A.R.S. tit. 48 ch. 28 — Arizona Revised Statutes Title 48 Chapter 28 — Active Management Area Water District

48-4801. Definitions In this chapter, unless the context otherwise requires: 1. "Active management area" means an active management area established under title 45, chapter 2. 2. "Board" means either the initial board of directors or the permanent board of directors of a district. 3. "Contract replenishment obligation" means an amount of groundwater that the district contracts to replenish in a year on behalf of a municipal provider pursuant to a contract authorized under section 48-4973, subsection B, paragraph 8. 4. "Credits" means any groundwater in addition to the amount of groundwater that may be used at a water district member land or delivered within a water district member service area for use within the water district member service area pursuant to the applicable assured water supply rules adopted by the department of water resources. 5. "Declaration" means an instrument recorded against real property and conforming to the requirements stated in section 48-4975, subsection A, paragraph 4. 6. "District" means an active management area water district established under this chapter. 7. "Effluent" has the definition prescribed by section 45-101. 8. "Excess groundwater" means an amount of groundwater equal to that amount of groundwater delivered to a water district member land in a calendar year or delivered within a water district member service area by the municipal provider for that water district member service area in a calendar year in excess of the amount of groundwater that may be used at the water district member land in that calendar year or may be delivered by the municipal provider for use within the water district member service area in that calendar year consistent with the applicable assured water supply rules adopted by the department of water resources pursuant to section 45-576, subsection H for the active management area where the water district member land or the water district member service area is located. 9. "Initial board" means the initial board of directors of a district organized under section 48-4803 for the purpose of establishing and managing the district preliminary to its permanent establishment under article 2 of this chapter or its dissolution under section 48-4806, subsection B, paragraph 2. 10. "Municipal provider" means a city, town or private water company. 11. "Operating unit" means a county, city, town, water company or political subdivision, this state, the United States, an Indian tribe or any other public or private entity with which a district has a contractual relationship for the acquisition, delivery, exchange, treatment, storage or recharge of water. 12. "Parcel of water district member land" means any portion of water district member land for which the county assessor for the county in which the water district member land is located has issued a separate tax parcel number. 13. "Permanent board" means the permanent board of directors of a district organized under section 48-4831. 14. "Private water company" has the same meaning as prescribed in section 45-402. 15. "Project" means a facility necessary or convenient to obtain, divert, withdraw, transport, exchange, deliver, treat or store water, including rights-of-way, real and personal property, interests in property and improvements to property that are necessary or appropriate to maintain and operate the facilities. 16. "Replenish" means to increase the amount of groundwater in an aquifer through water storage pursuant to title 45, chapter 3.1 for the purposes of meeting the obligations of article 7 of this chapter. 17. "Resolution" means a resolution, adopted by the governing body of a city or town, by the board of directors of a private water company that is a corporation, by the general partners of a private water company that is a partnership or by the individual owners of a private water company that is individually owned. 18. "Service area" has the same meaning as prescribed in section 45-402. 19. "Water company" means either a private water company as defined in section 45-402 or an irrigation district that primarily serves municipal water. 20. "Water district groundwater replenishment obligation" means, for the active management area in which water district member lands or water district member service areas are or may be located, the total of the cumulative water district parcel replenishment obligation of all parcels of water district member land in that active management area for a particular calendar year plus the cumulative water district service area replenishment obligation of all water district member service areas in that active management area for a particular calendar year. 21. "Water district member land" means any real property that meets the requirements of section 48-4975. 22. "Water district member service area" means the service area of a municipal provider that is located in the active management area in which the district is located and that qualifies as a water district member service area under section 48-4981, including any additions to or extensions of the service area. 23. "Water district parcel replenishment obligation" means, with respect to any particular parcel of water district member land, an amount of groundwater equal to the amount of groundwater delivered to the parcel of water district member land in a calendar year, multiplied by the percentage that the excess groundwater of the applicable water district member land for that year bears to the total amount of groundwater delivered to the applicable water district member land during that year. 24. "Water district service area replenishment obligation" means, with respect to any particular water district member service area, the excess groundwater of that water district member service area in a particular calendar year reduced by the replenishment credits, if any, applied by the municipal provider with respect to the water district member service area under section 48-4973, subsection I. 25. "Water storage" has the same meaning as prescribed by section 45-802.01. 48-4802. Formation A. A water district may be organized in an active management area in which all of the following conditions exist on the date the district is organized: 1. The active management area: (a) Has a management goal of safe-yield. (b) Contains territory in at least three counties. 2. The population of the most populous city in the active management area does not exceed seven hundred fifty thousand persons according to the most recent United States decennial census. B. The boundaries of the district shall be coterminous with the boundaries of the active management area. C. The district shall be organized on the adoption of a resolution approving the district's formation approved by a majority vote of each of the governing bodies of: 1. A majority of the counties in which the active management area is located, one of which must be the most populous county in the active management area. 2. The largest city by population in the active management area. 3. An irrigation district of more than one thousand acres in the active management area that levies district assessments under chapter 19, article 9 of this title. D. When each of the entities required under subsection C of this section has approved the formation of the district, the groundwater users advisory council in the active management area shall: 1. Notify the governing bodies of each county, city, town and irrigation district and each water company in the active management area that the district is being organized and that the initial board of directors will be appointed pursuant to section 48-4803. 