal mining company orother company efficiently to carry on its operations and toconduct its business in the same manner as if its stocks wereowned by private individuals.
        (9) To adopt rules for service and rates for service in connectionwith the furnishing of any public utility service by the city toconsumers, users, or patrons. However, any such rules and ratesfor service shall be in effect only after the rules and rates havebeen filed with and approved by the commission and suchapproval shall be granted by the commission only after noticeof hearing and hearing as provided by IC 8-1-1 and IC 8-1-2,and only after determining compliance of the rates of servicewith IC 8-1.5-3-8 and IC 8-1.5-3-10 and only after determiningcompliance of the rules of service with IC 8-1-1 and IC 8-1-2,along with the rules and standards of service for municipalutilities of Indiana approved by the commission.
        (10) To take over all contracts and rights of any kind orcharacter, and to fulfill and perform all obligations relating tothe property and business of any utility company whoseproperty may be taken over by any such city, either in absoluteownership or in trust.
        (11) To make all rules and bylaws customary in privatecorporations for their own conduct of business and necessaryfor the proper government and supervision of the utilities undertheir control. Any such rules and bylaws shall be subject to theapproval of the board of trustees.
As added by Acts 1981, P.L.11, SEC.43. Amended by P.L.23-1988,SEC.42; P.L.3-1989, SEC.57; P.L.8-1993, SEC.122.

IC 8-1-11.1-3.1
Board of directors; certain powers and duties pertaining tomunicipally owned utilities
    Sec. 3.1. In addition to the other powers specified by this chapterand notwithstanding IC 8-1.5-3-1, the board of directors for utilitieshas all rights and powers conferred on a municipally owned utility byIC 8-1.5-3-4(b), IC 8-1.5-3-6, and IC 8-1.5-3-7. Furthermore, theboard of directors for utilities shall operate as both the board and themunicipal legislative body for the purposes of IC 8-1.5-3-8.
As added by Acts 1982, P.L.74, SEC.4.

IC 8-1-11.1-3.5
Retirement, survivor, or other benefits; increase
    Sec. 3.5. (a) Every person who is receiving retirement benefits,survivor benefits or other benefits from any fund or funds establishedby, or under the authority of, the board of directors for utilities of thedepartment of public utilities may have such retirement benefits,

survivor benefits or any other benefits increased by an amount not toexceed two dollars ($2) per month for each year of active serviceprior to retirement. Such increase may be made if the board ofdirectors for utilities of the department of public utilities shall byresolution so provide which said board of directors is hereby givenpower to do.
    (b) Any person who is receiving a retirement, survivor or otherbenefit which commenced prior to January 1, 1976, shall receivesuch increased retirement benefits, survivor benefits or other benefitsas long as he or she shall live.
As added by Acts 1981, P.L.11, SEC.43.

IC 8-1-11.1-4
Directors or trustees; adverse interest in contracts
    Sec. 4. No contract shall be made for the purchase or sale of anymaterials or supplies on behalf of said board of directors for utilitieswith any trustee or director, and no trustee nor director shall haveany pecuniary interest in any such contract.
As added by Acts 1981, P.L.11, SEC.43.

IC 8-1-11.1-5
Actions to protect rights of cities
    Sec. 5. The board of directors for utilities in every such city may,in the name of the city, bring any such action which it deems properin order to protect the property rights of said city with reference toany such utility property so under the control of such board, or tosecure the more effective carrying out of the purposes of this chapterwith reference to the erection, maintenance and operation of anysuch utility property or properties.
As added by Acts 1981, P.L.11, SEC.43.

IC 8-1-11.1-6
Utility districts; creation
    Sec. 6. All of the territory included within the corporate limits ofany said city shall become and constitute a utility district for thepurpose of providing for the furnishing of utility service in such linesof utility operation as may be taken over or owned by said city, andthereafter said utility district shall be deemed duly created andestablished under and pursuant to the provisions of this chapter.
As added by Acts 1981, P.L.11, SEC.43.

