Sec. 4.08. ATTACHMENTS TO CONTRACTS.  A contract entered into under Section 4.06 of this Act must contain, or have attached to it, the specifications, plans, and details for work included in the contract, and work shall be done according to those plans and specifications under the supervision of the district.
Sec. 4.09. EXECUTION AND AVAILABILITY OF CONTRACTS.    (a)  A contract entered into under Section 4.06 of this Act must be in writing and signed by the contractor and a representative of the district designated by the board.
(b) The contract shall be kept in the district's office and must be available for public inspection.
Sec. 4.10. CONTRACTOR'S BOND.    (a)  A contractor shall execute a bond in an amount determined by the board, not to exceed the contract price, payable to the district and approved by the board, conditioned on the faithful performance of the obligations, agreements, and covenants of the contract.
(b) The bond must provide that if the contractor defaults on the contract, the contractor will pay to the district all damages sustained as a result of the default.  The bond shall be deposited in the district's depository, and a copy of the bond shall be kept in the district's office.
Sec. 4.11. MONITORING WORK.    (a)  The board has control of construction, renovation, or repairs being done for the district under a contract entered into under Section 4.06 of this Act and shall determine whether or not the contract is being fulfilled.
(b) The board shall have the construction, renovation, or repair work inspected by engineers, inspectors, and personnel of the district.
(c) During the progress of the work, the engineers, inspectors, and personnel doing the inspections shall submit to the board written reports that show whether or not the contractor is complying with the contract.
(d) On completion of construction, renovation, or repair work, the engineers, inspectors, and personnel shall submit to the board a final detailed written report including information necessary to show whether or not the contractor has fully complied with the contract.
Sec. 4.12. PAYMENT FOR WORK.    (a)  The district shall pay the contract price of construction, renovation, or repair contracts in accordance with this section.
(b) The district shall make progress payments under contracts monthly as the work proceeds or at more frequent intervals as determined by the board.
(c) If requested by the board, the contractor shall furnish an analysis of the total contract price showing the amount included for each principal category of the work, in such detail as requested, to provide a basis for determining progress payments.
(d) In making progress payments, 10 percent of the estimated amount shall be retained until final completion and acceptance of the contract work.  However, if the board, at any time after 50 percent of the work has been completed, finds that satisfactory progress is being made, it may authorize any of the remaining progress payments to be made in full.  Also, if the work is substantially complete, the board, if it finds the amount retained to be in excess of the amount adequate for the protection of the district, may release to the contractor all or a portion of the excess amount.
(e) On completion and acceptance of each separate project, work, or other division of the contract, on which the price is stated separately in the contract, payment may be made without retention of a percentage.
(f) When work is completed according to the terms of the contract, the board shall draw a warrant on the depository to pay any balance due on the contract.
Sec. 4.13. CONTRACTS FOR PURCHASE OF VEHICLES, EQUIPMENT, AND SUPPLIES OVER $15,000.    (a)  If the estimated amount of a proposed contract for the purchase of vehicles, equipment, or supplies is more than $15,000, the board shall ask for competitive bids as provided by Section 4.07 of this Act.
(b) This section does not apply to purchase of property from public agencies or to contracts for personal or professional services.
Sec. 4.14. ENTRY ON LAND.    (a)  The directors, the engineer, and the employees of the district may go on any land inside or outside the boundaries of the district to make surveys and examine the land with reference to the location of works, improvements, and waste disposal, treatment, and other facilities, plants, pipelines, equipment, and appliances and to attend to business of the district.
(b) Before a director, engineer, or employee enters on the land, the landowner must grant written permission or five days' written notice must be given to the landowner.
(c) If any activities of the district on the land cause damages to the land or property, the land or property shall be restored as nearly as possible to its original state.  The district shall pay the cost of the restoration.
Sec. 4.15. RIGHT TO USE ROAD RIGHT-OF-WAY.    (a)  The district has a right-of-way along and across all public state or county roads or highways;  provided that a governmental entity having jurisdiction of such right-of-way may designate the place upon the right-of-way the facilities of the district shall be installed and may require the relocation of the facilities of the district to accommodate any widening or changing of traffic lanes.  