2. Publish the notice once each week for two consecutive weeks in a newspaper of general circulation in the active management area. 48-4803. Initial board of directors; qualification and organization A. The governor shall appoint the initial board of directors, consisting of seven members, as follows: 1. One member from a list of nominees submitted by the board of supervisors of the most populous county in the active management area. 2. One member from a list of nominees submitted by the mayor with the approval of the city council of the most populous city in the active management area. 3. One member from a list of nominees submitted jointly by: (a) The mayor with the approval of the city council of the most populous incorporated city or town in the active management area that is located in a county other than the most populous county. (b) The board of supervisors of the county in which the city or town referred to in subdivision (a) is located. 4. One member from a list of nominees submitted by public or private agricultural interests representing owners or lessees of two thousand or more acres of land having irrigation grandfathered rights in the active management area. 5. Three members from lists of nominees submitted by the active management area groundwater users advisory council for each of the following areas of interest: (a) One member to represent mining interests, from a list of nominees that may be submitted to the council by mining companies in the active management area. (b) One member to represent water companies in the active management area that serve more than two thousand service connections, from a list of nominees that may be submitted to the council by such water companies. (c) One private citizen who resides in the active management area and who has no direct connection to or employment by any of the entity categories represented on the initial board. B. No member of the active management area groundwater users advisory council may serve on the initial board. C. Within thirty days after appointment each member of the initial board shall qualify for office by taking and subscribing the official oath. D. If a vacancy occurs on the initial board, it shall be filled in the same manner as the original appointment. A member so appointed shall qualify within thirty days after receiving notice of his appointment in the same manner as prescribed by this section and shall hold office as provided for other members of the initial board. E. The initial board shall conduct its organization meeting within thirty days after the appointment of its final member pursuant to subsection A. The initial board shall immediately enter upon its duties and shall select a chairman, vice-chairman and secretary-treasurer from among the members who shall hold office at the pleasure of the initial board. F. Initial members are not eligible for compensation but are eligible for reimbursement of actual and necessary expenses while engaged in official business under order of the initial board. 48-4804. Contest of formation; appeal Any aggrieved person or entity may contest the formation of a district under this chapter by filing an action within thirty days after the initial board assumes office under section 48-4803 in superior court in the most populous county in the active management area. If more than one such contest is pending, they shall be consolidated for trial. The court shall try the contest without delay and determine whether the district was properly organized and whether the initial board was properly appointed in substantial compliance with this article, and enter judgment accordingly. If an action is not filed within thirty days under this section, the formation of the district is presumed to be lawful and conclusive against all persons. 48-4805. Corporate existence; rights and immunities; official name A. A district is a corporate body and political subdivision of this state that may act in its official corporate name and has all of the rights and immunities of municipal corporations that are granted by the constitution and statutes of this state, including immunity of its property and bonds from taxation. B. The initial board, by resolution, shall establish the official name of the district, which shall contain the words "water district". The initial board shall provide written notice of the official name to the governor, secretary of state and director of water resources and to the entities that submitted nominees for appointment to the initial board under section 48-4803. 48-4806. Powers and duties of initial board; recommendation as to permanent organization or dissolution A. The initial board has all of the powers and responsibilities prescribed by this chapter unless specifically limited to the permanent board. B. Not later than thirty months after the initial board conducts its organizational meeting under section 48-4803, subsection E, it shall either: 1. Prepare, and adopt by resolution, a plan of permanent operation and administration. Before finally adopting the plan the board shall hold at least one public hearing on the proposed plan. The resolution must be approved by a majority of the initial board, and the approving majority must include the members serving on the initial board pursuant to section 48-4803, subsection A, paragraphs 1 and 2. The plan shall include a water resource augmentation plan under section 48-4854 and foreseeable water augmentation projects for the active management area and financing alternatives for each of the projects. The plan shall also prescribe transition procedures for converting to a permanent district under this chapter, to be completed not later than a stated period of time after adopting the resolution. The initial board shall send copies of the proposed plan and the finally adopted plan to each county, city, town, water company and irrigation district in the active management area, the active management area groundwater users advisory council, the director of water resources and each legislator whose district is in the active management area. 2. After a hearing and finding that a permanent district cannot feasibly function to the advantage of the water interests in the active management area, recommend that the district be terminated and outline a plan to conclude the affairs of the district pursuant to section 48-4807 within a stated period of time after making the recommendation. 48-4807. Dissolution A majority of the board may propose that the district be dissolved, but only if all contractual obligations and debts of the district are satisfied and another governmental entity or entities accept dedication of all district projects and of all water district groundwater replenishment obligations and other duties established under article 7 of this chapter. After a hearing, the board shall adopt by resolution a plan of termination to be executed within a stated period of time after it is adopted. All property of the district that is not dedicated to another governmental entity shall be transferred to the department of water resources for use in the active management area. All unexpended and unencumbered monies of the district shall be deposited, pursuant to sections 35-146 and 35-147, in the fund account established for the active management area under section 45-615. 