IC 8-1-11.1-7
Expenses; procedure for payment
    Sec. 7. All preliminary expenses actually incurred by such boardof directors in providing necessary records, the employment ofclerks, engineers, attorneys and other employees, the making ofsurveys, and all other expenses of whatsoever nature necessary to bepaid prior to the actual taking over and operation of any utility plantand the collection of revenues therefrom, shall be met and paid in thefollowing manner: Said board of directors for utilities shall from time

to time certify such items of expense to the controller of such city,directing him to pay the several amounts thereof, and thereupon saidcontroller shall at once draw his warrant or warrants upon the countytreasurer, which warrant or warrants shall be paid out of the generalfunds of such city not theretofore appropriated, without a specialappropriation being made therefor by the city-county council; or incase there are no such general funds of said city not otherwiseappropriated, the city controller shall recommend to the city-countycouncil the temporary transfer of other funds of such city as isnecessary to meet such items of expense, or the making of atemporary loan for such purpose, and such council shall thereuponat once make such transfer of funds or authorize such temporary loanin the same manner that other temporary loans are made by such city:Provided, however, That the fund or funds of such city from whichsuch payments are made shall be fully reimbursed and repaid withsix percent (6%) interest by such board of directors for utilities outof the first receipts from the operation of any such utility by saidboard which are not needed to defray current operating expenses andthe expenses of imperative betterments.
As added by Acts 1981, P.L.11, SEC.43.

IC 8-1-11.1-8
Bonds authorized; purposes; terms; sale procedures; disposition ofproceeds; mortgage bonds; temporary loans; execution
    Sec. 8. (a) For the purpose of raising money to pay for theacquisition of any utility property which said city shall have the rightto and shall determine to acquire, or which any such city may takeover as trustee for the inhabitants thereof, including any moneyrequired to be paid for the purpose of redeeming or extinguishing thecapital stock of any utility whose property may be so taken over andfor the purpose of paying any outstanding obligations of any utilitycompany subject to which the property of any such utility may betaken over by any such city, or held by it in trust for the inhabitantsthereof; or for the purpose of making necessary betterments,improvements, extensions or additions to any utility property owned,or so held in trust, by said city, the board of directors for utilitiesshall cause to be issued in the name of the said city the bonds of saidutility district not to exceed in amount the total cost of any suchutility so purchased, or so held in trust, and for the outstandingobligations of any utility subject to which the property is to be takenover and which it is desired to pay off and discharge and/or of anysuch additions, betterments, improvements, extensions or additionsto any utility owned, or so held in trust, and including all expensesnecessarily incurred in connection with the acquisition of any suchproperty, the paying off of any such indebtedness or the making ofany such improvements, extensions or additions thereto. Such bondsshall be issued in any denominations not more than one thousanddollars ($1,000) each, and shall be payable at such period not longerthan thirty (30) years after date, and in such series or series as suchboard of directors may by resolution determine. Said bonds shall be

negotiable as inland bills of exchange, and shall bear interest at anyrate, payable semiannually. On adopting a resolution ordering saidbonds, said board of directors shall certify a copy of the same to thecity controller of said city, who shall thereupon prepare said bondsand the same shall be executed by the mayor of said city and attestedby the city controller. Such bonds shall be exempt from taxation forany and all purposes. All of said bonds so issued by the board ofdirectors shall be sold by the city controller to the highest biddertherefor, but in no event for less than par, after giving notice of saleof such bonds by publication in accordance with IC 5-3-1. Any bondsissued pursuant to the provisions of this chapter, whether bonds ofsaid utility district, or mortgage bonds, certificates of indebtedness,or other obligations, as hereinafter provided for in this chapter, shallbe valid and binding without obtaining the approval of thecommission or the department of local government finance of thestate of Indiana. It shall be unlawful for said board of directors forutilities to cause to be issued under this chapter any bonds of saidutility district payable by special taxation when the total issue forthat purpose, including the bonds already issued and outstanding andthose proposed to be issued, is in excess of two percent (2%) of thetotal adjusted value of taxable property in the district as determinedunder IC 36-1-15, and all bonds or obligations issued in violation ofthis provision shall be void. Said bonds shall not in any respect be acorporate obligation or indebtedness of said city, but shall be andconstitute an indebtedness of said utility district as a special taxingdistrict, and said bonds and interest thereon shall be payable out ofa special tax levy upon all of the property of said utility district, orfrom surplus earnings as in this chapter provided; and said bondsshall recite such terms upon their face, together with the purpose forwhich they are issued. No suit to question the validity of said bondsso issued for said utility district or to prevent their issue and saleshall be instituted after the date set for the sale of said bonds, and allsaid bonds from and after said date shall be incontestable for anycause whatsoever.
    (b) In event any such city shall, pursuant to any contract right soto do, determine to take over the property and business of any utilitycompany by the payment to it of the amount necessary to pay off thestock of such company, the proceeds of any such utility districtbonds issued and sold as herein provided may, so far as is necessary,be paid over to any such utility company at the time of theconveyance, transfer, or taking over of its property, for the purposeof enabling such company to discharge its obligations to itsstockholders in accordance with the provisions of any such contract.
    (c) In addition to the authority granted to issue utility districtbonds the board of directors of any such utility district for thepurpose of providing necessary funds with which to pay the cost ofacquiring any utility property, or paying off any existingindebtedness of or upon any utility property, so acquired, or to paythe expenses of operation of any such utility property, including thecost of any betterments or extensions, may make temporary loans in

