7-13-2332. Issuance of refunding bonds without election. (1) (a) District refunding bonds, issued to provide money to refund outstanding bonded indebtedness, may be issued without a vote of the electorate. In order to issue refunding bonds, the board of directors shall adopt a resolution setting forth the facts regarding the outstanding bonds that are to be redeemed, the reasons for issuing the refunding bonds, and the terms and details of the refunding bond issue.

(b) After adopting a resolution, the board of directors may sell the bonds at times and in a manner considered to be in the public interest.

(2) (a) Refunding bonds may be issued prior to the maturity or redemption date of the outstanding bonds they are to refund. The proceeds of the refunding bonds, less any accrued interest or premium received upon the sale of the refunding bonds or amounts to be used for the cost of issuance or establishing reserves for the refunding bonds, must be deposited with other funds appropriated for payment of the outstanding bonds in escrow with a suitable banking institution in or out of the state.

(b) Deposited funds must be invested in securities that are general obligations of the United States or in securities for which the principal and interest are guaranteed by the United States. The securities must be payable on the dates required and bear interest at a rate sufficient, with any cash retained in the escrow account, to pay, when due, accrued interest on each refunded bond until its maturity or redemption date if called for redemption. The securities must also be sufficient to pay the principal of the bond at maturity or upon the redemption date and to pay any redemption premium.

(c) The escrow account must be irrevocably appropriated to the payment of principal, interest, and redemption premium, if any, of the refunded bonds.

(d) A district may pay for reasonable costs of issuing the refunding bonds and maintaining the escrow account. Alternatively, a district may issue crossover refunding bonds as provided in Title 17, chapter 5, part 21.