Sec. 10. "Special purpose bus" means a motor vehicle:
(1) that is designed and constructed for the accommodation of more than ten (10) passengers;
(2) that:
(A) meets the federal school bus safety requirements under 49 U.S.C. 30125 except the:
(i) stop signal arm required under federal motor vehicle safety standard (FMVSS) no. 131; and
(ii) flashing lamps required under federal motor vehicle safety standard (FMVSS) no. 108;
(B) when owned by a school corporation and used to transport students, complies with the Federal Motor Carrier Safety Regulations as prescribed by the United States Department of Transportation Federal Motor Carrier Safety Administration as set forth in 49 CFR Chapter III Subchapter B; or
(C) when owned by a school corporation and used to transport students, is a motor coach type bus; and
(3) that is used by a school corporation for transportation purposes appropriate under IC 20-27-9-5.