IC 5-1-6-1 Short title
Sec. 1. This chapter may be cited as "The Revenue Bond
Refinancing Law of 1937." As added by Acts 1980, P.L.8, SEC.10.
IC 5-1-6-2 Definitions
Sec. 2. The following terms wherever used or referred to in this
chapter shall have the following meanings, unless a different
meaning appears from the context:
(a) The term "issuing body" shall mean counties, cities, towns,
townships, school cities, school towns, school townships, districts,
political or civil subdivisions, or other public corporate bodies of this
state.
(b) The term "governing body" shall mean the council,
commission, board, or other body, officer, or officers which
constitutes the governing body of an issuing body.
(c) The term "law" shall mean any law, act, or statute, general,
special, or local, of this state.
(d) The term "enterprise" shall mean any work or works,
undertaking, utility, or project which the issuing body is authorized
to construct and from which the municipality derives revenues for
the refinancing, or the refinancing and improving of which
enterprise, refunding bonds are issued under this chapter, and such
enterprise shall include all improvements, betterments, extensions
and replacements thereto, and all appurtenances, facilities, lands,
rights in land, water rights, franchises, and structures in connection
therewith or incidental thereto.
(e) The term "federal agency" shall include the United States of
America, the President of the United States of America, or any
agency, instrumentality or corporation of the United States of
America, designated or created by or pursuant to any act or acts or
joint resolution or joint resolutions of the Congress of the United
States of America, or which may be owned or controlled, directly or
indirectly, by the United States of America.
(f) The term "improving" shall mean reconstructing, replacing,
extending, repairing, bettering, equipping, developing, embellishing
or improving or any one (1) or more or all of the foregoing.
(g) The term "refunding bonds" shall mean notes, bonds, or other
obligations of an issuing body issued pursuant to this chapter, or
pursuant to any other law, as supplemented by, or in conjunction
with this chapter.
(h) The term "refinancing" shall mean funding, refunding, paying,
or discharging, by means of refunding bonds or the proceeds
received from the sale thereof, all or any part of any notes, bonds, or
other obligations issued to finance or to aid in financing the
acquisition, construction or improving of an enterprise and payable
solely from all or any part of the revenues thereof, including interest
thereon in arrears or about to become due, whether or not represented
by coupons or interest certificates.
(i) The term "revenues" shall mean all fees, tolls, rates, rentals and
charges to be levied and collected in connection with and all other
income and receipts of whatever kind or character derived by the
issuing body from the operation of any enterprise or arising from any
enterprise.
(j) The term "holder of bonds" or "bondholders" or any similar
term shall mean any person who shall be the bearer of any
outstanding refunding bond or refunding bonds registered to bearer
or not registered, or the registered owner of any such outstanding
bond or bonds which shall at the time be registered other than to
bearer.
(k) Words importing the singular number shall include the plural
number in each case and vice versa, and words importing persons
shall include firms, limited liability companies, and corporations. As added by Acts 1980, P.L.8, SEC.10. Amended by P.L.8-1993,
SEC.46.
IC 5-1-6-3 Issuance of refunding bonds to refinance and improve enterprise
Sec. 3. Any issuing body shall have power and is hereby
authorized to refinance, or to refinance and improve, any enterprise,
and for such purpose or purposes to borrow money and issue
refunding bonds from time to time. As added by Acts 1980, P.L.8, SEC.10.
IC 5-1-6-4 Authorization by ordinance or resolution; municipally owned
public utility; any enterprise
Sec. 4. (a) The refunding bonds shall be authorized by ordinance
or resolution of the governing body. Such ordinance or resolution
may be adopted at a regular or special meeting, and at the same
meeting at which they are introduced in the manner now provided by
law.
(b) Whenever refunding bonds are to be authorized and issued
under this chapter for the purpose of refinancing and improving any
municipally owned public utility (other than a sewage treatment
works or a municipally owned public utility originally constructed
pursuant to IC 8-1-2) the issuing body desiring to issue such
refunding bonds shall file its petition in the office of the utility
regulatory commission setting forth the facts showing the necessity
for refinancing and improving such municipally owned utility and
praying for the approval thereof by said commission. The petitioner
shall give notice of the filing of such petition and hearing thereon to
the citizens and taxpayers of said issuing body by publication once
each week for two (2) weeks prior to such hearing in a newspaper
published in such issuing body, or in case no newspaper is there
published, then in a newspaper published in the county in which such
issuing body is situated, and if there be no newspaper published in
such county, notice shall be posted for fifteen (15) days in three (3)
public places therein. On the hearing of such petition, if it appears
that a necessity exists for the relief prayed for, the utility regulatory
commission shall approve the issuance of the refunding bonds, either
as prayed for or with such modifications or on such conditions as
may be deemed just and proper. Such approval shall contain a
certification that the income and revenues of said utility, in addition
to providing for operation and maintenance, and depreciation, are
sufficient to pay the principal and interest of said bonds, together
with a margin of ten percent (10%) in excess thereof. All such bonds
so issued under the order of such commission shall be incontestable
except for fraud, forgery, or violation of constitutional limitations. If
on such hearing it shall appear that such relief should not be granted,
the utility regulatory commission shall so declare and such bonds
shall not be issued; however, in case any petition for the approval of
the issuance of such bonds has been denied by the commission, the
governing body affected by such denial may within ten (10) days
from the date of such denial, file a petition with the commission
praying for submission of the question of whether such bonds shall
be issued, to the legal voters of such issuing body affected thereby.
If such commission be satisfied that said last mentioned petition is in
due form, it shall grant the prayer thereof within ten (10) days from
the filing of such petition and order such election at a time to be
fixed in such order. The county auditor shall give notice for such
election and all proceedings for the holding of such election shall be
governed by the law regulating general elections in such issuing
body. The county auditor shall certify the result of such election to
the utility regulatory commission, and if such result be in favor of the
issuance of such bonds, said commission within ten (10) days after
the filing of such certificate of result shall enter an order approving
the issuance of said bonds. All cost and expenses for the holding of
such election shall be paid by the issuing body proposing to issue
such bonds.
(c) Whenever refunding bonds are to be authorized and issued,
under this chapter, for the purpose of refinancing any enterprise, or
for the purpose of refinancing and improving any enterprise except
those mentioned in subsection (b), no proceedings or procedure of
any character whatever, other than the adoption of the ordinance or
resolution authorizing the issuance of such refunding bonds, shall be
required for the issuance of such refunding bonds by the issuing
body.
(d) Notwithstanding subsection (b) or any other law, refunding
bonds may be issued under this chapter by an issuing body without
approval of the utility regulatory commission if the governing body
of the issuing body finds that the refunding will either provide a
savings to the issuing body or will not, by itself, result in a rate
increase. As added by Acts 1980, P.L.8, SEC.10. Amended by P.L.44-1987,
SEC.3; P.L.23-1988, SEC.4.
IC 5-1-6-5 Terms and covenants of refunding bonds; negotiability
Sec. 5. The refunding bonds may be issued in one (1) or more
series, may bear such date or dates, may mature at such time or times
not exceeding forty (40) years from their respective dates, may bear
interest at any rate, payable annually or at shorter intervals, may be
in such denomination or denominations, may be in such form, either
coupon or registered, may carry such registration and conversion
privileges, may be executed in such manner, may be payable in such
medium of payment, at such place or places, may be subject to such
terms of redemption, with or without a premium, may be declared or
become due before the maturity date, may provide for the
replacement of mutilated, destroyed, stolen, or lost bonds, may be
authenticated in such manner and upon compliance with such
conditions, and may contain such other terms and covenants, as may
be provided by ordinance or resolution of the governing body.
Notwithstanding the form or tenor, and in the absence of an express
recital on the face thereof that the bond is nonnegotiable, all
refunding bonds shall at all times be, and shall be treated as, and
have all the qualities and incidents of negotiable instruments for all
purposes. As added by Acts 1980, P.L.8, SEC.10.
IC 5-1-6-6 Validity of authorization; issuance and obligations; recitals in bond
Sec. 6. Refunding bonds bearing the signatures of officers of the
issuing body in office on the date of the signing shall be valid and
binding obligations of the issuing body for all purposes,
notwithstanding that before the delivery thereof any or all of the
persons whose signatures appear thereon shall have ceased to be
officers of the issuing body, the same as if such persons had
continued to be officers of the issuing body until after delivery. The
validity of the authorization and issuance of the refunding bonds
shall not be dependent on or affected in any way by proceedings
taken for the improving of any enterprise for the refinancing and
improving of which the refunding bonds are to be issued, or by
contracts made in connection with the improving of any such
enterprise. Any resolution or ordinance authorizing refunding bonds
may provide that any such refunding bond may contain a recital that
such refunding bond is issued pursuant to this chapter, and any
refunding bond containing such recital under authority of any such
resolution shall be conclusively deemed to be valid and to have been
issued in conformity with the provisions of this chapter. As added by Acts 1980, P.L.8, SEC.10.
IC 5-1-6-7 Sale and exchange of refunding bonds
Sec. 7. (a) The refunding bonds may be sold or exchanged in
installments at different times, or an entire issue or series may be
sold or exchanged at one (1) time. Any issue or series of refunding
bonds may be exchanged in part or sold in part in installments at
different times or at one (1) time. The refunding bonds may be sold
or exchanged at any time, on, before, or after the maturity of any of
the outstanding notes, bonds, or other obligations to be refinanced
thereby.
(b) If the governing body determines to exchange any refunding
bonds, such refunding bonds may be exchanged privately for and in
payment and discharge of any of the outstanding notes, bonds or
other obligations of the issuing body issued to finance or to aid in
financing the acquisition, the construction, the improving, the
refinancing, or the improving and refinancing, of an enterprise. The
refunding bonds may be exchanged for a like or greater principal
amount of such notes, bonds or other obligations of the issuing body,
except that the principal amount of the refunding bonds may exceed
the principal amount of such outstanding notes, bonds, or other
obligations to the extent necessary or advisable, in the discretion of
the governing body, to fund interest in arrears or about to become
due. The holder or holders of such outstanding notes, bonds, or other
obligations need not pay accrued interest on the refunding bonds to
be delivered in exchange therefor if and to the extent that interest is
due or accrued and unpaid on such outstanding notes, bonds, or other
obligations to be surrendered.
