CHAPTER 3.7. AIRPORT DEVELOPMENT AUTHORITY
IC 8-22-3.7
Chapter 3.7. Airport Development Authority
IC 8-22-3.7-1
"Airport project" defined
Sec. 1. As used in this chapter, "airport project" has the meaningset forth in IC 8-22-3.6-2.
As added by P.L.108-1993, SEC.11.
IC 8-22-3.7-2
"Bonds" defined
Sec. 2. As used in this chapter, "bonds" means bonds, notes, orother evidences of indebtedness issued by the development authority.
As added by P.L.108-1993, SEC.11.
IC 8-22-3.7-3
"Development authority" defined
Sec. 3. As used in this chapter, "development authority" refers toan airport development authority created by this chapter.
As added by P.L.108-1993, SEC.11.
IC 8-22-3.7-4
"Development board" defined
Sec. 4. As used in this chapter, "development board" refers to theboard of directors of a development authority.
As added by P.L.108-1993, SEC.11.
IC 8-22-3.7-4.5
"Eligible entity" defined
Sec. 4.5. Notwithstanding IC 8-22-1-6, as used in this chapter,"eligible entity" means the following:
(1) A city having a population of more than ninety thousand(90,000) but less than one hundred five thousand (105,000).
(2) A county having a population of more than one hundred fivethousand (105,000) but less than one hundred ten thousand(110,000).
(3) A county having a population of more than three hundredthousand (300,000) but less than four hundred thousand(400,000).
As added by P.L.108-1993, SEC.11. Amended by P.L.115-1995,SEC.12; P.L.85-1996, SEC.8; P.L.170-2002, SEC.73.
IC 8-22-3.7-5
Creation of authority
Sec. 5. A "__________ Airport Development Authority" (theblank to be filled in with the name of the eligible entity) may becreated by an eligible entity as a separate body corporate and politicand as an instrumentality of the eligible entity to finance airportprojects for lease to the authority in that eligible entity. Adevelopment authority may be created by ordinance of the legislative
body of the eligible entity.
As added by P.L.108-1993, SEC.11.
IC 8-22-3.7-6
Development board; membership; term; removal; oath
Sec. 6. (a) The development board is composed of three (3)members, who must be residents of the eligible entity. The membersof a development board for a development authority established byan eligible entity described in section 4.5(1) of this chapter areappointed by the executive of the eligible entity. The members of adevelopment board for a development authority established by aneligible entity described in section 4.5(2) or 4.5(3) of this chapter areappointed as follows:
(1) One (1) member is appointed by the county executive.
(2) One (1) member is appointed by the executive of the citywith the largest population in the county.
(3) One (1) member is appointed by the board of an airportauthority that is located in the county.
(b) A member is entitled to serve a three (3) year term. A membermay be reappointed to subsequent terms.
(c) If a vacancy occurs on the development board, the officer orentity that made the original appointment shall fill the vacancy byappointing a new member for the remainder of the vacated term.
(d) A member may be removed for cause by the officer or entitythat appointed the member.
(e) Each member, before entering upon the duties of office, musttake and subscribe an oath of office under IC 5-4-1, which shall beendorsed upon the certificate of appointment and filed with therecords of the development board.
(f) A member may not receive a salary, and no profit or money ofthe development authority inures to the benefit of a member.
As added by P.L.108-1993, SEC.11. Amended by P.L.115-1995,SEC.13; P.L.85-1996, SEC.9.
IC 8-22-3.7-7
Meetings; quorum
Sec. 7. (a) Immediately after January 15 of each year, thedevelopment board shall hold an organizational meeting. It shall electone (1) of the members of the development board president, anothervice president, and another secretary-treasurer to perform the dutiesof those offices. These officers serve from the date of their electionand until their successors are elected and qualified. The developmentboard may elect an assistant secretary-treasurer.
(b) Special meetings may be called by the president of thedevelopment board or any two (2) members of the developmentboard.
(c) A majority of the members constitutes a quorum, and theconcurrence of a majority of the members is necessary to authorizeany action.
As added by P.L.108-1993, SEC.11.
IC 8-22-3.7-8
Bylaws and rules
Sec. 8. The development board may adopt the bylaws and rulesthat it considers necessary for the proper conduct of its duties and thesafeguarding of the funds and property entrusted to its care.
