(a) Whenever any public body created under this subchapter shall own or operate a consolidated waterworks system and shall desire to acquire, construct, or equip improvements, betterments, and extensions thereto, it may issue revenue bonds under the provisions of this section to pay for them. The procedure for issuance of bonds shall be as provided in this section.
(b)
(1) Bonds issued in accordance with this section shall be authorized by resolution of the board of commissioners.
(2) The bonds may be issued as registered bonds and may be exchangeable for bonds of another denomination or in another form.
(3) The bonds may:
(A) Be in such form and denominations;
(B) Have such date or dates;
(C) Be stated to mature at such time or times;
(D) Bear interest payable at such times and at such rate or rates;
(E) Be payable at such places within or without the state;
(F) Be subject to such terms of redemption in advance of maturity at such prices; and
(G) Contain such terms and conditions,
(4) The bonds shall have all the qualities of and shall be deemed to be negotiable instruments under the laws of the State of Arkansas, subject to provisions as to registration as set forth in this subsection.
(5) The authorizing resolution may contain any other terms, covenants, and conditions that the board of commissioners deems reasonable and desirable, including, without limitation, those pertaining to the:
(A) Maintenance of various funds and reserves;
(B) Nature and extent of any security for payment of the bonds;
(C) Custody and application of the proceeds of the bonds;
(D) Collection and disposition of revenues;
(E) Investing for authorized purposes; and
(F) Rights, duties, and obligations of the public body and the holders and registered owners of the bonds.
(c)
(1) The authorizing resolution may provide for the execution of a trust indenture between the public body and any financial institution within or without the State of Arkansas.
(2) The trust indenture may contain any terms, covenants, and conditions that are deemed desirable by the board of commissioners, including, without limitation, those pertaining to the:
(A) Maintenance of various funds and reserves;
(B) Nature and extent of any security for the payment of the bonds;
(C) Custody and application of the proceeds of the bonds;
(D) Collection and disposition of revenues;
(E) Investing and reinvesting of any moneys during periods not needed for authorized purposes; and
(F) Rights, duties, and obligations of the public body and the holders and registered owners of the bonds.
(d)
(1) Any authorizing resolution and trust indenture relating to the issuance and security of the bonds shall constitute a contract between the public body and holders and registered owners of the bonds.
(2) The contract and all covenants, agreements, and obligations therein, shall be promptly performed in strict compliance with the terms and provisions of the contract, and the covenants, agreements, and obligations of the public body may be enforced by mandamus or other appropriate proceeding at law or in equity.
(e)
(1) The resolution shall fix the minimum rate or rates for water or other services provided by the consolidated waterworks system to be collected before the payment of all of the bonds, with exceptions as may be provided in the resolution, and shall pledge the revenues derived from the consolidated waterworks system or any specified portion of the consolidated waterworks system for the purpose of paying the bonds and interest.
(2) The rates to be charged for the water or other services of the consolidated waterworks system or the specified portion of the consolidated waterworks system with revenues pledged to the payment of the bonds shall be sufficient to provide:
(A) For the payment of all principal of and interest on all bonds as and when due;
(B) For the operation and maintenance of the consolidated waterworks system or the specified portion of the consolidated waterworks system with revenues pledged to the payment of the bonds; and
(C) An adequate depreciation account for the consolidated waterworks system or the specified portion of the consolidated waterworks system with revenues pledged to the payment of the bonds.
(f)
(1) The proceeds derived from the sale of the bonds shall be used solely for the purpose of:
(A) Making betterments, improvements, and extensions to the consolidated waterworks system owned and operated by the public body;
(B) Paying interest on the bonds during the period of construction of the betterments, improvements, and extensions;
(C) Establishing any necessary reserves for the bonds;
(D) Paying the costs of issuing the bonds; and
(E) Paying any other costs and expenditures of whatever nature incidental to the accomplishment of the betterments, improvements, and extensions.
(2) The terms “betterments”, “improvements”, and “extensions” include all real property, personal property, buildings, structures, improvements, equipment, and facilities.
(g)
(1) Bonds issued under the provisions of this section shall be payable solely from revenues derived from the consolidated waterworks system or any specified portion of the consolidated waterworks system.
(2) The bonds shall not in any event constitute an indebtedness of, nor pledge the faith and credit of, the State of Arkansas or the participating public agencies within the meaning of any constitutional provisions or limitations.
(3) It shall be plainly stated on the face of each bond that it:
(A) Is issued under the provisions of this subchapter;
(B) Does not constitute an indebtedness of the State of Arkansas or the participating public agencies within any constitutional provisions or limitations; and
(C) Is not backed by the full faith and credit of the State of Arkansas or the participating public agencies.
(4) The bonds and the interest thereon shall be exempt from all taxation, state, county, and municipal. This exemption includes income taxation and inheritance taxation.
(h)
(1) The bonds may be sold in such manner, either at public or private sale, and upon such terms as the board of commissioners shall determine to be reasonable and expedient for effectuating the purposes of the public body.
(2) The bonds may be sold at a price the board of commissioners may accept, including sale at discount.
(i)
(1) The bonds shall be executed by manual or facsimile signature of the chair of the board of commissioners and the manual or facsimile signature of the secretary of the board of commissioners or any other officer of the public body authorized to do so by resolution of the board of commissioners.
(2) In case any of the officers whose signatures appear on the bonds shall cease to be the officers before delivery of the bonds, their signatures nevertheless shall be valid and sufficient for all purposes.
(3) Each bond shall be impressed or imprinted with the seal of the public body.
(j)
(1)
(A) Prior to a proposed issuance of revenue bonds by a public body, the public body shall publish one (1) time in a newspaper of general circulation in the participating public agencies:
(i) Notice of the proposed issuance of bonds;
(ii) The maximum principal amount of bonds contemplated to be sold;
(iii) A general description of the project contemplated to be financed or refinanced with bond proceeds; and
(iv) The date, time, and location of a public meeting at which members of the public may obtain further information regarding the bonds and the project.
(B) Notice under subdivision (j)(1)(A) of this section shall be published at least ten (10) days prior to the date of the hearing described in subdivision (j)(1)(A)(iv) of this section.
(2) The chief executive officer of the public body or his or her designee shall be responsible for conducting the hearing and shall request all public comments that might pertain to the proposed issuance of bonds by the public body.
(3)
(A) Upon compliance with the provisions of this section, other notice, hearing, or approval by the public body, any participating public agency or any governmental unit shall not be required as a condition to the issuance by a public body of its contemplated bonds or any interim financing with respect thereto.
(B) The provisions of the Revenue Bond Act of 1987, § 19-9-601 et seq., do not apply to this section and revenue bonds or interim financing issued hereunder.
(C) Notwithstanding the provisions of subdivision (j)(3)(A) of this section, the participating public agencies that have entered into the interlocal agreement forming the public body may, in the interlocal agreement, impose additional procedural requirements as a precedent for the issuance of revenue bonds by a public body, and if that is the case, the public body shall comply with those requirements prior to the issuance of the bonds and any interim financing.
all as the board of commissioners shall determine.