Bill Text: AZ HB2469 | 2012 | Fiftieth Legislature 2nd Regular | Introduced
Bill Title: Revenue allocation districts
Spectrum: Moderate Partisan Bill (Republican 15-2)
Status: (Vetoed) 2012-04-17 - Governor Vetoed [HB2469 Detail]
Download: Arizona-2012-HB2469-Introduced.html
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REFERENCE TITLE: revenue allocation districts |
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State of Arizona House of Representatives Fiftieth Legislature Second Regular Session 2012
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HB 2469 |
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Introduced by Representatives Gray R, Farley, Gowan, Smith D, Stevens: Brophy McGee, Crandell, Fann, Jones, Pancrazi, Pratt, Proud, Reeve, Vogt, Senators Antenori, Nelson, Shooter
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AN ACT
amending title 48, chapter 4, Arizona Revised Statutes, by adding article 7; relating to revenue allocation districts.
(TEXT OF BILL BEGINS ON NEXT PAGE)
Be it enacted by the Legislature of the State of Arizona:
Section 1. Title 48, chapter 4, Arizona Revised Statutes, is amended by adding article 7, to read:
ARTICLE 7. REVENUE ALLOCATION DISTRICTS
48-751. Definitions
In this article, unless the context otherwise requires:
1. "Base roll" means the assessment and tax roll for all classes of taxable property on January 1 of the year in which the governing body of a city or town adopts or modifies a revenue allocation district plan, reduced by the assessed value of property taken off the roll and increased by the assessed value of property added to the roll after the date of the roll.
2. "Base transaction privilege tax" means the amount of municipal transaction privilege tax collected by the municipality in which the district is located for the fiscal year immediately preceding the fiscal year in which the city or town adopts or modifies a revenue allocation district plan.
3. "Board of directors" means the board of directors of the district.
4. "Clerk" means the official who performs the duties of clerk of the city or town or any person appointed by the board of directors to be the clerk of the district.
5. "Debt service" means the principal of, interest on and premium, if any, on bonds when due, whether at maturity or on prior redemption, and fees and costs of registrars, trustees, paying agents or other agents necessary to handle the bonds and the costs of credit enhancement or liquidity support.
6. "District" means a revenue allocation district established by a city or town pursuant to this article.
7. "District plan" or "plan" means the plan for improvements for which the district is formed as described in section 48-752.
8. "General obligation bonds" means bonds that are issued pursuant to this article and that are secured by a pledge of property taxes levied on all taxable property within the boundaries of the district.
9. "Governing body" means the legislative body of the city or town in which the district is established.
10. "Increment value" means the total assessed value calculated by adding the differences between the current assessed value of the taxable property in the district and that property's assessed value on the base roll, if the difference is a positive value.
11. "Owner" means the person who, on the day the action, election or proceeding is begun or held, appears to be the owner of real property as shown on the property tax assessment roll.
12. "Project" means a project undertaken by a district for economic development, for reducing the loss of commerce, industry or employment, for increasing employment or for any combination pursuant to a revenue allocation district financing plan. Projects are limited to:
(a) The acquisition of land and improvements in the district.
(b) The development, redevelopment or conservation of land for public facilities or industrial or commercial development.
(c) Financial or other relocation assistance for property owners displaced as a result of carrying out the development or redevelopment of a project and other improvements necessary for carrying out the project plan, together with site improvements that are necessary for the preparation of any sites and making any land or improvements acquired in the project available, for other uses under the revenue allocation district plan.
(d) The construction of capital improvements in a district designed to increase or enhance the development of commerce or industry.
(e) The refinancing of any project in the district previously identified in the approved district plan and previously financed by the district.
(f) Any other projects specifically identified in the district plan the governing body considers appropriate to carry out the purposes of this article.
13. "Project costs" includes:
(a) Capital costs, including the actual costs of the construction of capital improvements and infrastructure, the demolition, alteration, remodeling, repair or reconstruction of existing buildings, structures and permanent fixtures, regardless of whether the improvements, facilities, buildings, structures and fixtures are publically or privately owned, the acquisition of equipment and the clearing and grading of land.
(b) Financing costs, including interest during construction and capitalized debt service or repair and replacement or other appropriate reserves.
(c) Real property assembly costs, as any deficit incurred from the sale or lease by the municipality of real or personal property within the district.