(c) If the governing body determines to sell any refunding bonds,
such refunding bonds shall be sold at not less than par at public sale
in such manner and upon such terms as the governing body shall
deem best for the interests of the issuing body. As added by Acts 1980, P.L.8, SEC.10.
IC 5-1-6-8 Lien on revenues of enterprise to secure bonds; additional security;
priority; restrictions
Sec. 8. (a) The refunding bonds shall be special obligations of the
issuing body and shall be payable from and secured by a lien upon
the revenues of the enterprise, as shall be more fully described in the
ordinance or resolution of the governing body authorizing the
issuance of the refunding bonds, and, subject to the constitution and
to the prior or superior rights of any person, any issuing body shall
have power by ordinance or resolution of its governing body to
pledge and assign for the security of the refunding bonds all or any
part of the gross or the net revenues of such enterprise.
(b) As additional security for any issue of refunding bonds
hereunder, or any part thereof, any issuing body shall have power,
and is hereby authorized, by ordinance or resolution of its governing
body to confer upon the holders of the refunding bonds all rights,
powers and remedies which said holders would be entitled to if they
were the owners and had possession of the notes, bonds or other
obligations for the refinancing of which such refunding bonds shall
have been issued including, but not limited to, the preservation of the
lien of such notes, bonds or other obligations without
extinguishment, impairment or diminution thereof. In the event any
issuing body exercises the power conferred by this subsection:
(1) each refunding bond shall contain a recital to the effect that
the holder thereof has been granted the additional security
provided by this subsection; and
(2) each note, bond or other obligation of the issuing body to be
refinanced by any such refunding bonds, shall be kept intact and
shall not be cancelled or destroyed until the refunding bonds,
and interest thereon, have been finally paid and discharged but
shall be stamped with a legend to the effect that such note,
bond, or other obligation has been refunded pursuant to this
chapter.
(c) All refunding bonds of the same issue shall be equally and
ratably secured, without priority by reason of number, date of bonds,
of sale, of execution or of delivery, by a lien upon the revenues of the
enterprise in accordance with the provisions of this section and the
ordinance or resolution authorizing the issuance of such refunding
bonds.
(d) Nothing in this section or in any other section of this chapter
shall be deemed in any way to alter the terms of any agreements
made with the holders of any outstanding notes, bonds, or other
obligations of the issuing body or to authorize the issuing body to
alter the terms of any such agreements, or to impair, or to authorize
the issuing body to impair the rights and remedies of any creditors of
the issuing body.
(e) Nothing in this section or any other section of this chapter
shall be deemed in any way to authorize any issuing body to do
anything in any manner or for any purpose which would result in the
creation or incurring of a debt or indebtedness or the issuance of any
instrument which would constitute a bond or debt within the meaning
of any provision, limitation, or restriction of the constitution relating
to the creation or incurring of a debt or indebtedness or the issuance
of an instrument constituting a bond or debt. As added by Acts 1980, P.L.8, SEC.10.
IC 5-1-6-9 Liability of issuing body
Sec. 9. (a) No recourse shall be had for the payment of the
refunding bonds, or interest thereon, or any part thereof, against the
general fund of any issuing body, nor shall the credit or taxing power
of any issuing body be deemed to be pledged thereto.
(b) The refunding bonds, and interest thereon, shall not be a debt
of the issuing body, nor a charge, lien, or encumbrance, legal or
equitable, upon any property of the issuing body, or upon any
income, receipts, or revenues of the issuing body other than such of
the revenues of the enterprise as shall have been pledged to the
payment thereof, and every refunding bond shall recite in substance
that said bond, including interest thereon, is payable solely from the
revenues pledged to the payment thereof and that the issuing body is
under no obligation to pay the same, except from said revenues. As added by Acts 1980, P.L.8, SEC.10.
IC 5-1-6-10 Exemption from taxation; exception
Sec. 10. The refunding bonds and the income therefrom shall be
exempt from taxation, except the financial institutions tax and
inheritance, estate and transfer taxes. As added by Acts 1980, P.L.8, SEC.10. Amended by P.L.21-1990,
SEC.4.
IC 5-1-6-11 Fiscal agent
Sec. 11. Any issuing body shall have power in connection with the
issuance of refunding bonds to appoint a fiscal agent, to provide for
the powers, duties and functions and compensations of such fiscal
agent, to limit the liabilities of such fiscal agent, to prescribe a
method for the resignation, removal, merger or consolidation of such
fiscal agent and the appointment of a successor fiscal agent and the
transfer of rights and properties to such successor fiscal agent. As added by Acts 1980, P.L.8, SEC.10.
IC 5-1-6-12 Duties of issuing body and others to secure payment of bonds and
interest
Sec. 12. (a) In order that the payment of the refunding bonds, and
interest thereon, shall be adequately secured, any issuing body
issuing refunding bonds pursuant to this chapter and the proper
officers, agents and employees thereof, are hereby directed, and it
shall be the mandatory duty of such issuing body and such officers,
agents and employees under this chapter, and it shall further be of the
essence of the contract of such issuing body with the bondholders, at
all times:
(1) to pay or cause to be paid punctually the principal of every
refunding bond, and the interest thereon, on the date or dates
and at the place or places and in the manner and out of the
funds mentioned in such refunding bonds and in the coupons
thereto appertaining and in accordance with the resolution
authorizing their issuance;
(2) to operate the enterprise in an efficient and economical
manner and to establish, levy, maintain, and collect such fees,
tolls, rentals, rates and other charges in connection therewith as
may be necessary or proper, which said fees, tolls, rates, rentals,
and other charges shall be at least sufficient after making due
and reasonable allowances for contingencies and for a margin
of error in the estimates:
(i) to pay all current expenses of operation, maintenance and
repair of such enterprise;
(ii) to pay the interest on and principal of the refunding
bonds as the same shall become due and payable;
(iii) to comply in all respects with the terms of the ordinance
or resolution authorizing the issuance of refunding bonds or
any other contract or agreement with the holders of the
refunding bonds; and
(iv) to meet any other obligations of the issuing body which
are charges, liens, or encumbrances upon the revenues of
such enterprise;
provided, however, that nothing in this section shall be
construed as curtailing any authority of the utility regulatory
commission to approve rates or charges;
(3) to operate, maintain, preserve, and keep, or cause to be
operated, maintained, preserved, and kept, the enterprise and
every part and parcel thereof, in good repair, working order and
condition;
(4) to preserve and protect the security of the refunding bonds
and the rights of the holders thereof, and to warrant and defend
such rights against all claims and demands of all persons
whomsoever;
(5) to pay and discharge, or cause to be paid or discharged any
and all lawful claims for labor, materials, and supplies, which,
if unpaid, might by law become a lien or charge upon the
revenues or any part thereof, prior or superior to the lien of the
refunding bonds, or which might impair the security of the
refunding bonds, to the end that the priority and security of the
refunding bonds shall be fully preserved and protected;
(6) to hold in trust the revenues pledged to the payment of the
refunding bonds for the benefit of the holders of the refunding
bonds and to apply such revenues only as provided by the
resolution or resolutions authorizing the issuance of the
refunding bonds or, if such resolution or resolutions shall
thereafter be modified in the manner provided therein or herein,
only as provided in such resolution or resolutions as modified;
and
(7) to keep proper books of record and accounts of the
enterprise (separate from all other records and accounts) in
which complete and correct entries shall be made of all
transactions relating to the enterprise or any part thereof, and
which, together with all other books and papers of the issuing
body, shall at all times be subject to the inspection of the holder
or holders of not less than ten percent (10%) of the refunding
bonds then outstanding or his or their representatives duly
authorized in writing.
(b) None of the foregoing duties shall be construed to require the
expenditure in any manner or for any purpose by the issuing body of
any funds other than revenues received or receivable from the
enterprise. As added by Acts 1980, P.L.8, SEC.10. Amended by P.L.23-1988,
SEC.5. IC 5-1-6-13 Additional powers of governing body; restrictions
Sec. 13. (a) The governing body shall have power, in addition to
the other powers conferred by this chapter, to insert provisions in any
ordinance or resolution authorizing the issuance of refunding bonds,
which shall be a part of the contract with the holders of the refunding
bonds, as to:
(1) limitations on the purpose to which the proceeds of sale of
any issue of refunding bonds, or any notes, bonds, or other
obligations then or thereafter to be issued to finance the
improving of the enterprise, may be applied;
(2) limitations on the issuance of additional refunding bonds, or
additional notes, bonds, or other obligations to finance the
improving of the enterprise, and on the lien thereof;
(3) limitations on the right of the issuing body or its governing
body to restrict and regulate the use of the enterprise;
(4) the amount and kind of insurance to be maintained on the
enterprise, and the use and disposition of insurance monies;
(5) pledging all or any part of the revenues of the enterprise to
which its right then exists or the right to which may thereafter
come into existence;
(6) covenanting against pledging all or any part of the revenues
of the enterprise to which its right then exists or the right to
which may thereafter come into existence;
(7) events of default and terms and conditions upon which any
or all of the refunding bonds shall become or may be declared
due before maturity and as to the terms and conditions upon
which such declaration and its consequences may be waived;
(8) the rights, liabilities, powers, and duties arising upon the
breach by it of any covenants, conditions or obligations;
(9) the vesting in a trust or trustees the right to enforce any
covenants made to secure, to pay, or in relation to the refunding
bonds, as to the powers and duties of such trustee or trustees,
and the limitation of liabilities thereof, and as to the terms and
conditions upon which the holders of the refunding bonds or
any proportion or percentage of them may enforce any
covenants made under this chapter or duties imposed hereby;
(10) a procedure by which the terms of any resolution or
ordinance authorizing refunding bonds, or any other contract
with bondholders, including but not limited to an indenture of
trust or similar instrument, may be amended or abrogated as to
the amount of refunding bonds, the holders of which must
consent thereto, and the manner in which such consent may be
given;
(11) the execution of all instruments necessary or convenient in
the exercise of the powers granted by this chapter or in the
performance of the duties of the issuing body and the officers,
agents, and employees thereof;
(12) refraining from pledging or in any manner whatever
claiming or taking the benefit or advantage of any stay or
extension law whenever enacted, which may affect the duties or
covenants of the issuing body in relation to the refunding bonds,
or the performance thereof, or the lien of such refunding bonds;
(13) the purchase out of any funds available therefor, including
but not limited to the proceeds of refunding bonds, of any
outstanding notes, bonds, or obligations, including but not
limited to refunding bonds, and the price or prices at which and
the manner in which such purchases may be made; and
(14) any other acts and things as may be necessary or
convenient or desirable in order to secure the refunding bonds,
or as may tend to make the refunding bonds more marketable.
