A.R.S. tit. 48 ch. 1 — Arizona Revised Statutes Title 48 Chapter 1 — General Provisions

48-101. State certification board A. The state certification board consists of the attorney general, the director of water resources and the deputy director of the financial institutions division of the department of insurance and financial institutions. B. The board shall elect one of its members chairman, and appoint a secretary who shall keep the records and minutes of the board. One or more members of the board shall from time to time, as may be required, designate from the member's regularly employed personnel the secretary and such clerks and assistants as are necessary to perform the duties of the board but without extra compensation. C. The governor shall be an ex officio member of the board without additional compensation. The office of the board shall be at Phoenix, where records concerning all proceedings taken under this article shall be kept. D. The board shall meet on a call of the chairman or on the written request of three of its members at a fixed time within official business hours, on not less than two days' prior written notice, but notice may be waived in writing. Meetings may be recessed or adjourned from time to time without giving further notice and continuances may be granted for good cause. A majority constitutes a quorum and matters pending before the board shall be decided by majority vote. The board may adopt necessary rules of procedure and regulations for the conduct of its affairs and discharge of its duties under this article. Fees other than for necessary stenographic services, printing or publication may not be charged or collected from the applicant by the board. E. The scope and subjects of the board’s examination, consideration and determination are confined to the matters prescribed and embraced in the record filed by the applicant in support of its application and its proposed bond issue, proof offered in respect thereto, and the adequacy, weight and sufficiency thereof to justify the proposed bond issue. 48-102. Findings of state certification board A. If the state certification board finds that the record offered in support of the application submitted sustains the application and that all requirements and conditions precedent have been fulfilled, it shall approve the bond application either in whole or in part, or shall otherwise disapprove the bond issue as a whole or as to the features or proposals that do not meet essential requirements. When the board has made and entered its findings, a decision shall be made accordingly. The rejection of any document or report or the contents of the document or report or the rejection of an entire application shall not preclude filing amended applications, documents, reports, statistics, plans, maps or other records or the subsequent consideration of any amended or altered bond proposal. B. The decision of the state certification board based on findings of fact supported by a preponderance of the evidence and that are not arbitrary or unreasonable shall be final and conclusive. C. The state certification board after approval of the application shall not exercise further control of the proceeds of any bond issue but they shall be controlled and administered solely by the applicant as provided in this chapter. 48-121. Definitions In this article, unless the context otherwise requires: 1. "District" includes any irrigation district, drainage district, flood control district, agricultural improvement district, electrical district, water conservation district or power district organized under the laws of this state. 2. "Federal agency" means the United States, the president of the United States, the federal emergency administrator of public works, or any such agencies or instrumentalities as may be designated or created to make grants or loans, or both, pursuant to any act or acts of the Congress. 48-122. Extension of unexpired permits Notwithstanding the provisions of any law to the contrary, when the director of water resources has issued to any district a permit to make an appropriation of water, or a reservoir permit, and actual construction work under the permit has not begun, and the time prescribed in the permit for beginning construction work has not expired, and the district has, or before the expiration of such prescribed time shall have, made application to any federal agency for a loan or grant, or both, of monies to be used for the construction of its works, or some part thereof, the time for beginning actual construction under the permit is extended until six months after the monies so applied for have become available to the district, but in no event shall such extension exceed two years after the time prescribed in the permit as that within which actual construction must be begun. 48-131. Compromise of taxes Boards of directors of irrigation districts, electrical districts, agricultural improvement districts, drainage districts, power districts, flood control districts, irrigation water delivery districts and other similar districts are authorized to compromise any district taxes levied against any parcel or parcels of land: 1. In all instances where the board finds that the parcel or parcels of land against which the taxes are assessed and levied are not worth the amount of such taxes, plus all other unpaid taxes levied against the land. 2. When the board finds that at the time when the taxes were assessed and levied, the parcel or parcels of land were not susceptible of profitable cultivation, but such compromise shall not be made until all coupons, warrants or installments on bonds for the payment of which the district taxes were assessed and levied have been fully paid. 48-141. Definitions In this article, unless the context otherwise requires: 1. "Board of directors" means the board having charge of the affairs of the district. 2. "Bond" means any bond issued pursuant to this article. 3. "District" means any irrigation or agricultural improvement district located in a federal reclamation project, organized pursuant to law. 4. "Undertaking" means the purchase, construction, leasing or acquisition of any real or personal property, works or facilities which the district is authorized by law to purchase, construct, lease or otherwise acquire, or the improvement, reconstruction, extension or addition to any real or personal property, works or facilities owned or operated by the district, but does not include the purchase or acquisition by the exercise of the right of eminent domain or condemnation of any existing works or facilities, nor the purchase, construction, leasing or acquisition of, or the extension or addition of, works or facilities designed to serve areas or territories outside the boundaries of the federal reclamation project in which the district is located, or areas or territories already being served or which within twelve months past have been served by existing works or facilities belonging to others. 48-142. Powers of district In the exercise of the powers granted the district by law, the district shall have the additional power: 1. To issue its bonds to finance the costs of any undertaking. 