48-4831. Permanent board of directors; qualification and organization; compensation (L93, ch 107 sec 15.) A. The permanent board of directors shall consist of eleven persons, each representing a separate division established pursuant to section 48-4834, subsection A, paragraph 2 plus one person appointed by the board of supervisors of any county in which fifty per cent or more of the assessed value of that county is located in the district. Each director shall be a qualified elector of a county located in whole or in part in the district and be a resident of the division or county that the director represents. B. On adopting a plan of permanent operation and administration, the initial board shall continue to constitute the district board until the elected directors of the permanent board are elected and qualify. At the next general election after the adoption of the plan of permanent operation and administration, the directors from divisions 1 through 5 shall be elected to serve four year terms and the directors from divisions 6 through 11 shall be elected to serve two year terms. Thereafter, all elected directors shall be elected to serve four year terms. Each director elected shall assume office on January 1 immediately following the election. The term of office and the time of assuming office for persons appointed to the permanent board by a board of supervisors are the same as for those persons elected from divisions 1 through 5. C. Each member of the permanent board shall qualify for office by taking and subscribing the official oath. The official oath shall be filed with the permanent board. D. If a vacancy occurs on the board, the board shall nominate and the governor shall appoint a replacement from the division in which the vacancy occurs. A director so appointed shall qualify within thirty days after receiving notice of the appointment in the same manner as prescribed by this section and shall hold office for the remainder of the term to which the appointment was made. E. The board shall select a chairman, vice-chairman and secretary-treasurer from among the members who shall hold office at the pleasure of the board. F. Board members are not eligible for compensation but are eligible for reimbursement of actual and necessary expenses while engaged in official business under order of the board. 48-4831. Permanent board of directors; qualification and organization; compensation (L93, ch 144 sec 1.) A. The permanent board of directors shall consist of eleven persons, each representing a separate division established pursuant to section 48-4834, subsection A, paragraph 2 plus one person elected at large from that portion of any county in which fifty per cent or more of the assessed value of that county is located in the district. Each director shall be a qualified elector of a county located in whole or in part in the district and be a resident of the division or that portion of the county that the director represents. B. On adopting a plan of permanent operation and administration, the initial board shall continue to constitute the district board until the directors of the permanent board are elected and qualify. At the next general election after the adoption of the plan of permanent operation and administration, the directors from divisions 1 through 5 shall be elected to serve four year terms and the directors from divisions 6 through 11 and the at large county directors shall be elected to serve two year terms. Thereafter, all directors shall be elected to serve four year terms. C. Each member of the permanent board shall qualify for office by taking and subscribing the official oath. The official oath shall be filed with the permanent board. D. If a vacancy occurs on the board, the board shall nominate and the governor shall appoint a replacement from the division or that portion of the county in which the vacancy occurs. A director so appointed shall qualify within thirty days after receiving notice of the appointment in the same manner as prescribed by this section and shall hold office for the remainder of the term to which the appointment was made. E. The board shall select a chairman, vice-chairman and secretary-treasurer from among the members who shall hold office at the pleasure of the board. F. Board members are not eligible for compensation but are eligible for reimbursement of actual and necessary expenses while engaged in official business under order of the board. 48-4832. Elections; nominating petitions A. A candidate for election to the permanent board as a division director shall be nominated by a petition signed by at least one hundred fifty qualified electors of the division in which the candidate resides. A candidate for election to the permanent board as an at large county director shall be nominated by a petition signed by at least one hundred fifty qualified electors of that portion of the county that is within the district. B. If a division is located wholly in one county and for the at large board position for that county, the nominating petition shall be filed with the clerk of the board of supervisors or the elections officer of that county as prescribed by title 16, chapter 3. C. If a division is located in two or more counties, the nominating petition shall be filed as prescribed by title 16, chapter 3, with the county elections officer for the county with the highest number of registered voters within the district. The county election officer shall immediately notify the board of supervisors of each county included in the division. Each board of supervisors so notified shall provide for the manner of voting and conduct of the election as provided for in subsection D. D. The names of the candidates for election to the permanent board shall be included on the election ballot of the division in which the candidate resides, or on the election ballot for that portion of the county that is within the district, as appropriate, without party designation. The manner of voting and conducting the election for the directors shall conform to the provisions of law relating to the general election of county officers including compliance with any applicable federal voting laws. E. Title 16, chapter 2, article 3 does not apply to any election held pursuant to this section. F. All expenses for the election of members of the permanent board incurred pursuant to this section are the responsibility of the county or counties involved. If a division is located in two or more counties, election expenses for that division shall be shared proportionately based on the number of qualified electors of each county who are residents of the division. G. Candidates for the permanent board and their campaign committees shall register with and report to the secretary of state and otherwise comply with the requirements of title 16, chapter 6, regarding elections under this section. 48-4833. Meetings; agenda A. The board shall hold regular meetings every calendar quarter and additional meetings on the call of the chairman or a majority of the members of the board. The secretary-treasurer shall give at least three days' notice of each meeting to each member of the board in addition to the public notices required by law. B. The district is a public body for purposes of title 38, chapter 3, article 3.1. 