Ariz. Rev. Stat. § 48-3619 – Form, issuance and sale of bonds; limitation on bonded indebtedness; payment of bonds and interest

A. The bonds authorized pursuant to section 48-3618 shall be issued for the general purpose or purposes provided in the voted proposition, which may be the acquisition by purchase, construction or otherwise of any facilities designed to further the objects or purposes of the district or for improving and extending any such facilities, or any combination of such purposes, and may include the payment of all legal, engineering and fiscal expenses reasonably incurred in connection with the authorized purposes of the bonds and with the authorization and issuance of the bonds as well as expenses incurred in connection with the original organization of the district. The bonds shall be fully negotiable for all purposes and shall never be issued in an amount which:
1. 1. Together with all other existing bonded indebtedness of the district then outstanding, exceeds in total principal amount five per cent of the assessed valuation of taxable property in the district as computed from the last assessment roll for county purposes completed before issuing the bonds.
2. 2. Together with all other existing bonded indebtedness of a zone then outstanding for which the property of a zone is subject to tax under this article, exceeds in total principal amount five per cent of the assessed valuation of taxable real property in the zone as computed from the last assessment roll for county purposes completed before issuing the bonds.
B. The limitation on bonded indebtedness does not apply in those districts or zones which embrace portions of two or more irrigation districts which have water delivery contracts with the United States pursuant to federal reclamation laws.
C. The bonds are the general obligations of the district, zone or zones and the full faith, credit and resources of the district, zone or zones shall be pledged for their payment. The board shall certify to the board of supervisors to levy annually on all taxable real property in the district, zone or zones secondary property taxes fully sufficient without limitations as to rate or amount to pay principal of and interest on such bonds as principal and interest fall due.
D. The bonds shall mature at such time or times not more than forty years from their date, shall bear interest at such rate or rates set by the accepted bid which shall not exceed the maximum rate of interest stated in the resolution calling the election, shall be payable at such place or places within or without this state and generally shall be issued in such manner and with such details as may be provided in the resolution. The bonds may be made callable on any interest payment date at a premium not to exceed three per cent of their face amount. If the district has any source of revenues other than from the proceeds of taxes, all or such part of the revenues as the board of directors may deem advisable may, in the discretion of the board, be pledged to the payment of the bonds.
E. The board may provide in the resolution authorizing bonds that the bonds shall recite that they are issued under authority of this article. Such recital conclusively imports full compliance with this article and all bonds issued containing the recital are incontestable for any cause whatsoever after their delivery for value.
F. The board may provide for the publication of any resolution or other proceeding adopted by the board in a newspaper of general circulation in the area of jurisdiction. For a period of thirty days after the date of publication any person in interest may contest the legality of the resolution or proceedings of any bonds which may be authorized, or the provisions made for the security and payment of the bonds, and after such time no person has any cause of action to contest the regularity, formality, legality or source of payment for any cause whatsoever.
G. Subject to this section, the board shall declare by resolution its intention to sell such bonds and shall fix the date, hour and place of sale and shall give notice of the sale of the bonds by publication for at least ten days in a newspaper of general circulation in the area of jurisdiction and in any other newspaper as the board directs. The notice shall state that sealed bids only will be received by the board for the purchase of the bonds, and the bonds will be awarded to the highest responsible bidder at a price of not less than par and accrued interest, and that a good faith check equal to two per cent of the principal amount of bonds to be sold must accompany all sealed bids. The board may reject any and all bids. The bonds may be in denominations or multiples of one thousand dollars and shall be signed by such officers of the board as are designated by resolution adopted by the board. Any bonds bearing the signature of officers in office at the date of signing are valid and binding for all purposes, notwithstanding that before their delivery any such person whose signature appears on the bonds may no longer be an officer.
H. Bonds may be issued by the district after the issuance of all of the first bonds but must be issued pursuant to the making of a supplemental engineer's program and a hearing as prescribed in this section.
I. Bonds issued under authority of this article do not enjoy a priority over other bonds issued under this article by reason of time of authorization or issuance. Bonds issued under this article are not taxable by this state or by any county, city, town or other political subdivision of this state.
J. All bonds issued under this article are legal investments for all trust funds, including those under jurisdiction of this state, and for the funds of all insurance companies, banks and trust companies, for the investment of state monies and for all sinking funds under the control of this state and political subdivisions of this state.