§ 5-1-5-6 — Proceeds of refunding bonds; disposition

Indiana § 5-1-5-6

• Jurisdiction: Indiana
• Title 5: STATE AND LOCAL ADMINISTRATION
• Art. 1: BONDS AND OTHER OBLIGATIONS
• Ch. 5: Refunding Bonds Generally

Text

The proceeds of the refunding bonds issued
pursuant to this chapter shall be placed in escrow and applied, with any
other available funds, to the payment on the date selected for
redemption of the principal, accrued interest and any redemption
premiums of the bonds being refunded, and, if so provided or permitted
in the ordinance authorizing the issuance of such refunding bonds or in
the trust indenture securing the same, may also be applied to the
payment of any interest on such refunding bonds, and any costs of
refunding. Pending such application, such escrowed proceeds may be
invested in direct obligations of, or obligations the principal of and the
interest on which are unconditionally guaranteed by the United States
of America, which shall mature, or which shall be subject to
redemption by the holder thereof at the option of such holder, not later
than the respective dates when the proceeds, together with the interest
accruing thereon, will be required for the purposes intended. In lieu of
such investments, all or part of such proceeds may be placed in interest
bearing time certificates of deposits with such eligible financial
institutions in the state of Indiana as the governing body shall
determine or other similar arrangements may be made with such
eligible financial institutions with regard thereto which will assure that
such proceeds, together with the interest accruing thereon, will be
available when required for the purposes intended, provided that, if
required by the governing body, such time certificates of deposits or
other similar arrangements shall be secured to the full amount thereof
by direct obligations of, or obligations the principal of and the interest
on which are unconditionally guaranteed by, the United States of
America of the type permitted for direct investment of the escrow fund.
All interest or other income earned on such investments shall first be
used to pay the interest on the refunding bonds as it becomes due. Any
excess shall become a part of and held in the escrow fund. Any balance
remaining in the escrow fund after redemption of all the bonds being
refunded shall be deposited in the sinking fund established for the
payment of the principal and interest on the refunding bonds.
Formerly: Acts 1973, P.L.28, SEC.1; Acts 1974, P.L.12, SEC.1.
As amended by P.L.27-2012, SEC.1.