CHAPTER 6. ISSUANCE OF BONDS
IC 21-34-6
Chapter 6. Issuance of Bonds
IC 21-34-6-1
Issuance and sale of bonds
Sec. 1. The board of trustees of a state educational institution may
borrow money and evidence the loans by the issuance and sale of
bonds of the board of trustees of the state educational institution to
provide funds with which to:
(1) pay part or all of the cost of any building facility, work, act,
or undertaking authorized by IC 21-34-2, IC 21-34-3-1, or
IC 21-34-3-3;
(2) pay part or all of the cost of acquiring (by purchase, lease,
sublease, condemnation, trade, or otherwise) or improving real
or personal property under IC 21-34-3-4; or
(3) perform the obligations of any joint-use agreements under
IC 21-34-4.
As added by P.L.2-2007, SEC.275.
IC 21-34-6-2
Security of bonds
Sec. 2. Bonds and the interest on bonds may be secured by the
following:
(1) A pledge or mortgage of:
(A) any property, real or personal, used, acquired, or to be
acquired and used for the purposes of this article; and
(B) the improvements made or to be made on the property.
However, no real estate, the title to which is on or after March
10, 1965, in the name of the state for the use and benefit of the
board of trustees of a state educational institution or the state
educational institution under its control, may not be pledged or
mortgaged until the title to the real estate has been conveyed to
the board of trustees of the state educational institution under
this article.
(2) A pledge of the building facilities fees to be collected and
deposited in the building facilities fund.
(3) Subject to outstanding liens and encumbrances, and any
covenants, agreements, or encumbrances on the funds existing
at the time of a pledge, a pledge of general student tuition fees
or any other available funds from whatever source derived that
under IC 21-34-5-5 may be used for any of the purposes of this
article.
(4) A pledge of any other money deposited in a building
facilities fund.
(5) A pledge of the proceeds of bonds issued under this article.
(6) Any one (1) or more of the ways described in this section
that the board of trustees of the issuing state educational
institution determines.
As added by P.L.2-2007, SEC.275.
IC 21-34-6-3
Liens
Sec. 3. The lien of the pledges or mortgages, to the extent of the
lien, unless otherwise determined by the board of trustees of the state
educational institution, is a first and primary lien for the payment of
the bonds secured and the interest on the bonds.
As added by P.L.2-2007, SEC.275.
IC 21-34-6-4
Issuance of bonds; limitations on amount
Sec. 4. In authorizing the issuance of bonds for any building
facility or facilities, the board of the issuing state educational
institution may:
(1) limit the amount of bonds that may be issued as a first lien
and charge against the property, fees, income, and funds; and
(2) provide, after the original issuance of bonds, for the
issuance of additional bonds secured by the same lien to
provide funds to:
(A) pay the cost of acquiring, erecting, constructing,
reconstructing, improving, rehabilitating, remodeling,
repairing, completing, extending, enlarging, equipping, or
furnishing the building facility or facilities for which the
original bonds were issued;
(B) provide funds to pay the cost of additional building
facilities under this article; or
(C) perform actions under both clauses (A) and (B).
As added by P.L.2-2007, SEC.275.
IC 21-34-6-5
Additional bonds; terms and conditions of issuance
Sec. 5. Additional bonds:
(1) shall be issued on the terms and conditions that the board of
trustees of the issuing state educational institution determines;
and
(2) may be:
(A) secured equally and ratably, without preference, priority,
or distinction, with the original issue of bonds; or
(B) made junior to the original issue of bonds.
As added by P.L.2-2007, SEC.275.
IC 21-34-6-6
Issuance of bonds; purpose
Sec. 6. The board of trustees of a state educational institution may
issue bonds for the purpose of:
(1) reimbursing the state educational institution for funds
expended or advanced for interim financing of the cost of any
building facility or facilities before the issuance of bonds for
the facility or facilities; or
(2) subject to existing covenants and agreements with the
holders of the outstanding obligations:
(A) funding outstanding obligations incurred or refunding
outstanding bonds issued either under:
(i) this article; or
(ii) other applicable law;
for building facilities approved by the governor and the
budget agency or its predecessor; or
(B) in part for funding or refunding purposes and in part for
any other purpose authorized by this article; and
may secure the payment of the bonds as provided in this article.
As added by P.L.2-2007, SEC.275.
IC 21-34-6-7
Refunding bonds
Sec. 7. Refunding bonds may be exchanged for the bonds being
funded or refunded or may be sold and the proceeds applied to the
funding or refunding.
As added by P.L.2-2007, SEC.275.
IC 21-34-6-8
Maximum amount of bonds
Sec. 8. Subject to any approval required under IC 21-34-10, bonds
may be issued in an amount or amounts that do not exceed the
maximum amount determined by the board of trustees of the issuing
state educational institution.
As added by P.L.2-2007, SEC.275.
IC 21-34-6-9
Form; terms; conditions of bonds
Sec. 9. Bonds may be issued in the form and upon the terms and
conditions, at the rate or rates of interest, and in the denominations
that may be made convertible into different denominations as the
governing board of the board of trustees of the state educational
institution determines by:
(1) the adoption of a resolution;
(2) approval of a form of trust indenture between the board of
trustees of the state educational institution and a designated
corporate trustee; or
(3) both subdivisions (1) and (2).
