9-571. Wastewater treatment and drinking water
treatment facilities and nonpoint source projects; financial
assistance loan repayment agreements; definitions
A. Notwithstanding any other law, a city or town may construct, acquire from a
willing seller or improve a wastewater treatment facility, drinking water facility or
nonpoint source project with monies borrowed from or financial assistance including
forgivable principal provided by the water infrastructure finance authority of Arizona.
B. To repay financial assistance from the water infrastructure finance authority of
Arizona a city or town 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 repay long-term obligations. If
revenue from a property tax assessment is the designated source of repayment under the
agreement, the property tax assessed and levied is a secondary property tax levy for
purposes of article IX, Constitution of Arizona.
C. For any city or town with a population of more than fifty thousand persons, the
governing body of the city or town 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 city or town, except that if revenue from a secondary
property tax levy is the designated source of repayment or if the project is constructed
with an improvement district, the question shall be submitted to the qualified electors
at an election held on the first Tuesday following the first Monday in November. For a
city or town with a population of fifty thousand persons or less, the revenues of the
city's or town's utility system or systems may be pledged to the payment of the repayment
agreement without an election, if the pledge of revenues does not violate any covenant
pertaining to the utility system or systems or the revenues pledged to secure outstanding
bonds or other obligations of the city or town. An election is not required if voter
approval has previously been obtained for substantially the same project with another
funding source. If a majority of the qualified electors voting on the question:
1. Approves, the governing body may execute, deliver and perform the financial
assistance loan repayment agreement.
2. Disapproves, the governing body shall not execute a financial assistance loan
repayment agreement.
D. Payments made pursuant to a financial assistance loan repayment agreement are
not subject to section 42-17106.
E. 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 wastewater treatment or drinking water facility or
nonpoint source project and repayment of the loan as the water infrastructure finance
authority of Arizona deems proper. Financial assistance loan repayment agreements may
provide for the payment of interest on the unpaid principal balance of such agreement at
the rates established in the agreement. The agreement may also provide for payment of
the city's or town's proportionate share of the expenses of administering the clean water
and drinking water revolving funds established by sections 49-1221 and 49-1241 and may
provide that the city or town pay financing and loan administration fees approved by the
water infrastructure finance authority. These costs may be included in the levy or
assessment amounts pledged to repay the financial assistance. Cities and towns are bound
by and shall fully perform the loan repayment agreements, and the agreements are
incontestable after the loan is funded by the water infrastructure finance authority of
Arizona. The city or town shall also agree to pay the authority's costs in issuing bonds
or otherwise borrowing to fund a loan.
F. A financial assistance loan repayment agreement under this section does not
create a debt of the city or town, and the authority shall not require that payment of a
financial assistance loan repayment agreement be made from other than those sources
permitted in subsection B of this section and as prescribed by sections 49-1225 and
49-1245.
G. A city or town may employ attorneys, accountants, financial consultants and such
other experts in their field as deemed necessary to perform services with respect to the
financial assistance loan repayment agreement.
H. This section is supplemental and alternative to any other law under which a city
or town may borrow money or issue bonds. This section shall not be construed as the
exclusive authorization to enter into loan agreements with the authority.
I. A city or town 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 by the voters pursuant to subsection C of this
section less the amount that the city or town is already obligated to repay to the water
infrastructure finance authority pursuant to a financial assistance loan repayment
agreement.
J. For the purposes of this section:
1. "City" includes both cities formed pursuant to this title and charter cities.
2. "Nonpoint source project" has the same meaning prescribed in section 49-1201.
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