A. An authority shall be governed by a board of directors. The board shall conduct elections pursuant to the Local Election Act [N.M. Stat. Ann. Chapter 1, Article 22] and in accordance with the Election Code [N.M. Stat. Ann. Chapter 1]. The initial board shall establish the boundaries and the number of electoral districts within two years of the creation of the authority. The board may provide for redistricting in its governance document upon any change in the authority’s boundary. The terms of office for directors shall be four years.

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B. The initial board shall have representation from each of the founding and joining entities. Each director shall reside within the electoral district of the authority from which that director is elected. The elected board shall serve staggered terms to be established in the governance document developed by the initial board. The directors of the initial board shall serve until their successors are elected and qualified. The board shall choose among its directors a chair, secretary and treasurer.

C. All powers, privileges and duties vested in or imposed upon an authority shall be exercised and performed by the board; provided that the board may delegate its powers by resolution to an officer or agent of the board, with the exception of the following:

(1)     adoption of board policies and procedures; (2)     ratification of acquisition of property;

(3)     initiation or continuation of legal action, except that initiation and filing of liens for unpaid rates and charges and suits for payment thereof and discontinuance of service for failure to pay such rates and charges may be delegated;

(4)     establishment of fees, tolls, rates or charges; and

(5)     issuance of revenue bonds.

D. Meetings of the board shall be held at least quarterly or at the call of the chair. A majority of the directors of the board constitutes a quorum for the transaction of any business. Except as provided in Subsection E of this section, the board shall only take action upon the affirmative vote of at least a majority of the board present. A vacancy in the membership of the board shall not impair the right of a quorum to exercise all rights and perform all duties of the board.

E. The non-delegable powers and duties provided in Subsection C of this section are only effective upon resolution passed by two-thirds of the directors of the board.

F. The board shall promulgate and adhere to policies and procedures for its conduct.

G. The board may disqualify a director of the board from voting on an issue when that director of the board has a financial interest or possible interest in the outcome of any policy, decision or determination before the board. A director of the board’s status as a member of the authority does not, by itself, constitute a financial interest or possible interest for the purposes of this section.

H. The board may:

(1)     adopt, amend and repeal bylaws;

(2)     maintain offices at a place designated by the board; and

(3)     employ an executive director who may employ staff. I. The board shall:

(1)     fix the time and place of meetings and the method of providing notice of the meetings in accordance with the Open Meetings Act [N.M. Stat. Ann. Chapter 10, Article 15];

(2)     promulgate orders, resolutions, policies and procedures necessary for the governance and management of the affairs of the authority and the execution of the powers vested in the authority;

(3)     establish usage classifications;

(4)     fix and from time to time uniformly increase or decrease utility rates, fees or other charges for services delivered or facilities operated or made available by the authority, subject to the following conditions:

(a) until paid, all rates, fees or charges constitute a lien subservient to a primary mortgage lien on and against the property served, and the lien may be enforced as provided by law;

(b) the board shall prescribe and enforce policies and procedures by which properties shall be connected with and disconnected from the facilities of the authority, including the amount of notice required before disconnection and payment plans to avoid discontinuing service to delinquent accounts; and

(c) after giving notice in accordance with an authority’s policies and procedures, the board shall shut off or discontinue service for unauthorized connections, illegal connections or connections for which rates, tolls or other charges are delinquent in payment. The board may file suit in a court of competent jurisdiction to recover costs associated with an unauthorized, illegal or delinquent connection, including the cost of water delivered, charges for connection and disconnection and damages. Attorney fees shall be awarded to the prevailing party; and

(5)     adopt an operating budget that supports the full cost of operation, maintenance and replacement as established by an asset management plan and a rate- setting analysis. The operating budget shall be subject to the approval of the department of finance and administration.