61-39 Lake Agassiz Water Authority - North Dakota Statutes

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CHAPTER 61-39LAKE AGASSIZ WATER AUTHORITY61-39-01. Findings and declaration of policy. The legislative assembly declares thatmany areas and localities in eastern North Dakota do not enjoy adequate quantities of
high-quality drinking water; that other areas and localities in eastern North Dakota do not have
sufficient quantities of water to ensure a dependable, long-term supply; that greater economic
security and the protection of health and property benefits the land and water resources of this
state; and that the promotion of the prosperity and general welfare of all of the people of this
state depend on the effective development and utilization of the land and water resources of this
state and necessitates and requires the exercise of the sovereign powers of this state and
concern a public purpose. To accomplish this public purpose, it is declared necessary that a
water authority to store and distribute water to eastern North Dakota be established to provide for
the supply and distribution of water to the people of eastern North Dakota for purposes, including
domestic, rural water, municipal, livestock, light industrial, and other uses, with primary emphasis
on domestic, rural water, and municipal uses; and provide for the future economic welfare and
prosperity of the people of this state, and particularly the people of eastern North Dakota, by the
bulk purchase of water from the Garrison Diversion Conservancy District delivered by the Red
River valley water supply project for beneficial and public uses.The Garrison DiversionConservancy District may acquire, construct, improve, and own the Red River valley water
supply project and may enter water supply contracts with member cities and water districts for
the sale of water for consumption within or outside the district or the state. Alternatively, the Lake
Agassiz water authority may enter one or more contracts to provide for the authority to acquire
bulk water from the Garrison Diversion Conservancy District and may enter water supply
contracts with member cities and water districts for the resale of this water for consumption within
or outside the state.The legislative assembly acknowledges that North Dakota and Minnesota communitiesjointly use the Red River as a water resource. It is in the best interest of eastern North Dakota
also to study and possibly provide for the water needs of those Minnesota communities through a
Red River valley water supply project, particularly if that project maintains the use of the Red
River for North Dakota communities.In furtherance of this public purpose, the state water commission may provide for theissuance of bonds in accordance with chapter 61-02 to finance the costs of any project to deliver
water to eastern North Dakota. This chapter does not abrogate or limit the rights, powers, duties,
and functions of the state water commission or state engineer, but is supplementary to those
rights, powers, duties, and functions.61-39-02. Lake Agassiz water authority created. The Lake Agassiz water authorityconsists of cities and water districts located in that part of the state which is included within the
boundaries of Cavalier, Pembina, Walsh, Nelson, Grand Forks, Griggs, Steele, Traill, Barnes,
Cass, Ransom, Sargent, and Richland Counties and that pay dues to the authority. Minnesota
cities may join the authority, provided a portion of the city is located within five miles [8.05
kilometers] of this state, or if the city uses the Red River for its primary water supply.Theauthority is a governmental agency, body politic and corporate with the authority to exercise the
power specified in this chapter, or which may be reasonably implied. Cities and water districts
may pay dues to the authority as determined by the authority.61-39-03. Lake Agassiz water authority - Board of directors. The authority must begoverned by a board of directors selected as follows:1.One member from a city with a population greater than forty thousand located east
of state highway 1 and north of state highway 200.2.One member from a city with a population greater than forty thousand located east
of state highway 1 and south of state highway 200.Page No. 13.One member from a city with a population of five thousand but not more than forty
thousand located east of state highway 1.4.One member from a city with a population of less than five thousand located east of
state highway 1.5.Two members from water districts located east of state highway 1 and north of state
highway 200.6.Two members from water districts located east of state highway 1 and south of state
highway 200.7.One member from water districts located east of state highway 1.8.One member from a Minnesota city with a population of more than thirty thousand
and which is located within five miles [8.05 kilometers] of this state.North Dakota city members must be selected for two-year terms by election by cities located east
of state highway 1 during the annual meeting of the North Dakota league of cities in every
odd-numbered year beginning in 2003. Water district members must be selected for two-year
terms by election by water districts located east of state highway 1 during the annual meeting of
the North Dakota rural water systems association in every even-numbered year beginning in
2004. The initial selection of members must be at a meeting held by the board of directors of the
North Dakota league of cities and by the board of directors of the North Dakota rural water
systems association. The initial city members shall serve until the annual meeting of the North