(b) Nothing in this section shall be construed to authorize any
issuing body to make any covenants, to perform any act or to do
anything which shall require the expenditure in any manner or for
any purpose by the issuing body of any funds other than revenues
received or receivable from the enterprise. As added by Acts 1980, P.L.8, SEC.10.
IC 5-1-6-14 Default in payment of principal or interest of bonds; receiver;
rights and powers; subsequent defaults; supervision of courts
Sec. 14. (a) In the event that the issuing body shall default in the
payment of the principal or interest on any of the refunding bonds
after the same shall become due, whether at maturity or upon call for
redemption, and such default shall continue for a period of thirty (30)
days, or in the event that the issuing body or the governing body or
officers, agents, or employees thereof shall fail or refuse to comply
with the provisions of this chapter or shall default in any agreement
made with the holders of the refunding bonds, any holder or holders
of refunding bonds, or trustee therefor, shall have the right to apply
in an appropriate judicial proceeding in the circuit or superior court
of the county in which the issuing body or the greater territorial
portion thereof is situated, or in which the enterprise is located, or
any court of competent jurisdiction, for the appointment of a receiver
of the enterprise, whether or not all refunding bonds have been
declared due and payable and whether or not such holder or holders,
or trustee therefor, is seeking or has sought to enforce any other
right, or exercise any remedy in connection with such refunding
bonds. Upon such application the circuit or superior court may
appoint, and if the application is made by the holders of twenty-five
percent (25%) in principal amount of such refunding bonds then
outstanding, or any trustee for holders of such refunding bonds in
such principal amount, shall appoint a receiver of the enterprise.
(b) The receiver so appointed shall forthwith, directly or by his
agents and attorneys, enter into and upon and take possession of the
enterprise and each and every part thereof and may exclude the
issuing body, its governing body, officers, agents, and employees and
all persons claiming under them wholly therefrom and shall have,
hold, use, operate, manage, and control the same and each and every
part thereof, and, in the name of the issuing body or otherwise, as the
receiver may deem best, and shall exercise all rights and powers of
the issuing body with respect to the enterprise as the issuing body
itself might do. Such receiver shall maintain, restore, insure and keep
insured, the enterprise, and from time to time shall make all such
necessary or proper repairs as to such receiver may seem expedient
and shall establish, levy, maintain and collect such fees, tolls, rentals,
and other charges in connection with the enterprise as such receiver
may deem necessary or proper and reasonable, and shall collect and
receive all revenues and shall deposit the same in a separate account
and apply such revenues so collected and received in such manner as
the court shall direct.
(c) Whenever all that is due upon the refunding bonds, and
interest thereon, and upon any other notes, bonds or other
obligations, and interest thereon, having a charge, lien, or
encumbrance on the revenues of the enterprise and under any of the
terms of any covenants or agreements with bondholders shall have
been paid or deposited as provided therein, and all defaults shall have
been cured and made good, the court may in its discretion, and after
such notice and hearing as it deems reasonable and proper, direct the
receiver to surrender possession of the enterprise to the issuing body,
the same right of the holders of the refunding bonds to secure the
appointment of a receiver to exist upon any subsequent default as
hereinabove provided.
(d) Such receiver shall in the performance of the powers
hereinabove conferred upon him, act under the direction and
supervision of the court making such appointment and shall at all
times be subject to the orders and decrees of such court and may be
removed thereby. Nothing herein contained shall limit or restrict the
jurisdiction of such court to enter such other and further orders and
decrees as such court may deem necessary or appropriate for the
exercise by the receiver of any functions specifically set forth herein. As added by Acts 1980, P.L.8, SEC.10.
IC 5-1-6-15 Remedy; nature
Sec. 15. (a) Subject to any contractual limitations binding upon
the holders of any issue of refunding bonds, or trustee therefor,
including but not limited to the restrictions of the exercise of any
remedy to a specified proportion or percentage of such holders, any
holder of refunding bonds, or trustee therefor, shall have the right
and power, for the equal benefit and protection of all holders of
refunding bonds similarly situated:
(1) by mandamus or other suit, action or proceeding at law or in
equity to enforce his rights against the issuing body and its
governing body and any of its officers, agents and employees
and to require and compel such issuing body or such governing
body or any such officers, agents, or employees to perform and
carry out its and their duties and obligations under this chapter
and its and their covenants and agreements with bondholders;
(2) by action or suit in equity to require the issuing body and the
governing body thereof to account as if they were the trustee of
an express trust;
(3) by action or suit in equity to enjoin any acts or things which
may be unlawful or in violation of the rights of the bondholders;
and
(4) to bring suit upon the refunding bonds.
(b) No remedy conferred by this chapter upon any holder of
refunding bonds, or any trustee therefor, is intended to be exclusive
of any other remedy, but each such remedy is cumulative and in
addition to every other remedy and may be exercised without
exhausting and without regard to any other remedy conferred by this
chapter or by any other law. No waiver of any default or breach of
duty or contract, whether by any holder of refunding bonds, or any
trustee therefor, shall extend to or shall affect any subsequent default
or breach of duty or contract or shall impair any rights or remedies
thereon. No delay or omission of any bondholder or any trustee
therefor to exercise any right or power accruing upon any default
shall impair any such right or power or shall be construed to be a
waiver of any such default or acquiescence therein. Every
substantive right and every remedy, conferred upon the holders of
refunding bonds, may be enforced and exercised from time to time
and as often as may be deemed expedient. In case any suit, action, or
proceeding to enforce any right or exercise any remedy shall be
brought or taken and then discontinued or abandoned, or shall be
determined adversely to the holder of the refunding bonds, or any
trustee therefor, then and in every such case the issuing body and
such holder, or such trustee, shall be restored to their former
positions and rights and remedies as if no such suit, action or
proceeding had been brought or taken. As added by Acts 1980, P.L.8, SEC.10.
IC 5-1-6-16 Powers conferred by chapter
Sec. 16. This chapter constitutes full and complete authority for
the issuance of refunding bonds. No procedure or proceedings,
publications, notices, consents, approvals, orders, acts or things by
any governing body, or any board, officer, commission, department,
agency, or instrumentality of the state or any issuing body shall be
required to issue any refunding bonds or to do any act or perform any
thing under this chapter, except as may be prescribed in this chapter.
The powers conferred by this chapter shall be in addition and
supplemental to, and not in substitution for, and the limitations
imposed by this chapter shall not affect, the powers conferred by any
other law. This chapter is remedial in nature and shall be liberally
construed. As added by Acts 1980, P.L.8, SEC.10.
IC 5-1-6-1 Short title
Sec. 1. This chapter may be cited as "The Revenue Bond
Refinancing Law of 1937." As added by Acts 1980, P.L.8, SEC.10.
IC 5-1-6-2 Definitions
Sec. 2. The following terms wherever used or referred to in this
chapter shall have the following meanings, unless a different
meaning appears from the context:
(a) The term "issuing body" shall mean counties, cities, towns,
townships, school cities, school towns, school townships, districts,
political or civil subdivisions, or other public corporate bodies of this
state.
(b) The term "governing body" shall mean the council,
commission, board, or other body, officer, or officers which
constitutes the governing body of an issuing body.
(c) The term "law" shall mean any law, act, or statute, general,
special, or local, of this state.
(d) The term "enterprise" shall mean any work or works,
undertaking, utility, or project which the issuing body is authorized
to construct and from which the municipality derives revenues for
the refinancing, or the refinancing and improving of which
enterprise, refunding bonds are issued under this chapter, and such
enterprise shall include all improvements, betterments, extensions
and replacements thereto, and all appurtenances, facilities, lands,
rights in land, water rights, franchises, and structures in connection
therewith or incidental thereto.
(e) The term "federal agency" shall include the United States of
America, the President of the United States of America, or any
agency, instrumentality or corporation of the United States of
America, designated or created by or pursuant to any act or acts or
joint resolution or joint resolutions of the Congress of the United
States of America, or which may be owned or controlled, directly or
indirectly, by the United States of America.
(f) The term "improving" shall mean reconstructing, replacing,
extending, repairing, bettering, equipping, developing, embellishing
or improving or any one (1) or more or all of the foregoing.
(g) The term "refunding bonds" shall mean notes, bonds, or other
obligations of an issuing body issued pursuant to this chapter, or
pursuant to any other law, as supplemented by, or in conjunction
with this chapter.
(h) The term "refinancing" shall mean funding, refunding, paying,
or discharging, by means of refunding bonds or the proceeds
received from the sale thereof, all or any part of any notes, bonds, or
other obligations issued to finance or to aid in financing the
acquisition, construction or improving of an enterprise and payable
solely from all or any part of the revenues thereof, including interest
thereon in arrears or about to become due, whether or not represented
by coupons or interest certificates.
(i) The term "revenues" shall mean all fees, tolls, rates, rentals and
charges to be levied and collected in connection with and all other
income and receipts of whatever kind or character derived by the
issuing body from the operation of any enterprise or arising from any
enterprise.
(j) The term "holder of bonds" or "bondholders" or any similar
term shall mean any person who shall be the bearer of any
outstanding refunding bond or refunding bonds registered to bearer
or not registered, or the registered owner of any such outstanding
bond or bonds which shall at the time be registered other than to
bearer.
(k) Words importing the singular number shall include the plural
number in each case and vice versa, and words importing persons
shall include firms, limited liability companies, and corporations. As added by Acts 1980, P.L.8, SEC.10. Amended by P.L.8-1993,
SEC.46.
IC 5-1-6-3 Issuance of refunding bonds to refinance and improve enterprise
Sec. 3. Any issuing body shall have power and is hereby
authorized to refinance, or to refinance and improve, any enterprise,
and for such purpose or purposes to borrow money and issue
refunding bonds from time to time. As added by Acts 1980, P.L.8, SEC.10.
