What is a Bond Refunding Referendum?
Under IC 5-1-5-2.5, an eligible school corporation may, if approved by a majority of voters in a referendum, refund a limited percentage of its outstanding bonds to provide an annual savings to its debt service fund that can be transferred to its capital projects fund, transportation fund, or school bus replacement fund.
According to IC 5-1-5-2.5(d)(2)(B), the referendum is to be conducted pursuant to the process prescribed by IC 20-46-1, which normally governs school corporation tax levy referenda. Consistent with IC 20-46-1-8, the Department of Local Government Finance (“Department”) reviews proposed referendum language and either approves or rejects it.
A school corporation seeking a bond refunding referendum must certify a copy of its resolution, including the language of the proposed question, to the Department. The Department will review the proposed language and either approve or reject the language based on its compliance with IC 5-1-5-2.5(d)(2)(B) and send the determination to the school corporation not more than ten days after the resolution is submitted to the Department.
If the Department approves the proposed language, the governing body of the school corporation must certify a copy of its resolution, including the language of the proposed question and the Department’s approval, to (1) the county fiscal body (for informational purposes only) and (2) the circuit court clerk of each county in which the school corporation is located.
Click HERE for information on past bond refunding referenda.