The board may sell bonds from time to time in amounts necessary and most advantageous to raise money for the construction or purchase of canals, reservoirs, reservoir sites, water rights, water wells and works, power plants, electrical motors, engines, power transmission lines, gas lines or oil lines for the primary purpose of supplying fuel and generating power for pumping purposes and necessary drainage works and otherwise to fully carry out the object and purposes of this act [73-12-1 to 73- 12-57 NMSA 1978]. Before making any sale, the board shall, at a meeting, by resolution declare its intention to sell a specified amount of the bonds and the day and hour and place of the sale and shall cause the resolution to be entered in the minutes and notice of the sale to be given by publication thereof by three insertions at least twenty days prior to the sale in a daily newspaper published in the city of Santa Fe and a like notice in a daily newspaper published in the city of Albuquerque and any other newspaper at its discretion. The board shall state that sealed proposals will be received by the board at its office for the purchase of the bonds and tell the day and hour named in the resolution. At the time appointed, the board shall open the proposals and award the purchase of the bonds to the highest responsible bidder and may reject all bids, but said board shall, in no event, sell any of said bonds for less than eighty-five percent of the face value thereof. In case no bid is made and accepted, as above provided, the board of directors is hereby authorized to use the bonds for the purchase or construction of canals, reservoir sites, reservoirs, water rights and works, power plants and transmission lines, oil and gas lines for the primary purpose of generating power for pumping purposes and necessary drainage works, provided such bonds shall not be so disposed of at less than eighty-five percent of the face value thereof.

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Refunding bonds may be issued and used by any district organized under the laws of this state for the purpose of retiring any bonds which may have been issued under the provisions of this act after the question of issuing refunding bonds has been submitted to an election as herein provided and has received the affirmative vote of a majority of those voting thereon within the district. The refunding bonds may be payable at the time or times and may be of such denominations as the board of directors may determine and shall be executed in the same manner as provided herein for the original issue of bonds. The board of directors shall have power to contract for the purchase of, and exchange of refunding bonds for, the whole or any part of the bonds to be refunded by the issue. The refunding bonds shall first be deposited with the county treasurer of the county wherein the office of the district is located and shall be delivered only as and when bonds so to be refunded in like amounts are surrendered to the county treasurer for cancellation. The refunding bonds may also be sold from time to time in such amounts as the board of directors may determine and in the same manner as provided for the sale of the original issue of bonds, the proceeds to be deposited with the treasurer to be paid out by him upon order of the board of directors in exchange for any of the outstanding bonds that may be so purchased or contracted for by the board of directors.

The treasurer may use the proceeds at any time in his hands to pay the principal and interest of any matured outstanding bonds presented for payment in case he does not have sufficient funds of the district otherwise provided for paying such maturing bonds.

The treasurer shall cancel all bonds of the district as and when the bonds are paid or refunded and shall cause to be recorded in the office of the county clerk of the county his certificate showing that the bonds, giving dates, serial numbers and amounts thereof, have been paid and cancelled, and such cancelled bonds shall be delivered to the board of directors of the district to be destroyed. It shall be the duty of the board of directors to destroy such cancelled bonds and to enter upon their records a statement giving the dates, serial numbers and amounts of the bonds so destroyed.