(d) Professional service costs, including costs incurred for architectural, planning, engineering and legal advice and services.
(e) Direct administrative costs, including reasonable charges for the time spent by municipal employees in connection with the implementation of a project plan.
(f) Relocation costs.
(g) Other related costs incidental to any of the listed costs.
14. "Related costs" means costs and expenses, exclusive of the actual cost of constructing and financing improvements that are related to establishing the district and reimbursement of sums advanced by the municipality for constructing and financing improvements, expended for attaining the purposes and goals for which the district was created.
15. "Revenue allocation district plan" or "plan" means a plan adopted by a city or town pursuant to section 48-753, as it currently exists, including any method or methods of financing the plan.
16. "Revenue bonds" means bonds that are issued pursuant to this article and that are secured by a pledge of revenues of the district or revenues collected by the city or town and paid to the district.
17. "Tax" or "taxes" means all property tax levies by all taxing jurisdictions on taxable property, unless excluded by this article.
18. "Taxable property" means taxable real property, improvements and personal property included on the assessment roll.
19. "Treasurer" means the person or official who performs the duties of treasurer of the municipality or any person appointed by the district board as the district treasurer.
48-752. Formation of district; board; change in boundaries
A. If the public convenience and necessity require, and on presentation of a petition signed by the owners of at least fifty‑one per cent of the land area proposed to be included in the district, the governing body of a city or town may adopt a resolution declaring its intention to form a revenue allocation district. The resolution shall state the following:
1. The area to be included in the district, which may include noncontiguous areas.
2. The purposes for which the district is to be formed.
3. That the revenue allocation district plan is on file with the clerk.
4. The date, time and place of the hearing to be held on the formation of the district.
5. The place where written objections to the formation of the district may be filed.
6. That formation of the district may result in a revenue allocation financing provision that will cause property taxes resulting from any increases in equalized assessed valuation in excess of the equalized assessed valuation as shown on the base roll to be allocated to the revenue allocation district, and that an agreement on administration of a revenue allocation financing provision has been negotiated with the city or town forming the district.
7. That the formation of the district is consistent with the growth area, cost of development, conservation, rehabilitation and redevelopment and the neighborhood and revitalization elements of the general plan of the city or town.
8. A reference to this article.
9. That the district will be governed by directors appointed by the governing body or that the governing body of the city or town will serve as the governing body of the district.
B. The district shall be governed by a board of directors appointed by the governing body of the city or town consisting of five persons named by the governing body, or the governing body may elect to act as the board of directors. The organization of the board of directors shall be included in the resolution of intent to form the district.
C. The clerk shall execute a notice, which shall read substantially as follows:
To whom it may concern:
The governing body of the city or town of __________, on (Date) , adopted the attached resolution declaring the intention to form a revenue allocation district. A hearing on formation will be held on (Date) , at (Time) at (Location) . All persons owning or claiming an interest in property in the proposed district who object to the inclusion of their land in the district, who object to the formation of the district or who object to the contents of the revenue allocation district plan must file a written objection with the undersigned at the following address before the time set for the hearing.
(Date)_______________________________
____________________________________
Clerk
(Address)___________________________
(Name of municipality)_______________
D. A copy of the resolution declaring the governing body's intention to form the district shall be attached to the notice, and the clerk shall cause a copy to be mailed to the owners of real property in the district as shown on the most recent assessment roll and to all other persons claiming an interest in such property who have filed a written request for a copy of the notice within the six months before or at any time following the adoption of the resolution of intent to form the district. The clerk shall also publish a copy of the notice and resolution at least once in the official newspaper of the city or town, if there is one, or, if there is no official newspaper, in a newspaper of general circulation in the county in which the city or town is located. The mailing and publication must be completed at least twenty days before the date set for hearing. The clerk shall execute an affidavit of mailing stating the date of mailing and the names and addresses of the persons to whom the notices and copies of the resolutions were mailed. The clerk shall obtain an affidavit from the newspaper in which the publication was made. The clerk shall cause both affidavits to be placed in the official records of the city or town. The affidavits are conclusive evidence of the mailing and publishing of notice. Notice shall not be held invalid for failure of delivery to the addressee. If the clerk determines that the person listed on the assessment roll is no longer the owner and the name and address of the successor owner become known, the clerk shall cause a copy of the notice and resolution to be mailed to the successor owner as soon as practicable after learning of the change of ownership.