2. To pledge to the punctual payment of the bonds and interest thereon an amount of the revenue from the undertaking, including improvements or extensions thereafter constructed or acquired, sufficient to pay the bonds and interest as they become due, and to create and maintain reasonable reserves therefor. The amount pledged may consist of all or any part of such revenue. The board of directors, in determining the cost of the undertaking, may include all costs and estimated costs of the issuance of the bonds, all engineering, inspection, fiscal and legal expenses, and interest which it is estimated will accrue on money borrowed or which will be borrowed during the construction period for six months thereafter. 48-143. Submission of question of issuance of bonds to electors Questions on bond issues under this article shall be submitted to the qualified electors of the district. No bonds shall be issued without the assent of a majority of the qualified electors voting at an election held for that purpose as provided in this article. 48-144. Resolution calling bond election; publication A. The board of directors shall adopt a resolution calling an election upon the question of the issuance of the bonds. The resolution shall state in substance: 1. The maximum amount of bonds to be issued. 2. The purpose for which the bonds are to be issued. 3. The maximum rate of interest which the bonds are to bear. 4. A brief, concise statement, which need not include any detail other than the mere statement of the fact, showing that the bonds will be payable solely from revenues. 5. The date on which the election is to be held. 6. The places where votes may be cast. 7. The hours between which such polling places will be open. B. The election resolution shall be posted in three public places in each division of the district for at least fifteen days prior to the date of the election and shall be published at least once not less than fifteen days nor more than thirty days prior to the date of the election in a newspaper of general circulation published in the county in which the office of the board of directors of the district is located. C. Instead of publishing the notice described in subsection A, the board of directors may, and for a nonresident qualified elector of the district shall, mail a notice of election to each household containing a qualified elector of the district. The notice shall contain the same information described in subsection A, paragraphs 1 through 5 and the polling place for that household's qualified electors and the times it is open. The notice shall be mailed at least thirty-five days before the election. 48-145. Conduct of election The election shall be conducted and the returns thereof canvassed in all respects as nearly as practicable in conformity with the provisions of law governing the election of directors of the district. No informalities in conducting the election shall invalidate it if the election has been otherwise fairly conducted. 48-146. Ballots At the election the ballots shall contain the words "for the bonds" and "against the bonds". To the right of and opposite each proposal shall be placed a square approximately the size of the square placed opposite the names of candidates on ballots. The voter shall indicate his vote "for the bonds" or "against the bonds" by inserting the mark "X" in the appropriate square. No other question, word or figure need be printed on any ballot. The ballot need not be any particular size, nor need sample ballots be printed, posted or distributed. 48-147. Form of bonds A. Bonds issued under this article shall be fully negotiable within the meaning and for all purposes under the applicable provisions of title 44. They may be in one or more series, bear such dates, be payable in such medium of payment, at such places, carry such registration privileges, be executed in such manner, contain such other terms, covenants and conditions, and be in such form, either couponed or registered, as the board of directors may by resolution prescribe. They shall be payable in equal annual installments, or they shall be of such maturities that the amount required for the payment of interest and principal becoming due thereon each year will be substantially the same, and in either event the final payment shall be due not more than thirty years from the date of issuance, but the first installment may be payable on such date as the board of directors prescribes, not more than two years after the date of issuance. Any or all such bonds shall be callable at such times, on such terms and in such manner as the board of directors by resolution prescribes. The bonds shall bear interest, payable semiannually, at the rate or rates set by the accepted bid which rate shall not exceed the maximum rate of interest set forth in the resolution calling the election, and shall be sold at not less than par to the person making the best bid therefor. B. The board of directors shall call for bids thereon by giving thirty days notice thereof by publication in a newspaper of general circulation within the county in which the office of the board of directors is located. The notice shall be in such form as prescribed by the board of directors. The bids shall be for the entire bond issue unless the board of directors by resolution allows bidding therefor in parcels of less than the entire issue. C. Pending the preparation of the definitive bonds, interim receipts or certificates may be issued to the purchasers of the bonds in such form and with such provisions as the board of directors may determine. 48-148. Charges for payment of undertaking A. The board of directors of the district issuing the bonds shall prescribe charges and revise them whenever necessary so that any undertaking for which the bonds were issued shall always remain self-supporting with revenue sufficient: 1. To pay when due all bonds and interest thereon, for the payment of which the revenue has been pledged, encumbered or charged. 2. To provide for all expenses of operation, maintenance, expansion and replacement of facilities. 3. To provide reasonable reserves for such purposes. B. Until the payment of all bonds on an undertaking issued under this article, neither the receipts nor expenditures in connection with the operation of the undertaking shall be included in any budget of the district, and the actual expenditures from the funds, other than for bond interest and redemption, shall be deemed to have been included in and to have constituted a part of the budget adopted by the district for the fiscal year in which the bonds were so paid. 48-149. Covenants in resolution A. Any resolution pertaining to the issuance of bonds under this article may contain covenants as to: 1. The purpose to which the proceeds of the sale of the bonds may be applied and to the use and disposition thereof. 2. The use and disposition of the revenue of the undertaking for which the bonds are to be issued. 3. The issuance of other or additional bonds payable from the revenue of the undertaking. 4. The operation and maintenance of the undertaking. 5. The insurance to be carried thereon and the use and disposition of insurance monies. 6. Books of account and the inspection and audit thereof. 7. The terms and conditions upon which the holders of the bonds, or any proportion of them or any trustee therefor, shall be entitled to the appointment of a receiver, who may enter and take possession of the undertaking, operate and maintain the same, prescribe charges, and collect, receive and apply all revenue thereafter arising therefrom in the same manner as the district itself might do. B. The provisions of this article and any such resolution shall be deemed a contract with the holders of the bonds, and the duties of the district and of its board of directors and officers under this article and any such resolution shall be enforceable by mandamus or any appropriate action of a court of competent jurisdiction. 