Dakota league of cities in 2003 and the initial water district members shall serve until the annual
meeting of the North Dakota rural water systems association in 2004. The initial Minnesota city
is Moorhead, as it is an associate member of the authority. Moorhead will serve in this capacity
until the league of Minnesota cities annual conference in 2006. During even-numbered years
thereafter, Minnesota cities within five miles [8.05 kilometers] of the Red River or that use the
Red River as a primary water supply may elect their representative. A member may designate
an alternate to attend meetings and to act on the member's behalf. The board of directors may
designate associate members who are nonvoting members of the board. Notwithstanding the
provisions of this section, within two years of the first delivery of water by the Red River valley
water supply project, board members must be from a city or water district that has entered a
water service contract with the Lake Agassiz water authority or the Garrison Diversion
Conservancy District.61-39-04. Board of directors - Officers - Meetings. The board of directors may adoptsuch rules and bylaws for the conduct of the business affairs of the authority as it determines
necessary, including the time and place of regular meetings of the board and a dues structure for
membership in the authority. The board shall elect from its members a chairman and a vice
chairman. The board shall also elect a secretary and a treasurer, which offices may be held by
the same individual, and either or both offices may be held by an individual who is not a member
of the board. Special meetings of the board may be called by the secretary on order of the
chairman or upon written request of a majority of the qualified members of the board. Notice of a
special meeting must be mailed to each member of the board at least six days before the
meeting, provided that a special meeting may be held at any time when all members of the board
are present or consent in writing. The Garrison Diversion Conservancy District shall provide
administrative, technical, and legal support for the authority.61-39-05. Authority of the Lake Agassiz water authority. The board of directors ofthe Lake Agassiz water authority may:1.Sue and be sued in the name of the authority.2.Exercise the power of eminent domain in the manner provided by title 32 for the
purpose of acquiring and securing any rights, titles, interests, estates, or easements
necessary or proper to carry out the duties imposed by this chapter, and particularlyPage No. 2to acquire the necessary rights in land for the construction of pipelines, reservoirs,
connections, valves, pumping installations, or other facilities for the storage,
transportation, or utilization of water and all other appurtenant facilities used in
connection with the authority, or any part thereof.3.Accept funds, property, and services or other assistance, financial or otherwise, from
federal, state, and other public or private sources for the purpose of aiding and
promoting the construction, maintenance, and operation of the authority.4.Cooperate and contract with the agencies or political subdivisions of the state of
North Dakota or other states, in research and investigation or other activities
promoting the establishment, construction, development, or operation of the
authority.5.Appoint and fix the compensation and reimbursement of expenses of such
employees as the board deems necessary to conduct the business and affairs of the
authority and to procure the services of engineers and other technical experts, and
to retain attorneys to assist, advise, and act for the authority in its proceedings.6.Operate and manage the authority to distribute water to its members and others
within or outside the territorial boundaries of this state.7.Sell or exchange any and all real property purchased or acquired by the authority.
All money received from any such sale or exchange must be deposited to the credit
of the authority and may be used to pay expenses of the authority.8.Enter a contract or contracts to provide for a supply of bulk water from the Garrison
Diversion Conservancy District which contract or contracts may provide for
payments to fund some or all of the Garrison Diversion Conservancy District's costs
of acquiring, constructing, or reconstructing one or more Red River valley water
supply projects, which Red River valley water supply projects the Garrison Diversion
Conservancy District may acquire, construct, improve, and own, as well as the
Garrison Diversion Conservancy District's costs of operating and maintaining one or
more Red River valley water supply projects, whether the acquisition, construction,
or reconstruction of any Red River valley water supply project actually is completed
and whether water actually is delivered pursuant to the contract or contracts, and
which contract or contracts the Garrison Diversion Conservancy District may
execute without limitation on the term of years.9.Enter a contract or contracts to provide for a bulk sale, lease, or other supply of
water for beneficial use to persons within or outside the authority, which contract or
contracts may provide for payments to fund some or all of the Garrison Diversion
Conservancy District's costs of acquiring, constructing, or reconstructing one or
more Red River valley water supply projects, as well as the Garrison Diversion
Conservancy District's costs of operating and maintaining one or more Red River
valley water supply projects, whether the acquisition, construction, or reconstruction
of any Red River valley water supply project actually is completed and whether
