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A.  For the purpose of providing funds for the acquisition (by purchase, construction or otherwise) of any property or facilities which the Authority is authorized to acquire hereunder, including the acquisition of water rights, and for extending and improving any such property and facilities, the Authority may from time to time issue its bonds in anticipation of the collection of its revenues, which bonds shall be fully negotiable for all purposes of the Negotiable Instruments Law as it may now or hereafter be in effect in this state.  The Authority may pledge to the payment of such bonds all or any part of its revenues, but such bonds shall never be payable as to either principal or interest from the proceeds of ad valorem taxes and shall not constitute an indebtedness of the Authority within the meaning of any constitutional limitation.  Bonds issued hereunder for purposes other than refunding shall never be issued in an amount which would cause the total outstanding bonded indebtedness of the Authority, including refunding bonds theretofore issued, to exceed $50,000,000.  There may be included in the amount of any such bond issue reasonable allowance for legal, engineering and fiscal services, interest during construction and for one year after the estimated date of completion of construction, and other expenses in connection with the authorization and issuance of the bonds and the acquisition or construction of the improvements, and, in the case of the first issue of bonds hereunder, including the expenses of incorporating the Authority.  

B.  Such bonds shall be authorized by resolution of the board of commissioners and may be issued in one or more series, may bear such date or dates, may mature at such time or times not exceeding sixty years from their respective dates, may bear interest at such rate or rates not exceeding six per cent per annum, may be in such form, either coupon or registered, may be executed in such manner, may be payable in such medium of payment at such place or places within or without the state, may be subject to such terms of redemption with or without premium, may contain such terms, covenants and conditions and may be sold in such manner and upon such terms as the board of commissioners may by resolution determine, provided that the bonds may not be sold on a basis which will result in a net interest cost to maturity in excess of six per cent per annum.  Pending the preparation of any series of bonds, interim receipts or certificates in such form and with such provisions as the board of commissioners may determine, may be issued to the purchasers of the bonds.  The board of commissioners may provide that the signatures of one or more officials appearing on the face of the bonds shall be facsimiles of such signatures.  All such bonds shall be approved by the State Bond and Tax Board prior to issuance.  

C.  Any resolution authorizing the issuance of bonds hereunder may contain covenants, including but not limited to:

(a)  The purpose or purposes to which the proceeds of the sale of the bonds may be applied and the deposit, use and disposition thereof;

(b)  The use, deposit, securing of deposits, and disposition of the revenues of the Authority, including the creation and maintenance of reserves;

(c)  The issuance of additional obligations payable from the revenues of the Authority;

(d)  The operation and maintenance of the properties of the Authority;

(e)  The insurance to be carried thereon and the use, deposit and disposition of insurance moneys;

(f)  Books of account and records and the inspection and audit thereof and the accounting methods of the Authority;

(g)  The non-rendering of any free service by the Authority;

(h)  The preservation of the properties of the Authority free from any mortgage, sale, lease or other encumbrance not specifically permitted by the terms of the resolution; and

(i)  The appointment and the powers and duties of any trustee who may be named in such resolution for the purpose of carrying out functions designed to safeguard the security of such bonds.  

D.  If any default be made in the payment of the principal of or interest on any bonds issued hereunder, any court having jurisdiction of the action may appoint a receiver to administer the properties, the revenues of which are pledged to the payment of such bonds, with power to make and collect rates and charges sufficient to provide for the payment of all bonds and obligations payable from such revenues and for the payment of operating expenses, and to apply the income and revenues thereof in conformity with the provisions of this Chapter and with the covenants and provisions contained in the resolution or resolutions authorizing such bonds.

E.  Any bonds issued hereunder bearing the signatures of officers in office on the date of the signing thereof shall be valid and binding obligations notwithstanding that before the delivery thereof any or all persons whose signatures appear thereon shall have ceased to be officers of the Authority.  The resolution authorizing the bonds may provide that the bonds shall contain a recital that they are issued pursuant to this Chapter, which recital shall be conclusive evidence of their validity and of the regularity of their issuance.  

F.  While any bonds are outstanding hereunder it shall be the duty of the board of commissioners to fix and from time to time to revise the rates of compensation for all commodities and services sold or rendered by the Authority which will be fully adequate to pay the expenses of operating and maintaining the Authority and its properties, to pay principal of and interest on its obligations promptly as principal and interest fall due and to carry out all of the provisions and covenants of the resolution or resolutions authorizing such bonds.  Nothing contained in this Section shall be so construed as to prevent the execution of leases or agreements by the Authority providing for the lease of properties of the Authority or the sale of commodities and services sold or rendered by the Authority at fixed rentals or prices for a term of years, provided that the rentals or prices so named are at the time of the execution of any such lease or agreement, together with the other reasonably anticipated revenues of the Authority, sufficient to assure the ability of the Authority to carry out the requirements of this Chapter and the requirements of the resolution or resolutions authorizing its bonds.  

G.  The board of commissioners may provide by resolutions for the issuance of bonds for the purpose of refunding any bonds hereafter outstanding under the provisions of this Chapter.  The issuance of such refunding bonds, the maturities and other details thereof, the rights of the holders thereof, and the duties of the Authority with respect thereto shall be governed by the provisions of this Chapter affecting the issuance of other bonds in so far as such provisions may be applicable.  Such refunding bonds need not necessarily be secured in the same manner as were the bonds refunded.  Such refunding bonds may either be issued in exchange for the bonds refunded or may be issued in such manner that the proceeds of the sale thereof will be applied to the payment of the bonds refunded, which payment may be made either simultaneously with the delivery of the refunding bonds or, if the bonds to be refunded have become due or will become due within six months of the date of the delivery of the refunding bonds either through maturity or through call for redemption pursuant to an option of redemption reserved therein may be made through the escrow of the proceeds of the refunding bonds with one of the paying agents for the bonds to be so refunded pursuant to instructions which will assure the proper application of such proceeds to the intended purpose.  

H.  Any bonds issued hereunder may, in the discretion of the board of commissioners, be additionally secured by deed of trust or mortgage lien upon all or any part of the properties and revenues of the Authority and all franchises, easements, water rights, appropriations, permits, leases, contracts and other rights appurtenant to such properties, which deed of trust or mortgage may vest in the trustee thereunder power to sell the encumbered properties for payment of the bonds secured thereby and power to operate such properties, and may contain all other provisions customarily contained in instruments of like kind.  Such deed of trust or mortgage shall be subject to foreclosure in the manner therein provided and any purchaser of the properties encumbered thereby, either at foreclosure sale or at a sale by the trustee pursuant to provisions therein contained, is hereby granted a franchise for the operation of the properties so purchased for a period of thirty years from the date of such purchase.  

Added by Acts 1950, No. 261, §11.  Amended by Acts 1956, No. 432, §5.