(1) The board of directors of the district may issue as obligations of the subdistrict, not as obligations of the Rio Grande water conservation district, special improvement bonds to be paid out of special improvement assessments made by the board of directors against all lands in the subdistrict benefited by the improvements financed by the bond proceeds, which special improvement assessments shall not exceed in the aggregate an amount equal to ninety percent of the amount of benefits determined to have accrued to said lands by reason of such improvements and unpaid at the time of issue of said bonds. Such bonds shall contain a recital to the effect that they are issued under and in accordance with the provisions of this article as special improvement bonds and are payable out of special improvement assessments to be levied against the property in said subdistrict and not otherwise.

(2) The special improvement bonds issued pursuant to subsection (1) of this section shall be signed "Water Users' Association No. ....., or Special Improvement District No. ....., of the Rio Grande Water Conservation District, by .........., President", and countersigned ".........., Treasurer". Otherwise said bonds shall be in such denominations and become due at such dates, with interest at such rate, payable either annually or semiannually, but not exceeding the rate of ten percent per annum, and contain such other provisions as may be fixed by the board of directors, not inconsistent with the provisions of this article. Except as otherwise expressly modified in this article, the law relating to the form and issuance of special improvement bonds of conservancy districts under the laws of this state, particularly section 37-5-106, shall apply and govern officers of the district in the issuance and sale of said bonds; and other provisions of said law with respect to the levy of assessments for the payment of said bonds with interest, particularly section 37-5-110, shall likewise be applicable to the bonds of a subdistrict organized under this article. If the subdistrict has a board of managers, the board of managers shall annually determine and certify to the board of directors of the district the total amount of the special improvement assessments to be collected; and the board of directors of the district, if it deems the amount so certified to be correct, shall order and levy the total special improvement assessments and otherwise conform to the procedure set forth in section 37-5-110.