the form of certificates of indebtedness, which shall be a chargesolely against either the particular utility property or against theearnings thereof, or both, on behalf of which the same is borrowed;or said board of directors may authorize the issuance of mortgagebonds secured by a mortgage upon the property or upon the earnings,or both, of the particular utility for whose benefit such moneys areborrowed; and any such certificates of indebtedness and mortgagesshall constitute charges as may be indicated aforesaid by thedirectors when authorizing the same and shall contain such terms andprovisions and shall be sold at such price and shall bear such rate ofinterest as such board of directors may approve.
    (d) Such mortgage indebtedness shall not constitute a generalobligation of such city, or of such utility district, but the holdersthereof shall be entitled to look solely to the mortgaged property andthe revenues derived from the operation thereof for the repayment ofsuch indebtedness.
    (e) All such certificates of indebtedness and mortgage bonds shallbe signed by the mayor of such city and attested by the citycontroller, and shall on their face show the purpose for which theyare issued and the character of the obligation created thereby. Allsuch certificates of indebtedness and mortgage bonds, or eitherthereof, shall be exempt from all taxation.
As added by Acts 1981, P.L.11, SEC.43. Amended by Acts 1981,P.L.45, SEC.6; P.L.23-1988, SEC.43; P.L.6-1997, SEC.130;P.L.90-2002, SEC.310.

IC 8-1-11.1-9
Disposition of bond revenues
    Sec. 9. All proceeds from the sale of said bonds under andpursuant to section 8 of this chapter shall be kept as a separate andspecific fund to pay the cost of the acquisition of any utility propertywhich said city shall have the right to and shall determine to acquireor the payment of obligations of any such utility subject to which itsproperty is purchased, or the cost of making necessary betterments,improvements, extensions or additions to any utility property ownedby said city, as hereinabove provided, and no part of the same shallbe used for any other purpose whatsoever. Such funds shall bedeposited at interest with the depository or depositories of otherpublic funds of such city, and all interest collected therefrom shallbelong to such fund. Any surplus of funds remaining out of theproceeds of said bonds after all of said costs and expenses are fullypaid shall be paid into and become a part of the utility district bondfund as hereinbefore referred to.
As added by Acts 1981, P.L.11, SEC.43.

IC 8-1-11.1-10
Tax levy to pay for bonds; utility district bond fund
    Sec. 10. For the purpose of raising money to pay all bonds issuedas provided in section 8 of this chapter, and the interest thereon, tothe extent that moneys are not available therefor in the judgment of

the board of directors for utilities from the operations of said utilityplant or plants so owned by said city, the board of directors forutilities, as an official board of said utility district, is herebyempowered to levy, and shall levy each year, a special tax upon allthe property of said utility district in such manner as to meet and paythe principal of said bonds as they severally mature, together with allaccruing interest thereon. Said board of directors shall cause said taxso levied each year to be certified to the city controller of said cityand the auditor of the county in which said utility district is located,on or before the first day of October of each year. Such tax so leviedand certified shall be estimated and entered upon the tax duplicate bythe auditor, and shall be collected and enforced by the countytreasurer in the same manner as state and county taxes are estimated,entered, collected and enforced; and as such tax is so collected by thecounty treasurer, it shall be accumulated and kept in a separate fundto be known as the "Utility District Bond Fund," and shall be appliedto the payment of the aforesaid utility district bonds and interest asthey severally mature, and for no other purpose whatsoever:Provided, That all accumulations of said fund prior to their use forthe payment of such bonds and interest shall be deposited, at interest,with the depository or depositories of other public funds in such city,and all interest collected thereon shall belong to such fund.
As added by Acts 1981, P.L.11, SEC.43.