IC 5-1-6-4 Authorization by ordinance or resolution; municipally owned
public utility; any enterprise
Sec. 4. (a) The refunding bonds shall be authorized by ordinance
or resolution of the governing body. Such ordinance or resolution
may be adopted at a regular or special meeting, and at the same
meeting at which they are introduced in the manner now provided by
law.
(b) Whenever refunding bonds are to be authorized and issued
under this chapter for the purpose of refinancing and improving any
municipally owned public utility (other than a sewage treatment
works or a municipally owned public utility originally constructed
pursuant to IC 8-1-2) the issuing body desiring to issue such
refunding bonds shall file its petition in the office of the utility
regulatory commission setting forth the facts showing the necessity
for refinancing and improving such municipally owned utility and
praying for the approval thereof by said commission. The petitioner
shall give notice of the filing of such petition and hearing thereon to
the citizens and taxpayers of said issuing body by publication once
each week for two (2) weeks prior to such hearing in a newspaper
published in such issuing body, or in case no newspaper is there
published, then in a newspaper published in the county in which such
issuing body is situated, and if there be no newspaper published in
such county, notice shall be posted for fifteen (15) days in three (3)
public places therein. On the hearing of such petition, if it appears
that a necessity exists for the relief prayed for, the utility regulatory
commission shall approve the issuance of the refunding bonds, either
as prayed for or with such modifications or on such conditions as
may be deemed just and proper. Such approval shall contain a
certification that the income and revenues of said utility, in addition
to providing for operation and maintenance, and depreciation, are
sufficient to pay the principal and interest of said bonds, together
with a margin of ten percent (10%) in excess thereof. All such bonds
so issued under the order of such commission shall be incontestable
except for fraud, forgery, or violation of constitutional limitations. If
on such hearing it shall appear that such relief should not be granted,
the utility regulatory commission shall so declare and such bonds
shall not be issued; however, in case any petition for the approval of
the issuance of such bonds has been denied by the commission, the
governing body affected by such denial may within ten (10) days
from the date of such denial, file a petition with the commission
praying for submission of the question of whether such bonds shall
be issued, to the legal voters of such issuing body affected thereby.
If such commission be satisfied that said last mentioned petition is in
due form, it shall grant the prayer thereof within ten (10) days from
the filing of such petition and order such election at a time to be
fixed in such order. The county auditor shall give notice for such
election and all proceedings for the holding of such election shall be
governed by the law regulating general elections in such issuing
body. The county auditor shall certify the result of such election to
the utility regulatory commission, and if such result be in favor of the
issuance of such bonds, said commission within ten (10) days after
the filing of such certificate of result shall enter an order approving
the issuance of said bonds. All cost and expenses for the holding of
such election shall be paid by the issuing body proposing to issue
such bonds.
(c) Whenever refunding bonds are to be authorized and issued,
under this chapter, for the purpose of refinancing any enterprise, or
for the purpose of refinancing and improving any enterprise except
those mentioned in subsection (b), no proceedings or procedure of
any character whatever, other than the adoption of the ordinance or
resolution authorizing the issuance of such refunding bonds, shall be
required for the issuance of such refunding bonds by the issuing
body.
(d) Notwithstanding subsection (b) or any other law, refunding
bonds may be issued under this chapter by an issuing body without
approval of the utility regulatory commission if the governing body
of the issuing body finds that the refunding will either provide a
savings to the issuing body or will not, by itself, result in a rate
increase. As added by Acts 1980, P.L.8, SEC.10. Amended by P.L.44-1987,
SEC.3; P.L.23-1988, SEC.4.
IC 5-1-6-5 Terms and covenants of refunding bonds; negotiability
Sec. 5. The refunding bonds may be issued in one (1) or more
series, may bear such date or dates, may mature at such time or times
not exceeding forty (40) years from their respective dates, may bear
interest at any rate, payable annually or at shorter intervals, may be
in such denomination or denominations, may be in such form, either
coupon or registered, may carry such registration and conversion
privileges, may be executed in such manner, may be payable in such
medium of payment, at such place or places, may be subject to such
terms of redemption, with or without a premium, may be declared or
become due before the maturity date, may provide for the
replacement of mutilated, destroyed, stolen, or lost bonds, may be
authenticated in such manner and upon compliance with such
conditions, and may contain such other terms and covenants, as may
be provided by ordinance or resolution of the governing body.
Notwithstanding the form or tenor, and in the absence of an express
recital on the face thereof that the bond is nonnegotiable, all
refunding bonds shall at all times be, and shall be treated as, and
have all the qualities and incidents of negotiable instruments for all
purposes. As added by Acts 1980, P.L.8, SEC.10.
IC 5-1-6-6 Validity of authorization; issuance and obligations; recitals in bond
Sec. 6. Refunding bonds bearing the signatures of officers of the
issuing body in office on the date of the signing shall be valid and
binding obligations of the issuing body for all purposes,
notwithstanding that before the delivery thereof any or all of the
persons whose signatures appear thereon shall have ceased to be
officers of the issuing body, the same as if such persons had
continued to be officers of the issuing body until after delivery. The
validity of the authorization and issuance of the refunding bonds
shall not be dependent on or affected in any way by proceedings
taken for the improving of any enterprise for the refinancing and
improving of which the refunding bonds are to be issued, or by
contracts made in connection with the improving of any such
enterprise. Any resolution or ordinance authorizing refunding bonds
may provide that any such refunding bond may contain a recital that
such refunding bond is issued pursuant to this chapter, and any
refunding bond containing such recital under authority of any such
resolution shall be conclusively deemed to be valid and to have been
issued in conformity with the provisions of this chapter. As added by Acts 1980, P.L.8, SEC.10.
IC 5-1-6-7 Sale and exchange of refunding bonds
Sec. 7. (a) The refunding bonds may be sold or exchanged in
installments at different times, or an entire issue or series may be
sold or exchanged at one (1) time. Any issue or series of refunding
bonds may be exchanged in part or sold in part in installments at
different times or at one (1) time. The refunding bonds may be sold
or exchanged at any time, on, before, or after the maturity of any of
the outstanding notes, bonds, or other obligations to be refinanced
thereby.
(b) If the governing body determines to exchange any refunding
bonds, such refunding bonds may be exchanged privately for and in
payment and discharge of any of the outstanding notes, bonds or
other obligations of the issuing body issued to finance or to aid in
financing the acquisition, the construction, the improving, the
refinancing, or the improving and refinancing, of an enterprise. The
refunding bonds may be exchanged for a like or greater principal
amount of such notes, bonds or other obligations of the issuing body,
except that the principal amount of the refunding bonds may exceed
the principal amount of such outstanding notes, bonds, or other
obligations to the extent necessary or advisable, in the discretion of
the governing body, to fund interest in arrears or about to become
due. The holder or holders of such outstanding notes, bonds, or other
obligations need not pay accrued interest on the refunding bonds to
be delivered in exchange therefor if and to the extent that interest is
due or accrued and unpaid on such outstanding notes, bonds, or other
obligations to be surrendered.
(c) If the governing body determines to sell any refunding bonds,
such refunding bonds shall be sold at not less than par at public sale
in such manner and upon such terms as the governing body shall
deem best for the interests of the issuing body. As added by Acts 1980, P.L.8, SEC.10.
IC 5-1-6-8 Lien on revenues of enterprise to secure bonds; additional security;
priority; restrictions
Sec. 8. (a) The refunding bonds shall be special obligations of the
issuing body and shall be payable from and secured by a lien upon
the revenues of the enterprise, as shall be more fully described in the
ordinance or resolution of the governing body authorizing the
issuance of the refunding bonds, and, subject to the constitution and
to the prior or superior rights of any person, any issuing body shall
have power by ordinance or resolution of its governing body to
pledge and assign for the security of the refunding bonds all or any
part of the gross or the net revenues of such enterprise.
(b) As additional security for any issue of refunding bonds
hereunder, or any part thereof, any issuing body shall have power,
and is hereby authorized, by ordinance or resolution of its governing
body to confer upon the holders of the refunding bonds all rights,
powers and remedies which said holders would be entitled to if they
were the owners and had possession of the notes, bonds or other
obligations for the refinancing of which such refunding bonds shall
have been issued including, but not limited to, the preservation of the
lien of such notes, bonds or other obligations without
extinguishment, impairment or diminution thereof. In the event any
issuing body exercises the power conferred by this subsection:
(1) each refunding bond shall contain a recital to the effect that
the holder thereof has been granted the additional security
provided by this subsection; and
(2) each note, bond or other obligation of the issuing body to be
refinanced by any such refunding bonds, shall be kept intact and
shall not be cancelled or destroyed until the refunding bonds,
and interest thereon, have been finally paid and discharged but
shall be stamped with a legend to the effect that such note,
bond, or other obligation has been refunded pursuant to this
chapter.
(c) All refunding bonds of the same issue shall be equally and
ratably secured, without priority by reason of number, date of bonds,
of sale, of execution or of delivery, by a lien upon the revenues of the
enterprise in accordance with the provisions of this section and the
ordinance or resolution authorizing the issuance of such refunding
bonds.
(d) Nothing in this section or in any other section of this chapter
shall be deemed in any way to alter the terms of any agreements
made with the holders of any outstanding notes, bonds, or other
obligations of the issuing body or to authorize the issuing body to
alter the terms of any such agreements, or to impair, or to authorize
the issuing body to impair the rights and remedies of any creditors of
the issuing body.
(e) Nothing in this section or any other section of this chapter
shall be deemed in any way to authorize any issuing body to do
anything in any manner or for any purpose which would result in the
creation or incurring of a debt or indebtedness or the issuance of any
instrument which would constitute a bond or debt within the meaning
of any provision, limitation, or restriction of the constitution relating
to the creation or incurring of a debt or indebtedness or the issuance
of an instrument constituting a bond or debt. As added by Acts 1980, P.L.8, SEC.10.
IC 5-1-6-9 Liability of issuing body
Sec. 9. (a) No recourse shall be had for the payment of the
refunding bonds, or interest thereon, or any part thereof, against the
general fund of any issuing body, nor shall the credit or taxing power
of any issuing body be deemed to be pledged thereto.