As added by P.L.108-1993, SEC.11.
IC 8-22-3.7-9
Purposes of authority
Sec. 9. The development authority is organized for the followingpurposes:
(1) Financing, constructing, and leasing airport projects to theauthority.
(2) Financing and constructing additional improvements toairport projects owned by the development authority and leasingthem to the authority.
(3) Acquiring all or a portion of one (1) or more airport projectsfrom the authority by purchase or lease and leasing these airportprojects back to the authority, with any additionalimprovements that may be made to them.
(4) Acquiring all or a portion of one (1) or more airport projectsfrom the authority by purchase or lease to fund or refundindebtedness incurred on account of those airport projects toenable the authority to make a savings in debt serviceobligations or lease rental obligations or to obtain relief fromcovenants that the authority considers to be unduly burdensome.
As added by P.L.108-1993, SEC.11.
IC 8-22-3.7-10
Authorized activities of authority; dissolution
Sec. 10. (a) The development authority may also:
(1) finance, improve, construct, reconstruct, renovate, purchase,lease, acquire, and equip airport projects;
(2) lease those airport projects to the authority;
(3) sue, be sued, plead, and be impleaded, but all actions againstthe development authority must be brought in the circuit orsuperior court of the county in which the development authorityis located;
(4) lease, rent, purchase, and hold any real or personal propertyneeded or considered useful in connection with airport projects;
(5) acquire real or personal property by gift, devise, or bequestand hold, use, or dispose of that property for the purposesauthorized by this chapter;
(6) with permission of the owner or occupant, enter upon anylots or lands for the purpose of surveying or examining them todetermine the location of an airport project;
(7) design, order, contract for, and construct, reconstruct, andrenovate any airport projects or improvements thereto;
(8) employ managers, superintendents, architects, engineers,attorneys, auditors, clerks, construction managers, and other
employees necessary for construction of airport projects orimprovements to them;
(9) make and enter into all contracts and agreements necessaryor incidental to the performance of its duties and the executionof its powers under this chapter; and
(10) take any other action necessary to implement its purposesas set forth in section 9 of this chapter.
(b) Whenever the development board determines that the purposesfor which the development authority was formed have beensubstantially fulfilled and that all bonds issued and all otherobligations incurred by the development authority have been fullypaid or satisfied or provision for the payment of the bonds andobligations has been made in accordance with the terms of theresolution or trust indenture securing them, the development boardmay declare the development authority dissolved. On the effectivedate of the resolution of dissolution, the title to all funds and otherproperty owned by the development authority at the time of thedissolution vests in the authority. However, if the authority is not inexistence, the title vests in the eligible entity.
As added by P.L.108-1993, SEC.11.
IC 8-22-3.7-11
Refund of bonds; lease back
Sec. 11. (a) Bonds issued under IC 8-22-3 may be refunded asprovided in this section.
(b) The authority may lease all or a portion of an airport projectto the development authority, which may be at a nominal lease rentalwith a lease back to the authority, conditioned upon the developmentauthority assuming bonds issued under IC 8-22-3 and issuing itsbonds to refund those bonds.
As added by P.L.108-1993, SEC.11.
IC 8-22-3.7-12
Reasonableness of leases; leases of airport projects fromdevelopment authority
Sec. 12. (a) Before a lease may be entered into, the authority mustfind that the lease rental provided for is fair and reasonable.
(b) A lease of an airport project from the development authorityto the authority:
(1) must comply with IC 8-22-3.6;
(2) may not require payment of lease rental for a newlyconstructed airport project or for improvements to an existingairport project except to the extent that the airport project orimprovements to the project have been completed and are readyfor occupancy or use;
(3) may contain provisions:
(A) allowing the authority to continue to operate an existingairport project until completion of the improvements,reconstruction, or renovation; and
(B) requiring payment of lease rentals for an existing airport
project being used, reconstructed, or renovated;
(4) may contain an option to renew the lease for the same orshorter term on the conditions provided in the lease;
(5) must contain an option for the authority to purchase theairport project upon the terms stated in the lease during the termof the lease for a price equal to the amount required to pay allindebtedness incurred on account of the airport project,including indebtedness incurred for the refunding of thatindebtedness;
(6) may be entered into before acquisition or construction of anairport project;
(7) may provide that the authority shall agree to:
(A) pay all taxes and assessments on the project;
(B) maintain insurance on the project for the benefit of thedevelopment authority; and
(C) assume responsibility for utilities, repairs, alterations,and any costs of operation; and
(8) may provide that the lease rental payments by the authorityshall be made from any one (1) or more of the sources set forthin IC 8-22-3.6.
