Indiana Code
Chapter 5. Refunding Bonds Generally
5-1-5-18. Use of Savings From Refunding of Bonds

Sec. 18. (a) This section applies to bonds that are:
(1) issued after June 30, 2008, by a local issuing body; and
(2) payable from ad valorem property taxes, special benefit taxes on property, or tax increment revenues derived from property taxes;
including bonds that are issued under a statute that permits the bonds to be issued without complying with any other law or otherwise expressly exempts the bonds from the requirements of this section.
(b) Savings (as computed under section 2 of this chapter) that accrue from the issuance of bonds to retire or otherwise refund other bonds may be used only for the following purposes:
(1) To maintain a debt service reserve fund for the refunding bonds at the level required under the terms of the refunding bonds, if the local issuing body adopts an ordinance, resolution, or order authorizing that use of the proceeds or earnings.
(2) To pay the principal or interest, or both, on:
(A) the refunding bonds; or
(B) other bonds, if the issuing body approves an ordinance authorizing the use of the savings to pay principal or interest on other bonds.
(3) To reduce the rate or amount of ad valorem property taxes, special benefit taxes on property, or tax increment revenues imposed by or allocated to the local issuing body.
(c) An increment as computed under section 2.5 of this chapter that occurs from the issuance of bonds by an eligible school corporation to retire or otherwise refund other bonds as provided in section 2.5 of this chapter may be used only to make transfers permitted by IC 20-46-7-15 for the eligible school corporation.
As added by P.L.146-2008, SEC.25. Amended by P.L.229-2011, SEC.65.

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