CHAPTER 5. RESERVE FUND
IC 5-1.5-5
Chapter 5. Reserve Fund
IC 5-1.5-5-1
Establishment; application of funds; required debt service reserve;
excess money
Sec. 1. (a) The board may establish and maintain a reserve fund
for each issue of bonds or notes in which there shall be deposited or
transferred:
(1) all money appropriated by the general assembly for the
purpose of the fund in accordance with section 4(a) of this
chapter;
(2) all proceeds of bonds or notes required to be deposited in
the fund by terms of a contract between the bank and its holders
or a resolution of the bank with respect to the proceeds of bonds
or notes;
(3) all other money appropriated by the general assembly to a
reserve fund; and
(4) any other money or funds of the bank that it decides to
deposit in the fund.
(b) Subject to section 4(b) of this chapter, money in any reserve
fund shall be held and applied solely to the payment of the interest
on and principal of bonds or notes of the bank as the interest and
principal become due and payable and for the retirement of bonds or
notes. The money may not be withdrawn if a withdrawal would
reduce the amount in the reserve fund to an amount less than the
required debt service reserve, except for payment of interest then due
and payable on bonds or notes and the principal of bonds or notes
then maturing and payable, whether by reason of maturity or
mandatory redemption, for which payments other money of the bank
is not then available. As used in this chapter, "required debt service
reserve" means, as of the date of computation, the amount required
to be on deposit in the reserve fund as provided by resolution or trust
agreement of the bank.
(c) Money in any reserve fund in excess of the required debt
service reserve, whether by reason of investment or otherwise, may
be withdrawn at any time by the bank and transferred to another fund
or account of the bank, subject to the provisions of any agreement
with the holders of any bonds or notes.
As added by P.L.25-1984, SEC.1. Amended by P.L.43-1985, SEC.18;
P.L.46-1987, SEC.13.
IC 5-1.5-5-2
Investment of funds
Sec. 2. Money in any reserve fund may be invested in the manner
provided in IC 5-1.5-3-3.
As added by P.L.25-1984, SEC.1. Amended by P.L.43-1985, SEC.19.
IC 5-1.5-5-3
Valuation of investments
Sec. 3. For purposes of valuation, investments in the reserve fund
shall be valued at par, or if purchased at less than par, at cost unless
otherwise provided by resolution or trust agreement of the bank.
Valuation on a particular date shall include the amount of interest
then earned or accrued to that date on the money or investments in
the reserve fund.
As added by P.L.25-1984, SEC.1. Amended by P.L.43-1985, SEC.20.
IC 5-1.5-5-4
Required debt service reserve; resolution concerning
appropriations; excess funds; budget committee review
Sec. 4. (a) Except as provided in subsection (c), and in order to
assure the maintenance of the required debt service reserve in any
reserve fund, a resolution authorizing the bank to issue bonds or
notes may include a provision stating that:
(1) the general assembly may annually appropriate to the bank
for deposit in one (1) or more of the funds the sum, certified by
the chairman of the board to the general assembly, that is
necessary to restore one (1) or more of the funds to an amount
equal to the required debt service reserve; and
(2) the chairman annually, before December 1, shall make and
deliver to the general assembly a certificate stating the sum
required to restore the funds to that amount.
Nothing in this subsection creates a debt or liability of the state to
make any appropriation.
(b) All amounts received on account of money appropriated by the
state to any reserve fund shall be held and applied in accordance with
section 1(b) of this chapter. However, at the end of each fiscal year,
if the amount in any reserve fund exceeds the required debt service
reserve, any amount representing earnings or income received on
account of any money appropriated to the reserve fund that exceeds
the expenses of the bank for that fiscal year may be transferred to the
general fund of the state.
(c) Notwithstanding any other law, and except as provided by
subsection (d), after June 30, 2005, the:
(1) issuance by the bank of any indebtedness that incorporates
the provisions set forth in subsection (a) or otherwise
establishes a procedure for the bank or a person acting on behalf
of the bank to certify to the general assembly the amount
needed to restore a reserve fund or another fund to required
levels; or
(2) execution by the bank of any other agreement that creates a
moral obligation of the state to pay all or part of any
indebtedness issued by the bank;
is subject to review by the budget committee and approval by the
budget director.
(d) If the budget committee does not conduct a review of a
proposed transaction under subsection (c) within twenty-one (21)
days after a request by the bank, the review is considered to have
been conducted. If the budget director does not approve or
disapprove a proposed transaction under subsection (c) within
twenty-one (21) days after a request by the bank, the transaction is
considered to have been approved.
As added by P.L.25-1984, SEC.1. Amended by P.L.43-1985, SEC.21;
P.L.235-2005, SEC.77.
IC 5-1.5-5-5
Combining reserve funds
Sec. 5. Subject to the provisions of any agreement with its
holders, the bank may combine a reserve fund established for an
issue of bonds or notes into one (1) or more reserve funds.
As added by P.L.25-1984, SEC.1. Amended by P.L.43-1985, SEC.22.
IC 5-1.5-5-6
Certain qualified entities; debt service reserve appropriations not
available
Sec. 6. The provisions of section 4(a) of this chapter are not
available to any bonds or notes issued by the bank to purchase
securities of, or fund loans to, any qualified entity described in
IC 5-1.5-1-8(5) or IC 5-1.5-1-8(6).
As added by P.L.37-1991, SEC.4.