48-4834. Administrative powers and duties; division boundaries; executive director and employees; annual report A. The board shall: 1. Determine its organizational and procedural structure, adopt, amend or repeal bylaws, rules and forms consistent with the requirements of this chapter and prescribe a system of accounts. 2. Determine the boundaries of the divisions in the district that shall be numbered respectively divisions 1 through 11. After each United States decennial census the board shall define the boundaries and limits of each division and shall: (a) Make the divisions equal or as nearly equal in population as is practicable, based on the census. (b) Make the configuration of each division as compact as practicable consistent with equal population. (c) Preserve existing communities of interest within the same division to the extent practicable. (d) If possible, align the divisions over identified groundwater sub-basins and the division boundaries along existing voting precinct boundaries, survey lines or political or administrative boundaries. B. The board may: 1. Manage, set policy and conduct the business and affairs of the district. 2. Make and execute all necessary contracts, including intergovernmental agreements pursuant to title 11, chapter 7, article 3. 3. Sue and be sued. 4. Adopt a seal for the district to be used to attest to documents. 5. Provide for payment of all debts and appropriate claims against the district from the appropriate funds. 6. Employ an executive director and such administrative, legal, engineering, accounting, clerical and other staff as may be necessary and prescribe the duties, terms and conditions of employment. 7. Retain outside professional services, including legal counsel. 8. Acquire suitable offices, furnishings and necessary equipment and supplies. 9. Perform all other acts necessary to carry out the purposes of this chapter. C. The board shall prepare and publish an annual report on or before December 1 each year containing a full and complete account of its transactions and proceedings for the preceding fiscal year and other facts and recommendations deemed to be of public value. This annual report may include and may be combined with the financial report prescribed by section 48-4888. The district shall make copies of the annual report available to the public on request. D. All employees shall be selected on a nonpartisan basis according to their qualifications. The executive director shall serve at the pleasure of the board. E. Immediately on organization, the permanent board shall initiate proceedings to determine the application of federal voting laws to the district and shall take any necessary action to comply with the applicable federal law. 48-4835. Advisory council A. As part of a plan of permanent operation and administration adopted under section 48-4806, subsection B, paragraph 1, the initial board shall determine the size and representative nature of a permanent advisory council to the permanent board. The advisory council shall include representatives of mining, agricultural and environmental interests, water companies, each incorporated city and town in the district and each county located in whole or in part in the district. B. The advisory council shall have the powers, functions and duties prescribed by the plan of permanent operation and administration including mandatory oversight and review and the right to make recommendations to the permanent board regarding the capital and operating budgets of the district and any planned projects of the district. 48-4851. Cooperation with governmental entities A. The district shall cooperate, coordinate and confer with the director of water resources, state agencies, other special districts, authorities and other political subdivisions of this state and the United States with respect to matters within their jurisdiction relating to augmenting water supplies of the active management area and developing state water plans. B. In acquiring, constructing and operating projects, the district, consistent with the purposes and policies of this chapter, shall cooperate with established and existing organizations for use of or interconnection with suitable diversion, withdrawal, transportation, delivery, treatment, storage or recharge facilities. C. Any operating unit, or combination of operating units, may request the district to exercise its powers and privileges in making any project or proposed project survey or investigation, or for assistance in initiating or completing any works or projects authorized by this chapter. D. The district may act as: 1. A bargaining and negotiating agency on the request of an operating unit in transactions and dealings between the various departments of the federal government. 2. A connecting, intermediate or contracting medium for operating units when, for united or joint participation, such a medium is convenient or essential to the receipt, acceptance or enjoyment by the operating units of any financial proposals, grants or other benefits made available under any statute or by any entity. 3. A coordinating, clearing, administering or supervising instrumentality by and through which operating units may cooperate or unite through or by contracts or agreements in applying or pooling their resources, functional rights or privileges for common purposes contemplated under this chapter. 4. An agency to enhance the water supply for the active management area for purposes of section 45-576. E. Operating units may enter into contracts, agreements and arrangements, including intergovernmental agreements under title 11, chapter 7, article 3, which may be necessary to accomplish the purposes of this section. If convenient and essential to accomplish such purposes, the operating units and the district may associate themselves in a cooperative corporation under the incorporation laws of this state, and it is the duty of each party to do and perform all things on their respective parts under that association. F. This section shall not be construed to alter any debt limitation of the operating units. 48-4852. Limitation on powers This chapter shall not be construed to modify, alter or change the functions, powers, duties, rights and liabilities prescribed under title 45, chapters 1, 2 and 3. This chapter does not authorize the district to: 1. Engage in the retail distribution of water within the service area of a city, town, water company or irrigation district without the written authorization of the city, town, water company or irrigation district. 2. Regulate the acquisition, use or disposal of water or rights to water except as specifically provided by this chapter or pursuant to contractual agreements that are consistent with this chapter. 3. Sell, resell, deliver or distribute electricity or other forms of energy to others. 4. Acquire any water except: (a) Water from within the Tucson active management area. (b) Effluent. (c) Central Arizona project water. (d) Central Arizona project water from Indian tribes. (e) Colorado River water having a priority earlier than September 30, 1968 from an irrigation district having an entitlement to such water, but only with the consent of the irrigation district and upon such terms as the irrigation district may specify. 5. Acquire electrical power and energy that is sold, offered for sale or otherwise disposed of pursuant to title 30, chapter 1 or title 45, chapter 10. 