E. Any owner of taxable property in the proposed district may file a written objection with the clerk before 5:00 p.m. on the business day preceding the date set for the hearing. The objection may raise any of the following:
1. That the objector's property would not be benefited from the improvements listed in the revenue allocation district plan and that the property should be excluded from the district.
2. That the district should not be formed, stating the specific reasons.
3. That the revenue allocation district plan should be modified, stating the reasons for modification.
F. At the hearing, including any adjournments or continuances, the governing body shall hear and pass only on the written objections and the testimony and evidence presented in support of or opposition to the objections.
G. Testimony at the hearing need not be under oath, unless requested by a property owner or required by the governing board. Requests by property owners must be made in writing and be filed with or served on the clerk before the hearing begins or the request is considered to be waived.
H. The minutes or a copy of a written transcript or a tape recording of the proceedings of a hearing conducted pursuant to this section shall be open to public inspection three working days after the hearing. Any person may request to examine or be furnished copies, printouts, photographs, transcripts or recordings of a hearing during regular office hours of the governing body. The custodian of the records shall furnish the materials and may charge a reasonable fee that does not exceed the actual cost of reproducing the item requested.
I. After the hearing, the governing body may adopt a resolution ordering the formation of the district, deleting any property determined not to be necessary or modifying the revenue allocation district plan and then ordering the formation of the district or determining that the district not be formed. A resolution ordering formation of the district shall state the names and terms of office of the initial directors or, if the governing body elects to serve as the governing body of the district, that determination shall be included in the order of formation.
J. If the formation of the district is approved, the governing body shall order the formation, appoint the initial board of directors, set the boundaries of the district and order that a map showing the boundaries be drawn and a copy of the order forming the district be delivered to the board of supervisors of the county in which the district is located and to the department of revenue. The district must be located entirely within the exterior boundaries of the city or town and may include noncontiguous areas. A notice of the formation showing the number and date of the order and giving a description of the land included in the district shall be recorded with the county recorder.
K. An area may be deleted from the district or an area contiguous to the existing district added to the district following the same procedure prescribed by this section for the formation of the district and adoption of a resolution by the governing body of the city or town. The city or town shall immediately notify the county assessor and the department of revenue of any deletions from and additions to the district occurring under this subsection.
L. On its formation, the district is a corporate and political body and, except as otherwise limited, modified or provided by this article, has all of the rights, powers and immunities of municipal corporations, including as provided by title 35, chapter 3, articles 3, 3.1, 3.2, 4 and 5. Except as otherwise provided in this article, a district is considered to be a municipal corporation and political subdivision of this state, separate and apart from the city or town.
M. The formation of a revenue allocation district, the adoption of a revenue allocation plan, the issuing of GENERAL obligation or revenue bonds and the imposition of use charges pursuant to this article are declared to be a public benefit.
N. The district has perpetual succession.
48-753. Revenue allocation district plan
A. Before adopting a resolution to establish a district pursuant to section 48-752, the city or town must adopt a revenue allocation district plan, filed with the clerk, providing a general description of the operation and financing of the district, the capital improvements and other projects for which the district is proposed to be formed and the geographical location and boundaries of the district.
B. The clerk shall post notice of the filing of the plan in the locations designated by the city or town for posting of official notices and agendas. The governing body shall hold a public hearing on the plan.
C. Any subsequent modification of the plan must be filed, noticed and be subject to a public hearing in the same manner as the adoption of the original plan.
48-754. Powers
In addition to the powers otherwise granted to a district pursuant to this article, to further the revenue allocation district plan, the district may:
1. Enter into contracts and spend monies for any project purpose with respect to the district.
2. Enter into intergovernmental agreements pursuant to title 11, chapter 7, article 3 for planning, designing, inspecting, owning, controlling, maintaining, operating and repairing projects in the district.
3. Sell, lease or otherwise dispose of property if the sale, lease or conveyance is not a violation of the terms of any contract or bond resolution of the district.
4. Reimburse the city or town for providing services to the district.
5. Plan, design, inspect, own, control, maintain, operate and repair projects.
6. Establish, charge and collect user fees, rates or charges for the use of any project in the district.
7. Employ staff, counsel and consultants.
8. Accept gifts or grants and incur and repay loans for any project purpose.
9. Enter into agreements with the city or town for the allocation of the tax on increment value of property in the district or the allocation of bond proceeds supported by a general obligation property tax levy pursuant to the adopted revenue allocation district plan.