As added by P.L.2-2007, SEC.275.
IC 21-34-6-10
Resolutions and indenture for bonds
Sec. 10. A resolution or indenture for bonds may include
provisions for:
(1) protecting and enforcing the rights and remedies of the
holders of the bonds being issued;
(2) covenants setting forth the duties of the state educational
institution and its officers in relation to:
(A) the acquisition, construction, operation, maintenance,
use, and abandonment of the building facility; and
(B) insurance of the building facility;
(3) the custody, safeguarding, application, and investment of all
money;
(4) the rights and remedies of the trustee and the holders of the
bonds being issued;
(5) the issuance of additional bonds as provided in the
resolution or indenture; and
(6) other terms, conditions, and covenants as the board of
trustees of the state educational institution determine are proper,
including provision for the establishment of a debt service
reserve by:
(A) the use of bond proceeds or other sources;
(B) the furnishing of an insurance policy, surety bond, or
letter of credit; or
(C) any combination of clause (A) or (B).
As added by P.L.2-2007, SEC.275.
IC 21-34-6-11
Public sale of bonds
Sec. 11. Bonds must be sold at public or negotiated sale as
provided by IC 21-32-3.
As added by P.L.2-2007, SEC.275.
IC 21-34-6-12
Bonds and interest coupons
Sec. 12. All bonds and the interest coupons appertaining to bonds
issued under this article must be negotiable instruments within the
meaning and for all purposes under Indiana laws, subject only to the
provisions of the bonds for registration as to principal or as to
principal and interest. Any bonds registered as to principal and
interest may be made convertible to bearer bonds with coupons.
As added by P.L.2-2007, SEC.275.
IC 21-34-6-13
Actions to contest the validity of bonds
Sec. 13. (a) An action to contest the validity of any bonds issued
under this article may not be brought after the fifteenth day
following:
(1) the first publication of notice of the sale or intent to sell the
bonds under IC 21-32-3 if the bonds are sold at public sale; or
(2) the publication one (1) time in newspapers described in
IC 21-32-3-3 of notice of execution and delivery of the contract
of sale for the bonds if the bonds are sold at negotiated sale.
(b) The board of trustees of a state educational institution shall
publish notice under subsection (a)(2) if it sells bonds at negotiated
sale within thirty (30) days of execution of the contract of sale for the
bonds.
As added by P.L.2-2007, SEC.275.
IC 21-34-6-14
Rates of interests of bonds
Sec. 14. The rate or rates of interest of bonds may be fixed or
variable. Variable rates shall be determined in the manner and in
accordance with the procedures set forth in the resolution or
indenture authorizing the issuance of the bonds. Bonds bearing a
variable rate of interest may be converted to bonds bearing a fixed
rate or rates of interest to the extent and in the manner set forth in the
resolution or indenture under which the bonds are issued.
As added by P.L.2-2007, SEC.275.
IC 21-34-6-15
Payment of interest
Sec. 15. Interest may be:
(1) payable semiannually, annually, or at any other interval or
intervals as may be provided in the resolution or indenture; or
(2) compounded and paid at maturity or at any other times as
specified in the resolution or indenture.
As added by P.L.2-2007, SEC.275.
IC 21-34-6-16
Mandatory redemption
Sec. 16. Bonds may be made subject, at the option of the holders,
to mandatory redemption by the board of trustees of the state
educational institution at the times and under the circumstances set
forth in the authorizing resolution or indenture.
As added by P.L.2-2007, SEC.275.
IC 21-34-6-17
Resolutions and indentures
Sec. 17. A resolution or indenture may contain provisions
regarding:
(1) the investment of money, sale, exchange, or disposal of
property; and
(2) the manner of authorizing and making payments,
notwithstanding IC 5-13 or any general statute relating to these
matters.
As added by P.L.2-2007, SEC.275.
IC 21-34-6-18
Execution of bonds and coupons
Sec. 18. (a) Bonds and coupons appertaining to bonds shall be
executed in the name of the issuing state educational institution by
the manual or facsimile signatures of the officer or officers of the
state educational institution that the board of trustees of the state
educational institution designates.
(b) One (1) signature on the obligation must be manual and may
be either the signature of one (1) of the officers or of any trustee,
fiscal agent, or other fiduciary charged with authenticating the bonds.
(c) The seal or a facsimile of the seal of the state educational
institution shall be affixed, imprinted, engraved, or otherwise
reproduced on each bond.
(d) If any officer whose manual or facsimile signature appears on
any bond or coupon ceases to be an officer before the delivery of the
bonds, the officer's signature is valid and sufficient for all purposes
as if the officer had remained in office until delivery.
(e) The resolution or indenture under which the bonds are issued
may provide for the authentication of the bonds by the trustee, fiscal
agent, or other fiduciary designated in the resolution or indenture.
As added by P.L.2-2007, SEC.275.