(b) The refunding bonds, and interest thereon, shall not be a debt
of the issuing body, nor a charge, lien, or encumbrance, legal or
equitable, upon any property of the issuing body, or upon any
income, receipts, or revenues of the issuing body other than such of
the revenues of the enterprise as shall have been pledged to the
payment thereof, and every refunding bond shall recite in substance
that said bond, including interest thereon, is payable solely from the
revenues pledged to the payment thereof and that the issuing body is
under no obligation to pay the same, except from said revenues. As added by Acts 1980, P.L.8, SEC.10.
IC 5-1-6-10 Exemption from taxation; exception
Sec. 10. The refunding bonds and the income therefrom shall be
exempt from taxation, except the financial institutions tax and
inheritance, estate and transfer taxes. As added by Acts 1980, P.L.8, SEC.10. Amended by P.L.21-1990,
SEC.4.
IC 5-1-6-11 Fiscal agent
Sec. 11. Any issuing body shall have power in connection with the
issuance of refunding bonds to appoint a fiscal agent, to provide for
the powers, duties and functions and compensations of such fiscal
agent, to limit the liabilities of such fiscal agent, to prescribe a
method for the resignation, removal, merger or consolidation of such
fiscal agent and the appointment of a successor fiscal agent and the
transfer of rights and properties to such successor fiscal agent. As added by Acts 1980, P.L.8, SEC.10.
IC 5-1-6-12 Duties of issuing body and others to secure payment of bonds and
interest
Sec. 12. (a) In order that the payment of the refunding bonds, and
interest thereon, shall be adequately secured, any issuing body
issuing refunding bonds pursuant to this chapter and the proper
officers, agents and employees thereof, are hereby directed, and it
shall be the mandatory duty of such issuing body and such officers,
agents and employees under this chapter, and it shall further be of the
essence of the contract of such issuing body with the bondholders, at
all times:
(1) to pay or cause to be paid punctually the principal of every
refunding bond, and the interest thereon, on the date or dates
and at the place or places and in the manner and out of the
funds mentioned in such refunding bonds and in the coupons
thereto appertaining and in accordance with the resolution
authorizing their issuance;
(2) to operate the enterprise in an efficient and economical
manner and to establish, levy, maintain, and collect such fees,
tolls, rentals, rates and other charges in connection therewith as
may be necessary or proper, which said fees, tolls, rates, rentals,
and other charges shall be at least sufficient after making due
and reasonable allowances for contingencies and for a margin
of error in the estimates:
(i) to pay all current expenses of operation, maintenance and
repair of such enterprise;
(ii) to pay the interest on and principal of the refunding
bonds as the same shall become due and payable;
(iii) to comply in all respects with the terms of the ordinance
or resolution authorizing the issuance of refunding bonds or
any other contract or agreement with the holders of the
refunding bonds; and
(iv) to meet any other obligations of the issuing body which
are charges, liens, or encumbrances upon the revenues of
such enterprise;
provided, however, that nothing in this section shall be
construed as curtailing any authority of the utility regulatory
commission to approve rates or charges;
(3) to operate, maintain, preserve, and keep, or cause to be
operated, maintained, preserved, and kept, the enterprise and
every part and parcel thereof, in good repair, working order and
condition;
(4) to preserve and protect the security of the refunding bonds
and the rights of the holders thereof, and to warrant and defend
such rights against all claims and demands of all persons
whomsoever;
(5) to pay and discharge, or cause to be paid or discharged any
and all lawful claims for labor, materials, and supplies, which,
if unpaid, might by law become a lien or charge upon the
revenues or any part thereof, prior or superior to the lien of the
refunding bonds, or which might impair the security of the
refunding bonds, to the end that the priority and security of the
refunding bonds shall be fully preserved and protected;
(6) to hold in trust the revenues pledged to the payment of the
refunding bonds for the benefit of the holders of the refunding
bonds and to apply such revenues only as provided by the
resolution or resolutions authorizing the issuance of the
refunding bonds or, if such resolution or resolutions shall
thereafter be modified in the manner provided therein or herein,
only as provided in such resolution or resolutions as modified;
and
(7) to keep proper books of record and accounts of the
enterprise (separate from all other records and accounts) in
which complete and correct entries shall be made of all
transactions relating to the enterprise or any part thereof, and
which, together with all other books and papers of the issuing
body, shall at all times be subject to the inspection of the holder
or holders of not less than ten percent (10%) of the refunding
bonds then outstanding or his or their representatives duly
authorized in writing.
(b) None of the foregoing duties shall be construed to require the
expenditure in any manner or for any purpose by the issuing body of
any funds other than revenues received or receivable from the
enterprise. As added by Acts 1980, P.L.8, SEC.10. Amended by P.L.23-1988,
SEC.5. IC 5-1-6-13 Additional powers of governing body; restrictions
Sec. 13. (a) The governing body shall have power, in addition to
the other powers conferred by this chapter, to insert provisions in any
ordinance or resolution authorizing the issuance of refunding bonds,
which shall be a part of the contract with the holders of the refunding
bonds, as to:
(1) limitations on the purpose to which the proceeds of sale of
any issue of refunding bonds, or any notes, bonds, or other
obligations then or thereafter to be issued to finance the
improving of the enterprise, may be applied;
(2) limitations on the issuance of additional refunding bonds, or
additional notes, bonds, or other obligations to finance the
improving of the enterprise, and on the lien thereof;
(3) limitations on the right of the issuing body or its governing
body to restrict and regulate the use of the enterprise;
(4) the amount and kind of insurance to be maintained on the
enterprise, and the use and disposition of insurance monies;
(5) pledging all or any part of the revenues of the enterprise to
which its right then exists or the right to which may thereafter
come into existence;
(6) covenanting against pledging all or any part of the revenues
of the enterprise to which its right then exists or the right to
which may thereafter come into existence;
(7) events of default and terms and conditions upon which any
or all of the refunding bonds shall become or may be declared
due before maturity and as to the terms and conditions upon
which such declaration and its consequences may be waived;
(8) the rights, liabilities, powers, and duties arising upon the
breach by it of any covenants, conditions or obligations;
(9) the vesting in a trust or trustees the right to enforce any
covenants made to secure, to pay, or in relation to the refunding
bonds, as to the powers and duties of such trustee or trustees,
and the limitation of liabilities thereof, and as to the terms and
conditions upon which the holders of the refunding bonds or
any proportion or percentage of them may enforce any
covenants made under this chapter or duties imposed hereby;
(10) a procedure by which the terms of any resolution or
ordinance authorizing refunding bonds, or any other contract
with bondholders, including but not limited to an indenture of
trust or similar instrument, may be amended or abrogated as to
the amount of refunding bonds, the holders of which must
consent thereto, and the manner in which such consent may be
given;
(11) the execution of all instruments necessary or convenient in
the exercise of the powers granted by this chapter or in the
performance of the duties of the issuing body and the officers,
agents, and employees thereof;
(12) refraining from pledging or in any manner whatever
claiming or taking the benefit or advantage of any stay or
extension law whenever enacted, which may affect the duties or
covenants of the issuing body in relation to the refunding bonds,
or the performance thereof, or the lien of such refunding bonds;
(13) the purchase out of any funds available therefor, including
but not limited to the proceeds of refunding bonds, of any
outstanding notes, bonds, or obligations, including but not
limited to refunding bonds, and the price or prices at which and
the manner in which such purchases may be made; and
(14) any other acts and things as may be necessary or
convenient or desirable in order to secure the refunding bonds,
or as may tend to make the refunding bonds more marketable.
(b) Nothing in this section shall be construed to authorize any
issuing body to make any covenants, to perform any act or to do
anything which shall require the expenditure in any manner or for
any purpose by the issuing body of any funds other than revenues
received or receivable from the enterprise. As added by Acts 1980, P.L.8, SEC.10.
IC 5-1-6-14 Default in payment of principal or interest of bonds; receiver;
rights and powers; subsequent defaults; supervision of courts
Sec. 14. (a) In the event that the issuing body shall default in the
payment of the principal or interest on any of the refunding bonds
after the same shall become due, whether at maturity or upon call for
redemption, and such default shall continue for a period of thirty (30)
days, or in the event that the issuing body or the governing body or
officers, agents, or employees thereof shall fail or refuse to comply
with the provisions of this chapter or shall default in any agreement
made with the holders of the refunding bonds, any holder or holders
of refunding bonds, or trustee therefor, shall have the right to apply
in an appropriate judicial proceeding in the circuit or superior court
of the county in which the issuing body or the greater territorial
portion thereof is situated, or in which the enterprise is located, or
any court of competent jurisdiction, for the appointment of a receiver
of the enterprise, whether or not all refunding bonds have been
declared due and payable and whether or not such holder or holders,
or trustee therefor, is seeking or has sought to enforce any other
right, or exercise any remedy in connection with such refunding
bonds. Upon such application the circuit or superior court may
appoint, and if the application is made by the holders of twenty-five
percent (25%) in principal amount of such refunding bonds then
outstanding, or any trustee for holders of such refunding bonds in
such principal amount, shall appoint a receiver of the enterprise.
(b) The receiver so appointed shall forthwith, directly or by his
agents and attorneys, enter into and upon and take possession of the
enterprise and each and every part thereof and may exclude the
issuing body, its governing body, officers, agents, and employees and
all persons claiming under them wholly therefrom and shall have,
hold, use, operate, manage, and control the same and each and every
part thereof, and, in the name of the issuing body or otherwise, as the
receiver may deem best, and shall exercise all rights and powers of
the issuing body with respect to the enterprise as the issuing body
itself might do. Such receiver shall maintain, restore, insure and keep
insured, the enterprise, and from time to time shall make all such
necessary or proper repairs as to such receiver may seem expedient
and shall establish, levy, maintain and collect such fees, tolls, rentals,
and other charges in connection with the enterprise as such receiver
may deem necessary or proper and reasonable, and shall collect and
receive all revenues and shall deposit the same in a separate account
and apply such revenues so collected and received in such manner as
the court shall direct.
(c) Whenever all that is due upon the refunding bonds, and
interest thereon, and upon any other notes, bonds or other
obligations, and interest thereon, having a charge, lien, or
encumbrance on the revenues of the enterprise and under any of the
terms of any covenants or agreements with bondholders shall have
been paid or deposited as provided therein, and all defaults shall have
been cured and made good, the court may in its discretion, and after
such notice and hearing as it deems reasonable and proper, direct the
receiver to surrender possession of the enterprise to the issuing body,
the same right of the holders of the refunding bonds to secure the
appointment of a receiver to exist upon any subsequent default as
hereinabove provided.
