(1) Any
combination of cities and towns of this state which are authorized to own and
operate electric systems may, by contract with each other or with cities and towns
of any adjoining state, establish a separate governmental entity, to be known as a
power authority, to be used by such contracting municipalities to effect the
development of electric energy resources or production and transmission of
electric energy in whole or in part for the benefit of the inhabitants of such
contracting municipalities.
(2) Any contract establishing such separate governmental entity shall
specify:
(a) The name and purpose of such entity and the functions or services to be
provided by such entity;
(b) The establishment and organization of a governing body of the entity,
which shall be a board of directors in which all legislative power of the entity is
vested, including:
(I) The number of directors, their manner of appointment, their terms of
office, their compensation if any, and the procedure for filling vacancies on the
board;
(II) The officers of the entity, the manner of their selection, and their duties;
(III) The voting requirements for action by the board; except that, unless
specifically provided otherwise, a majority of directors shall constitute a quorum,
and a majority of the quorum shall be necessary for any action taken by the board;
(IV) The duties of the board which shall include the obligation to comply with
the provisions of parts 1, 5, and 6 of this article;
(c) Provisions for the disposition, division, or distribution of any property or
assets of the entity;
(d) The term of the contract, which may be continued for a definite term or
until rescinded or terminated, and the method, if any, by which it may be rescinded
or terminated; except that such contract may not be rescinded or terminated so
long as the entity has bonds, notes, or other obligations outstanding, unless
provision for full payment of such obligations, by escrow or otherwise, has been
made pursuant to the terms of such obligations.
(3) The general powers of such entity shall include the following powers:
(a) To develop electric energy resources and produce or transmit electric
energy in whole or in part for the benefit of the inhabitants of the contracting
municipalities;
(b) To make and enter into contracts, including, without limitation, contracts
with cities and towns in any adjoining state, irrespective of whether such cities and
towns are parties to the contract establishing the separate governmental entity;
(c) To employ agents and employees;
(d) To acquire, construct, manage, maintain, or operate electric energy
facilities, works, or improvements or any interest therein;
(e) To acquire, hold, lease (as lessor or lessee), sell, or otherwise dispose of
any real or personal property, commodity, or service;
(f) To condemn property for public use, if such property is not owned by any
public utility and devoted to such public use pursuant to state authority;
(g) To incur debts, liabilities, or obligations;
(h) To sue and be sued in its own name;
(i) To have and use a corporate seal;
(j) To fix, maintain, and revise fees, rates, and charges for functions, services,
or facilities provided by the entity;
(k) To adopt, by resolution, regulations respecting the exercise of its powers
and the carrying out of its purposes;
(l) To exercise any other powers which are essential to the provision of
functions, services, or facilities by the entity and which are specified in the contract;
(m) To do and perform any acts and things authorized by this section under,
through, or by means of an agent or by contracts with any person, firm, or
corporation;
(n) To deposit moneys of the power authority not then needed in the conduct
of the power authority affairs in any depository authorized in section 24-75-603,
C.R.S. For the purpose of making such deposits, the board of directors may appoint,
by written resolution, one or more persons to act as custodians of the moneys of the
power authority. Such persons shall give surety bonds in such amounts and form
and for such purposes as the board requires.
(o) To acquire or cross railroad rights-of-way in the manner set forth in
section 40-5-105, C.R.S.
(4) The separate governmental entity established by such contracting
municipalities shall be a political subdivision and a public corporation of the state,
separate from the parties to the contract, and shall be a validly created and
existing political subdivision and public corporation of the state, irrespective of
whether a contracting municipality, including a city or town of an adjoining state,
withdraws (whether voluntarily, by operation of law, or otherwise) from such entity
subsequent to its creation under circumstances not resulting in the rescission or
termination of the contract establishing such entity pursuant to its terms. It shall
have the duties, privileges, immunities, rights, liabilities, and disabilities of a public
body politic and corporate. The provisions of articles 10.5 and 47 of title 11, C.R.S.,
shall apply to moneys of the entity.
(5) The bonds, notes, and other obligations of such separate governmental
entity shall not be the debts, liabilities, or obligations of the contracting
municipalities.
