CHICAGO — Indiana local governments have a total of $34.4 billion of outstanding debt, with the Marion County Airport Authority, Indianapolis and the city of Carmel topping the list, a new report shows.

Of the $34.4 billion, $18.7 billion is lease-backed debt, nearly all of which represents bonds issued by a building corporation that was created to issue the debt, according to a new report by the state’s Department of Local Government Finance.

School districts carry the most amount of debt, followed by special districts, then cities and towns, according to the DLGF.

More than a quarter of property tax revenue goes toward paying off debt, the report said.

“Payments on local government indebtedness consume a significant portion of property taxes,” said the report, which provides an overview of all local government bonds, lease, and other debt outstanding as of Dec. 31, 2011. “For property taxes payable in 2012, 26% of the certified levies were attributable to debt service funds. Statewide, debt service levies represent $1.6 billion of the $6.3 billion in certified levies.”

Indiana school districts and towns carry the most amount of debt of any subdivision in the state, with a total of $16.9 billion of outstanding obligations. Of that, more than $14.5 billion is lease payments and $172 million is federal credits, which are expected payments from the federal government to subsidize projects that qualify for federal aid.

The report also breaks down obligations by principal and interest.

The Marion County Airport Authority, which operates the Indianapolis International Airport, ranks first among all local districts, including special districts, with $2.1 billion of outstanding debt. None of that is lease-backed debt.

Indianapolis ranks second among all local governments, with $1.9 billion of debt. The city of Carmel, located outside of Indianapolis, ranks fifth among all districts, with $895.1 million of debt. Of that, $357 million is lease-backed debt.

The Indianapolis public school district carries the most debt of all school districts, with $903 million of debt, nearly all of which is lease-backed.

Cities and towns carry just under $8 billion, according to the report. Special districts have the second-largest amount of debt, with $6.5 billion. Counties have a total of $1.7 billion of outstanding debt.

Separately, the Indianapolis-Marion County City-County Council Monday night approved a controversial plan to expand the city’s lucrative downtown tax-increment financing district. The approval paves the way for a large economic development project.

The project includes building a new fire station, creating a business corridor, and a separate retail and residential development.

The TIF expansion was delayed by debate and a lawsuit from critics who said it will siphon off tax dollars from schools and libraries.

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