Sec. 12.5. (a) The governing body of two (2) or more school corporations situated in the same or adjoining counties may:

(1) consolidate; or

(2) be required to consolidate under section 5.5 of this chapter;

their respective school corporations under the conditions prescribed in this section. A school corporation that consolidates with one (1) or more school corporations as prescribed under this section is considered a subunit of the consolidated school corporation.

(b) A resolution for consolidation under this section must include:

(1) subject to section 3(b) of this chapter, the information required in section 3(a)(1) through 3(a)(4) of this chapter; and

(2) a declaration that debts or obligations paid by a debt service levy under IC 20-40-9 incurred by a subunit before the consolidated school corporation comes into existence may be levied only on the taxpayers of the subunit that initially incurred the debts or obligations.

(c) A resolution for consolidation under this section may include any declarations concerning the proposed consolidation that are otherwise permitted under this chapter, including the following:

(1) A declaration that the name or attendance area of each school within a subunit may remain unchanged after the date on which the consolidated school corporation comes into existence.

(2) A declaration that the administrative functions of each subunit will be consolidated in the proposed consolidated school corporation.

(d) All debts of the former school corporations shall be assumed and paid by the new consolidated school corporation. However, a debt service levy under IC 20-46-7 for debts and obligations incurred by a school corporation before the date the school corporation consolidates under this chapter may be levied only in the subunit of the consolidated school corporation that initially incurred the debt or obligation, unless otherwise provided in the resolution.

(e) All debts and obligations incurred by the consolidated school corporation after the date on which the consolidation becomes effective are considered a debt or obligation of the consolidated school corporation as a whole.

(f) This subsection applies to a consolidation under this section. Upon receipt of the resolution to consolidate under section 11 of this chapter, the department of local government finance shall set for the consolidated school corporation:

(1) new maximum levies under IC 20-46-4 and IC 20-46-5, which must equal the sum of the existing maximum levies adjusted for assessed value growth; and

(2) a new maximum rate under IC 20-46-6, which equals an amount determined as follows:

STEP ONE: Determine the maximum amount that may be levied under each subunit's maximum capital projects fund tax rate.

STEP TWO: Determine the sum of the STEP ONE amounts.

STEP THREE: Determine the sum of the certified net assessed values for the subunits.

STEP FOUR: Divide the STEP TWO amount by the STEP THREE amount.

STEP FIVE: Determine the product (rounded to the nearest ten-thousandth (0.0001)) of:

(i) the STEP FOUR amount; multiplied by

(ii) one hundred (100).

(g) A consolidation under this section is subject to all other provisions of this chapter to the extent the provisions are not inconsistent with and do not conflict with this section. If there is a conflict between any provision in this chapter and a provision in this section, this section governs.

As added by P.L.169-2017, SEC.8.