(a) The board of commissioners of any improvement district, operating a system of waterworks, gas plants, or electric plants belonging to and owned by any improvement district, may lease the system of waterworks, gas plants, or electric plants for such period of time and upon such terms and conditions as the board of commissioners may deem for the best interest of the district.
(b) The lessees shall be required to maintain, keep in repair, and return the plant to the district in as good condition as when received, ordinary wear and tear excepted, but the maintenance contemplated shall permit more modern or suitable machinery or equipment, equally as efficient to perform the service required, to be installed in place of machinery or equipment then in use.
(c) No lease shall be made except to persons, firms, or corporations holding a franchise to operate a system of waterworks, gas plants, or electric plants in the city or town in which the plant or system to be leased is situated.
(d) No plant shall be taken over for operation under the provisions hereof unless and until the lessee files with the district an approved bond, in such sum as the board of commissioners may require, for the faithful fulfillment of the terms of the lease.