HEA 1192 Summary

• Allows eligible school corporations to issue refunding bonds to refinance existing debt, with a minimum 20% debt service savings required before January 1, 2014, or 30% savings after that date, subject to department of local government finance certification.

• Establishes criteria for designating political subdivisions (including school corporations) as "distressed" based on financial hardship conditions such as bond defaults, missed payroll, accumulated deficits of 8% or more, or severe impacts from property tax credits.

• Creates an emergency manager position for distressed political subdivisions (except school corporations) with authority over budgets, contracts, expenditures, and salaries to restore fiscal stability.

• Expands eligibility for loans from the counter-cyclical revenue and economic stabilization fund to school corporations designated as distressed, with loan amounts up to $5 million or $1,000 per student (whichever is less), at interest rates based on state revenue commissioner rates minus 2%.

• Requires school corporations that previously provided transportation to continue offering it unless they provide three years' advance notice and obtain voter approval for termination; allows waivers upon department approval if safe alternative plans are demonstrated.

• Amends school bus replacement fund levy provisions to allow department adjustments based on school corporation acquisition plans and modifies retirement/severance bond financing with phased adjustment percentages from 25% to 100% for property tax reduction requirements.