48-150. Validity of bonds A. Bonds issued under this article and bearing the signatures of officers in office on the date of the signing thereof shall be valid and binding obligations, notwithstanding that before delivery and payment thereof any and all of the persons whose signatures appear thereon have ceased to be officers of the district issuing the bonds. B. The validity of the bonds shall not be dependent on nor affected by the validity or regularity of any proceedings relating to the construction, improvement, reconstruction, acquisition or extension of the undertaking financed by the bonds or acquired in connection therewith. 48-151. Certification of bonds by attorney general Any district may submit to the attorney general any bonds issued under this article after all proceedings for their issuance have been taken. Upon submission the attorney general shall examine into and give an opinion upon the validity of the bonds and the regularity of all proceedings in connection therewith. If the proceedings conform to the provisions of this article, and the bonds when delivered and paid for will constitute binding and legal obligations of the district according to the terms thereof, the attorney general shall certify in substance upon the back of each of the bonds that it is issued in accordance with the constitution and laws of this state. 48-152. Disposition of proceeds All proceeds received from the sale of the bonds, all fees, rents, tolls or other charges received by the district from any undertaking financed by the bonds, and all monies received from any source in connection therewith shall be paid to the district treasurer, or such depository as may be designated by the board of directors. The district treasurer or depository shall not commingle any money received under the terms of this article with any other monies, but the monies received under this article shall be deposited in a separate fund with the district treasurer or depository in the name of the district. The board of directors may by resolution provide that all deposits of such proceeds, fees, rents, tolls or other charges, and the monies received under this article, shall be secured by obligations of the United States or of this state of a market value equal at all times to the amount of the deposits, and all banks and trust companies are authorized to give such security for the deposits. 48-153. Prior lien of bonds All bonds of the same issue under this article shall have a prior and paramount lien on the revenue of the undertaking for which the bonds have been issued over and ahead of any claims or other obligations of any nature against that revenue subsequently arising or subsequently incurred. All bonds of the same issue under this article shall be equally and ratably secured, without priority by reason of number, date of bonds, sale, execution or delivery, by a lien on the revenue in accordance with the terms of the resolution authorizing the bonds. 48-154. Bonds payable only from revenue pledged; bonds not district indebtedness No holder of any bonds issued under this article shall have the right to compel any exercise of the taxing power of the district to pay the bonds or the interest thereon. Each bond issued under this article shall recite in substance that the payment of the bond and the interest thereon is enforceable exclusively from the revenue pledged to its payment. Bonds issued under this article by the district shall not be a debt of the district, nor shall payment thereof be enforceable out of any funds other than the revenue pledged to the payment thereof. 48-155. Supplemental nature of article A. Insofar as the provisions of this article are inconsistent with any other provision of law, the provisions of this article shall be controlling. The powers conferred by this article shall be in addition and supplemental to the powers conferred by any other law. B. Bonds may be issued under this article for any undertaking, notwithstanding that any other law may provide for the issuance of bonds for a like purpose and without regard to the requirements, restrictions or other provisions contained in any other law. 48-171. Definitions In this article, unless the context otherwise requires: 1. "Bonds" includes bonds, notes, temporary notes, temporary bonds, interim receipts, interim certificates, certificates of indebtedness, refunding notes, refunding bonds or other evidences of indebtedness or obligations of the district. 2. "Contract" or "agreement" between the federal government and a district includes contracts and agreements in the customary form and includes a resolution, unilateral promise or other commitment by the federal government by which it undertakes to make a loan, grant or purchase of the kind described in this article upon performance of specified conditions. When such a resolution, unilateral promise or other commitment by the federal government is made, the terms, conditions and restrictions therein set forth shall, for the purposes of this article, be deemed to constitute covenants of such a contract that are to be performed by the district, if the district accepts any money from the federal government. 3. "District" includes any irrigation district, drainage district, flood control district, agricultural improvement district, electrical district or power district, and in addition thereto any district, political subdivision, governmental agency, corporation or instrumentality of the state having territorial boundaries and created or organized for the purpose of benefiting or performing services for lands in the state. 4. "Federal government" includes the United States, the president of the United States, the federal emergency administrator of public works, reconstruction finance corporation, or any agency, instrumentality or corporation of the United States, which has been or may be designated, created or authorized by or pursuant to any act or acts of the Congress, or which is owned or controlled, directly or indirectly, by the United States. 5. "Governing body" of a district includes the body, board, commission, officer or officers, or other authority, having charge of the finances of the district. 48-172. Power to contract with federal government; purposes of contract A. If any district desires to secure loans, grants or advances of money from the federal government for the purpose of acquiring or constructing works or properties or of making or procuring extensions, improvements, reconstruction or repairs of or to any of their works or properties, or for refunding, refinancing, paying or reducing all or any part of their existing indebtedness, or for any one or more of such purposes, the district may enter into contracts or agreements with the federal government. The contract shall contain agreements whereby the federal government will do any or all of the following: 1. Make loans, grants or advances to or for the benefit of the district. 2. Purchase bonds to be issued by the district pursuant to the provisions of the contract or agreement. 