Bonds of the authority; obligations.

(a) In addition to all other powers now or hereafter granted by law, the authority shall have the following powers, together with all powers incidental thereto or necessary to the discharge thereof in corporate form:

(1) To sell and issue bonds of the authority in order to provide funds for any corporate function, use, or purpose, any such bonds to be payable solely out of one or more of the following:

a. Any or all proceeds or receipts from the privilege, license, or excise tax levied on the sale, distribution, storage, use, or consumption of tobacco and certain tobacco products in Jackson County by Section 45-36-247.

b. Any or all proceeds from any tax received by the Jackson County Commission which are required by law to be deposited to the credit of the Jackson County Water Authority.

c. The revenues derived from any water, sewer, or garbage system or facility of the authority.

(2) To pledge for payment of any bonds issued by the authority any proceeds, receipts, or revenues from which those bonds are made payable as provided in this part.

(3) To borrow money for temporary use for any of its corporate purposes and, in evidence of such borrowing, to issue, from time to time, revenue bonds or notes maturing not later than 36 months from the date of issuance. Any such temporary borrowing may be made in anticipation of the sale and issuance of long-term revenue bonds, and in such event, the principal proceeds from the sale of such long-term revenue bonds, to the extent necessary, shall be used for payment of the principal of and the interest on the temporary revenue bonds or notes issued in anticipation of the sale and issuance of such long-term revenue bonds. Any such temporary borrowing may also be made with respect to a project simultaneously with or after the sale and issuance of long-term revenue bonds issued with respect to such project if, under the terms of the proceedings under which such long-term revenue bonds are issued, the proceeds therefrom or any part thereof may not be used or released until completion of the project with respect to which issued or other similar contingency. In such case, the principal proceeds from the long-term revenue bonds, when released and to the extent necessary, shall be applied for payment of the temporary bonds or notes. Any temporary bonds or notes issued pursuant to this subdivision may be refunded or renewed or extended for an additional period of not more than 36 months from the date of maturity of the temporary bonds or notes being refunded or renewed or extended, but otherwise pursuant to all of the terms and conditions of this subdivision, whether or not the project with respect to which the outstanding temporary bonds or notes were issued has been completed.

(b)(1) All bonds issued by the authority shall be signed by the chair of its board or other chief executive officer and attested by its secretary and the seal of the authority shall be affixed thereto; provided, that a facsimile of the signatures of both of the officers whose signatures shall appear on the bonds may be imprinted or otherwise reproduced thereon in lieu of being manually signed if the proceedings in which the bonds are authorized to be issued provide for the manual authentication of such bonds by a trustee, registrar, or paying agent; provided further, that a facsimile of the seal of the authority may be imprinted or otherwise reproduced on any such bonds in lieu of being manually affixed thereto.

(2) Any such bonds may be executed and delivered by the authority at any time and, from time to time, shall be in such form and denominations and of such tenor and maturities, shall contain such provisions not inconsistent with this part and shall bear such rate or rates of interest, or no interest, computed, compounded (if determined by the board to be advantageous), payable at such time or times, and evidenced in such manner, as may be provided by resolution of its board. Bonds of the authority may be sold at either public or private sale in such manner and at such price or prices and at such time or times as may be determined by the board to be most advantageous. The principal of and interest on any bonds issued or obligations assumed by the authority may thereafter at any time (whether before, at, or after maturity of any such principal and whether at, after, or not exceeding six months prior to the maturity of any such interest) and, from time to time, be refunded by the issuance of refunding bonds of the authority, which may be sold by the authority at public or private sale at such price or prices as may be determined by its board to be most advantageous or which may be exchanged for the bonds or other obligations to be refunded. The authority may pay all expenses, premiums, and commissions which its board may deem necessary and advantageous in connection with any financing done by it. All bonds issued by the authority shall be construed to be negotiable instruments although payable solely from a specified source. Neither a public hearing nor consent of the State Department of Finance shall be prerequisite to the issuance of bonds by the authority. All bonds issued by the authority and the income therefrom shall be exempt from all taxation in the State of Alabama.

(3) All obligations created or assumed and all bonds issued or assumed by the authority shall be solely and exclusively an obligation of the authority and shall not create an obligation or debt of any county or municipality; provided, that this sentence shall not be construed to release the original obligor from liability on any bond or other obligation assumed by the authority.

(4) Any bonds issued by the authority shall be limited or special obligations of the authority payable solely out of the proceeds, receipts, or revenues specified in the proceedings authorizing those bonds. Any such proceedings may provide that the bonds therein authorized shall be payable solely out of one or more of the following: a. Any or all proceeds or receipts from the privilege, license, or excise tax levied on the sale, distribution, storage, use, or consumption of tobacco and certain tobacco products in Jackson County by Section 45-36-247.

b. Any or all proceeds from any tax received by the Jackson County Commission which are required by law to be deposited to the credit of the Jackson County Water Authority.

c. The revenues derived from the leasing, sale, or operation of all water, sewer, and garbage systems and facilities owned by the authority or solely out of the revenues from the leasing, sale, or operation of any one or more of such systems or facilities or parts thereof, regardless of the fact that those bonds may have been issued with respect to or for the benefit of only certain particular systems or facilities of the authority.

