41-7-816. Keeping funds; fixing prices, rates and charges.

(a) The board shall create three (3) separate funds, one (1) fund to be known as the construction fund, another fund to be known as the water fund, and another fund to be known as the sinking fund, each such fund to be identified by the same series letter or letters as the bonds, warrants, notes, debentures, or other evidences of indebtedness of such series. A separate account shall be kept of each construction fund and of each water fund and of each sinking fund for each project.

(b) The proceeds of the sale of the bonds and other evidences of indebtedness of each series issued under the provisions of this act shall be placed to the credit of the appropriate construction fund, which fund shall at all times be kept segregated and set apart from all other funds. There shall also be credited to the appropriate construction fund the interest received upon the deposits of moneys in such fund and moneys received by way of gift or grant from the United States or from any other source for the construction of the works. The moneys in each construction fund shall be paid out or disbursed in such manner as may be determined by the board, subject to the provisions of this act, to pay the cost of the works as hereinabove defined. Any surplus which may remain in any construction fund after providing for the payment of the cost of the works shall be added to and become a part of the appropriate sinking fund hereinafter provided for.

(c)(i) The board is hereby authorized and empowered, subject to the provisions of this act, to fix and establish the prices, rates and charges at which any and all the resources and facilities made available under the provisions of this act shall be sold and disposed of; to enter into any and all contracts and agreements, and to do any and all things which in its judgment are necessary, convenient or expedient for the accomplishment of any and all the purposes and objects of this act, under such general regulations and upon such terms, limitations and conditions as it shall prescribe; and it is and shall be the duty of the board to enter into such contracts and fix and establish such prices, rates and charges so at to provide at all times funds which will be sufficient to pay all costs of operation and maintenance of any and all of the works authorized by this act, together with necessary repairs thereto, and which will provide at all times sufficient funds to meet and pay the principal and interest of all bonds, warrants, notes, debentures and other evidences of indebtedness as they severally become due and payable; provided, that nothing contained in this act shall authorize any change, alteration or revision of any such rates, prices or charges as established by any contract entered into under authority of this act except as provided by any such contract;

(ii) Every contract made by the board for the sale, conveyance and distribution of water, use of water, water storage, electric power or other service, or for the sale of any property or facilities, shall provide that in the event of any failure or default in the payment of any moneys specified in such contract to be paid to the board, the board may, upon such notice as shall be prescribed in such contract, terminate such contract and all obligations thereunder. The act of the board in ceasing on any such default to furnish or deliver water, use of water, water storage, electric power or other service under such contract shall not deprive the board of, or limit any remedy provided by such contract or by law for the recovery of any and all moneys due or which become due under such contract;

(iii) All income or profit and revenue of the works and all moneys received from the sale, conveyance, distribution or disposal of water, use of water, water storage, electric power or other service, and from the operation, lease, sale or other disposition of the works, property and facilities acquired under the provisions of this act shall be paid to the credit of the appropriate water fund.

(d) The board shall provide in the proceedings authorizing the issuance of each series of bonds, warrants, notes, debentures, or other evidences of indebtedness or in the trust indenture securing the same, for paying into the appropriate sinking fund at stated intervals all moneys then remaining in the water fund, after paying all costs of operation, maintenance and repairs of the works. All moneys in each sinking fund shall be pledged for the payment of and used for the purpose of paying the interest, principal, and the necessary fiscal agency charges upon the bonds, warrants, notes, debentures or other evidences of indebtedness as the same shall fall due.