(d) Such receiver shall in the performance of the powers
hereinabove conferred upon him, act under the direction and
supervision of the court making such appointment and shall at all
times be subject to the orders and decrees of such court and may be
removed thereby. Nothing herein contained shall limit or restrict the
jurisdiction of such court to enter such other and further orders and
decrees as such court may deem necessary or appropriate for the
exercise by the receiver of any functions specifically set forth herein. As added by Acts 1980, P.L.8, SEC.10.
IC 5-1-6-15 Remedy; nature
Sec. 15. (a) Subject to any contractual limitations binding upon
the holders of any issue of refunding bonds, or trustee therefor,
including but not limited to the restrictions of the exercise of any
remedy to a specified proportion or percentage of such holders, any
holder of refunding bonds, or trustee therefor, shall have the right
and power, for the equal benefit and protection of all holders of
refunding bonds similarly situated:
(1) by mandamus or other suit, action or proceeding at law or in
equity to enforce his rights against the issuing body and its
governing body and any of its officers, agents and employees
and to require and compel such issuing body or such governing
body or any such officers, agents, or employees to perform and
carry out its and their duties and obligations under this chapter
and its and their covenants and agreements with bondholders;
(2) by action or suit in equity to require the issuing body and the
governing body thereof to account as if they were the trustee of
an express trust;
(3) by action or suit in equity to enjoin any acts or things which
may be unlawful or in violation of the rights of the bondholders;
and
(4) to bring suit upon the refunding bonds.
(b) No remedy conferred by this chapter upon any holder of
refunding bonds, or any trustee therefor, is intended to be exclusive
of any other remedy, but each such remedy is cumulative and in
addition to every other remedy and may be exercised without
exhausting and without regard to any other remedy conferred by this
chapter or by any other law. No waiver of any default or breach of
duty or contract, whether by any holder of refunding bonds, or any
trustee therefor, shall extend to or shall affect any subsequent default
or breach of duty or contract or shall impair any rights or remedies
thereon. No delay or omission of any bondholder or any trustee
therefor to exercise any right or power accruing upon any default
shall impair any such right or power or shall be construed to be a
waiver of any such default or acquiescence therein. Every
substantive right and every remedy, conferred upon the holders of
refunding bonds, may be enforced and exercised from time to time
and as often as may be deemed expedient. In case any suit, action, or
proceeding to enforce any right or exercise any remedy shall be
brought or taken and then discontinued or abandoned, or shall be
determined adversely to the holder of the refunding bonds, or any
trustee therefor, then and in every such case the issuing body and
such holder, or such trustee, shall be restored to their former
positions and rights and remedies as if no such suit, action or
proceeding had been brought or taken. As added by Acts 1980, P.L.8, SEC.10.
IC 5-1-6-16 Powers conferred by chapter
Sec. 16. This chapter constitutes full and complete authority for
the issuance of refunding bonds. No procedure or proceedings,
publications, notices, consents, approvals, orders, acts or things by
any governing body, or any board, officer, commission, department,
agency, or instrumentality of the state or any issuing body shall be
required to issue any refunding bonds or to do any act or perform any
thing under this chapter, except as may be prescribed in this chapter.
The powers conferred by this chapter shall be in addition and
supplemental to, and not in substitution for, and the limitations
imposed by this chapter shall not affect, the powers conferred by any
other law. This chapter is remedial in nature and shall be liberally
construed. As added by Acts 1980, P.L.8, SEC.10.
IC 5-1-6-1 Short title
Sec. 1. This chapter may be cited as "The Revenue Bond
Refinancing Law of 1937." As added by Acts 1980, P.L.8, SEC.10.
IC 5-1-6-2 Definitions
Sec. 2. The following terms wherever used or referred to in this
chapter shall have the following meanings, unless a different
meaning appears from the context:
(a) The term "issuing body" shall mean counties, cities, towns,
townships, school cities, school towns, school townships, districts,
political or civil subdivisions, or other public corporate bodies of this
state.
(b) The term "governing body" shall mean the council,
commission, board, or other body, officer, or officers which
constitutes the governing body of an issuing body.
(c) The term "law" shall mean any law, act, or statute, general,
special, or local, of this state.
(d) The term "enterprise" shall mean any work or works,
undertaking, utility, or project which the issuing body is authorized
to construct and from which the municipality derives revenues for
the refinancing, or the refinancing and improving of which
enterprise, refunding bonds are issued under this chapter, and such
enterprise shall include all improvements, betterments, extensions
and replacements thereto, and all appurtenances, facilities, lands,
rights in land, water rights, franchises, and structures in connection
therewith or incidental thereto.
(e) The term "federal agency" shall include the United States of
America, the President of the United States of America, or any
agency, instrumentality or corporation of the United States of
America, designated or created by or pursuant to any act or acts or
joint resolution or joint resolutions of the Congress of the United
States of America, or which may be owned or controlled, directly or
indirectly, by the United States of America.
(f) The term "improving" shall mean reconstructing, replacing,
extending, repairing, bettering, equipping, developing, embellishing
or improving or any one (1) or more or all of the foregoing.
(g) The term "refunding bonds" shall mean notes, bonds, or other
obligations of an issuing body issued pursuant to this chapter, or
pursuant to any other law, as supplemented by, or in conjunction
with this chapter.
(h) The term "refinancing" shall mean funding, refunding, paying,
or discharging, by means of refunding bonds or the proceeds
received from the sale thereof, all or any part of any notes, bonds, or
other obligations issued to finance or to aid in financing the
acquisition, construction or improving of an enterprise and payable
solely from all or any part of the revenues thereof, including interest
thereon in arrears or about to become due, whether or not represented
by coupons or interest certificates.
(i) The term "revenues" shall mean all fees, tolls, rates, rentals and
charges to be levied and collected in connection with and all other
income and receipts of whatever kind or character derived by the
issuing body from the operation of any enterprise or arising from any
enterprise.
(j) The term "holder of bonds" or "bondholders" or any similar
term shall mean any person who shall be the bearer of any
outstanding refunding bond or refunding bonds registered to bearer
or not registered, or the registered owner of any such outstanding
bond or bonds which shall at the time be registered other than to
bearer.
(k) Words importing the singular number shall include the plural
number in each case and vice versa, and words importing persons
shall include firms, limited liability companies, and corporations. As added by Acts 1980, P.L.8, SEC.10. Amended by P.L.8-1993,
SEC.46.
IC 5-1-6-3 Issuance of refunding bonds to refinance and improve enterprise
Sec. 3. Any issuing body shall have power and is hereby
authorized to refinance, or to refinance and improve, any enterprise,
and for such purpose or purposes to borrow money and issue
refunding bonds from time to time. As added by Acts 1980, P.L.8, SEC.10.
IC 5-1-6-4 Authorization by ordinance or resolution; municipally owned
public utility; any enterprise
Sec. 4. (a) The refunding bonds shall be authorized by ordinance
or resolution of the governing body. Such ordinance or resolution
may be adopted at a regular or special meeting, and at the same
meeting at which they are introduced in the manner now provided by
law.
(b) Whenever refunding bonds are to be authorized and issued
under this chapter for the purpose of refinancing and improving any
municipally owned public utility (other than a sewage treatment
works or a municipally owned public utility originally constructed
pursuant to IC 8-1-2) the issuing body desiring to issue such
refunding bonds shall file its petition in the office of the utility
regulatory commission setting forth the facts showing the necessity
for refinancing and improving such municipally owned utility and
praying for the approval thereof by said commission. The petitioner
shall give notice of the filing of such petition and hearing thereon to
the citizens and taxpayers of said issuing body by publication once
each week for two (2) weeks prior to such hearing in a newspaper
published in such issuing body, or in case no newspaper is there
published, then in a newspaper published in the county in which such
issuing body is situated, and if there be no newspaper published in
such county, notice shall be posted for fifteen (15) days in three (3)
public places therein. On the hearing of such petition, if it appears
that a necessity exists for the relief prayed for, the utility regulatory
commission shall approve the issuance of the refunding bonds, either
as prayed for or with such modifications or on such conditions as
may be deemed just and proper. Such approval shall contain a
certification that the income and revenues of said utility, in addition
to providing for operation and maintenance, and depreciation, are
sufficient to pay the principal and interest of said bonds, together
with a margin of ten percent (10%) in excess thereof. All such bonds
so issued under the order of such commission shall be incontestable
except for fraud, forgery, or violation of constitutional limitations. If
on such hearing it shall appear that such relief should not be granted,
the utility regulatory commission shall so declare and such bonds
shall not be issued; however, in case any petition for the approval of
the issuance of such bonds has been denied by the commission, the
governing body affected by such denial may within ten (10) days
from the date of such denial, file a petition with the commission
praying for submission of the question of whether such bonds shall
be issued, to the legal voters of such issuing body affected thereby.
If such commission be satisfied that said last mentioned petition is in
due form, it shall grant the prayer thereof within ten (10) days from
the filing of such petition and order such election at a time to be
fixed in such order. The county auditor shall give notice for such
election and all proceedings for the holding of such election shall be
governed by the law regulating general elections in such issuing
body. The county auditor shall certify the result of such election to
the utility regulatory commission, and if such result be in favor of the
issuance of such bonds, said commission within ten (10) days after
the filing of such certificate of result shall enter an order approving
the issuance of said bonds. All cost and expenses for the holding of
such election shall be paid by the issuing body proposing to issue
such bonds.
(c) Whenever refunding bonds are to be authorized and issued,
under this chapter, for the purpose of refinancing any enterprise, or
for the purpose of refinancing and improving any enterprise except
those mentioned in subsection (b), no proceedings or procedure of
any character whatever, other than the adoption of the ordinance or
resolution authorizing the issuance of such refunding bonds, shall be
required for the issuance of such refunding bonds by the issuing
body.
(d) Notwithstanding subsection (b) or any other law, refunding
bonds may be issued under this chapter by an issuing body without
approval of the utility regulatory commission if the governing body
of the issuing body finds that the refunding will either provide a
savings to the issuing body or will not, by itself, result in a rate
increase. As added by Acts 1980, P.L.8, SEC.10. Amended by P.L.44-1987,
SEC.3; P.L.23-1988, SEC.4.
