§ 8-1-2.2-10 — Contracts with municipality

Indiana § 8-1-2.2-10

• Jurisdiction: Indiana
• Art. 1: UTILITIES GENERALLY
• Ch. 2.2: Municipal Electric Utility Programs

Text

(a) Any municipality which is a member of
a joint agency may contract to purchase power and energy and related
services from the joint agency derived from any project or projects or
without designation as to source and pursuant to which contracts such
municipality shall agree to make payments to the joint agency from the
revenues of its electric system adequate:
(1) to pay when due (whether at maturity, upon acceleration, or by
sinking fund requirements) the principal, premium, if any, and
interest on all bonds issued by the joint agency to finance any
service provided to such member municipality, and to establish
reserves therefor; and
(2) to pay the necessary expenses of the joint agency (including,
without limitation, all amounts required to be collected pursuant
to the trust agreement or resolution providing for the issuance of
bonds) and to establish reserves therefor.
Since the creation of a joint agency is an alternative method whereby
a municipality may obtain the benefits of a joint project or projects, any
contract may provide: (A) that the contracting municipality shall be
obligated to make the payments required by the contract whether or not
a project is completed, operable or operating and notwithstanding the
suspension, interruption, interference, reduction or curtailment of the
output of a project or the power and energy contracted for; and (B) that
the payments under the contract may not be subject to any reduction
whether by offset or otherwise, and may not be conditioned upon the
performance or nonperformance of the joint agency or any other
member of the joint agency under the contract or any other instrument.
Any contract may also provide that if one (1) or more of the
municipalities should default in the performance or discharge of its
obligations under its contract, the other contracting municipalities shall
assume, pro rata, or otherwise, the obligations of the defaulting
municipality or municipalities and may succeed to the rights and
interests of the defaulting municipality or municipalities as may be
agreed upon in the contract. Any such contract may also provide for
requirements, purchases, or exclusive dealing arrangements if the joint
agency determines that such provisions are necessary to obtain
financing on favorable terms.
(b) Notwithstanding the provisions of any other law to the contrary,
a contract with respect to the sale or purchase of power and energy,
transmission and related services, from a joint agency may extend for
an initial period not exceeding fifty (50) years from the date service is
estimated to be first rendered under the contract, with additional
periods as may be agreed upon by the parties, and the execution and
effectiveness of the contract may not be subject to any authorizations
or approvals by the state or any agency, commission or instrumentality
or political subdivision thereof except as specifically required and
provided in this chapter, nor shall it be subject to any publication
requirements.
(c) Payments by a municipality under any contract with a joint
agency shall be payable solely from the revenues derived from the
ownership and operation of the electric system of that municipality and
may be treated as an expense of the operation and maintenance thereof
if the contract so provides, and any obligation under that contract may
not constitute a legal or equitable pledge, charge, lien, or encumbrance
upon any property of the municipality or upon any of its income,
receipts, or revenues, except the revenues of its electric system, and
neither the faith and credit nor the taxing power of the municipality are,
or may be, pledged for the payment of any obligation under any such
contract. A municipality shall be obligated to fix, charge, and collect
rents, rates, fees, and charges for electric power and energy and other
services, facilities, and commodities, sold, furnished, or supplied
through its electric system in an amount sufficient to provide revenues
adequate to meet its obligations under any such contract and to pay any
and all other amounts payable from or constituting a charge and lien
upon such revenues. In any proceeding before the commission for the
approval of rates set by a municipality subject to its jurisdiction, the
commission shall make specific findings of the revenue requirements
referred to in the prior sentence and shall provide rates sufficient for
such requirements.
(d) Any member of a joint agency may furnish the joint agency with
money derived solely from the ownership and operation of its electric
system or facilities and provide the joint agency with personnel,
equipment, and property, both real and personal. Any municipality may
also provide any services to a joint agency.
(e) A joint agency or any member of a joint agency may contract for,
advance, or contribute funds derived solely from the ownership and
operation of its electric system or facilities to a joint agency or any
member of a joint agency as may be agreed upon by the joint agency
and the member. A:
(1) joint agency shall repay such advances or contributions from
proceeds of bonds, or from any other funds of the joint agency;
and
(2) member of a joint agency shall repay such advances or
contributions from funds derived solely from the ownership and
operation of its electric system or facilities;
together with interest thereon as may be agreed upon by the member
and the joint agency.
(f) In the exercise of the powers enumerated in this chapter,
including without limitation, the execution of contracts as provided in
this section, a municipality and a joint agency shall be deemed to be
exercising a part of the sovereign powers of the state and shall be
exempt from any and all laws, rules, and regulations prohibiting,
limiting, or conditioning anticompetitive conduct.
As added by Acts 1980, P.L.68, SEC.1. Amended by
P.L.36-2017, SEC.4.