water actually is delivered pursuant to the contract or contracts, which contract or
contracts cities and water districts that are members of the Lake Agassiz water
authority are authorized to execute without limitation on the term of years.10.Borrow money as provided in this chapter.11.Issue and sell revenue bonds for its own benefit or for the benefit of the Garrison
Diversion Conservancy District, in an amount or amounts determined by the board,
including an amount or amounts for costs of issuance and financing, and any
necessary reserve funds, for the purpose of financing the cost of a project,
purchasing bulk water, or otherwise making capital payments required under a water
purchase contract.Page No. 312.Lend some or all proceeds of its revenue bonds to the Garrison Diversion
Conservancy District, to the state of North Dakota, or to a political subdivision or
public body within the state, to facilitate the Garrison Diversion Conservancy
District's acquisition, construction, reconstruction, or improvement of one or more
Red River valley water supply projects, or any feasibility study or preliminary
economic, engineering, or legal work relating to any Red River valley water supply
project.13.Refund and refinance its bonds from time to time as often as it is advantageous and
in the interest of the authority.14.Pledge any and all income, profits, and revenues received by the authority in
connection with the operation, lease, sale, or other disposition of all or any part of a
project to secure the payment of bonds issued and sold to finance the project or
otherwise.15.Prescribe, revise, and collect rates, fees, tolls, or charges for the services, facilities,
or commodities furnished by the authority, and in anticipation of the collection of the
revenues of the authority, issue revenue bonds to finance all or part of the costs of
the acquisition, construction, reconstruction, improvement, betterment, or extension
of a project.16.Pledge revenues of the authority to the punctual payment of principal and interest on
bonds or water purchase contract obligations.A pledge under this subsectionapplies to the revenues of improvements, betterments, or extensions of the authority
which may be constructed or acquired after the issuance of bonds, the revenues of
existing systems, plants, works, instrumentalities, and properties of any part of the
authority improved, bettered, or extended, and the revenues received from
payments made under water sale contracts between the authority and persons that
contract to purchase water from the authority.17.Make all contracts, execute all instruments, and do all things necessary or
convenient in the exercise of its powers or in the performance of its covenants or
duties or in order to secure the payment of its bonds, but an encumbrance,
mortgage, or other pledge of property of the authority may not be created by any
such contract or instrument.18.Accept from any authorized federal agency loans or grants for the planning,
construction, acquisition, lease, or other provision of a project, and to enter into
agreements with the agency respecting the loans or grants.19.Contract debts and borrow money, pledge property of the authority for repayment of
indebtedness other than bonded indebtedness, and provide for payment of debts
and expenses of the authority.20.Operate and manage the authority to distribute water to western Minnesota cities
that are members of the authority.Property of the authority may not be liable to be forfeited or taken in payment of any bonds
issued under this chapter, and debt on the general credit of the authority may not be incurred in
any manner for payment of bonds under this chapter.61-39-06. Resolution authorizing the issuance of revenue bonds. The issuance ofrevenue bonds or refunding bonds must be authorized by a resolution of the board adopted after
appropriate notice by the affirmative vote of a majority of the board. Unless otherwise provided in
the resolution, the resolution under this section takes effect immediately and need not be laid
over, published, or posted.Page No. 4Each resolution providing for the issuance of bonds provided for in this chapter must setforth the purpose or purposes for which the bonds are to be issued, the provisions for payment of
the bonds, and the revenues or other funds pledged to secure the payment of the bonds.61-39-07. Provisions governing bonds. The resolution authorizing the issuance ofrevenue bonds or refunding bonds under this chapter or resolutions adopted after the adoption of
the original resolution must prescribe:1.The rate or rates of interest, or if an interest rate is variable, the method for
calculating the interest rate.2.Whether the bonds will be in one or more series.3.The date or dates the bonds will bear.4.The time or times the bonds will mature.5.The medium in which the bonds will be payable.6.The place or places where the bonds will be payable.7.The terms of redemption, if any, to which the bonds will be subject.8.The manner in which the bonds will be executed.9.The terms, covenants, and conditions that the bonds will contain.10.The form in which the bonds will be issued, either coupon or registered.61-39-08. Sale of bonds - When private sale authorized - Public sale and notice.Revenue bonds or refunding bonds may be sold at public or private sale on such terms as the
board deems appropriate.61-39-09. Notes issued pending preparation of bonds - Negotiability. Pending theissuance of bonds, bond anticipation notes may be issued and sold in the form and with the
provisions determined by the board.61-39-10. Validity of notes and bonds. Bond anticipation notes, revenue bonds, orrefunding bonds bearing the manual or facsimile signatures of the appropriate officers who are in