48-4853. Functional powers of board The board, for and in the name of the district, may: 1. Acquire in any lawful manner, except as limited by this chapter, and sell, lease, exchange or otherwise dispose of real and personal property, easements and rights-of-way that are necessary or required for the uses and purposes of the district. 2. Construct, maintain and operate all works and other property acquired and used for any of the projects owned by the district. 3. Acquire, hold, assign or otherwise dispose of long-term storage credits registered to storage accounts under any provision of title 45, chapter 3.1. 4. Accept appointment or other authorization and act as agent of any operating unit for purposes of acquiring, transporting, delivering, treating or storing water pursuant to this chapter. 5. Issue bonds and pledge all or part of its revenue from any source for security and payment of its bonds except replenishment tax and replenishment assessment revenues generated under article 7 of this chapter. 6. Negotiate, make, execute, acknowledge and perform any contract, agreement or obligation it deems advisable for the interest of the district or to carry out or accomplish the purposes of this chapter, including agreements to acquire water supplies, for water exchanges and for water deliveries. 7. Except as otherwise limited by this chapter, acquire electricity or other forms of energy necessary to transport water or otherwise operate the projects of the district. 8. Plan, coordinate, construct, operate, maintain and dismantle water augmentation projects including treatment, water storage, storage facilities and recovery wells and retention projects and, in conjunction with county flood control districts, flood control projects for water augmentation purposes. 9. Provide technical or financial assistance to operating units relating to developing water supplies for purposes of the management goals and plans adopted under title 45, chapter 2. 10. At any time after the adoption of a plan of permanent operation and administration, adopt an ordinance or resolution directing the district to undertake the water district groundwater replenishment obligations of water district member lands and water district member service areas pursuant to section 48-4982. 11. Advance monies necessary for the installation, construction, repair, maintenance or replacement of capital improvements related to water storage, storage facilities and recovery wells for replenishment purposes or any other replenishment activities of the district undertaken pursuant to article 7 of this chapter. Monies advanced under this paragraph shall bear interest as determined by the board. Repayment of the advances shall be amortized over the useful life of the capital improvements, as determined by the board. 12. Advance monies for the payment of the operation and administrative costs and expenses of the district relating to performance of the water district groundwater replenishment obligations under article 7 of this chapter and including reasonable reserves. Monies advanced under this paragraph shall bear interest as determined by the board. Repayment of the advances shall be amortized over a reasonable period, as determined by the board. 13. Assign to the water district account of the district at fair value long-term storage credits held by the district and accrued through water storage. 14. Conduct any other activities that are reasonably necessary and related to the powers and duties described by this chapter. 48-4854. Planning In conjunction and cooperation with the director of water resources, the groundwater users advisory council and operating units in the active management area, and consistent with the management plan adopted for the active management area under title 45, chapter 2, article 9, the district shall: 1. Develop a comprehensive water resource augmentation plan for the active management area to guide the development of water augmentation efforts in the active management area. 2. Coordinate water conservation efforts to encourage pooling the resources of all operating units in the active management area to maximize conservation of the existing water sources in the active management area. 48-4855. Acquisition of water A. The district, subject to the limitations described in section 48-4852, paragraph 4, may: 1. Negotiate to acquire in its own name, or on behalf of an operating unit located in the active management area, water and rights to water which may be legally available to augment the water supply of the active management area. The district shall not acquire a nonrenewable water source from an area outside its own active management area. 2. Sell or exchange any water it acquires in its own name to or with any operating unit in the active management area under such terms as are necessary to ensure the use of the water in a manner consistent with the management goal and plan of the active management area prescribed under title 45, chapter 2, article 9 and the water augmentation plan developed under section 48-4854. 3. Sell, lease, exchange, hold, sever, transfer or retire water rights. 4. Negotiate and enter into agreements to use existing facilities to transport water to the active management area and within the active management area. 5. Apply for and hold, in its own name or on behalf of an operating unit or units, permits that are required by law to engage in any of the activities described in this chapter. B. The district shall not by contract obligate or bind itself to take delivery of any water until it develops a means to store or dispose of the water. C. In acquiring, selling, leasing, exchanging, holding, severing, transferring or retiring any water or rights to water, the district shall comply with any applicable federal or state law, regulation, rule, order, permit or other requirement applicable to the water or rights to water. 48-4856. Acquisition of property; limited eminent domain authority; survey rights A. The legal title to all property and property rights acquired under this chapter vests in the district and shall be held for the uses and purposes prescribed by this chapter. B. The board may: 1. Acquire, hold, manage, occupy and possess property as provided by this chapter. 2. Take conveyances for all property acquired by the district in the name of the district. 3. Sell, lease, exchange or otherwise dispose of any property of the district which is no longer necessary or suitable for the uses and purposes of the district and execute, acknowledge and deliver all such conveyances, leases, contracts or other instruments as the board deems necessary. 4. Institute and maintain actions and proceedings necessary to enforce, maintain, protect or preserve all rights, privileges and immunities created or granted by this chapter relating to acquiring, owning and disposing of property. C. The board may institute condemnation proceedings in the name of the district, and all statutes of this state relating to the exercise of eminent domain apply to the proceedings, except that the board may not exercise the right of eminent domain: 1. Outside of the active management area. 2. To condemn land or existing projects or facilities owned by any governmental entity or person for the purpose of condemning water rights or existing water production, delivery or storage systems. 