3. Purchase bonds theretofore issued by the district either from the holders thereof or from bondholders' committees or other agents or representatives of the holders. B. The contracts or agreements may contain such terms, conditions, covenants and restrictions for the security of the federal government, or any subsequent holder of the bonds, or for any other purpose as may be agreed upon between the respective districts and the federal government. 48-173. District powers under federal contracts A. Any district which is a party to a contract or agreement with the federal government may enter into and comply with the terms and provisions thereof and shall do and perform all things on its part to be done or performed thereunder, including but not limited to limiting the amount of additional indebtedness which the district may incur and the levying and collecting of such taxes, assessments or other charges as may be necessary both to pay interest and principal on all indebtedness to be incurred by the district pursuant to the contract, and maintaining such reserves either for the future needs of the district or for further assurance of the payment of principal and interest on the indebtedness as may be required by the terms of the contract or agreement. B. If the proceeds of all or any part of any bonds issued pursuant to the contract are to be used for the purpose of refunding, refinancing or paying any bonds previously issued by the district, and if any owner or owners of lands within its boundaries can show that his or their lands were only subject to payment of a special limited part of the principal and interest falling due on such pre-existing bonds, the maximum amount of taxes or assessments which may be levied against such lands on account of the principal of the portion of such new bonds to be issued for refunding, refinancing or payment of the pre-existing bonds shall not be larger in aggregate amount than the principal amount of the pre-existing bonds chargeable against such lands. This subsection shall not be deemed to limit the obligation of such lands or the owners thereof to pay additional taxes and assessments for the payment of interest on a like principal amount of the new bonds. C. If, prior to the issuance of any bonds or the advance of any monies by the federal government pursuant to the provisions of such a contract, the governing body of the district adopts a resolution stating that it is in the best interests of the district that the amount of the taxes and assessments that may be assessed, levied or collected by it shall be limited in such manner and for such term or period as may be specified in the resolution, then, after the issuance of any bonds or the advance of any monies by the federal government pursuant to the provisions of such a contract, whichever occurs first, the power of the district to assess, levy or collect taxes and assessments shall be so limited during the term therein specified, and immediately upon the issuance of any such bonds or the advance of any such monies, the power of the district to assess, levy or collect taxes and assessments shall be reduced to the extent specified in the resolution for the period therein described. D. By any such contract or agreement, the district may agree that the federal government, or any such public or private agency or corporation, may assume or liquidate, compromise, pay or discharge, all or any part of the indebtedness of the district. It may agree that the stock or other evidence of the ownership or interest of the district in any such private corporation or agency, as well as any other properties of the district, may be placed or held in trust irrevocably during the term of the contract or agreement or for such other period as may be prescribed in the contract. The contract or agreement may contain any other term or condition deemed necessary. E. The district is authorized to do any and all acts and things considered necessary or advisable by the federal government and the district in connection with or additionally to secure any loans or grants of money or issuance or sale of bonds provided for in the contract or agreement. 48-174. Terms of contract relating to maintenance and operation of works Notwithstanding any general, special or local law, the contract or agreement may provide for the maintenance and operation of the works, properties or undertakings of the district and for the distribution of irrigation water, electrical power or other services or facilities thereof during the term provided by the contract or agreement, by the federal government or by the holders of a percentage in amount of the then outstanding bonds of the district as provided in the contract or agreement or by any public or private agency designated in the contract or agreement. The private agency may be a corporation directly or indirectly owned or controlled by the district. 48-175. Approval of contract by real property taxpayers A. Notwithstanding the provisions of any general, special or local law, before any contract or agreement with the federal government becomes effective and binding upon the district, the contract or agreement shall be submitted to and approved by the vote of a majority of the real property taxpayers voting on the question of approving or disapproving the contract or agreement. The taxpayers shall also in all respects be qualified electors of this state and of the district affected by the question. The question may be submitted at a general, special or primary election. B. Notice of the time and place of a general or primary election shall be given in the manner provided by law therefor. If a special election is held, notice of the time and place thereof shall be given by posting notices in three public places in the district for at least ten days prior to the election, and if a newspaper is published in the county in which the office of the governing body of the district is located, by one publication of the notice at least ten days prior to the election. At any general, primary or special election at which the proposition is to be submitted, the election notice shall recite that the district proposes to enter into a contract or agreement with the federal government for a loan or grant of money to or for the benefit of the district or for the purchase or exchange by the federal government of bonds issued or to be issued by the district. The notice shall also recite the maximum amount of money that may be advanced by the federal government pursuant to the contract or agreement and the maximum amount, interest rate and maturities of any new bonds that may be issued by the district pursuant thereto, and shall state that a copy of the proposed contract or agreement is available for inspection by any elector of the district at the office of the governing body. C. At the election the ballots shall contain the words "Shall the proposed contract between the district and ________ and the issuance of any bonds thereunder be approved?" "Yes", "No", or other words equivalent thereto. If no bonds are to be issued pursuant to the contract, the words "and the issuance of any bonds thereunder" may be omitted from the question. Any special election shall be conducted and the votes canvassed in all respects as nearly as practicable in conformity with the provisions of law relating to the election of members of the governing body of the district. No informalities in conducting the election shall invalidate it if the election has been otherwise fairly conducted. D. A contract or agreement on which there has