10. By resolution, pledge an allocation of increment value or bond proceeds supported by a general obligation property tax to finance the costs of any project in the district.
11. Pay the financial, legal and administrative costs of the district.
12. Enter into contracts, agreements and trust indentures to obtain credit enhancement or liquidity support for its bonds and process the issuance, registration, transfer and payment of its bonds and the disbursement and investment of proceeds of the bonds.
13. With the consent of the governing body of the city or town that formed the district:
(a) For the purpose of implementing a project contained in the project plan, enter into agreements with persons outside of the district to provide services to persons and property outside of the district.
(b) Use public easements and rights‑of‑way in or across public property, roadways, highways, streets or other thoroughfares and other public easements and rights‑of‑way, whether in or out of the geographical limits of the district or the city or town.
14. Adopt and change a seal.
15. Sue and be sued.
16. Enter into development agreements, as defined in section 9‑500.05, to carry out the powers and duties of the district as set forth in this article.
17. Administer, in a reasonable manner, the implementation of the revenue allocation district plan.
48-755. Records; open meetings
A. The district shall keep the following records, which shall be open to public inspection:
1. Minutes of all meetings of the board of directors.
2. All resolutions.
3. Accounts showing all monies received and disbursed.
4. The annual budget.
5. All other records required to be maintained by law.
B. If the board of directors is appointed by the governing body of the city or town, each director shall serve for a term of six years, except that two directors initially appointed by the governing body, selected by lot, shall serve for a term of four years. On the expiration of the term of an appointed director, the governing body shall appoint a person to fill the position. If a vacancy occurs because of death, resignation or inability of the director to discharge the duties of director, the vacancy shall be filled by interim appointment made by the governing body for the remainder of the unexpired term until the member's successor is appointed. An appointed director shall not be an elected official of the city or town, unless the governing body of the city or town serves as the board of directors of the district.
C. The board of directors shall comply with title 38, chapter 3, article 3.1 as a separate political subdivision.
D. The clerk and treasurer of the district shall be the clerk and the finance director of the city or town, respectively, unless the board of directors appoints a separate clerk and treasurer of the district. The governing body of the city or town may designate its municipal manager and municipal attorney to serve as the manager and counsel of the district. END_STATUTE
48-756. Recording documents
The board of directors shall file and record with the county recorder the order forming the district, the revenue allocation district plan and the canvass of any bond election under section 48-764 and submit copies of all such information to the state real estate department.
48-757. Dissolution of district
A. A district may be dissolved by the board of directors by a resolution of the board if the following conditions exist:
1. All of the property owned by the district has been or will be conveyed to a city or town.
2. Either the district has no obligations or the city or town has assumed all of the obligations of the district.
3. All bonds issued by the district supported by a pledge of property tax revenues have been paid in full.
B. The board of directors shall comply with the conditions prescribed by subsection A of this section and shall dissolve the district if both of the following occur:
1. The board of directors has consented to comply with the conditions prescribed by subsection A of this section and determines that the district has been inactive for at least five consecutive years and has no future purpose.
2. The board of directors adopts a resolution dissolving the district and records the resolution in the office of the county recorder.
C. The district may not be dissolved if any revenue bonds of the district remain outstanding unless an amount of money sufficient, together with investment income, to make all payments due on the revenue bonds either at maturity or prior redemption has been deposited with a trustee or escrow agent and pledged to the payment and redemption of the bonds. The district may continue to operate after dissolution only as needed to collect money and make payments on any outstanding bonds.
48-758. Financing projects; sources of revenue
A. The projects to be constructed or acquired pursuant to the revenue allocation district plan may be financed from one or more of the following revenue sources:
1. Proceeds from the sale of revenue bonds of the district.
2. Tax revenues from the increment value of taxable real and personal property allocated by the city or town to the district according to the revenue allocation district plan.
3. Incremental increases in transaction privilege tax revenue according to the revenue allocation district plan.
4. Proceeds from the sale of general obligation bonds of the district.
5. State, federal and private grants and contributions.
6. Any other monies lawfully available to the district.
B. The district may establish, charge and collect user fees, rates or charges for the use of any project in the district as provided by section 48‑754, paragraph 6.