3. To acquire electrical facilities, whether real or personal property, or to make an extension or addition in order to serve areas that are already lawfully served. D. Agents, employees and representatives of the board may enter any land on reasonable notice to the owner or occupant to survey or locate necessary works, rights-of-way or structures for the purposes of the district. 48-4857. Construction work and purchases by bid only; exceptions; award of contract; bond A. The construction of projects or facilities undertaken by the district shall be by contract and not by force account. The district may enter into contracts for construction work exceeding twenty-five thousand dollars only after notice published for at least ten days, except in cases of emergency to prevent imminent loss or danger. All such contracts shall be let by public bid to the lowest responsible bidder. The district may call for sealed bids and may accept or reject any bid. Bids shall be accompanied by a reasonable bid bond in an amount the district demands. This subsection does not apply to any contracts entered into with a state or federal agency, a political subdivision or an Indian tribe. B. All purchases and contracts made by the district for material or services other than personal services shall be made after advertising in such manner and at such times sufficiently in advance of opening bids as the district deems adequate to ensure appropriate notices and an opportunity for competition. Advertisement is not required, but the purchase or procurement may be made in the open market, in any of the following cases: 1. An emergency requiring immediate delivery of the material or performance of the services. 2. Repair parts, accessories or supplemental equipment or services that are required for material or services previously furnished or contracted for. 3. If the aggregate amount involved in the purchase of material or procurement of services does not exceed twenty-five thousand dollars. C. In comparing bids and in making awards the district shall give due consideration to such factors as: 1. The relative quality and adaptability of material or services. 2. The bidder's financial responsibility, skill, experience, record of integrity in dealing and ability to furnish repair and maintenance services. 3. The time of delivery or performance offered. 4. Whether the bidder has complied with the specifications. D. Subsection C does not apply to any contracts entered into with a state or federal agency, a political subdivision or an Indian tribe. E. The district shall protect its interests by providing for and securing such bond or bonds as are required under title 34, chapter 2, article 2. 48-4881. Administrative and operation budgets A. On or before July 1 each year the district shall adopt an administrative budget for the succeeding fiscal year. The budget shall consist of a complete statement of administrative expenditures from the general fund during the past fiscal year and an estimate of the different amounts which may be deemed necessary to meet administrative requirements of the district for the next fiscal year, fixing the amounts proposed for all recurring items of expense and an amount for contingencies or emergencies. No administrative expenditures may be made in excess of the total amount of the budget. Economies resulting in remaining balances for any fiscal year shall be available for subsequent administration or operating purposes. B. The district shall also prepare an operation budget for each fiscal year covering operations and including capital items. The budget shall consist of a full and complete statement of all incoming receipts and expenditures for the past fiscal year and an estimate of anticipated income and expenditures for the next fiscal year. The budget shall also give a complete asset and liability statement and statement of profit and loss, together with an itemized statement of cash on hand, commitments, reserves and obligations anticipated for the next fiscal year, together with such other information as will give a full and complete disclosure of the current financial condition of the district. C. The district shall transmit copies of the budget to each operating unit, the groundwater users advisory council for the active management area and the director of water resources. 48-4882. Augmentation administration fee A. From and after the date on which the district is initially organized under section 48-4802, the state treasurer shall transfer all unencumbered monies for the purpose of augmentation of the water supply of the active management area levied pursuant to section 45-611, subsection A, paragraph 2 and received after January 1, 1990 pursuant to section 45-615, paragraph 1, with accrued interest, to the secretary-treasurer of the district for deposit in the general fund of the district. B. From and after the date on which the permanent board assumes office under section 48-4831, the active management area is exempt from the groundwater withdrawal fee for augmentation under section 45-611, subsection A, paragraph 2, but the state treasurer shall continue to transmit to the district all such monies that continue to be collected for periods preceding the permanent organization of the board. The exemption provided by this subsection terminates if the district is dissolved under section 48-4807. C. From and after the date on which the permanent board assumes office, the board may levy an annual groundwater withdrawal fee for augmentation of the water supply from each person withdrawing groundwater in the active management area in an amount not greater than two dollars per acre-foot of groundwater withdrawn and beneficially used. The director of water resources shall collect the augmentation fee levied under this subsection. D. The permanent board shall set the augmentation fee under subsection C of this section not later than October 1 of each year for the following calendar year. Within thirty days after the permanent board sets the augmentation fee, the board shall give written notice of the fee to: 1. The clerk of the board of supervisors of the counties in the active management area and to the mayor of each city or town, to each water company and to the presiding officer of each political subdivision established pursuant to chapter 17, 18, 19 or 20 of this title in the active management area. 2. All holders of grandfathered rights and groundwater withdrawal permits in the active management area. E. A person who, under section 45-604, subsection B, is not required to use and does not use a water measuring device to measure withdrawals made pursuant to a type 2 non-irrigation grandfathered right or a groundwater withdrawal permit shall pay an amount equal to the augmentation fee set by the board for the calendar year multiplied by the number of acre-feet of the grandfathered right or the groundwater withdrawal permit. F. The augmentation fee under subsection C of this section shall be paid to the director of water resources at the time the person withdrawing groundwater files a report on annual groundwater withdrawals pursuant to section 45-632. If a person who is required to pay the fee for any calendar year fails to pay the fee for the calendar year in question on or before March 31 of the following year, the director of water resources may assess and collect a penalty of ten per cent of the unpaid fee, without compounding, for each month or portion of a month that the fee is delinquent. The total penalty assessed under this subsection shall not exceed sixty per cent of the unpaid fee. The director of water resources shall transmit all monies collected under this section to the secretary-treasurer of the district for deposit in the general fund of the district. 