48-2979

48-2979. Investment and reinvestment of
sinking fund

A. The board of directors of an irrigation district may invest and reinvest all
money belonging or credited to the district as a sinking fund. The investment shall be
made for the best interests of the district.

B. The funds may be invested and reinvested under the authority of the federal farm
credit act of 1933, or invested and reinvested in any of the following:

1. Bonds or other evidences of indebtedness of the United States of America or any
of its agencies or instrumentalities when such obligations are guaranteed as to principal
and interest by the United States of America or by any agency or instrumentality thereof.

2. Bonds or other evidences of indebtedness of this state, or of any of the
counties or incorporated cities, towns, or duly organized school districts of this state.

3. Bonds, notes or evidences of indebtedness of any county, municipality, or
municipal district utility within this state, which are payable from revenues or earnings
specifically pledged for the payment of the principal and interest on such obligations,
and for the payment of which a lawful sinking fund or reserve fund has been established
and is being maintained, but only if no default in payment of principal or interest on
the obligations to be purchased has occurred within five years of the date of investment
therein, or, if such obligations were issued less than five years prior to the date of
investment, no default in payment of principal or interest has occurred on the
obligations to be purchased, nor on any other obligations of the issuer within five years
of such investment.

4. Bonds, notes or evidences of indebtedness issued by any municipal improvement
district in this state to finance local improvements authorized by law, if the principal
and interest of such obligations are payable from assessments on real property within
such local improvement district. No such investment shall be made if the face value of
all such obligations, and similar obligations outstanding, exceed fifty per cent of the
market value of the real property and improvements upon which such bonds or the
assessments for the payment of principal and interest thereon are liens inferior only to
the liens for general ad valorem property taxes. Such investment shall be made only if
no default in payment of principal or interest on the obligations to be purchased has
occurred within five years of the date of investment therein, or, if such obligations
were issued less than five years prior to the date of investment, no default in payment
of principal or interest has occurred on the obligations to be purchased, nor on any
other obligation of the issuer within five years of such investment.

5. Interest bearing saving accounts or certificates of deposit insured in banks or
savings and loan associations doing business in Arizona by the federal deposit insurance
corporation, or the federal savings and loan insurance corporation, but only if they are
secured by the depository to the same extent and in the same manner as required by the
general depository law of the state. Security shall not be required for that portion of
any deposit that is insured under any law of the United States.

C. All money earned as interest or otherwise derived by virtue of the provisions of
this section shall be credited to the sinking fund.