been an adverse vote may be resubmitted to the electors in the same or any modified form at a subsequent election. If the proposition voted upon is approved, no further or additional approval by the voters at an election or otherwise shall be required for the acquisition, construction, reconstruction, extension, improvement, betterment or repair of works, properties or undertakings of or for the district insofar as they are financed pursuant to the contract or agreement, or for any refunding, refinancing, retiring or reducing all or any part of the indebtedness of the district, or for the issuance of bonds by the district as provided in the contract or agreement, or for the levy of any taxes, assessments or other charges for the payment of any amounts payable by the district pursuant to the provisions of the contract or agreement or of principal and interest on any such bonds when they fall due. E. A sanitary district bond election under section 48-2020 or a sanitary district proceeding under chapter 14, article 2 of this title satisfies the requirements of subsection A of this section if, at the bond election, a majority of the qualified electors voting in the election approves, or if, under chapter 14, article 2 of this title, the owners of a majority of the frontage of the property along the proposed improvement do not file an objection to the proceedings, the contract or agreement with the federal government, as described in the resolution calling for the bond election under section 48-2020 or the resolution of intention to order the improvements under section 48-2044, is effective and binding on the sanitary district. 48-176. Approval by state certification board Notwithstanding the provisions of any general, special or local law, before the contract or agreement with the federal government becomes effective and binding upon the district it shall be approved by resolution of the state certification board. 48-177. Issuance, sale and terms of bonds A. Notwithstanding the provisions of any general, special or local law, the district may issue, sell or exchange bonds of such kind, in such amount and with such security or agreements as may be provided by the contract or agreement, and issue and sell such bonds either at one time or from time to time to such persons or in such manner as may be provided in the contract or agreement. B. The bonds may be in such form, bear such date or dates, be in such denomination or denominations, mature in such amount or amounts and at such time or times not exceeding fifty years from their date, be executed in such manner, be payable in such medium of payment and at such place or places, and bear such privileges as to registration, conversion, reconversion, redemption or exchange, as may be provided in the contract or agreement. In the absence of specific provisions in the contract or agreement as to any of the matters set forth in this subsection, they shall be done or performed in such manner as is acceptable to the federal government and specified in a resolution or resolutions of, or approved by, the governing body of the district. C. If any of the officers of the district who sign the bonds cease to be officers of the district before the delivery thereof, the bonds shall nevertheless be valid and binding obligations of the district for all purposes when duly delivered and paid for the same as if the persons who signed the bonds had continued to be officers of the district until after delivery and payment. D. The bonds may bear interest at a rate or rates not to exceed the maximum rate set forth in the notice of election, and may be sold either at public or private sale for an amount equal to not less than one hundred per cent of the principal amount thereof, upon such terms and conditions as the governing body of the district determines, or may be exchanged for a like or greater principal amount of outstanding bonds of the district. If the purchaser pays interest accrued on the bonds at the date of purchase, interest shall be payable on the bonds from the date when the accruals commenced. E. Notwithstanding their form or tenor, the bonds and any other bonds purchased by the federal government pursuant to the terms of the contract or agreement shall at all times be negotiable instruments, unless they contain on their face an express statement that they are nonnegotiable. 48-178. Determination of validity of contract and bonds by attorney general Notwithstanding the provisions of any general, special or local law, any district may submit to the attorney general any contract or agreement, or any bonds issued under the contract or agreement entered into pursuant to the provisions of this article after the bonds have been prepared, signed and sealed. Upon submission to the attorney general, he shall examine into and render an opinion upon the validity of the contract or agreement or of any bonds and the regularity of all proceedings in connection with the execution and issuance thereof. If the contract, agreement and bonds have been executed and issued in conformity with the constitution and laws of the state, and are binding, legal and valid obligations of the district and enforceable according to the terms thereof, the attorney general shall certify in substance upon the back of each of the bonds, and on the back of any contract or agreement or of a certified copy thereof so submitted to him, that it is issued or executed pursuant to the constitution and the laws of the state. The certificate shall be conclusive evidence of the authority of the district to enter into the contract or agreement or to issue the bonds and of the validity thereof. 48-179. Proceedings to test validity of contracts and bonds; petition A. After the execution of any contract or agreement contemplated by this article, the governing body of a district may file a petition in the superior court in the county in which the office of the district is located to determine the validity: 1. Of the bonds authorized by the contract or agreement. 2. Of all proceedings taken or had thereunder in connection with the issuance thereof of the levy of any taxes or assessments either for payment of principal and interest on the bonds or for any other purpose provided for or necessitated by the contract or agreement. 3. Of any provisions of the contract limiting or reducing indebtedness, taxes or other charges. 4. Of any and all other covenants of the district contained in the contract or agreement. B. The action shall be in the nature of a proceeding in rem and jurisdiction of all parties interested shall be acquired by notice given as provided in section 48-180. The petition shall set forth: 1. The fact showing that the district is a district as defined as in this article. 2. The contract or agreement with the federal government. 3. That the contract or agreement has been approved by resolution of the state certification board and by a vote of the majority of the qualified voters of the district in the manner provided in this article. 4. All resolutions adopted by the governing body and copies of any bonds proposed to be issued by the district pursuant to the contract or agreement together with a full statement of all proceedings taken by the district in connection with the authentication and issuance thereof. 5. All proceedings of the district with reference to the levy of taxes and assessments pursuant to the contract or agreement. 