IC 5-1-6-5 Terms and covenants of refunding bonds; negotiability
Sec. 5. The refunding bonds may be issued in one (1) or more
series, may bear such date or dates, may mature at such time or times
not exceeding forty (40) years from their respective dates, may bear
interest at any rate, payable annually or at shorter intervals, may be
in such denomination or denominations, may be in such form, either
coupon or registered, may carry such registration and conversion
privileges, may be executed in such manner, may be payable in such
medium of payment, at such place or places, may be subject to such
terms of redemption, with or without a premium, may be declared or
become due before the maturity date, may provide for the
replacement of mutilated, destroyed, stolen, or lost bonds, may be
authenticated in such manner and upon compliance with such
conditions, and may contain such other terms and covenants, as may
be provided by ordinance or resolution of the governing body.
Notwithstanding the form or tenor, and in the absence of an express
recital on the face thereof that the bond is nonnegotiable, all
refunding bonds shall at all times be, and shall be treated as, and
have all the qualities and incidents of negotiable instruments for all
purposes. As added by Acts 1980, P.L.8, SEC.10.
IC 5-1-6-6 Validity of authorization; issuance and obligations; recitals in bond
Sec. 6. Refunding bonds bearing the signatures of officers of the
issuing body in office on the date of the signing shall be valid and
binding obligations of the issuing body for all purposes,
notwithstanding that before the delivery thereof any or all of the
persons whose signatures appear thereon shall have ceased to be
officers of the issuing body, the same as if such persons had
continued to be officers of the issuing body until after delivery. The
validity of the authorization and issuance of the refunding bonds
shall not be dependent on or affected in any way by proceedings
taken for the improving of any enterprise for the refinancing and
improving of which the refunding bonds are to be issued, or by
contracts made in connection with the improving of any such
enterprise. Any resolution or ordinance authorizing refunding bonds
may provide that any such refunding bond may contain a recital that
such refunding bond is issued pursuant to this chapter, and any
refunding bond containing such recital under authority of any such
resolution shall be conclusively deemed to be valid and to have been
issued in conformity with the provisions of this chapter. As added by Acts 1980, P.L.8, SEC.10.
IC 5-1-6-7 Sale and exchange of refunding bonds
Sec. 7. (a) The refunding bonds may be sold or exchanged in
installments at different times, or an entire issue or series may be
sold or exchanged at one (1) time. Any issue or series of refunding
bonds may be exchanged in part or sold in part in installments at
different times or at one (1) time. The refunding bonds may be sold
or exchanged at any time, on, before, or after the maturity of any of
the outstanding notes, bonds, or other obligations to be refinanced
thereby.
(b) If the governing body determines to exchange any refunding
bonds, such refunding bonds may be exchanged privately for and in
payment and discharge of any of the outstanding notes, bonds or
other obligations of the issuing body issued to finance or to aid in
financing the acquisition, the construction, the improving, the
refinancing, or the improving and refinancing, of an enterprise. The
refunding bonds may be exchanged for a like or greater principal
amount of such notes, bonds or other obligations of the issuing body,
except that the principal amount of the refunding bonds may exceed
the principal amount of such outstanding notes, bonds, or other
obligations to the extent necessary or advisable, in the discretion of
the governing body, to fund interest in arrears or about to become
due. The holder or holders of such outstanding notes, bonds, or other
obligations need not pay accrued interest on the refunding bonds to
be delivered in exchange therefor if and to the extent that interest is
due or accrued and unpaid on such outstanding notes, bonds, or other
obligations to be surrendered.
(c) If the governing body determines to sell any refunding bonds,
such refunding bonds shall be sold at not less than par at public sale
in such manner and upon such terms as the governing body shall
deem best for the interests of the issuing body. As added by Acts 1980, P.L.8, SEC.10.
IC 5-1-6-8 Lien on revenues of enterprise to secure bonds; additional security;
priority; restrictions
Sec. 8. (a) The refunding bonds shall be special obligations of the
issuing body and shall be payable from and secured by a lien upon
the revenues of the enterprise, as shall be more fully described in the
ordinance or resolution of the governing body authorizing the
issuance of the refunding bonds, and, subject to the constitution and
to the prior or superior rights of any person, any issuing body shall
have power by ordinance or resolution of its governing body to
pledge and assign for the security of the refunding bonds all or any
part of the gross or the net revenues of such enterprise.
(b) As additional security for any issue of refunding bonds
hereunder, or any part thereof, any issuing body shall have power,
and is hereby authorized, by ordinance or resolution of its governing
body to confer upon the holders of the refunding bonds all rights,
powers and remedies which said holders would be entitled to if they
were the owners and had possession of the notes, bonds or other
obligations for the refinancing of which such refunding bonds shall
have been issued including, but not limited to, the preservation of the
lien of such notes, bonds or other obligations without
extinguishment, impairment or diminution thereof. In the event any
issuing body exercises the power conferred by this subsection:
(1) each refunding bond shall contain a recital to the effect that
the holder thereof has been granted the additional security
provided by this subsection; and
(2) each note, bond or other obligation of the issuing body to be
refinanced by any such refunding bonds, shall be kept intact and
shall not be cancelled or destroyed until the refunding bonds,
and interest thereon, have been finally paid and discharged but
shall be stamped with a legend to the effect that such note,
bond, or other obligation has been refunded pursuant to this
chapter.
(c) All refunding bonds of the same issue shall be equally and
ratably secured, without priority by reason of number, date of bonds,
of sale, of execution or of delivery, by a lien upon the revenues of the
enterprise in accordance with the provisions of this section and the
ordinance or resolution authorizing the issuance of such refunding
bonds.
(d) Nothing in this section or in any other section of this chapter
shall be deemed in any way to alter the terms of any agreements
made with the holders of any outstanding notes, bonds, or other
obligations of the issuing body or to authorize the issuing body to
alter the terms of any such agreements, or to impair, or to authorize
the issuing body to impair the rights and remedies of any creditors of
the issuing body.
(e) Nothing in this section or any other section of this chapter
shall be deemed in any way to authorize any issuing body to do
anything in any manner or for any purpose which would result in the
creation or incurring of a debt or indebtedness or the issuance of any
instrument which would constitute a bond or debt within the meaning
of any provision, limitation, or restriction of the constitution relating
to the creation or incurring of a debt or indebtedness or the issuance
of an instrument constituting a bond or debt. As added by Acts 1980, P.L.8, SEC.10.
IC 5-1-6-9 Liability of issuing body
Sec. 9. (a) No recourse shall be had for the payment of the
refunding bonds, or interest thereon, or any part thereof, against the
general fund of any issuing body, nor shall the credit or taxing power
of any issuing body be deemed to be pledged thereto.
(b) The refunding bonds, and interest thereon, shall not be a debt
of the issuing body, nor a charge, lien, or encumbrance, legal or
equitable, upon any property of the issuing body, or upon any
income, receipts, or revenues of the issuing body other than such of
the revenues of the enterprise as shall have been pledged to the
payment thereof, and every refunding bond shall recite in substance
that said bond, including interest thereon, is payable solely from the
revenues pledged to the payment thereof and that the issuing body is
under no obligation to pay the same, except from said revenues. As added by Acts 1980, P.L.8, SEC.10.
IC 5-1-6-10 Exemption from taxation; exception
Sec. 10. The refunding bonds and the income therefrom shall be
exempt from taxation, except the financial institutions tax and
inheritance, estate and transfer taxes. As added by Acts 1980, P.L.8, SEC.10. Amended by P.L.21-1990,
SEC.4.
IC 5-1-6-11 Fiscal agent
Sec. 11. Any issuing body shall have power in connection with the
issuance of refunding bonds to appoint a fiscal agent, to provide for
the powers, duties and functions and compensations of such fiscal
agent, to limit the liabilities of such fiscal agent, to prescribe a
method for the resignation, removal, merger or consolidation of such
fiscal agent and the appointment of a successor fiscal agent and the
transfer of rights and properties to such successor fiscal agent. As added by Acts 1980, P.L.8, SEC.10.
IC 5-1-6-12 Duties of issuing body and others to secure payment of bonds and
interest
Sec. 12. (a) In order that the payment of the refunding bonds, and
interest thereon, shall be adequately secured, any issuing body
issuing refunding bonds pursuant to this chapter and the proper
officers, agents and employees thereof, are hereby directed, and it
shall be the mandatory duty of such issuing body and such officers,
agents and employees under this chapter, and it shall further be of the
essence of the contract of such issuing body with the bondholders, at
all times:
(1) to pay or cause to be paid punctually the principal of every
refunding bond, and the interest thereon, on the date or dates
and at the place or places and in the manner and out of the
funds mentioned in such refunding bonds and in the coupons
thereto appertaining and in accordance with the resolution
authorizing their issuance;
(2) to operate the enterprise in an efficient and economical
manner and to establish, levy, maintain, and collect such fees,
tolls, rentals, rates and other charges in connection therewith as
may be necessary or proper, which said fees, tolls, rates, rentals,
and other charges shall be at least sufficient after making due
and reasonable allowances for contingencies and for a margin
of error in the estimates:
(i) to pay all current expenses of operation, maintenance and
repair of such enterprise;
(ii) to pay the interest on and principal of the refunding
bonds as the same shall become due and payable;
(iii) to comply in all respects with the terms of the ordinance
or resolution authorizing the issuance of refunding bonds or
any other contract or agreement with the holders of the
refunding bonds; and
(iv) to meet any other obligations of the issuing body which
are charges, liens, or encumbrances upon the revenues of
such enterprise;
provided, however, that nothing in this section shall be
construed as curtailing any authority of the utility regulatory
commission to approve rates or charges;
(3) to operate, maintain, preserve, and keep, or cause to be
operated, maintained, preserved, and kept, the enterprise and
every part and parcel thereof, in good repair, working order and
condition;
(4) to preserve and protect the security of the refunding bonds
and the rights of the holders thereof, and to warrant and defend
such rights against all claims and demands of all persons
whomsoever;
(5) to pay and discharge, or cause to be paid or discharged any
and all lawful claims for labor, materials, and supplies, which,
if unpaid, might by law become a lien or charge upon the
revenues or any part thereof, prior or superior to the lien of the
refunding bonds, or which might impair the security of the
refunding bonds, to the end that the priority and security of the
refunding bonds shall be fully preserved and protected;
(6) to hold in trust the revenues pledged to the payment of the
refunding bonds for the benefit of the holders of the refunding
bonds and to apply such revenues only as provided by the
resolution or resolutions authorizing the issuance of the
refunding bonds or, if such resolution or resolutions shall
thereafter be modified in the manner provided therein or herein,
only as provided in such resolution or resolutions as modified;
and
(7) to keep proper books of record and accounts of the
enterprise (separate from all other records and accounts) in
which complete and correct entries shall be made of all
transactions relating to the enterprise or any part thereof, and
which, together with all other books and papers of the issuing
body, shall at all times be subject to the inspection of the holder
or holders of not less than ten percent (10%) of the refunding
bonds then outstanding or his or their representatives duly
authorized in writing.