48-759. Determination and allocation of property tax revenue increments
A. The allocation of ad valorem property tax increments within a revenue allocation district shall be calculated using primary property taxes levied by the city or town in which the district is located. Secondary property tax levies and property tax levies by all other political subdivisions of this state, other than the city or town in which the district is located, are not affected by the district.
B. The amount of property tax revenues collected within the district from the primary property tax levy on the current tax roll by the city or town in which the district is located, minus the amount of revenues collected within the district from the primary property tax levy on the base roll by the city or town in which the district is located shall be allocated to the revenue allocation district.
C. The incremental amount of transaction privilege tax revenues that may be allocated to the district is the total amount of municipal transaction privilege tax revenues collected by the city or town within the district in the current fiscal year, minus the base transaction privilege tax and any other transaction privilege tax revenues not pledged for projects in the district plan.
D. All tax increment revenues allocated to the district shall be credited to one or more special funds established pursuant to section 48-760.
48-760. General fund; special fund
A. Except for tax increment revenues and general obligation property tax revenues for repayment of bonds pledged pursuant to a revenue allocation financing provision of the district plan, all monies received by the district shall be credited to a general fund of the district.
B. On enactment of an ordinance adopting a revenue allocation financing provision as part of the district plan, the board of directors shall establish a special fund or funds for the purposes of this article. All tax increment revenues and any other revenues pledged for those purposes shall be credited to the designated special fund or funds.
C. The board of directors may segregate the general fund and any special fund into separate and exclusive accounts and subaccounts as necessary to accommodate the financial requirements of the district.
48-761. Statements and estimates of expenses; annual budget
A. The board of directors shall make annual statements and estimates of the operation and maintenance expenses of the district, the costs of projects to be financed and the amount of all other proposed expenditures to be paid from the increment of transaction privilege taxes imposed by the city or town forming the district or the increment of primary property taxes identified in the project plan to be used for projects undertaken by the district. The statements and estimates shall include the amount of all other proposed expenditures for maintenance and operation of the district to be paid from other sources of revenue. The board of directors shall file the annual statements and estimates with the clerk, publish a notice of the filing of the estimate and hold hearings on the portions of the estimate not relating to debt service on bonds.
B. On or before July 1 of each year, the district treasurer shall prepare a proposed budget of tentative expenditures and revenues for the ensuing fiscal year to be submitted to the board of directors for approval.
C. The board of directors shall hold a public hearing on the proposed budget. The governing body of the participating city or town may review the proposed annual budget and may submit written comments to the board of directors for its assistance and information. The board of directors shall then direct that the proposed annual budget be published in a newspaper of general circulation in the district.
D. At least fourteen days after the hearing, but no later than October 1, the board of directors must adopt the final budget for the fiscal year. The adopted budget may not exceed the proposed budget of tentative revenues and expenditures.
48-762. Revenue bonds
A. At any time after the district is organized, the board of directors may hold a hearing on the question of authorizing the issuance of either or both:
1. Revenue bonds of the district to provide monies for any project consistent with the revenue allocation district plan.
2. General obligation bonds of the district to provide monies for any project consistent with the revenue allocation district plan.
B. If authorized by an election held pursuant to section 48-764, the board of directors may:
1. Issue and sell revenue bonds of the district if approved by resolution of the board of directors.
2. As provided by section 48-763, issue and sell general obligation bonds of the district if approved by resolution of the board of directors.
3. Enter into an intergovernmental agreement under this article to permit an industrial development authority formed under title 35, chapter 5 to issue bonds for a project in the district plan and to pledge revenues of the district for repayment of the industrial development authority bonds, the expenses of issuing the bonds and funding debt service reserve accounts and bond insurance.
4. Pledge to the payment of its revenue bonds any revenues of the district or revenues to be collected by the municipality in trust for the district and paid to the district.
C. The district shall prescribe, and revise as necessary, fees and charges to generate revenue sufficient, together with any monies from the sources described in section 48-758, to pay when due the principal and interest of all revenue bonds for the payment of which revenue has been pledged. The establishment or revision of any rates, fees and charges shall be identified and noticed concurrently with the annual budget process of the district pursuant to section 48-761.
D. If, in the resolution of the board of directors, the revenues to be pledged are limited to certain types of revenues, only those types of revenues may be pledged and only those revenues must be maintained.