IC 8-1-11.1-11
Surplus earnings; disposition
    Sec. 11. Within sixty (60) days after the end of each calendaryear, if there be at any time any bonds outstanding issued on accountof said utility district, payable in whole or in part through a tax levyagainst the property in said utility district, said board of directors forutilities shall cause any surplus earnings arising from the operationof any such utility property, which are not pledged to secure thepayment of any obligation of, or on account of said utility district,and which are not, in the opinion of such board of directors,necessary to provide against possible unfavorable results fromoperation, or to provide for contemplated betterments, extensions,improvements, or additions, to be paid over to the county treasurerand to be added to and become a part of said utility district bondfund, and to be used for the same purposes and in the same manneras funds derived from levy of taxes, as in this chapter hereinbeforeprovided. In event there are no such utility district bonds at the timeoutstanding, any such surplus operating revenues not needed for thepurposes aforesaid shall be paid over to and become a part of thegeneral funds of such city.
As added by Acts 1981, P.L.11, SEC.43.

IC 8-1-11.1-12
Expenditures of current income; vouchers
    Sec. 12. The current receipts and all other moneys derived fromthe operation of any such utility property shall be expended by said

board of directors upon vouchers in a form to be determined by them,and any such funds shall be deposited in such bank or banks as maybe determined by said board to the credit of said board of directorsfor utilities, and any interest earned on any such deposits shall beadded to the principal thereof. No appropriation in any form shall benecessary for the expenditure of any of such current income or forthe expenditure of the proceeds of any sale of bonds, or of any otherobligations, as hereinbefore authorized, but all funds arising underthe provisions hereof shall be deemed appropriated for the respectivepurposes herein named and shall be under the control of the board ofdirectors for utilities as herein provided, and said board of directorsshall have full, complete and exclusive authority to expend suchfunds for the purposes herein provided.
As added by Acts 1981, P.L.11, SEC.43.

IC 8-1-11.1-13
Separate books of account for separate utilities
    Sec. 13. In event more than one (1) utility property is operated bysaid board of directors, separate books of account and records shallbe kept for each utility, and the funds of each shall be keptsegregated.
As added by Acts 1981, P.L.11, SEC.43.

IC 8-1-11.1-14
Quarterly accounting and report to city controller
    Sec. 14. The board of directors for utilities shall make quarterlyaccounting and reports to the city controller of such city, of all fundsreceived and expended by it, and not less than sixty (60) days afterthe end of each calendar year the city controller shall makepublication in not less than two (2) newspapers of general circulationprinted and published within said city of the material facts as setforth in the report of said board of directors for the precedingcalendar year.
As added by Acts 1981, P.L.11, SEC.43.

IC 8-1-11.1-15
Board of directors free from control of department of localgovernment finance
    Sec. 15. This chapter being necessary for and intended to secureefficient and economical management and operation of utilityproperties in any consolidated city taking advantage of the provisionshereof, the said board of directors shall have full power to transactall the business pertaining to said management and operation of eachand all such utilities, including the issuance of bonds, mortgages, andother forms of indebtedness, free from all control and supervision ofthe department of local government finance of Indiana. This chaptershall be liberally construed to effectuate the purpose hereof, and ifany one (1) or more sections, clauses, phrases, or parts thereof, ofthis chapter shall be held invalid, the remaining sections, clauses,phrases, or parts thereof, shall not be affected thereby, and the

legislature declares that it would have enacted all other parts of saidchapter even if any or all of the aforesaid portions thereof had notbeen included therein.
As added by Acts 1981, P.L.11, SEC.43. Amended by P.L.90-2002,SEC.311.

IC 8-1-11.1-16
Budgets; nonapplication of chapters; fixing and review of budgets,tax rates, and levies; limitations on property tax rates orappropriations
    Sec. 16. The provisions of IC 6-1.1-17 and IC 6-1.1-18 shall notapply to the board of directors created by this chapter, but such boardof directors shall annually, on or before the thirty-first day ofDecember, furnish to the city controller an estimate of the moneys tobe expended by them for the succeeding calendar year.
As added by Acts 1981, P.L.11, SEC.43.

IC 8-1-11.1-17
Examination and audit of books and accounts
    Sec. 17. The books, accounts, records and transactions of saidutility district and of the board of directors thereof shall be subjectto examination, audit and supervision by the state board of accountsto the same extent as the books, accounts, records and transactionsof other municipal governments or officers or departments ofmunicipal governments are subject thereto.
As added by Acts 1981, P.L.11, SEC.43.

