TITLE 43

IRRIGATION DISTRICTS

CHAPTER 22

RECONSTRUCTION, REHABILITATION, REPLACEMENT AND IMPROVEMENT OF DAMS BY IRRIGATION DISTRICTS — FINANCIAL AND OTHER ARRANGEMENTS

43-2202.  Issuance of bonds or interim notes — Terms and conditions. The board of directors is authorized to issue the bonds of the district in the manner for which provision is made in this chapter, which bonds shall be fully negotiable for all purposes of the Uniform Commercial Code of the state of Idaho as the same may be in force from time to time.

Bonds issued hereunder shall be authorized by resolution or resolutions of the board. They shall be in coupon form but may be made registrable as to principal if so provided in the resolution authorizing their issuance. Such bonds shall be in denominations of one hundred dollars ($100) or a multiple thereof, shall bear interest at such rate or rates, payable annually or semiannually as the board shall elect, shall mature serially or otherwise at any time or times, shall be payable at such place or places within or without the state, may be made redeemable prior to maturity in such manner and at such premiums, shall be executed in such manner, and shall be sold in such manner and at such price or prices as may be determined by resolution of the board.

Bonds may be issued hereunder at one (1) time or from time to time. If more than one (1) issue or series of bonds is delivered hereunder the bonds of the respective issues or series shall have such priorities of payment as may be provided in the proceedings authorizing the bonds.

Any resolution authorizing the issuance of bonds hereunder shall provide for the creation of a sinking fund into which shall be paid from the revenues and assessments pledged to such payment in the authorizing resolution sums fully sufficient to pay the principal of and interest on the bonds and to create such reserve for contingencies as may be required by the resolution. Any resolution so authorizing bonds may contain such covenants with the future holders of the bonds as to the disposition of such revenues and assessments, the issuance of future bonds and the creation of future liens and encumbrances against the revenues and assessments and other pertinent matters deemed necessary or proper by the board to assure the merchantability of the bonds, provided such covenants and agreements are not inconsistent with the provisions of this chapter.

Any resolution, or any contract with another irrigation district, may adopt the provisions of section 43-413, Idaho Code, with respect to the providing of a safety fund with respect to any assessments levied for the repayment of the bonds or the payment of any contract obligation.

It may be provided in any such resolution that any holder of the bonds or of any of the coupons thereto attached may by appropriate legal action compel performance of all duties required of the board and the officials of the district by the provisions of title 43, Idaho Code, and the provisions of the resolution authorizing the bonds. If any bond issued hereunder is permitted to go into default, as to principal or interest, any court of competent jurisdiction may, pursuant to the application of the holder of any bond, or if applicable the trustee pursuant to a trust indenture, appoint a receiver to collect and distribute the revenues and assessments pledged to the repayment of the bonds pursuant to the provisions and requirements of the resolution and of this act and as the court may direct.

The board of any district which shall have issued any bonds under the provisions of this chapter may authorize the issuance of bonds hereunder for the purpose of refunding all or any part of such outstanding bonds. Refunding bonds may be either sold and the proceeds thereof applied to or deposited in an escrow for the retirement of the outstanding bonds or may be delivered in exchange for the outstanding bonds. The refunding bonds shall be authorized and secured in the manner herein provided for the issuance and securing of other bonds and may but shall not be required to have the same source of security and payment as the bonds refunded. No election on the issuance of refunding bonds shall be required, but if by an increase in the amount of bonds or by changes in the security, the requirements of the constitution for an election become applicable, then any such refunding bonds shall be approved at an election held and conducted pursuant to the provisions of section 43-2203, Idaho Code.

In addition to the permanent financing contemplated in this section, the board of any district may borrow money and issue interim notes in evidence thereof whenever it is deemed advisable and in the interests of the district to borrow funds temporarily for any of the purposes herein provided in advance of permanent financing. No election shall be required upon the issuance of interim notes. The board may from time to time and pursuant to appropriate resolution borrow money and issue interim notes to evidence borrowings for the purpose of obtaining funds for any of the purposes authorized in subsection (D) of section 43-2201, Idaho Code. Any resolution authorizing the issuance of such interim notes shall describe generally the purpose for which such notes are to be issued and shall specify the principal amount, rate of interest and maturity date, which shall be the same for all interim notes and which shall be not to exceed five (5) years from the date of issue of such notes, and such other pertinent terms as may be specified in such resolution. The interim notes shall be issued from time to time by the board as funds are borrowed, in the manner the board may determine. Interest on the interim notes may be made payable semiannually, annually or at maturity. The interim notes may be made redeemable prior to maturity at the option of the board in the manner and upon the terms fixed by the resolution authorizing their issuance. Such interim notes shall be in such denominations, shall be executed in such manner, and shall be sold at such price or prices as may be determined by resolution of the board. All such interim notes and the interest thereon may be secured by a pledge of the proceeds of the revenues and assessments provided in subsection (D) of section 43-2201, Idaho Code, and shall be payable solely from such revenues and assessments and from the proceeds to be derived from the sale of any bonds for permanent financing authorized to be issued pursuant to this chapter. Contemporaneously with the issue of the bonds as provided by this chapter, all interim notes, even though they may not have then matured, shall be paid, both principal and interest and applicable premium, if any, to date of payment, from the funds derived from the sale of bonds authorized hereunder for the permanent financing, and such interim notes shall thereupon be surrendered and canceled.

The resolution authorizing the issuance of any bonds or interim notes hereunder shall, and any resolution authorizing the execution of any contract hereunder may, be published one (1) time in a newspaper of general circulation in the district. For a period of thirty (30) days from the date of such publication any person in interest may file suit in any court of competent jurisdiction to contest the regularity, formality or legality of the proceedings authorizing the bonds, the interim notes, the execution of such contract or the legality of such resolution and its provisions or of the contract or of the bonds or interim notes to be issued pursuant thereto and the provisions securing the bonds or interim notes. After the expiration of such thirty (30) day period no one shall have any right of action to contest the validity of the contract or of the bonds or interim notes or of such proceedings or of such resolution or the validity of the pledges and covenants made in such proceedings and resolution and the contract and the bonds and interim notes and the provisions for their payment shall be conclusively presumed to be legal and no court shall thereafter have authority to inquire into such matters.

History:

[43-2202, as added by 1974, ch. 1, sec. 1, p. 3.]