E. The district or the city or town shall not be compelled to exercise any taxing power to pay the bonds or the interest on the bonds. Revenue bonds issued under this article are not a debt of the district, the city or town or this state, nor is the payment of revenue bonds enforceable out of any monies other than the revenue pledged to the payment of the bonds.
F. The district may issue and sell refunding bonds to refund any revenue bonds of the district.
48-763. General obligation bonds; tax levy
A. At any time after the hearing on formation of the district, the district board may order and call a general obligation bond election as provided by section 48-764 to submit to the qualified electors of the district or to those persons who are qualified to vote pursuant to section 48-764 the question of authorizing the district board to issue general obligation bonds of the district to provide monies for any public infrastructure purposes consistent with the revenue allocation district plan.
B. If general obligation bonds are approved at an election, the district board may issue and sell general obligation bonds of the district.
C. If general obligation bonds are to be sold in a public offering, the bonds shall not be issued unless they receive one of the four highest investment grade ratings by a nationally recognized bond rating agency.
D. After general obligation bonds are issued, the district board shall enter in its minutes a record of the bonds sold and their numbers and dates and shall annually levy and cause an ad valorem tax to be collected, at the same time and in the same manner as other property taxes are levied and collected on all taxable property in the district, sufficient, together with any monies from the sources described in section 48-758, to pay debt service on the bonds when due. Monies derived from the levy of the tax constitute funds to pay the debt service on the bonds and shall be kept separately from other monies of the district.
E. The amount of INDEBTEDNESS evidenced by general obligation bonds issued under this section shall not at any time exceed the estimated project cost as set forth in the revenue allocation district plan plus all costs connected with issuing and selling the bonds and credit enhancement and liquidity support fees and costs.
F. The district may issue and sell refunding bonds to refund any general obligation bonds. No election is required for issuing general obligation bonds to refund any general obligation bonds of the district.
48-764. Election to approve bonds; acreage voting
A. At any time after the hearing on formation of the district, the board of directors, or, if before formation, the governing body of the city or town, may call an election to submit to the qualified electors of the district and the owners of taxable real and personal property in the district, the question of authorizing either or both:
1. The allocation of an incremental portion of ad valorem tax revenues from the taxable real and personal property in the district, unless otherwise exempt under this article, or the allocation of the increment of municipal transaction privilege tax revenues above the base transaction privilege tax revenues to fund the project or projects described in the revenue allocation district plan.
2. The issuance of general obligation bonds of the district in such series, amounts and terms as determined necessary to fund the project or projects described in the revenue allocation district plan.
B. If the district intends to issue one or more series of revenue bonds, the board of directors may submit the question of authorizing the issuance of one or more series of revenue bonds for projects contained in the revenue allocation district plan.
C. Notice of the election shall be given by posting notices in three public places in the district at least twenty days before the election. Notice shall also be published in a newspaper of general circulation in the municipality in which the district is located once a week for two consecutive weeks before the election. The notice shall include:
1. The place of holding the election.
2. The hours during the day, at least six, in which the polls will be opened.
3. That a district plan is on file in the office of the clerk of the municipality in which the district is located.
D. The board of directors or the governing body of the municipality shall determine the date of the election, the polling places for the election and may consolidate county precincts. Except as otherwise provided, the election shall comply with the general election laws of this state.
E. Each owner of taxable real and personal property in the district shall have one vote for each one-fifth acre, or lesser portion rounded upward to the nearest one-fifth acre, owned by that person.
F. If no person has registered to vote in the district within fifty days immediately preceding any scheduled election date, any election required to be held pursuant to this article shall be held with the vote of the owners of the land.
G. The ballot shall contain the words "District, Yes" and "District, No", and for revenue bonds "revenue Bonds, Yes" and "revenue Bonds, No" and for general obligation bonds "bonds, yes" and "bonds, no".
H. Notwithstanding any other provision of this article, if a petition approving formation of the district has been signed by all of the owners of taxable real and personal property in the proposed district, the municipality may waive any or all requirements for holding an election.
I. The city or town governing body shall canvass returns of the election within fourteen days after an election.
48-765. Terms of bonds
A. The board of directors shall prescribe the denominations of the bonds, the size of each issue, the maturities, interest payment dates and interest rates, whether fixed or variable. The bonds may be sold by competitive bid, including an online bidding process, or negotiated sale for public or private offering at, below or above par. If the bonds are sold below par, the aggregate amount of discount and interest to be paid on the bonds shall not exceed the amount of interest that would have been payable on those bonds pursuant to the maturity schedule prescribed by the board of directors at the maximum rate set out in the bond resolution. For the purposes of this subsection, "online bidding process" means a procurement process in which the board of directors receives bids electronically over the internet in a real-time, competitive bidding event.
