1. As used in this section, the following terms shall mean:
(1) "Board" , the board of education, board of trustees, board of regents, or board of governors of an educational institution;
(2) "Educational institution" , any school district, including all community college districts, and any state college or university organized under chapter 174 .
2. The board of any educational institution may enter into agreements as authorized in this section in order to provide for the acquisition, construction, improvement, extension, repair, remodeling, renovation and financing of sites, buildings, facilities, furnishings and equipment for the use of the educational institution for educational purposes.
3. The board may on such terms as it shall approve:
(1) Lease sites, buildings, facilities, furnishings and equipment acquired or constructed; or
(2) Notwithstanding the provisions of this chapter or any other provision of law to the contrary, sell or lease at fair market value, which may be determined by appraisal, any existing sites, together with any existing buildings and facilities thereon, in order to acquire, construct, improve, extend, repair, remodel, renovate, furnish and equip buildings and facilities thereon, and lease back or purchase such sites, buildings and facilities; provided that upon selling or leasing the sites, buildings or facilities, any lease back to the educational institution is not more than one year in length, and with not more than twenty-five successive options by the educational institution to renew the lease under the same conditions; and provided further that there is an agreement to convey or sell the sites, buildings or facilities, including any improvements, extensions, renovations, furnishings or equipment, back to the educational institution with clear title at the end of the period of successive one-year options or at any time bonds, notes or other obligations issued to pay for the improvements, extensions, renovations, furnishings or equipment have been paid and discharged.
4. Any consideration, promissory note or deed of trust which an educational institution receives for selling or leasing property pursuant to this section shall be placed in a separate fund or in escrow, and neither the principal or any interest thereon shall be commingled with any other funds of the educational institutions. At such time as the title or deed for property acquired, constructed, improved, extended, repaired, remodeled or renovated under this section is conveyed to the educational institution, the consideration shall be returned.
5. The board may make rental payments under such leases out of its general funds or out of any other available funds, provided that in no event shall the educational institution become indebted in an amount exceeding in any year the income and revenue of the educational institution for such year plus any unencumbered balances from previous years.
6. Any bonds, notes and other obligations issued to pay for the acquisition, construction, improvements, extensions, repairs, remodeling or renovations of sites, buildings and facilities, pursuant to this section, may be secured by a mortgage, pledge or deed of trust of the sites, buildings and facilities and a pledge of the revenues received from the rental thereof to the educational institution. Such bonds, notes and other obligations issued shall not be a debt of the educational institution and the educational institution shall not be liable thereon, and in no event shall such bonds, notes or other obligations be payable out of any funds or properties other than those acquired for the purposes of this section, and such bonds, notes and obligations shall not constitute an indebtedness of the educational institution within the meaning of any constitutional or statutory debt limitation or restriction.
7. The interest on such bonds, notes and other obligations and the income therefrom shall be exempt from taxation by the state and its political subdivisions, except for death and gift taxes on transfers. Sites, buildings, facilities, furnishings and equipment owned in connection with any project pursuant to this section shall be exempt from taxation.
8. The board may make all other contracts or agreements necessary or convenient in connection with any project pursuant to this section.
9. Notice that the board is considering a project pursuant to this section shall be given by publication in a newspaper published within the county in which all or a part of the educational institution is located which has general circulation within the area of the educational institution, once a week for two consecutive weeks, the last publication to be at least seven days prior to the date of the meeting of the board at which such project will be considered and acted upon.
10. Provisions of other law to the contrary notwithstanding, payments made from any source by a school district, after the latter of July 1, 1994, or July 12, 1994, that result in the transfer of the title of real property to the school district, other than those payments made from the capital projects fund, shall be deducted as an adjustment to the funds payable to the district pursuant to section 163.031 beginning in the year following the transfer of title to the district, as determined by the department of elementary and secondary education. No district with modular buildings leased in fiscal year 2004, with the lease payments made from the incidental fund and that initiates the transfer of title to the district after fiscal year 2007, shall have any adjustment to the funds payable to the district under section 163.031 as a result of the transfer of title.
11. Notwithstanding provisions of this section to the contrary, the board of education of any school district may enter into agreements with the county in which the school district is located, or with a city, town, or village wholly or partially located within the boundaries of the school district, in order to provide for the acquisition, construction, improvement, extension, repair, remodeling, renovation, and financing of sites, buildings, facilities, furnishings, and equipment for the use of the school district for educational purposes. Such an agreement may provide for the present or future acquisition of an ownership interest in such facilities by the school district, by lease, lease-purchase agreement, option to purchase agreement, or similar provisions, and may provide for a joint venture between the school district and other entity or entities that are parties to such an agreement providing for the sharing of the costs of acquisition, construction, repair, maintenance, and operation of such facilities. The school district may wholly own such facilities, or may acquire a partial ownership interest along with the county, city, town, or village with which the agreement was executed.