48-1019

48-1019. Drinking water facility and
wastewater facility projects; financial assistance loan repayment
agreements; definition

A. Notwithstanding any other law, a domestic water or wastewater improvement
district may construct, acquire, or improve a drinking water, wastewater or water
reclamation facility with monies borrowed from or financial assistance, including
forgivable principal, provided by the water infrastructure finance authority of Arizona
pursuant to title 49, chapter 8.

B. To repay financial assistance from the authority a district may enter into a
financial assistance loan repayment agreement with the authority. A financial assistance
loan repayment agreement is payable from any revenues otherwise authorized by law to be
used to pay long-term obligations.

C. For a district with a population of more than fifty thousand persons, the board
of directors of the district shall submit the question of entering and performing a
financial assistance loan repayment agreement to the qualified electors voting at a
regular or special election in the district. An election is not required if voter
approval has previously been obtained for substantially the same project with another
funding source. For a district with a population of fifty thousand persons or less, the
board may enter into the financial assistance loan repayment agreement on the approval of
the board and an election is not required.

D. A financial assistance loan repayment agreement entered into pursuant to this
section shall contain the covenants and conditions pertaining to the construction,
acquisition or improvement of a drinking water, wastewater or water reclamation facility
and repayment of the loan as the authority deems proper. Financial assistance loan
repayment agreements may provide for the payment of interest on the unpaid principal
balance of the agreement at the rates established in the agreement. The agreement may
also provide for payment of the domestic water or wastewater improvement district's
proportionate share of the expenses of administering the drinking water revolving fund
established by sections 49-1221 and 49-1241 and may provide that the domestic water or
wastewater improvement district pay financing and loan administration fees approved by
the authority. These costs may be included in the assessment or revenue amounts pledged
to repay the loan. Districts are bound by and shall fully perform the loan repayment
agreements, and the agreements are incontestable after the loan is funded by the
authority. The domestic water improvement district shall also agree to pay the
authority's costs in issuing bonds or otherwise borrowing to fund a loan.

E. A financial assistance loan repayment agreement under this section does not
create a debt of the domestic water or wastewater improvement district, and the authority
shall not require that payment of a loan agreement be made from other than those sources
permitted in subsection B of this section.

F. A domestic water or wastewater improvement district may employ or contract for
the services of attorneys, accountants, financial consultants and other experts in their
field as deemed necessary to perform services with respect to the financial assistance
loan repayment agreement.

G. This section is supplemental and alternative to any other law under which a
district may borrow money or issue bonds. This section shall be construed as the
exclusive authorization to enter into loan agreements with the authority.

H. A district may borrow additional monies or enter into additional financial
assistance loan repayment agreements with the water infrastructure finance authority in
an amount up to the amount approved pursuant to subsection C of this section less the
amount that the district is obligated to repay to the water infrastructure finance
authority pursuant to a financial assistance loan repayment agreement.

I. For the purposes of this section "authority" means the water infrastructure
finance authority of Arizona.