office on the date of signing are valid and binding obligations notwithstanding that before the
delivery and payment any or all of the persons whose signatures appear on the notes or bonds
have ceased to be officers of the issuing authority. The resolution authorizing the notes or bonds
may provide that the notes or bonds must contain a recital that they are issued under this chapter
and the recital is conclusive evidence of their validity and of the regularity of their issuance.61-39-11. Notes and bonds exempt from taxation. Notwithstanding any restrictioncontained in any other law, the state and all public officers, boards, and agencies, and political
subdivisions and agencies thereof, all national banking associations, state banks, trust
companies, savings banks and institutions, savings and loan associations, investment
companies, and other persons carrying on a banking business, and executors, administrators,
guardians, trustees, and other fiduciaries, may legally invest any sinking funds, moneys, or other
funds belonging to them or within their control in any bonds issued by the authority pursuant to
this chapter, and the bonds are authorized security for public deposits.Notes and bonds,including refunding bonds, issued under this chapter and their income are exempt from all
taxation by the state or by any political subdivision except inheritance, estate, and transfer taxes.61-39-12. Covenants and provisions that may be inserted in resolution authorizingbonds.Any resolution authorizing the issuance of bonds under this chapter may containcovenants and provisions concerning:Page No. 51.The rates, fees, tolls, or charges to be charged for the services, facilities, and
commodities of a project.2.The use and disposition of all or a portion of the authority's income, profits, and
revenues.3.The creation, maintenance, regulation, use, and disposition of reserves or sinking
funds.4.The purpose to which the proceeds of the sale of bonds may be applied and the use
and disposition of the proceeds.5.The events of default and the rights and liabilities arising upon default and the terms
and conditions upon which the holders of bonds issued under this chapter may bring
civil action on the bonds.6.The creation, priority, and enforcement of liens against the authority's income,
profits, or revenues.7.The issuance of other or additional bonds or instruments payable from or
constituting a charge against the authority's income, profits, or revenues.8.The creation and use of synthetic interest rate contracts, interest rate caps, floors,
and collars, and other techniques to lower the authority's borrowing rate or reduce its
exposure to interest rate risk, or both.9.The keeping, inspection, and audit of books of account.10.The terms and conditions upon which any or all of the bonds become or may be
declared due before maturity and the terms and conditions upon which the
declaration and its consequences may be waived.11.The rights, liabilities, powers, and duties arising upon the breach by the authority of
any covenants, conditions, or obligations.12.The vesting in a trustee of the right to enforce any covenants made to secure, to
pay, or in relation to the bonds, the powers and duties of such trustee, and the
limitations of liabilities thereof.13.The terms and conditions upon which the holders of the bonds, or the holders of any
proportion or percentage of them, may enforce any covenants made or any duties
imposed under this chapter.14.A procedure by which the terms of any resolution authorizing bonds or of any other
contract with bondholders, including an indenture of trust or similar instrument, may
be amended or abrogated, and the amount of bonds that holders of which must
consent to the resolution or contract, and the manner in which such consent may be
given.15.The subordination of the security of any bonds issued under this chapter and the
payment of principal and interest on those bonds, to the extent deemed feasible and
desirable by the governing body, to other bonds or obligations of the authority issued
to finance or refinance a project or that may be outstanding when the bonds thus
subordinated are issued and delivered.16.Provisions with respect to the authority entering an agreement with a private bond
insurer, bank, or other liquidity or credit enhancer for bond insurance, a guarantee, a
letter of credit, or any other credit or liquidity enhancement that the authority may
find to be advantageous or necessary to insure, guaranty, or enhance the paymentPage No. 6of the principal of or interest on or liquidity for some or all of the bonds. The cost of
any such enhancement or liquidity may be paid from bond proceeds or from other
funds of the authority available for this purpose.This section does not authorize the authority to do anything in any manner or for any purpose
which would result in the creation or incurring of a debt or indebtedness of the state or the
issuance of any instrument which would constitute a debt or indebtedness of the state within the
meaning of any provision, limitation, or restriction of the Constitution of North Dakota relating to
the creation or incurring of a debt or indebtedness of the state or the issuance of an instrument
constituting a debt or indebtedness of the state.61-39-13.Liability of authority for notes and bonds - Taxing power prohibited.Bond anticipation notes, revenue bonds, and refunding bonds issued under this chapter may not
be payable from or charged upon any funds other than the revenue pledged to their payment and