IC 8-1-11.1-18
Application of chapter to currently held or acquired utilities
    Sec. 18. Whenever in any sections of this chapter any provisionsare made applying or relating to any public utility or utility propertyowned, held, or acquired by said city, all such provisions shall applyand relate also to any public utility and utility property which saidcity may hold, possess, be entitled to, or in any manner acquire intrust for the use and benefit of the inhabitants thereof.
As added by Acts 1981, P.L.11, SEC.43.

IC 8-1-11.1-19
"Revenue obligations" defined
    Sec. 19. As used in this chapter, "revenue obligations" shall meanany obligations, including bonds, notes, temporary, interim orpermanent certificates of indebtedness, debentures or otherobligations payable out of the income and revenues derived fromutility property.
As added by Acts 1981, P.L.11, SEC.43.

IC 8-1-11.1-20
Revenue obligations; issuance; authorized purposes
    Sec. 20. The board of directors for utilities may issue revenueobligations for any one or more of the following purposes:        (1) For the purpose of obtaining funds with which to pay for theacquisition of any utility property which any such city shallhave acquired or shall have the right to and shall determine toacquire, or which any such city may have taken over as trusteefor the inhabitants thereof, including any money required to bepaid for the purpose of redeeming or extinguishing the capitalstock of any utility whose property has been or may be so takenover and for the purpose of paying any outstanding obligationsof any utility subject to which the property is or may be held intrust for the inhabitants thereof, or for the purpose of makingnecessary betterments, improvements, extensions or additionsto any utility property owned or held in trust by any such city,including all costs necessarily incurred in connection with theacquisition of any such property or taking it over in trust or thepaying off of any such indebtedness or the making of any suchbetterments, improvements, extensions, or additions thereto.
        (2) For the purpose of reimbursing the department of publicutilities, or its board of directors for utilities for fundsborrowed, expended or advanced for interim financing of thecost of any utility property, or any betterments, improvements,extensions or additions thereto.
        (3) Subject to covenants and agreements with the holders ofoutstanding obligations, for the purpose of funding or refundingrevenue obligations. If the board of directors for utilitiesdetermines that it would be advantageous to the department ofpublic utilities to exchange funding or refunding obligations forthe revenue obligations being funded or refunded, suchexchange may be made, provided the actual interest cost is notincreased.
As added by Acts 1981, P.L.11, SEC.43.

IC 8-1-11.1-21
Security for revenue obligations; issuance of additional obligationsauthorized
    Sec. 21. Such revenue obligations shall be secured by a pledge ofthe unobligated income and revenues of any one (1) or more of theutility properties of the department of public utilities. In addition, theboard of directors for utilities may in its discretion secure thepayment of such revenue obligations by a mortgage upon theproperty of the particular utility for whose benefit the proceeds of therevenue obligations are to be used. In authorizing the issuance ofsuch obligations for any particular property or properties, the boardof directors for utilities of the department of public utilities may limitthe amount of such obligations that may be issued as a first lien andcharge against such property or properties and the income andrevenues therefrom, or such board of directors for utilities mayauthorize the issuance from time to time thereafter of additionalobligations secured by the same pledge or lien to provide funds forthe completion of the property, properties, betterments,improvements, extensions or additions thereto, on account of which

the original obligations were issued, or to provide funds to pay thecost of additional utility properties, betterments, improvements,extensions or additions thereto, or for both such purposes. Suchadditional obligations shall be issued on such terms and conditionsas such board may determine, and may be secured equally andratably, without preference, priority or distinction, with the originalissue of obligations or may be made junior thereto.
As added by Acts 1981, P.L.11, SEC.43.

