Citations Affected: IC 20-5-6-9 ; IC 36-1-14-1.
Synopsis: Public school endowment corporations. Allows a political
subdivision to donate proceeds from riverboat gaming to public school
endowment corporations that meet certain conditions.
Effective: July 1, 2000.
November 18, 1999, read first time and referred to Committee on Finance.
A BILL FOR AN ACT to amend the Indiana Code concerning
IS ADDED TO THE INDIANA CODE
AS A NEW SECTION TO READ AS FOLLOWS [EFFECTIVE JULY
1, 2000]: Sec. 9. (a) As used in this section, "public school
endowment corporation" means a corporation that is:
(1) organized under the Indiana Nonprofit Corporation Act of 1991 (IC 23-17);
(2) organized exclusively for educational, charitable, or scientific purposes; and
(3) formed for the purpose of providing educational resources to:
(A) a particular school corporation or school corporations; or
(B) the schools in a particular geographic area.
(b) As used in this section, "proceeds from riverboat gaming" means tax revenue received by a political subdivision under IC 4-33-12-6 , IC 4-33-13 , or an agreement to share a city's or county's part of the tax revenue.
(c) As used in this section, "political subdivision" has the meaning set forth in IC 36-1-2-13.
(d) A political subdivision may donate proceeds from riverboat gaming to a public school endowment corporation under the following conditions:
(1) The public school endowment corporation retains all rights to the donation, including investment powers.
(2) The public school endowment corporation agrees to return the donation to the political subdivision if the corporation:
(A) loses the corporation's status as a public charitable organization;
(B) is liquidated; or
(C) violates any condition of the endowment set by the fiscal body of the political subdivision.
(e) A public school endowment corporation may distribute both principal and income.
SECTION 2. IC 36-1-14-1 IS AMENDED TO READ AS FOLLOWS [EFFECTIVE JULY 1, 2000]: Sec. 1. (a) This section does not apply to donations of proceeds from riverboat gaming to a public school endowment corporation under IC 20-5-6-9.
(b) Notwithstanding IC 8-1.5-2-6 (d), a unit may donate the proceeds from the sale of a utility or facility or from a grant, a gift, a donation, an endowment, a bequest, or a trust to a foundation under the following conditions:
(1) The foundation is a charitable nonprofit community foundation.
(2) The foundation retains all rights to the donation, including investment powers.
(3) The foundation agrees to do the following:
(A) Hold the donation as a permanent endowment.
(B) Distribute the income from the donation only to the unit as directed by resolution of the fiscal body of the unit.
(C) Return the donation to the general fund of the unit if the foundation:
(i) loses the foundation's status as a public charitable organization;
(ii) is liquidated; or
(iii) violates any condition of the endowment set by the fiscal body of the unit.
SECTION 3. [EFFECTIVE JULY 1, 2000] (a) The definitions in IC 20-5-6-9 , as added by this act, apply throughout this SECTION.
(b) A donation of proceeds of riverboat gaming to a public
school endowment corporation that:
(1) was made by a political subdivision before July 1, 2000; and
(2) would have been permitted by IC 20-5-6-9 , as added by
this act, if IC 20-5-6-9 had been in effect before July 1, 2000;
is legalized and validated.