48-4883. Water supply fees The district may assess fees, including extraction fees, development impact fees, connection fees, user fees, replenishment fees and administration fees, against any operating unit or other person with which the district has a contractual responsibility to provide any service. The amount of the fee and the method of payment shall be determined pursuant to the agreement between the district and the operating unit or person, based on the cost of the service the district provides. Any fee assessed under this section is not a rate or charge of the operating unit and is not subject to regulation by the Arizona corporation commission. The secretary-treasurer of the district shall deposit all monies received under this section in the general fund of the district. 48-4885. Accounting classifications; bond fund; general fund A. The secretary-treasurer of the district shall establish appropriate accounting classifications and designations in the district accounting records to provide for accurate and systematic control and allotment of all monies received. B. The secretary-treasurer shall maintain a bond fund and a general fund of the district and shall apportion all monies received into the fund corresponding with the purpose for which the monies were received. The secretary-treasurer may invest inactive monies from either the general fund or the bond fund and shall credit income earned on the investments to the respective fund. 48-4886. Receipt of monies; disbursements; operation of accounting system A. Monies due to the district under agreements for the sale of water or other services, proceeds of bond issues or any other obligation may be made payable at the office of the district. All monies derived from operations of the district and received by any officer, agent or employee of the district shall be promptly remitted to the secretary-treasurer. B. All operation monies of the district shall be paid out only according to the regularly adopted operation budget of the district on warrants in discharge of claims and obligations approved by the board, signed by the chairman of the board and countersigned by the executive director or other duly authorized officer of the district. C. The appropriate claim vouchers shall be regularly entered in the accounting system of the district and preserved for auditing purposes. 48-4887. Payment of interest coupons; investment of bond fund monies The secretary-treasurer of the district shall: 1. Pay matured interest coupons from bonds of the district from the bond fund. 2. Invest monies in the bond fund, under direction of the board, in bonds of the United States or this state which shall be kept in the bond fund and may be used to redeem bonds of the district, on the request of the holders, either by exchanging them for bonds of the district or by converting them into cash. 48-4888. Annual financial report and audit A. On or before December 1 each year the board shall make a verified statement of the financial condition of the district as of June 30 of the preceding fiscal year, showing particularly the receipts and disbursements during the fiscal year and the source of the receipts and the purpose of the disbursements. The statement may be included in and combined with the annual report prescribed by section 48-4834, subsection C. B. Within thirty days after the close of each fiscal year the district shall cause an audit to be made of the funds of the district by a certified public accountant. The board shall file a copy of the audit with the auditor general. The auditor general may make such further audits and examinations as he deems necessary and may take appropriate action relating to the audit pursuant to title 41, chapter 7, article 10.1. If the auditor general takes no official action within thirty days after the audit is filed, the audit is deemed sufficient. The board shall pay any fees and costs of the certified public accountant and auditor general under this section from the general fund of the district. 48-4911. Authority to issue revenue bonds If the district finds other financing methods or procedures inadvisable, inadequate or insufficient to acquire or construct projects, works or facilities, it may independently or in conjunction with any other optional or alternative plans provided in this chapter issue revenue bonds as provided by this article. 48-4912. Prerequisites to issuance No revenue bonds may be issued until provision is made by contracts pursuant to this chapter adequate in the judgment of the board to ensure all necessary fiscal reserves, operation costs, maintenance and depreciation charges and payment of principal and interest of any bonds relating to any proposed project or facility involved and within the time fixed. Revenue bonds shall not be issued except on resolution by the district. 48-4913. Scope of resolution A. Resolutions for a bond issue or issues under this article shall state the amount of the proposed issue or issues, the proposed interest rate and types and terms of bonds, that all other methods of necessary financing by the district have been found impractical, inadvisable or inadequate and that the issuance of the bonds is necessary and advisable as proposed. B. Resolutions shall be signed by the district chairman and secretary-treasurer. In support of the resolution the district shall enter into its record pertinent engineering, economic and financial data, appropriate maps, drawings, plans, outlines, calculations, summaries and related agreements and any other essential information constituting a record appropriate to the resolution. C. The resolution may approve a bond issue to finance an entire plan or system or any single or joint project, section or other facility of a related system or plan proposed for ultimate integration and completion. 48-4914. Hearing; findings A. The chairman of the board, at the earliest practical date, shall fix a time and place for a hearing not less than twenty nor more than thirty days after adopting the resolution. Notice of the time and place fixed for the hearing shall be published twice in a newspaper of general circulation in the active management area. B. All pertinent records and documents shall be filed not less than ten days before the date set for the hearing. Prehearings respecting any particular document, feature or incidental matter or any separable part or portion of any resolution may be held by the board on ten days' previous written notice if the board deems that holding a prehearing is conducive to expediting a final hearing, and a decision as to the issues presented may thereupon be rendered. C. At the time and place fixed for the hearing, the board shall examine and determine the matters and questions involved. Hearings may be recessed, adjourned or continued as the board may order. D. Any person who holds an original agreement or proposal made with the district relating to or concerning the handling, sale, control or disposition of a proposed issue of bonds or who has previously made an offer or bid in good faith to purchase the bonds pursuant to a published invitation for bids by the district, and any operating unit holding contracts with the district not less than ten days before the date fixed for the hearing, may qualify to be heard. E. If the board finds that all precedent requirements and conditions have been fulfilled, it shall approve the bond issue in whole or in part, or shall otherwise disapprove the bond issue as a whole or as to such features or proposals as do not meet essential requirements. When the board has made and entered its findings, it shall enter a decision accordingly. F. The decision of the board based on findings of fact which are supported by a preponderance of the evidence and which are not arbitrary or unreasonable is final and conclusive. 