As added by P.L.108-1993, SEC.11.
IC 8-22-3.7-13
Authority for leases between development authority and authority
Sec. 13. This chapter and IC 8-22-3.6 contain full and completeauthority for leases between the development authority and theauthority. No law, procedure, proceedings, publications, notices,consents, approvals, orders, or acts by the board, authority or theeligible entity or any other officer, department, agency, orinstrumentality of the state or any political subdivision are requiredto enter into any lease, except as prescribed in this chapter andIC 8-22-3.6.
As added by P.L.108-1993, SEC.11.
IC 8-22-3.7-14
Leases; authority approval of plans and specifications of project
Sec. 14. If the lease provides for an airport project orimprovements to an airport project to be constructed by thedevelopment authority, the plans and specifications shall besubmitted to and approved by the authority.
As added by P.L.108-1993, SEC.11.
IC 8-22-3.7-15
Party walls; easements; licenses
Sec. 15. The development authority and the authority may enterinto common wall (party wall) agreements or other agreementsconcerning easements or licenses. These agreements shall berecorded with the recorder of the county.
As added by P.L.108-1993, SEC.11.
IC 8-22-3.7-16
Sales or leases of projects to development authority
Sec. 16. (a) The authority may lease for a nominal lease rental orsell to the development authority one (1) or more airport projects orportions of airport projects or land upon which an airport project islocated or is to be constructed.
(b) Any lease of all or a portion of an airport project by theauthority to the development authority must be for a term equal to theterm of the lease of that airport project back to the authority.
(c) The authority or the eligible entity may sell property to thedevelopment authority for the amount that the authority or theeligible entity determines to be in the best interest of the authority orthe eligible entity, which amount may be paid from the proceeds ofbonds of the development authority.
(d) The authority may sublease an airport project or portion of anairport project to any person or entity for a term not to exceed theterm of the lease from the development authority, upon the terms andat the rental that the authority determines to be in the best interest ofthe authority.
As added by P.L.108-1993, SEC.11.
IC 8-22-3.7-17
Bond issues
Sec. 17. (a) The development authority may issue bonds for thepurpose of obtaining money to pay the cost of:
(1) acquiring property;
(2) constructing, improving, reconstructing, or renovating one(1) or more airport projects; or
(3) funding or refunding bonds issued under this chapter orIC 8-22-3.
(b) The bonds are payable solely from the lease rentals from thelease of the airport project for which the bonds were issued,insurance proceeds, and any other funds pledged or available.
(c) The bonds shall be authorized by a resolution of thedevelopment board.
(d) The terms and form of the bonds shall either be set out in theresolution or in a form of trust indenture approved by the resolution.
(e) The bonds shall mature within fifty (50) years.
(f) The development board shall sell the bonds at public or privatesale upon terms determined by the development board.
(g) All money received from any bonds issued under this chaptershall be applied solely to the payment of the cost of the acquisitionor construction, or both, of airport projects, or the cost of refundingor refinancing outstanding bonds, for which the bonds are issued.The cost may include:
(1) planning and development of the airport project and allrelated buildings, facilities, structures, and improvements;
(2) acquisition of a site and clearing and preparing the site forconstruction;
(3) equipment, facilities, structures, and improvements that are
necessary or desirable to make the airport projects suitable foruse and operations;
(4) architectural, engineering, consultant, and attorney fees;
(5) incidental expenses in connection with the issuance and saleof bonds;
(6) reserves for principal and interest;
(7) interest during construction and for a period thereafterdetermined by the board, but in no event to exceed five (5)years;
(8) financial advisory fees;
(9) insurance during construction;
(10) municipal bond insurance, debt service reserve insurance,letters of credit, or other credit enhancement; and
(11) in the case of refunding or refinancing, payment of theprincipal of, redemption premiums, if any, and interest on, thebonds being refunded or refinanced.
As added by P.L.108-1993, SEC.11.