6. All other resolutions adopted by the governing body of the district in connection with the contract or agreement. C. The petition shall pray that the contract or agreement and all proceedings be examined by the court and that if they are found to be in substantial compliance with the provisions of this article they be ratified, confirmed and validated. 48-180. Time for hearing; notice; summons; parties; pleadings A. Upon filing of the petition in the superior court, the court or judge thereof shall fix a time for a hearing on the petition, which shall be not less than fifteen days from the date of filing the petition, and shall order the clerk of the court to issue summons in the matter directed to all persons who may have or claim any interest in any land located in the district or in any matters referred to in the petition. The court shall also order the clerk to give notice of the filing of the petition and the date of the hearing thereon by publishing the summons at least once a week for two weeks in a newspaper published or of general circulation in the county in which the office of the district is located, and by posting a written or printed copy of the notice in at least three public places in the district, the first of the publications and postings to be not less than ten days prior to the date fixed for the hearing. B. The summons shall state the maximum amount that may be advanced by the federal government pursuant to the contract, shall describe in general terms the maximum amount, interest rate and maturities of any new bonds to be issued by the district pursuant thereto, and shall contain any other information the court deems advisable to have inserted therein. The summons shall also state the time and place fixed for hearing the petition and that any person interested in or whose rights may be affected by the execution of the contract or agreement, or by issuance or sale of any bonds, or by the levy of taxes or assessments, or by the limitation of the taxes or assessments, or by the proceedings had or to be had by the governing body with respect to the matters, or by the entering into or the performance of the contract or agreement, may, on or before the date fixed for hearing the petition, move to dismiss the petition for failure to state a claim upon which relief can be granted or answer the petition, and may appear in the hearing and contest the granting of the petition and the entry of any order of confirmation pursuant thereto. C. Any owner of land in the district or any other person interested in or whose rights may be affected by the entering into or the performance of the contract or agreement, or by the issuance or sale or exchange of any bonds, or by the levy of any taxes or assessments or by the limitation of indebtedness, taxes or assessments, or by the entry of any order of confirmation, may enter his appearance in the proceeding and move to dismiss the petition for failure to state a claim upon which relief can be granted or answer the petition and contest the granting of the prayer of the petition. D. The provisions of law pertaining to civil actions shall be applicable to the responsive pleadings to the petition. The governing body of the district shall be the plaintiff and the person or persons filing the responsive pleadings shall be the defendants in the proceeding. Every material allegation of the petition not specifically controverted by the answer shall be taken as true, and every holder of title or evidence of title to lands included in the district and every other party in interest failing to file a responsive pleading to the petition, shall be deemed to admit as true all the material allegations thereof. 48-181. Hearing; determination of validity A. At the hearing on the petition, the superior court shall examine the contract or agreement referred to therein and the proceedings of the district or other body in connection with the execution of such contract or agreement, together with any proceedings taken in connection with the issuance of any bonds, the levy of any taxes or assessments and other matters pursuant thereto, and shall hear all testimony that may be offered by the petitioner or any defendants with reference to the instruments and proceedings, and any argument that is offered with reference to the validity thereof. After the examination and hearing of all relevant testimony and argument that is offered at the hearing, the court shall find and determine whether the contract or agreement has been validly entered into by the district or other body in compliance with all applicable laws of the state, whether the district or other body has the lawful right and authority to enter into and to do and perform all the covenants and agreements on its part to be performed under the contract or agreement, whether the proceedings of the district or other body in connection with the execution of the contract, with the authentication and issuance of any bonds or other evidences of indebtedness and the levy of any taxes or assessments, and any other action taken by the district in performance of the contract or agreement, have been duly and properly taken in conformity with the provisions of the contract and this article and any other laws of the state applicable thereto, and whether the proceedings in connection with the filing of the petition in the action and the giving of notice of the hearing thereon comply with the provisions of this article. The court shall cause the findings and determinations to be entered in the record of the hearing. B. This article shall be liberally construed and such compliance with its provisions as does not adversely affect substantial rights of the owners of lands within the district shall be deemed sufficient. In hearing the petition and in preparing its findings and determinations thereon, the court shall disregard any error, omission or other irregularity which in the opinion of the court does not thus adversely affect the substantial rights of landowners. The court may ratify, approve and confirm the proceedings wholly or in part, and may ratify, approve and confirm the contract or agreement, the bonds and the taxes, and enter its judgment accordingly. 48-182. Appeals A. An appeal may be taken to the supreme court from the judgment at any time within ten days after entry of the judgment. The appeal shall be taken, perfected and heard in the manner prescribed by law for appeals in civil actions from the superior court. B. If no appeal is taken or if taken and the judgment of the superior court is affirmed by the supreme court, the judgment shall be conclusive as to the validity of the contract or agreement and the terms and provisions thereof, any bonds, taxes or provisions for reserves, and shall not be questioned in any court. All issues which were or might have been raised at the hearing on the petition shall thereafter be res judicata in all actions involving the validity of any of the provisions included in the judgment. C. The costs of the proceedings shall be allowed or apportioned between the parties in the discretion of the court. 