§ 5-1-6-8 — Lien on revenues of enterprise to secure bonds; additional security; priority; restrictions

(a) The refunding bonds shall be special
obligations of the issuing body and shall be payable from and secured
by a lien upon the revenues of the enterprise, as shall be more fully
described in the ordinance or resolution of the governing body
authorizing the issuance of the refunding bonds, and, subject to the
constitution and to the prior or superior rights of any person, any
issuing body shall have power by ordinance or resolution of its
governing body to pledge and assign for the security of the refunding
bonds all or any part of the gross or the net revenues of such enterprise.
(b) As additional security for any issue of refunding bonds
hereunder, or any part thereof, any issuing body shall have power, and
is hereby authorized, by ordinance or resolution of its governing body
to confer upon the holders of the refunding bonds all rights, powers and
remedies which said holders would be entitled to if they were the
owners and had possession of the notes, bonds or other obligations for
the refinancing of which such refunding bonds shall have been issued
including, but not limited to, the preservation of the lien of such notes,
bonds or other obligations without extinguishment, impairment or
diminution thereof. In the event any issuing body exercises the power
conferred by this subsection:
(1) each refunding bond shall contain a recital to the effect that
the holder thereof has been granted the additional security
provided by this subsection; and
(2) each note, bond or other obligation of the issuing body to be
refinanced by any such refunding bonds, shall be kept intact and
shall not be cancelled or destroyed until the refunding bonds, and
interest thereon, have been finally paid and discharged but shall
be stamped with a legend to the effect that such note, bond, or
other obligation has been refunded pursuant to this chapter.
(c) All refunding bonds of the same issue shall be equally and
ratably secured, without priority by reason of number, date of bonds,
of sale, of execution or of delivery, by a lien upon the revenues of the
enterprise in accordance with the provisions of this section and the
ordinance or resolution authorizing the issuance of such refunding
bonds.
(d) Nothing in this section or in any other section of this chapter
shall be deemed in any way to alter the terms of any agreements made
with the holders of any outstanding notes, bonds, or other obligations
of the issuing body or to authorize the issuing body to alter the terms
of any such agreements, or to impair, or to authorize the issuing body
to impair the rights and remedies of any creditors of the issuing body.
(e) Nothing in this section or any other section of this chapter shall
be deemed in any way to authorize any issuing body to do anything in
any manner or for any purpose which would result in the creation or
incurring of a debt or indebtedness or the issuance of any instrument
which would constitute a bond or debt within the meaning of any
provision, limitation, or restriction of the constitution relating to the
creation or incurring of a debt or indebtedness or the issuance of an
instrument constituting a bond or debt.
[Pre-Local Government Recodification Citation:
19-8-7-8.]
As added by Acts 1980, P.L.8, SEC.10.