the authority's notes and bonds may not be subject to any pecuniary liability. The holder of any
such notes or bonds may not enforce payment of the notes or bonds against any property of the
authority.Notes and bonds issued under this chapter do not constitute a charge, lien, orencumbrance upon any property of the authority, other than the revenues pledged to their
payments. Each note and each bond issued under this chapter must recite in substance that the
note or bond and interest on the note or bond is payable solely from the revenue pledged to the
payment and that the note or bond does not constitute a debt of the state within the meaning of
any constitutional or statutory limitation.61-39-14. Duties of authority and officers relative to the issuance of bonds. Toadequately secure the payment of bonds and interest on the bonds, the authority and its officers,
agents, and employees shall:1.Pay or cause to be paid punctually the principal and interest of every bond on the
dates, at the places, in the manner, and out of the funds provided in the refunding
bond and in accordance with the resolution authorizing its issuance.2.Make certain any project financed by the authority is operated in an efficient and
economical manner, enforce all water purchase and water sales contracts, and
establish, levy, maintain, and collect related necessary or proper fees, tolls, rentals,
rates, and other charges. Such fees, tolls, rentals, rates, and other charges must be
sufficient, after making due and reasonable allowances for contingencies and for a
margin of error in the estimates, at least:a.To pay all current expenses of operation and maintenance of any project;b.To make all payments required under any water purchase contract the authority
may execute;c.To pay the interest and principal on the authority's notes and bonds as they
become due;d.To comply with the terms of the resolution authorizing the issuance of the
bonds or any other contract or agreement with the holders of the refunding
bonds; ande.To meet any other obligations of the authority that are charges, liens, or
encumbrances upon the revenues of the authority.3.Operate, maintain, preserve, and keep every part of any tangible project financed
and owned or operated by the authority in good repair, working order, and condition.4.Enforce the provisions of all water purchase and sale contracts that produce
revenues pledged to payment of bonds.Page No. 75.Preserve and protect the security of the bonds and the rights of the bondholders and
warrant and defend such rights against all claims and demands.6.Pay and discharge all lawful claims for labor, materials, and supplies which, if
unpaid, might become by law a lien or charge upon the revenues, or any part of the
revenues, superior to the lien of the bonds or which might impair the security of the
bonds.7.Hold in trust the revenues pledged to the payment of the bonds for the benefit of the
holders of the bonds and apply the revenues only as provided by the resolution
authorizing the issuance of the bonds or, if the resolution is modified, as provided in
the modified resolution.8.Keep proper separate books of record and accounts of the project in which complete
and correct entries must be made of all transactions relating to any part of the
project.All books and papers of the authority are subject to inspection by theholders of ten percent or more of the outstanding bonds or of their representatives
authorized in writing.The duties contained in this section may not require any expenditure by the authority of any
funds other than revenue received from a project or water sale contract. The performance of the
duties enumerated in this section is of the essence of the contract of the authority with the
bondholders.61-39-15. Remedies of bondholders in general. Subject to any contractual limitationsbinding upon the holders of any issue of bonds, or a trustee for the holders, including the
restriction of the exercise of any remedy to a specified proportion or percentage of the holders,
any holder of bonds or trustee, for the equal benefit and protection of all bondholders similarly
situated, may:1.By mandamus or other civil action, enforce the holder's rights against the authority
and its board and any of its officers, agents, or employees and may require the
authority or the board or any officers, agents, or employees of the authority or board
to perform their duties and obligations under this chapter and their covenants and
agreements with bondholders.2.By civil action, require the authority and the board to account as if they were the
trustees of an express trust.3.By civil action, enjoin any acts or things that may be unlawful or in violation of the
rights of the bondholders.4.Bring suit upon the bond.A right or remedy conferred by this chapter upon any bondholder, or upon any trustee for a
bondholder, is not intended to be exclusive of any other right or remedy, but each such right or
remedy is cumulative and in addition to every other right or remedy and may be exercised
without exhausting and without regard to any other remedy conferred by this chapter or by any
other law of this state.61-39-16. Project - Definition. As used in this chapter, unless the context otherwiserequires, the term "project" means either a system, plant, works, instrumentality, or property used
to provide water supply in connection with the Red River valley water supply project, or a contract
for the purchase of water, including a contract for the bulk purchase of water from the Garrison
Diversion Conservancy District delivered by means of a Red River valley water supply project.Page No. 8Document Outlinechapter 61-39 lake agassiz water authority