48-183. Use of proceeds of loan and grant; limitation Notwithstanding the provisions of any general, special or local law, the proceeds of any loan, grant or purchase of bonds shall be used only for the purposes authorized by the contract or agreement or approved by the federal government. If so authorized or approved the following items of cost shall be payable from any funds made available to a district through a loan or grant, or from any sale or exchange of bonds authorized by a contract or agreement made pursuant to this article: 1. Engineering, inspection, accounting and legal costs and expenses in connection with the preparation or performance of any contract or agreement authorized by this article. 2. The cost of issuance of any bonds authorized by this article, including printing, advertising, accounting, legal and other similar expenses in connection therewith. 3. Insurance premiums, compensation insurance, contractors' bonds and all other proper items of expense incurred during the period while any work provided for by the contract or agreement is under construction, and interest on money borrowed during such period and an additional period of not exceeding six months after completion. 48-184. Proceedings cumulative Notwithstanding the provisions of any general, special or local law, any proceedings taken prior to December 12, 1934 by any district relating to the subject matter of this article, whether or not commenced under any other law, may be continued under this article, or at the option of the governing body, may be discontinued and new proceedings instituted under this article. If a district evidences its desire to continue any prior proceedings under this article by the adoption of a resolution to that effect by its governing body, all acts of the district and of any other agency of the state in connection therewith, including but not limited to, the submission to and approval by the state certification board of any contract or agreement, the submission of any such contract or agreement to a vote of the electors of the district, taken or had in the proceedings prior to December 12, 1934, shall, if the proceedings were when taken substantially in conformity with the provisions of this article, be validated and of the same force and effect as if this article had been in effect at the time the proceedings were had. If any district, prior to December 12, 1934, has entered into any contract or agreement with the federal government as contemplated by this article, performance of which has not been completed by the federal government, or with any public or private agency pursuant to any contract or agreement with the federal government, the contract or agreement so entered into shall be deemed authorized, validated and confirmed by this article and entitled to all the privileges and subject to all the terms and provisions of this article. 48-185. Purposes of article It is the purpose of this article to enable districts to secure the benefits of any act or acts of the Congress to encourage national recovery or to provide for the construction of useful public works, to encourage public works, to reduce unemployment or to improve the conditions of agriculture and thereby to assist in the national recovery and promote public welfare. To those ends districts may perform all acts required by the federal government as a condition of any loan or grant of money or sale or purchase of any bonds and do all things necessary or convenient to carry out such purpose in addition to the express powers conferred in this article. This article is remedial in nature and the powers hereby granted shall be liberally construed. 48-186. Supplemental nature of article This article is cumulative and the powers conferred hereby shall be in addition and supplemental to the powers conferred by any other general, special or local law. This article is not intended to repeal any other law, but insofar as the provisions of this article are inconsistent or in conflict with the provisions of any other law, the provisions of this article shall be controlling. 48-187. Governing body; civil immunity; definition A person who serves on the governing body of a district is immune from civil liability and is not subject to suit directly or by contribution for any act or omission resulting in damage or injury if such person was acting in good faith and within the scope of his official capacity, unless the damage or injury was caused by willful and wanton or grossly negligent conduct of such person. Nothing in this section limits or modifies the duties of such person to the district. As used in this section "official capacity" means any decision, act or event undertaken by the district in furtherance of the purpose or purposes for which the district was formed or any ancillary or additional purpose authorized by law. 48-201. Definitions In this article, unless the context otherwise requires: 1. "District" means any irrigation, drainage, flood control, agricultural improvement, electrical, water conservation or power district organized under the laws of this state. 2. "Governing body of the district" means the board of directors, board of trustees, district supervisors, or any other name by which the body charged with the administration of the affairs of a district may be known. 3. "Person" means any individual, firm, partnership, joint venture, corporation or association. 48-202. Approval of plans and specifications by the director of water resources A. When any construction, repair, alteration, extension or improvement work for district purposes is to be performed according to plans and specifications prepared by or for a district, the governing body of the district may, if it so desires, make application to the director of water resources for his approval in writing of the plans and specifications. B. All applications shall contain such information and data as the director may require and shall have attached to the application the plans and specifications to be approved. C. If application is made to the director for approval of plans and specifications for any such work, no person shall commence any such work until the director has approved the plans and specifications in writing, and when approved all work shall be performed strictly in accordance with the plans and specifications as approved. 48-203. Estimated cost of work; application fees; exemption A. The estimated cost of any such work shall include the cost of all labor and materials to be utilized in completing such work. B. Application shall be accompanied by a filing fee of fifty dollars. There shall be a further fee paid at the time of filing the application, or upon receipt of the proceeds of bonds and prior to beginning actual work if the work is to be paid for from the proceeds of bonds, based upon the estimated cost of the work, as follows: 1. For the first two hundred fifty thousand dollars, one per cent of the estimated cost. 2. For the next seven hundred fifty thousand dollars, one-half of one per cent. 3. For the next four million dollars, one-fourth of one per cent. 4. For all costs in excess of five million dollars, one-tenth of one per cent. C. The provisions of subsection B of this section shall not apply to a district formed by a county, city or town. 48-204. Liability in actions for damages A. No action shall be brought or maintained against the state, the director of water resources or his employees or agents for damages sustained as a result of the approval by the director of the plans and specifications for any such work. B. No action shall be brought or maintained against any person for damages resulting directly or indirectly from any such construction, repair, alteration, extension or improvement work performed by such person in accordance with plans and specifications as approved by the director. C. The provisions of subsection B shall not be deemed to limit the liability of any person for negligence or wilful wrongdoing during the performance of such work. D. Nothing in this section shall relieve a district from the legal duties, obligations and liabilities it may have arising from any work performed in accordance with the plans and specifications approved by the director, nor to relieve any district or person from the legal duties, obligations and liabilities provided under title 23. 