Section 11-89-32

Procedure to form special corporation.

(a) In order to provide for operation and financing of one or more, but not all, of its authorized services under Chapter 89, Title 11, by following the procedures set out in this article, any district may establish a separate public corporation and grant to it the power to finance and operate any, but not all, of the authorized services of the district. If any district may, by its certificate of incorporation, provide more than one of fire protection service, sewer service, or water service in its service area, it may provide that any one or more of the services, but not all of them, may be operated and financed through a special corporation organized pursuant to this article. The procedure to organize a special corporation is as follows: The board shall adopt a resolution specifying that it is necessary or expedient that a special corporation be organized pursuant to this article to operate and finance one or more, but not all, of the services of the district in connection with a water system, sewer system, or fire protection facilities. The services to be exercised by the special corporation shall be expressly referred to in the resolution. The board shall authorize three persons who reside in the proposed service area of the special corporation to proceed to organize the special corporation. Each of these persons shall submit to the board the proposed certificate of incorporation of the special corporation, together with the certificate of the Secretary of State of the State of Alabama that the name proposed for the special corporation is not identical to that of any other corporation organized under the laws of this state or so similar thereto as to lead to confusion or uncertainty. The certificate of the Secretary of State shall be made an exhibit to the proposed certificate of incorporation and shall be recorded therewith. The board shall approve the certificate of incorporation and authorize it to be recorded. The certificate of incorporation shall be executed by each of the three persons designated as organizers and recorded in the office of the judge of probate of the county in which the certificate of incorporation of the district was recorded. The certificate of incorporation need not be recorded in any other office, even though it is proposed that the special corporation shall operate in more than one county.

(b) The certificate of incorporation of the special corporation shall state the following:

(1) The names of the persons forming the special corporation and a statement that each of them resides in the proposed service area of the special corporation.

(2) The period for the duration of the special corporation. If the duration is to be perpetual, subject to termination upon termination of the district, that fact shall be stated.

(3) The name of the district, together with the date on which the board of the district approved the certificate of incorporation.

(4) A statement of the type or types of service proposed to be rendered by the special corporation.

(5) Whether the service or services will be rendered throughout the entire service area of the district, or in a smaller service area. If the service or services will be rendered throughout the entire service area, no legal description need be set forth in the certificate of incorporation. If the service or services are to be rendered in a smaller service area, a concise legal description in the certificate of incorporation of the area or areas in which the special corporation proposes to render its service or services is required. In no event, shall the service area of a special corporation include any area not in the service area of the district.

(6) Any other matters relating to the special corporation that the incorporators may choose to insert and that have been approved by the board.

(c) If the special corporation is empowered to issue bonds, the certificate of incorporation shall contain a provision that prohibits any bonds from being issued unless the total principal amount, final maturity date, and applicable interest rate or rates of the bonds have been approved by the board.

(Acts 1994, No. 94-707, p. 1370, §3.)