KRS 76.259: Financing methods temporarily inadequate, procedure -- Contracts.

(1) If the district finds as a fact that the methods of financing sewer facilities within a

construction subdistrict provided for in KRS 76.005 to 76.295 will be inadequate,

uneconomic, or unduly burdensome to the residents to be initially served, the

district may contract with one or more persons to construct or cause to be

constructed a sewer system within the construction subdistrict or to advance or loan

money to the district for the construction of a sewer system within the construction

subdistrict. The se wer system constructed must either be conveyed to the district,

acting for the construction subdistrict, and be a subdistrict facility, or provisions for

the eventual conveyance of the system to the district, acting for the subdistrict, must

be included in the contract. When the district finds that one or more financing

methods for construction subdistricts established by KRS 76.005 to 76.295,

excluding this section, have become feasible, the district may adopt such method or

methods to raise the money to p ay for the construction of sewer facilities within the

construction subdistrict or to pay the loan.

(2) The contract may be made prior to the making of an order establishing the

construction subdistrict. The contract may require that one (1) or more perso ns

agree to buy construction subdistrict bonds to be issued pursuant to KRS 76.254 in

an amount specified, which shall be sufficient to finance the construction of the

sewer system. The maximum price and yield of the bonds shall be stated in the

contract. Such contract shall not prevent the district from selling the bonds to a

lower bidder.

(3) All contracts made pursuant to this section shall be in writing and shall contain a

covenant that this section shall prevail over any contrary feature of the contract.

(4) The General Assembly declares that the public policy of the Commonwealth will

not be offended merely because a contract or loan made pursuant to this section is

privately negotiated or because it is made without competitive bidding.

(5) Bonds sold to one (1) or more contracting parties pursuant to subsection (2) shall be

indorsed to disclose the nature of the sale. Such bonds, no matter who the holder or

owner, shall never be eligible to have any payment made on their account pursuant

to subsection (6) of KRS 76.262.