(6) The contracting municipalities may provide in the contract for payment to
the separate governmental entity of funds from proprietary revenues for services
rendered by the entity, from proprietary revenues or other public funds as
contributions to defray the cost of any purpose set forth in the contract, and from
proprietary revenues or other public funds as advances for any purpose subject to
repayment by the entity.
(7) (a) To carry out the purposes for which the separate governmental entity
was established, the entity is authorized to issue bonds, notes, or other obligations
payable solely from the revenues derived or to be derived from the function,
service, or facility or the combined functions, services, or facilities of the entity or
from any other available funds of the entity. The terms, conditions, and details of
said bonds, notes, and other obligations, the procedures related thereto, and the
refunding thereof shall be set forth in the resolution authorizing said bonds, notes,
or other obligations and shall, as nearly as may be practicable, be substantially the
same as those provided in part 4 of article 35 of title 31, C.R.S., relating to water
and sewer revenue bonds; except that the purposes for which the same may be
issued shall not be so limited and except that said bonds, notes, and other
obligations may be sold at public or private sale. Bonds, notes, or other obligations
issued under this subsection (7) shall not constitute an indebtedness of the entity or
the cooperating or contracting municipalities within the meaning of any
constitutional or statutory limitation or other provision. Each bond, note, or other
obligation issued under this subsection (7) shall recite in substance that said bond,
note, or other obligation, including the interest thereon, is payable solely from the
revenues and other available funds of the entity pledged for the payment thereof
and that said bond, note, or other obligation does not constitute a debt of the entity
or the cooperating or contracting municipalities within the meaning of any
constitutional or statutory limitations or provisions. Notwithstanding anything in
this section to the contrary, such bonds, notes, and other obligations may be issued
to mature at such times not beyond forty years from their respective issue dates,
shall bear interest at such rates, and shall be sold at, above, or below the principal
amount thereof, all as shall be determined by the board of the entity.
Notwithstanding anything in this section to the contrary, in the case of short-term
notes or other obligations maturing not later than one year from the date of
issuance thereof, the board of the entity may authorize officials of the entity to fix
principal amounts, maturity dates, interest rates, and purchase prices of any
particular issue of such short-term notes or obligations, subject to such limitations
as to maximum term, maximum principal amount outstanding, and maximum net
effective interest rates as the board shall prescribe by resolution. Such action may
be taken by the board of the entity only at a public meeting preceded by adequate
notice, and the action of the board shall be properly recorded on the permanent
records of the board.
(b) The resolution, trust indenture, or other security agreement under which
any bonds, notes, or other obligations are issued shall constitute a contract with the
holders thereof, and it may contain such provisions as shall be determined by the
board of the entity to be appropriate and necessary in connection with the issuance
thereof and to provide security for the payment thereof, including, without
limitation, any mortgage or other security interest in any revenues, funds, rights, or
properties of the entity. The bonds, notes, and other obligations of the entity and
the income therefrom shall be exempt from taxation, except inheritance, estate,
and transfer taxes.
(8) A separate governmental entity established by contracting municipalities
shall, if the contract so provides, be the successor to any nonprofit corporation,
agency, or other entity theretofore organized by the contracting municipalities to
provide the same function, service, or facility, and such separate governmental
entity shall be entitled to all rights and privileges and shall assume all obligations
and liabilities of such other entity under existing contracts to which such other
entity is a party.
(9) The authority granted pursuant to this section shall in no manner limit the
powers of governments to enter into intergovernmental cooperation or contracts or
to establish separate legal entities pursuant to the provisions of section 29-1-203 or
any other applicable law or otherwise to carry out their powers under applicable
statutory or charter provisions, nor shall such authority limit the powers reserved to
cities and towns by section 2 of article XI of the state constitution. Nothing in this
part 2 constitutes a legislative declaration of preference for electric systems
owned by separate governmental entities over electric systems owned by other or
different entities.
(10) For the purposes of subsection (1), paragraph (b) of subsection (3), and
subsection (4) of this section, cities and towns of any adjoining state means any
city or town located in any state sharing a common border with the state of
Colorado which owns an electric system and which is located not more than fifteen
miles from the common border of the state of Colorado and such adjoining state.