B. The proceeds of the sales shall be deposited with the district treasurer, or with a trustee or agent designated by the board of directors, to the credit of the district to be withdrawn for the purposes provided by this article. Pending that use, the proceeds may be invested as determined by the board of directors. The board of directors may place any restrictions on investment yield on the bonds or any monies pledged to pay the bonds if necessary to comply with federal income tax laws and regulations to gain any federal tax benefits available with respect to the bonds. Monies shall be invested under this subsection in a manner that avoids arbitrage penalties prescribed by federal law.
C. The bonds may contain such terms, conditions, covenants and agreements as the board of directors considers proper. The bonds may be payable from any combination of sources described in this article and as specified in the bonds if all applicable requirements are met.
D. Bonds issued under this article are declared to be issued for an essential public and governmental purpose.
E. If any of the public officials whose signatures appear on bonds issued under this article no longer hold office when the bonds are delivered, the signatures remain valid and sufficient for all purposes.
F. Bonds issued under this article are fully negotiable within the meaning and for all purposes of the uniform commercial code regardless of whether the bonds actually constitute negotiable instruments under the uniform commercial code.
G. In any legal action or proceeding involving the validity or enforceability of any bond, or the security of any bond, issued under this article, any such bond reciting in substance that it has been issued in connection with a project of the district is conclusively deemed to have been issued for that purpose and the project is conclusively deemed to have been planned, located and carried out as provided by this article.
H. Bonds issued under this article:
1. Are government obligation securities suitable for investment by:
(a) Public officers and bodies of this state and of counties, municipalities and other political subdivisions of this state.
(b) Insurance companies, associations and other persons carrying on an insurance business.
(c) Financial institutions, investment companies and other persons carrying on a banking business.
(d) Fiduciaries.
(e) All other persons who are authorized to invest in government obligations.
2. Are securities that may be deposited with public officers or bodies of this state and counties, municipalities and other political subdivisions of this state for purposes that require the deposit of government bonds or obligations.
I. It is the purpose of this section to authorize any persons, political subdivisions and officers, public or private, to use any funds owned or controlled by them for the purchase of any such bonds or other obligations. Nothing contained in this section with regard to legal investments shall be construed as relieving any person of any duty of exercising reasonable care in selecting securities.
J. Except to the extent of monies deposited in a special fund or funds pursuant to section 48-760 and pledged to the payment of the principal of and interest on bonds or other obligations, the district, the city or town establishing the district, this state and any other political subdivision of the state are not liable on any such bonds or obligations. The bonds and other obligations:
1. Do not give rise to any general obligation or liability of the city or town, this state or any of its political subdivisions.
2. Do not give rise to a charge against their general credit or taxing powers.
3. Are not payable out of any funds or properties other than the special fund or funds pledged by the district for that purpose.
4. Do not constitute an indebtedness or the pledging of faith and credit within the meaning of any constitutional or statutory debt limitation or restriction.
K. No direct or collateral action attacking or otherwise questioning the validity of a revenue allocation district, a project, the adoption or approval of a revenue allocation district plan, any bonds issued under this article or any of the findings or determinations of the governing body of a city or town in connection with the district, project, plan or bonds may be brought before the effective date of the resolution adopting the revenue allocation district plan. No direct or collateral action attacking or otherwise questioning the validity of bonds issued pursuant to this article may be brought before the effective date of the resolution authorizing the bonds. For a period of thirty days after the effective date of the resolution authorizing the bonds, any person in interest has the right to contest the legality of the resolution or proceeding or any bonds that may be authorized. No contest or proceeding to question the validity or legality of any resolution or proceeding, or any bonds that may be authorized, passed or adopted under this article may be brought in any court by any person for any cause after the expiration of thirty days after the effective date of the resolution or proceeding. After that time the validity, legality and regularity of the resolution or proceeding or any authorized bonds is conclusively presumed.
L. The powers conferred by this article are supplemental and alternative to other powers conferred by law. This article is intended as an independent and comprehensive conferral of powers to accomplish the purposes of this article.