(5) The authority may pledge for the payment of any of its bonds the revenues from which such bonds are payable and may execute and deliver a trust indenture evidencing any such pledge or a mortgage and deed of trust conveying as security for such bonds the water, sewer, or garbage systems or facilities or any part of any thereof, the revenues or any part of the revenues from which are so pledged. Any mortgage and deed of trust or trust indenture made by the authority may contain such agreements as the board may deem advisable respecting the operation and maintenance of the property and the use of the revenues subject to such mortgage and deed of trust or affected by such trust indenture and respecting the rights, duties, and remedies of the parties to any such instrument and the parties for the benefit of whom such instrument is made; provided, that no such instrument shall be subject to foreclosure.

(c)(1) As security for payment of the principal of and interest on bonds issued or obligations assumed by it, the authority may enter into a contract or contracts binding itself for the proper application of the proceeds of bonds and other funds, for the continued operation and maintenance of any water, sewer, or garbage system owned by it or any part or parts thereof, for the imposition and collection of reasonable rates for and the promulgation of reasonable regulations respecting any service furnished from any such system or facility, for the disposition and application of its gross revenues or any part thereof and for any other act or series of acts not inconsistent with this part for the protection of the bonds and other obligations being secured and the assurance that the revenues from such system or facility shall be sufficient to operate such system or facility, maintain the same in good repair and in good operating condition, pay the principal of and interest on any bonds payable from such revenues, and maintain such reserves as may be deemed appropriate for the protection of the bonds, the efficient operation of such system or facility, and the making of replacements thereof and capital improvements thereto.

(2) Any contract pursuant to this section may be set forth in any resolution of the board authorizing the issuance of bonds or the assumption of obligations or in any mortgage and deed of trust or trust indenture made by the authority under this part.

(d) Any resolution of the board or trust indenture under which bonds may be issued pursuant to this part may contain provisions creating a statutory mortgage lien, in favor of the holders of such bonds, on the water, sewer, and garbage systems and facilities or any thereof (including any after-acquired property) out of the revenues from which such bonds are made payable. The resolution of the board or the trust indenture may provide for the filing for record in the office of the judge of probate of each county in which any part of such water, sewer, and garbage systems and facilities or any thereof may be located of a notice containing a brief description of such systems and facilities or either, a brief description of such bonds and a declaration that the statutory mortgage lien has been created for the benefit of the holders of such bonds upon such systems and facilities or either, including any additions thereto and extensions thereof. Each judge of probate shall receive, record, and index any such notice filed for record in his or her office. The recording of such notice, as provided in this section, shall operate as constructive notice of the contents thereof.

(e) All moneys derived from the sale of any bonds issued by the authority shall be used solely for the purpose or purposes for which the same are authorized, including the funding of all or part of any reserve funds which may be required for debt service, replacement and extension or capital improvements, and any costs and expenses incidental thereto. Such costs and expenses may include but shall not be limited to:

(1) The fiscal, engineering, legal, and other expenses incurred in connection with the issuance of and security for the bonds, including, without limitation, the charges, premiums, or fees in connection with any debt service insurance or letter of credit or other additional security given with respect to its bonds, whether such amounts are to be paid in a lump sum or over a period of time.

(2) Interest on bonds in the case of bonds issued to pay costs of construction or, if a part only of any series of bonds is issued for construction purposes, interest on that portion of the bonds of that series that is issued to pay construction costs prior to and during such construction and for not exceeding one year after completion of such construction.

(3) Any premium that may be necessary to pay in order to redeem or retire the bonds or other obligation to be refunded in the case of the bonds issued for the purpose of refunding principal and interest, or either, with respect to bonds issued or obligations assumed by the authority.

(f) The proceeds of any bonds issued by the authority and moneys held in any special fund established by the authority in connection with the issuance of any of its bonds may be invested in any direct obligations of the United States of America, the obligations of any agency of the United States of America, interest bearing bank deposits, or in any securities the payment of the principal of and interest on which is fully secured by direct obligations of the United States of America or in any obligations in which municipal or county funds are authorized to be invested pursuant to Section 11-81-21.

(g) Any provisions of this section to the contrary notwithstanding, the authority is hereby prohibited from using the proceeds from any bonds issued pursuant to this section to provide for any sewer or garbage systems until an adequate potable water supply with sufficient fire hydrants to satisfy the minimum requirements of the state fire insurance code is made available and placed at the option of every single family residence in the county.

(Act 89-265, p. 389, §7; Act 91-310, p. 566, §1.)