48-205. Application of article Nothing in this article shall be deemed to apply to a contract between a district and the federal government under the provisions of article 5 of this chapter. 48-221. Definitions In this article, unless the context otherwise requires: 1. "Compensation" means money paid to an employee of a district for services in the form of a fixed salary or wages at the end of established pay periods, which, in the case of employees with fluctuating rates of pay, shall be considered as being the guaranteed rate of pay, and which, in the case of employees with dual rates, shall be for the primary occupation. Such fixed salary or wage rates for any regularly established pay period shall be that which is in effect on the first day of each such period. "Compensation" does not include payments for overtime and bonuses over and above fixed salaries or wages for normal hours of service. 2. "District" means an irrigation district, drainage district, flood control district, agricultural improvement district, electrical district, or power district organized pursuant to the laws of this state. 3. "District contributions" means sums of money paid by a district to finance a retirement plan. 4. "Employee" means a person in the service of a district whose customary employment is for an average of not less than thirty hours a week and for twelve months a year. 5. "Employee contributions" means sums of money paid by the employees of a district for participation in a retirement plan. 6. "Governing body" of a district means the body, board, commission, officer or officers, or other authority having charge of the finances of the district. 7. "Participant" means an employee of a district who is eligible under the provisions of section 48-224 for participation in the retirement plan adopted by a district. 8. "Plan" means a retirement plan authorized by section 48-222. 9. "Prior service" means service for a district by any employee for any period not exceeding twenty-five years immediately prior to the adoption of a retirement plan. 10. "Termination of service" means the cessation of employment of an employee by a district, but service shall not be deemed terminated by reason of any military absence, or any leave of absence or furlough granted by the district. 48-222. District retirement plans authorized; benefits provided A. A district which is not participating in the Arizona state retirement system provided by title 38, chapter 5, article 2, or the employees of which are not members of the Arizona state retirement system may, by appropriate action of a majority of its governing body, adopt a retirement plan for its employees. B. Any such retirement plan may provide for such of the following benefits in such amounts and at such times as the governing body of a district may determine: 1. Retirement income or pensions for eligible district employees upon attaining age not less than sixty years payable in installments not more frequently than monthly, either from a trust fund and the income therefrom created by employees' and district contributions or by the purchase of single premium annuity contracts with legal reserve life insurance companies authorized to transact business in Arizona in such amounts as the balance in the employees' accounts on the books of the trust fund will provide. 2. The purchase by the district of a group annuity contract with a reserve life insurance company providing for retirement income upon attaining age not less than sixty years, for death benefits of a participant prior to the participant's retirement, and for any of the other benefits mentioned in this section. 3. Payment of retirement pension or income upon an employee having a permanent and total disability to the extent to which the employee is prevented from engaging in the employee's normal occupation with the district. The disability retirement income shall commence at such time as the plan adopted by the governing body of a district shall provide. 4. Termination of service withdrawal benefits after both the attainment of age fifty and five years of participation in the plan. 5. The establishment of nonforfeitable interests of various types in any trust fund or annuity contract upon termination of service after not less than five years of continuous participation in the plan, depending upon the period of continuous participation. 6. Prior service retirement income and benefits. C. The governing body is authorized to adopt such other provisions in a plan as it may deem to be for the best interests of the participants and the district and which are actuarially sound and not in conflict with the provisions of this article. 48-223. Types of retirement plans; trust fund; insured plan The plan adopted may provide for either: 1. The creation of a retirement trust fund to consist of all contributions made by the district and the participants and the net income produced by the investment of the trust fund. The trust fund shall be held, managed and administered by a trustee pursuant to an agreement between the district and the trustee. The governing body of the district is authorized to enter into an agreement with a bank or corporation empowered to exercise trust powers providing for the holding, management, administration, and disposition of the trust fund upon such terms and under such conditions as the governing body may determine to be in the best interest of the participants and the district and to afford the greatest actuarially sound benefits to the participants. Such trustee shall be a corporation or association organized under the laws of this state or of the United States and shall have been engaged in business not less than ten years. The trust funds may be invested in any of the securities or obligations prescribed by section 38-719, or as hereafter amended, for the investment of funds of the Arizona state retirement system. 2. A group annuity contract with a legal reserve insurance company for the purpose of providing for the purchase of annuities, the payment of death and termination benefits, and such other benefits as shall be provided by the plan. The insurance company shall be authorized to transact business in the state for the purposes of issuing such group annuity contracts. 48-224. Eligibility and participation Each employee of a district shall be eligible to participate in the plan adopted if he has been continuously employed by the district for a period of not less than twenty-four months prior to the effective date of the plan adopted by a district, or for such longer period as may be provided in the plan. The plan may provide that an employee who shall have attained a specified age or who has been continuously employed by the district a specified number of years will not be eligible. Each other employee shall become eligible to participate on the first day of the month coinciding with or immediately