§ 23-13-5-8 — Nullifying action of board regarding corporate stock; vesting property and assets in local public school corporation; vesting in county; bonds

(a) Should for any cause any action of the
board of directors or trustees of a corporation be invalid or ineffective
in whole or in part as and for a cancellation or retirement of capital
stock as provided in this chapter, then the entire act of cancellation or
retirement as to all other stock shall be held null and void. If at any
time after the transfer of any stock to the corporation or to the trustees
or directors it becomes no longer possible for the corporation to operate
the postsecondary educational institution as a postsecondary
educational institution, and the fact is found to exist by the board of
trustees or directors, the property and assets of the corporation vest in
and belong absolutely to the local public school corporation within
whose territorial limits the postsecondary educational institution is
situated unless the local public school corporation elects to refuse to
accept the property and assets in writing served upon the board of
trustees or an officer thereof within one hundred twenty (120) days. If
the local public school corporation elects to refuse to accept the
property and assets, then the property and assets of the corporation vest
in and belong absolutely to the county within whose territorial limits
the postsecondary educational institution is situated unless the county,
acting by its legislative body, elects to refuse to accept the property and
assets in writing served upon the board of trustees or an officer within
one hundred twenty (120) days. If the county refuses to accept the
property and assets, the property and assets vest in and belong
absolutely to the state general fund. If situated in a school city or town
corporation, the election shall be made by the school board of the
municipality.
(b) The local school corporation receiving the property or assets is
responsible for the payment of the lawful debts and liabilities of the
corporation. For the purpose of raising funds to pay the debts and
liabilities, the township executive, with the concurrence and sanction
of the township legislative body, or the city or town school board, as
the case may be, is authorized and empowered to issue and sell bonds
of the school city or school town. The debt created by the bonds,
together with all other indebtedness of the school corporation, may not
exceed two percent (2%) of the adjusted value of the taxable property
within the school corporation as determined under IC 36-1-15. If the
building or property of the corporation vested in the school corporation
is suitable for instructing students of the township in the arts of
agriculture, domestic science, or physical or practical mental culture,
and in which to hold school or civic entertainments or be used for
township, town, or city purposes, then the township executive, with the
concurrence and sanction of the township, city, or town legislative
body, as the case may be, is authorized and empowered to issue and
sell bonds of the civil township, city, or town, as the case may be, and
apply the proceeds to the payment of the debts and liabilities of the
corporation. The proceeds of the bonds, together with all other
indebtedness of the civil township, city, or town, may not exceed two
percent (2%) of the adjusted value of the taxable property within the
civil township, city, or town, as determined under IC 36-1-15. If the
county receives the property, it is authorized to issue its general
obligation bonds to pay the debts and liabilities as general obligation
bonds of counties are issued under the general law. Unless the civil
township and school and civil cities and towns can liquidate the debts
and liabilities without violating Article 13, Section 1 of the
Constitution of the State of Indiana and IC 36-1-15, they shall elect to
refuse to accept the property. Unless the county can liquidate the debts
and liabilities without violating the constitutional provision, it shall
elect to refuse the property. If a civil township, city, or town uses its
funds or the proceeds of the sale of its bonds to liquidate the debts and
liabilities, it shall have an interest in the property in the proportion the
funds expended by it bear to the funds expended by the school city or
school town.
(c) Any bonds issued under this chapter shall be payable in not more
than twenty (20) years after the date of their issuance. The municipal
corporation issuing the bonds shall annually levy a tax on all of the
taxable property within the municipal corporation in an amount
sufficient to pay the interest on and the principal of such bonds as they
mature. The bonds may mature and be payable either semiannually or
annually. Notice of sale of the bonds shall be published once each week
for two (2) weeks in a newspaper published in the municipal
corporation issuing the bonds, or in a newspaper published in the
county seat of the county in which the municipal corporation is located.
Additional notices may be published.
(d) If the corporation ceases to exist or winds up its affairs without
its board of trustees or directors finding that it is no longer possible for
the corporation to operate the university, college, or institution of
learning as a postsecondary educational institution, this shall have the
same effect as such a finding.
Formerly: Acts 1909, c.52, s.7; Acts 1949, c.147, s.1; Acts
1951, c.78, s.1. As amended by P.L.8-1987, SEC.74; P.L.8-1989,
SEC.83; P.L.1-1993, SEC.192; P.L.6-1997, SEC.196; P.L.246-2005,
SEC.208; P.L.2-2007, SEC.316; P.L.233-2015, SEC.323.