48-4915. Issuance of revenue bonds Revenue bonds issued under this article shall be authorized by resolution of the district and may be issued in one or more series, shall bear such date or dates, mature at such time or times, bear interest at such rate or rates, be in such denomination or denominations and in such form, either coupon or registered, carry such conversion or registration privileges, have such rank or priority, be executed in such manner and be payable in such medium of payment, at such place or places, and subject to such terms of redemption, with or without premium, as the resolution may provide. Bonds may be sold at public or private sale at not less than par with accrued interest. Notwithstanding any provision of law to the contrary, bonds issued pursuant to this article are negotiable. 48-4916. Provisions of revenue bonds; sale A. Revenue bonds issued under this article shall provide that: 1. The bond is purchased and taken after a complete disclosure of and with a full knowledge of all of the surrounding relevant facts and circumstances and not on the representation, faith or credit of the district, this state or any of its political subdivisions. 2. The holder in order to obtain payment may not compel this state or any of its political subdivisions to exercise its appropriation or taxing power. 3. The bond does not constitute a debt of this state and is payable only from revenues of the district. B. The gross or net revenue derived from any project or any part of a project may be pledged to secure the payment of any series of bonds. C. The district may provide for reimbursement to the holder of all expenses of litigation and attorney fees incurred in collecting the bonds in the event of default, and may provide for and fix the powers and duties of a trustee if necessary to enforce collection. Bond resolutions, agreements and bonds may be in such form and may contain such other conditions and terms as the district deems appropriate or necessary to make the bonds fully salable and marketable. D. The district may provide that any holder of bonds, or a trustee designated by the district at the time of issuing the bonds, may on proper showing secure an order of the superior court requiring the district, subject to the contracts with operating units then in effect, to fix and collect rates and charges which will produce adequate revenues to permit setting up adequate yearly reserves with which to meet future payments according to the terms of the bond. E. All revenue bonds issued by the district and agreements of the district with respect to revenue bonds are subject to this chapter, and no revenue bond or agreement may contain any provision in conflict with this chapter. An amendment of this chapter does not diminish or impair the remedy and rights of the bondholder. F. The bonds shall be signed by the chairman or vice-chairman and the secretary-treasurer of the district who are in office at the date of signing and are valid obligations of the district although before delivery or sale the persons whose signatures appear on the bonds may have ceased to be officers of the district. G. The validity of the bonds is not dependent on or affected by the legality of any proceeding relating to the acquisition, construction, improvement or extension of a project for which the bonds are issued. The bonds shall recite that they are regularly issued pursuant to this chapter and that recital is prima facie evidence of their legality and validity. H. Bonds so issued may be sold when the money is needed for the purposes for which they were issued. Pending the preparation or execution of definite bonds, interim receipts or certificates or temporary bonds may be delivered to the purchaser or purchasers of bonds. 48-4917. Certification of bonds by attorney general The board may submit any bonds issued under this article to the attorney general after all proceedings for their authorization have been completed. On submission the attorney general shall examine and pass on the validity of the bonds and the regularity of the proceedings. If the proceedings comply with this article, and if he determines that, when delivered and paid for, the bonds will constitute binding and legal obligations of the board, the attorney general shall certify on the back of each bond, in substance, that it is issued according to the constitution and laws of this state. 48-4918. Validity of bonds This chapter constitutes full authority for authorizing and issuing bonds without reference to any other law of this state. No other law with regard to the authorization or issuance of obligations or which in any way impedes or restricts the carrying out of the acts authorized by this article may be construed to apply to any proceedings taken or acts done pursuant to this article. 48-4919. Water district revenue bonds as legal investments Active management area water district revenue bonds issued under this article are securities in which public officers and bodies of this state and of municipalities and political subdivisions of this state, all companies, associations and other persons carrying on an insurance business, all financial institutions, investment companies and other persons carrying on a banking business, all fiduciaries and all other persons who are authorized to invest in governmental obligations may properly and legally invest. The bonds are also securities which may be deposited with public officers or bodies of this state and municipalities and political subdivisions of this state for purposes which require the deposit of governmental bonds or obligations. 48-4971. Undertaking of replenishment obligation A. At any time after the adoption of a plan of permanent operation and administration under section 48-4806, subsection B, the board may elect to adopt an ordinance or resolution to undertake the water district groundwater replenishment obligation of any and all real property and municipal providers that thereafter qualify as, respectively, water district member lands and water district member service areas under this article. B. Following the adoption of such ordinance or resolution the district shall perform the duties and obligations set forth in this article. C. The district shall promptly notify the director of water resources and any replenishment authority established under chapter 22 of this title of the adoption of such ordinance or resolution. 48-4972. Groundwater replenishment obligation; replenishment location; source of replenishment; exception A. The district shall replenish groundwater in an amount equal to the water district groundwater replenishment obligation. The district shall complete the replenishment of the water district groundwater replenishment obligation applica