Indiana § 20-29-6-3 - Unlawful deficit financing
Full text of Indiana Indiana Code § 20-29-6-3 — Unlawful deficit financing, with citation guidance and answers to common questions.
§ 20-29-6-3. Unlawful deficit financing
Sec. 3. (a) It is unlawful for a school employer to enter into any agreement that would place the employer in a position of deficit financing due to a reduction in the employer's actual general fund (before January 1, 2019) or education fund (after December 31, 2018) revenue or an increase in the employer's expenditures when the expenditures exceed the employer's current year actual general fund (before January 1, 2019) or education fund (after December 31, 2018) revenue. Except as provided in subsection (c), revenue does not include money estimated to be or actually transferred from the school corporation's operations fund to its education fund. Revenue does not include money allocated for supplemental payments in a resolution passed under subsection (d).
(b) A contract that provides for deficit financing is void to that extent, and an individual teacher's contract executed under the contract is void to that extent.
(c) Notwithstanding subsection (a), before September 15 of any year, a governing body may pass a one (1) year resolution indicating that a portion or percentage of money transferred from the operations fund to the education fund may be considered education fund revenue for purposes of funding a contract under this chapter and to determine whether an agreement would place the employer in a position of deficit financing. The resolution shall expire within one (1) year of the resolution's adoption by the governing body.
(d) Before September 15 of any year, a governing body may pass a one (1) or two (2) year resolution indicating that a portion or percentage of education fund revenue allocated for supplemental fund payments under IC 20-28-9-1.5(a) is not considered education fund revenue for the purposes of subsection (a). The resolution shall not extend beyond the end of the corresponding state budget biennium.
[Pre-2005 Elementary and Secondary Education Recodification Citation: 20-7.5-1-3.]
As added by P.L.1-2005, SEC.13. Amended by P.L.48-2011, SEC.13; P.L.244-2017, SEC.56; P.L.254-2019, SEC.2; P.L.75-2025, SEC.3.
Source: official Indiana text · Last verified 2026-08-27
Frequently Asked Questions About Indiana § 20-29-6-3
What does Indiana Code § 20-29-6-3 cover?
Section 20-29-6-3 ("Unlawful deficit financing") is part of the Indiana Code, the codified statutory law of Indiana. It sets out the legal rule or procedure described in the text above. Statutes are amended regularly, so always verify against the official source.
How do I cite Indiana § 20-29-6-3?
A common citation format is "Indiana Code § 20-29-6-3" (Indiana). Legal writing may require the code abbreviation, section number, and year or edition. Match the style required by your court, professor, or publisher.
Is this the official text of Indiana law?
No. This page is for research and education and may not include the most recent amendments. For official current law, check the Indiana official source linked on this page or consult a licensed Indiana attorney.
How does Indiana § 20-29-6-3 apply to my situation?
Statutes are interpreted in context, and application depends on your specific facts. Only a licensed attorney in Indiana can advise on how this section applies to you. Contact your state or local bar association for a referral.
Sources & Verification
Not legal advice. Verify against the official source and consult a licensed attorney in Indiana.