IC 8-22-3.7-18
Law governing issuance; bonds as legal investment
Sec. 18. (a) This chapter contains full and complete authority forthe issuance of bonds. No law, procedure, proceedings, publications,notices, consents, approvals, orders, or acts by the board of any otherofficer, department, agency, or instrumentality of the state or of anypolitical subdivision are required to issue any bonds, except asprescribed in this chapter.
(b) Bonds issued under this chapter are legal investments forprivate trust funds and the funds of banks, trust companies, insurancecompanies, building and loan associates, credit unions, banks ofdiscount and deposit, savings banks, private banks, loan and trust andsafe deposit companies, rural loan and savings associations, guarantyloan and savings associations, mortgage guaranty companies, smallloan companies, industrial loan and investment companies, and otherfinancial institutions organized under Indiana law.
As added by P.L.108-1993, SEC.11.
IC 8-22-3.7-19
Trust indentures securing bonds
Sec. 19. (a) The development authority may secure bonds issuedunder this chapter by a trust indenture between the developmentauthority and a corporate trustee, which may be any trust companyor national or state bank within Indiana that has trust powers.
(b) The trust indenture may:
(1) pledge or assign lease rentals, receipts, and income fromleased airport projects;
(2) contain reasonable and proper provisions for protecting andenforcing the rights and remedies of the bondholders, includingcovenants setting forth the duties of the authority and the board;
(3) set forth the rights and remedies of bondholders and trustee;and (4) restrict the individual right of action of bondholders.
However, the trust indenture may not mortgage airport projects.
(c) Any pledge or assignment made by the development authorityunder this section is valid and binding in accordance withIC 5-1-14-4 from the time that the pledge or assignment is made,against all persons whether they have notice of the lien or not. Anytrust indenture by which a pledge is created or an assignment neednot be filed or recorded. The lien is perfected against third parties inaccordance with IC 5-1-14-4.
As added by P.L.108-1993, SEC.11.
IC 8-22-3.7-20
Bonds issued upon exercise of option to purchase
Sec. 20. If the authority exercises its option to purchase leasedproperty, it may issue its bonds authorized by statute.
As added by P.L.108-1993, SEC.11.
IC 8-22-3.7-21
Exemptions from taxation
Sec. 21. (a) All:
(1) property owned by the development authority;
(2) revenues of the development authority; and
(3) bonds issued by the development authority, the interest onthe bonds, the proceeds received by a holder from the sale ofbonds to the extent of the holder's cost of acquisition, proceedsreceived upon redemption before maturity, proceeds received atmaturity, and the receipt of interest in proceeds;
are exempt from taxation in Indiana for all purposes except thefinancial institutions tax imposed under IC 6-5.5 or a stateinheritance tax imposed under IC 6-4.1.
(b) All securities issued under this chapter are exempt from theregistration requirements of IC 23-19 and other securities registrationstatutes.
As added by P.L.108-1993, SEC.11. Amended by P.L.254-1997(ss),SEC.18; P.L.27-2007, SEC.9.
IC 8-22-3.7-22
Actions to contest validity of bonds; conditions
Sec. 22. Any action to contest the validity of bonds to be issuedunder this chapter may not be brought after:
(1) fifteen (15) days following the receipt of bids for the bonds,if the bonds are sold at public sale; or
(2) the time limitations set forth in IC 5-1-14-13.
As added by P.L.108-1993, SEC.11.
IC 8-22-3.7-23
Impairment of bondholder rights
Sec. 23. The general assembly covenants that it will not:
(1) repeal or amend this chapter, IC 8-22-3.5, or IC 8-22-3.6 ina manner that would adversely affect owners of outstanding
bonds, or payment of any lease rentals, secured by the revenuespledged under this chapter, IC 8-22-3.5, or IC 8-22-3.6; or
(2) in any way impair the rights of owners of bonds of thedevelopment authority, or the owners of bonds secured by leaserentals, secured by a pledge of revenues under this chapter orIC 8-22-3.6.
As added by P.L.108-1993, SEC.11.
IC 8-22-3.7-24
Financing powers as public purpose
Sec. 24. This provision of alternative financing power to eligibleentities, development authorities, and authorities in order to financeairport projects is a public purpose.
As added by P.L.108-1993, SEC.11.
IC 8-22-3.7-25
Supplemental nature of chapter
Sec. 25. This chapter is supplemental to other statutes and doesnot supersede any other provisions of the Indiana Code.
As added by P.L.108-1993, SEC.11.