§22-23A-11. Establishment of dedicated source of revenue by community water system for funding of loan by authority; powers of water system; default; repayment guidelines; project accounts.

(a) In order to provide for the funding of the loan by the authority for a project to a community water system, such water system shall establish a dedicated source of revenue to repay only the monies received from the authority and to provide for operation, maintenance and equipment replacement expenses. Such water system is hereby authorized and empowered, any existing statute to the contrary notwithstanding, to do and perform any one or more of the following:

(1) To obligate itself to pay to the authority at periodic intervals a sum sufficient to provide bond debt service with respect to the bonds of the authority issued to fund the loan for such project and to pay over such debt service to the account of the project for deposit to the Water Supply Assistance Fund;

(2) To levy, collect and pay over to the authority and to obligate itself to continue to levy, collect and pay over to the authority the proceeds of any one or more of the following:

a. Any water supply service fee or charge; and

b. Other revenue available to the community water system;

(3) To undertake and obligate itself to pay its contractual obligation to the authority solely from the proceeds from any one or more of the sources specified in subdivision (2) above, or to impose upon itself a general obligation pledge, if appropriate, to the authority additionally secured by a pledge of any one or more of such sources; provided, however, that all members of said community water system shall be notified of the proposed contract with the authority, specifically stating the obligations and pledge of revenue and other terms and conditions of said contract, and provided further that a formal meeting of the community water system be held and a vote be taken prior to the final agreement with the authority being made;

(4) To obligate itself to continue to levy and collect such revenues, fees and charges as shall equal not less than 110 percent nor more than 125 percent, as determined by the authority of the maximum principal and interest maturing and coming due in any one year on the bonds issued by the authority to fund a loan for the project; and

(5) To enter into such agreements, to perform such acts and to delegate such functions and duties as its governing body shall determine to be necessary or desirable to enable the authority to fund a loan to the community water system to aid it in the construction or acquisition of a project.

(b) In the event of default, the authority may utilize all available remedies under state law.

(c) All loans made by the authority shall provide that repayment of such loans shall be made in accordance with guidelines for such repayment made by the authority.

(d) The recipients of loans shall maintain project accounts in accordance with generally accepted government accounting standards.

(Acts 1988, 1st Ex. Sess., No. 88-857, p. 338, §11.)