(b) None of the foregoing duties shall be construed to require the
expenditure in any manner or for any purpose by the issuing body of
any funds other than revenues received or receivable from the
enterprise. As added by Acts 1980, P.L.8, SEC.10. Amended by P.L.23-1988,
SEC.5. IC 5-1-6-13 Additional powers of governing body; restrictions
Sec. 13. (a) The governing body shall have power, in addition to
the other powers conferred by this chapter, to insert provisions in any
ordinance or resolution authorizing the issuance of refunding bonds,
which shall be a part of the contract with the holders of the refunding
bonds, as to:
(1) limitations on the purpose to which the proceeds of sale of
any issue of refunding bonds, or any notes, bonds, or other
obligations then or thereafter to be issued to finance the
improving of the enterprise, may be applied;
(2) limitations on the issuance of additional refunding bonds, or
additional notes, bonds, or other obligations to finance the
improving of the enterprise, and on the lien thereof;
(3) limitations on the right of the issuing body or its governing
body to restrict and regulate the use of the enterprise;
(4) the amount and kind of insurance to be maintained on the
enterprise, and the use and disposition of insurance monies;
(5) pledging all or any part of the revenues of the enterprise to
which its right then exists or the right to which may thereafter
come into existence;
(6) covenanting against pledging all or any part of the revenues
of the enterprise to which its right then exists or the right to
which may thereafter come into existence;
(7) events of default and terms and conditions upon which any
or all of the refunding bonds shall become or may be declared
due before maturity and as to the terms and conditions upon
which such declaration and its consequences may be waived;
(8) the rights, liabilities, powers, and duties arising upon the
breach by it of any covenants, conditions or obligations;
(9) the vesting in a trust or trustees the right to enforce any
covenants made to secure, to pay, or in relation to the refunding
bonds, as to the powers and duties of such trustee or trustees,
and the limitation of liabilities thereof, and as to the terms and
conditions upon which the holders of the refunding bonds or
any proportion or percentage of them may enforce any
covenants made under this chapter or duties imposed hereby;
(10) a procedure by which the terms of any resolution or
ordinance authorizing refunding bonds, or any other contract
with bondholders, including but not limited to an indenture of
trust or similar instrument, may be amended or abrogated as to
the amount of refunding bonds, the holders of which must
consent thereto, and the manner in which such consent may be
given;
(11) the execution of all instruments necessary or convenient in
the exercise of the powers granted by this chapter or in the
performance of the duties of the issuing body and the officers,
agents, and employees thereof;
(12) refraining from pledging or in any manner whatever
claiming or taking the benefit or advantage of any stay or
extension law whenever enacted, which may affect the duties or
covenants of the issuing body in relation to the refunding bonds,
or the performance thereof, or the lien of such refunding bonds;
(13) the purchase out of any funds available therefor, including
but not limited to the proceeds of refunding bonds, of any
outstanding notes, bonds, or obligations, including but not
limited to refunding bonds, and the price or prices at which and
the manner in which such purchases may be made; and
(14) any other acts and things as may be necessary or
convenient or desirable in order to secure the refunding bonds,
or as may tend to make the refunding bonds more marketable.
(b) Nothing in this section shall be construed to authorize any
issuing body to make any covenants, to perform any act or to do
anything which shall require the expenditure in any manner or for
any purpose by the issuing body of any funds other than revenues
received or receivable from the enterprise. As added by Acts 1980, P.L.8, SEC.10.
IC 5-1-6-14 Default in payment of principal or interest of bonds; receiver;
rights and powers; subsequent defaults; supervision of courts
Sec. 14. (a) In the event that the issuing body shall default in the
payment of the principal or interest on any of the refunding bonds
after the same shall become due, whether at maturity or upon call for
redemption, and such default shall continue for a period of thirty (30)
days, or in the event that the issuing body or the governing body or
officers, agents, or employees thereof shall fail or refuse to comply
with the provisions of this chapter or shall default in any agreement
made with the holders of the refunding bonds, any holder or holders
of refunding bonds, or trustee therefor, shall have the right to apply
in an appropriate judicial proceeding in the circuit or superior court
of the county in which the issuing body or the greater territorial
portion thereof is situated, or in which the enterprise is located, or
any court of competent jurisdiction, for the appointment of a receiver
of the enterprise, whether or not all refunding bonds have been
declared due and payable and whether or not such holder or holders,
or trustee therefor, is seeking or has sought to enforce any other
right, or exercise any remedy in connection with such refunding
bonds. Upon such application the circuit or superior court may
appoint, and if the application is made by the holders of twenty-five
percent (25%) in principal amount of such refunding bonds then
outstanding, or any trustee for holders of such refunding bonds in
such principal amount, shall appoint a receiver of the enterprise.
(b) The receiver so appointed shall forthwith, directly or by his
agents and attorneys, enter into and upon and take possession of the
enterprise and each and every part thereof and may exclude the
issuing body, its governing body, officers, agents, and employees and
all persons claiming under them wholly therefrom and shall have,
hold, use, operate, manage, and control the same and each and every
part thereof, and, in the name of the issuing body or otherwise, as the
receiver may deem best, and shall exercise all rights and powers of
the issuing body with respect to the enterprise as the issuing body
itself might do. Such receiver shall maintain, restore, insure and keep
insured, the enterprise, and from time to time shall make all such
necessary or proper repairs as to such receiver may seem expedient
and shall establish, levy, maintain and collect such fees, tolls, rentals,
and other charges in connection with the enterprise as such receiver
may deem necessary or proper and reasonable, and shall collect and
receive all revenues and shall deposit the same in a separate account
and apply such revenues so collected and received in such manner as
the court shall direct.
(c) Whenever all that is due upon the refunding bonds, and
interest thereon, and upon any other notes, bonds or other
obligations, and interest thereon, having a charge, lien, or
encumbrance on the revenues of the enterprise and under any of the
terms of any covenants or agreements with bondholders shall have
been paid or deposited as provided therein, and all defaults shall have
been cured and made good, the court may in its discretion, and after
such notice and hearing as it deems reasonable and proper, direct the
receiver to surrender possession of the enterprise to the issuing body,
the same right of the holders of the refunding bonds to secure the
appointment of a receiver to exist upon any subsequent default as
hereinabove provided.
(d) Such receiver shall in the performance of the powers
hereinabove conferred upon him, act under the direction and
supervision of the court making such appointment and shall at all
times be subject to the orders and decrees of such court and may be
removed thereby. Nothing herein contained shall limit or restrict the
jurisdiction of such court to enter such other and further orders and
decrees as such court may deem necessary or appropriate for the
exercise by the receiver of any functions specifically set forth herein. As added by Acts 1980, P.L.8, SEC.10.
IC 5-1-6-15 Remedy; nature
Sec. 15. (a) Subject to any contractual limitations binding upon
the holders of any issue of refunding bonds, or trustee therefor,
including but not limited to the restrictions of the exercise of any
remedy to a specified proportion or percentage of such holders, any
holder of refunding bonds, or trustee therefor, shall have the right
and power, for the equal benefit and protection of all holders of
refunding bonds similarly situated:
(1) by mandamus or other suit, action or proceeding at law or in
equity to enforce his rights against the issuing body and its
governing body and any of its officers, agents and employees
and to require and compel such issuing body or such governing
body or any such officers, agents, or employees to perform and
carry out its and their duties and obligations under this chapter
and its and their covenants and agreements with bondholders;
(2) by action or suit in equity to require the issuing body and the
governing body thereof to account as if they were the trustee of
an express trust;
(3) by action or suit in equity to enjoin any acts or things which
may be unlawful or in violation of the rights of the bondholders;
and
(4) to bring suit upon the refunding bonds.
(b) No remedy conferred by this chapter upon any holder of
refunding bonds, or any trustee therefor, is intended to be exclusive
of any other remedy, but each such remedy is cumulative and in
addition to every other remedy and may be exercised without
exhausting and without regard to any other remedy conferred by this
chapter or by any other law. No waiver of any default or breach of
duty or contract, whether by any holder of refunding bonds, or any
trustee therefor, shall extend to or shall affect any subsequent default
or breach of duty or contract or shall impair any rights or remedies
thereon. No delay or omission of any bondholder or any trustee
therefor to exercise any right or power accruing upon any default
shall impair any such right or power or shall be construed to be a
waiver of any such default or acquiescence therein. Every
substantive right and every remedy, conferred upon the holders of
refunding bonds, may be enforced and exercised from time to time
and as often as may be deemed expedient. In case any suit, action, or
proceeding to enforce any right or exercise any remedy shall be
brought or taken and then discontinued or abandoned, or shall be
determined adversely to the holder of the refunding bonds, or any
trustee therefor, then and in every such case the issuing body and
such holder, or such trustee, shall be restored to their former
positions and rights and remedies as if no such suit, action or
proceeding had been brought or taken. As added by Acts 1980, P.L.8, SEC.10.
IC 5-1-6-16 Powers conferred by chapter
Sec. 16. This chapter constitutes full and complete authority for
the issuance of refunding bonds. No procedure or proceedings,
publications, notices, consents, approvals, orders, acts or things by
any governing body, or any board, officer, commission, department,
agency, or instrumentality of the state or any issuing body shall be
required to issue any refunding bonds or to do any act or perform any
thing under this chapter, except as may be prescribed in this chapter.
The powers conferred by this chapter shall be in addition and
supplemental to, and not in substitution for, and the limitations
imposed by this chapter shall not affect, the powers conferred by any
other law. This chapter is remedial in nature and shall be liberally
construed. As added by Acts 1980, P.L.8, SEC.10.
