Sec. 7. The state board shall, before July 1 immediately following the referendum, establish the school districts for the election of the members of the governing body under section 6(b) of this chapter as follows:
(1) The districts shall be drawn on the basis of precinct lines.
(2) The districts must be, as nearly as practicable, of equal population, with the population of the largest district not to exceed the population of the smallest district by more than five percent (5%).
(3) The district lines must not cross precinct lines.