IC 8-1-11.1-22
Resolution authorizing revenue obligations; trust indenture; termsof obligations
    Sec. 22. (a) Such revenue obligations shall be authorized byresolution adopted by the board of directors for utilities and theterms, conditions and form thereof shall be set out in such resolutionor in a form of trust indenture between the corporation and adesignated corporate trustee, or both.
    (b) Such revenue obligations shall bear interest, not to exceed amaximum rate to be determined by the board of directors for utilities,payable annually or at shorter intervals and shall mature at such timeor times as may be determined in such resolution or indenture. Theobligations may be made redeemable before maturity at the option ofthe board of directors for utilities under such terms and conditions asmay be fixed by the resolution or indenture.
    (c) The principal and interest of the revenue obligations may bemade payable in any lawful medium. The resolution or indentureshall determine the form of obligations, including the interestcoupons if any to be attached thereto, and shall fix the denominationor denominations of the obligations and the place or places ofpayment of the principal and interest thereof, which may be at anybank or trust company within or without the state.
    (d) Provision may be made for the registration of any of theobligations in the name of the owner as to principal alone, or as toboth principal and interest, but fully registered obligations shall bemade convertible to coupon obligations at the option of the registeredowner. The obligations including interest shall be exempt from alltaxation: state, county and municipal.
    (e) Such resolution or the indenture may also include provisionsfor protecting and enforcing the rights and remedies of the holders ofthe obligations being issued and covenants setting forth the duties ofthe department of public utilities and its officers in relation to theacquisition, construction, operation and maintenance of andinsurance to be carried on the property or properties on account ofwhich the obligations are being issued, and, to the fullest extentpermitted by law, the maintenance of rates and charges to becollected on account hereof; also, provisions for the custody,safeguarding and application of all moneys and the rights andremedies of the trustee and the holders of the obligations beingissued, and for the issuance of additional parity obligations or juniorlien obligations secured by a pledge of the revenues or by a pledge

or mortgage of the revenues and property described in said resolutionor indenture; also, such other terms, conditions, limitations andcovenants as the board of directors for utilities shall deem proper.Such obligations and any interest coupons appertaining thereto shallbe negotiable instruments within the meaning and for all purposesunder the laws of this state, subject only to the provisions forregistration of the obligations.
As added by Acts 1981, P.L.11, SEC.43.

IC 8-1-11.1-23
Temporary loans authorized
    Sec. 23. For the purpose of providing necessary funds with whichto pay the cost of acquiring any utility property, or paying off anyindebtedness of or upon any utility property, so acquired, or to payfor interim costs of construction prior to long term financing,including the costs of any betterments, improvements, additions orextensions, or to pay the expenses of operation of any such utilityproperty the board of directors for utilities may also make temporaryloans, which shall mature within one (1) year from date of issuance,in the form of certificates of indebtedness, which shall be a chargesolely against the income and revenue of the utility, or upon theproceeds of revenue obligations to be issued, or any combinationthereof.
As added by Acts 1981, P.L.11, SEC.43.

IC 8-1-11.1-24
Revenue obligations; approval or validation; facsimile signatures;sale; actions to contest validity; certificates of indebtedness;execution
    Sec. 24. (a) All such revenue obligations shall be valid without thenecessity of any approval of or ratification by either the commissionor the department of local government finance. The board ofdirectors for utilities, upon adopting a resolution authorizing suchrevenue obligations, shall certify a copy thereof to the city controllerof such city who shall thereupon prepare said revenue obligations,and the same shall be issued in the name of the city and shall beexecuted by the mayor of said city and attested by the city controllerand the clerk of the city-county council. Facsimile signatures may beused in executing such revenue obligations, provided that one ormore of the signatures on the revenue obligations shall be manuallysigned, except that all signatures on interest coupons may befacsimile signatures.
    (b) Certificates of indebtedness issued under section 23 of thischapter shall be executed solely by the president of the board ofdirectors without the execution of the mayor. The signature of thepresident must be attested by the secretary of the board.
    (c) Such revenue obligations shall be sold by the city controller ofsaid city subject to the requirements of IC 5-1-11; provided, that anyrevenue obligations maturing within one (1) year of date of issuanceneed not be sold at public sale but may be sold in such manner as the

board of directors for utilities may determine; and, provided further,that any revenue obligations may be offered for sale and sold to theUnited States or to any corporation owned or controlled by theUnited States without notice by publication. No suit to question thevalidity of any revenue obligations so issued or to prevent theirissuance or sale shall be instituted after the date fixed for the sale ofsuch revenue obligations and all such revenue obligations from andafter such date shall be incontestable, except for fraud, forgery, orviolation of constitutional provisions.
As added by Acts 1981, P.L.11, SEC.43. Amended by P.L.23-1988,SEC.44; P.L.90-2002, SEC.312.

IC 8-1-11.1-25
Revenue obligations; eligible investments; deposit of securities
    Sec. 25. Any revenue obligations issued pursuant to the provisionsof this chapter shall be eligible investments for the funds of any kindor character of every financial institution, insurance company orprivate trust, and such obligations shall be eligible for deposit by anyfinancial institution, insurance company or trustee under any law ofthis state providing for the deposit of securities or funds.
As added by Acts 1981, P.L.11, SEC.43.