(b) The district may not proceed with any action to change, alter, or damage facilities or property of the state without having first obtained the written consent of the governmental entity having control and jurisdiction of such facilities or property.
Sec. 4.16. FEES AND CHARGES.    (a)  The board may adopt and enforce all necessary charges, fees, or rentals, in addition to taxes, for providing any district facilities or services.
(b) The board may require a deposit for any services or facilities furnished and may or may not provide that the deposit will bear interest.  The interest, if any, may accrue to the deposit or be used to offset amounts due.
(c) The board may discontinue a facility or service to prevent an abuse or enforce payment of an unpaid charge, fee, or rental due the district, including taxes that have been due for not less than six months.
Sec. 4.17. ACQUISITION OF EXISTING FACILITIES.  If the district acquires existing works, improvements, facilities, plants, pipelines, equipment, and appliances that are completed, partially completed, or under construction, the district may assume the contracts and obligations of the previous owner and perform the obligations of the previous owner in the same manner and to the same extent that any other purchaser or assignee would be bound.
Sec. 4.18. SOLID WASTE RESOURCE RECOVERY FACILITIES.  The district may construct or acquire and operate solid waste resource recovery facilities inside the district.
Sec. 4.19. REGULATION OF SOLID WASTE MANAGEMENT.  The district shall comply with all standards, laws, and rules relating to the operation for all aspects of solid waste handling, including storage, collection, recycling, incineration, sanitary landfill, or composting.
Sec. 4.20. ON-SITE SEWAGE DISPOSAL SYSTEMS.    (a)  The district may apply to the department for designation as an authorized agent to implement and enforce on-site sewage disposal rules under Chapter 366, Health and Safety Code.
(b) If the district finds that due to the nature of the soil or drainage in the area it is necessary to prevent water pollution that may injure the public health, the district by rule may:
(1) provide limits on the number and kind of septic tanks in an area defined by the rule;
(2) prohibit the use of septic tanks in the area;  or
(3) prohibit the installation of new septic tanks in the area.
(c) The board shall consult the department and the commission before the adoption of a rule under Subsection (b) of this section.
(d) The board may not issue a rule under Subsection (b) of this section without first holding a public hearing in the area to be affected by the rule.
Sec. 4.21. SOLID WASTE MANAGEMENT CONTRACTS.    (a)  Unless otherwise provided by this Act, the district may contract to provide solid waste management services inside the district.
(b) The district shall set fees in a contract under Subsection (a) of this section after considering:
(1) the quality of the waste;
(2) the quantity of the waste;
(3) the difficulty encountered in treating or disposing of the waste;
(4) operation and maintenance expenses and debt retirement services;  and
(5) any other reasonable considerations.
Sec. 4.22. AREAWIDE WASTE TREATMENT.  The powers and duties conferred on the district are granted subject to the state policy to encourage the development and use of regional and integrated solid waste management systems to serve the needs of the citizens of the state.
ARTICLE 5. DISTRICT FINANCES

Sec. 5.01. FISCAL YEAR.    (a)  The district operates on the fiscal year established by the board.
(b) The fiscal year may not be changed more than once in a 24-month period.
Sec. 5.02. ANNUAL AUDIT.  Annually, the board shall have an audit made of the financial condition of the district.
Sec. 5.03. ANNUAL BUDGET.    (a)  The board shall prepare and approve an annual budget for the district.
(b) The budget shall contain a complete financial statement, including a statement of:
(1) the outstanding obligations of the district;
(2) the amount of cash on hand to the credit of each fund of the district;
(3) the amount of money received by the district from all sources during the previous year;
(4) the amount of money available to the district from all sources during the ensuing year;
(5) the amount of the balances expected at the end of the year in which the budget is being prepared;
(6) the estimated amount of revenues and balances available to cover the proposed budget;  and
(7) the estimated tax rate that will be required.
Sec. 5.04. AMENDING BUDGET.  After adoption, the annual budget may be amended on the board's approval.
Sec. 5.05. LIMITATION ON EXPENDITURE.  Money may not be spent for an expense not included in the annual budget or an amendment to it unless the board by order declares the expense to be necessary.
Sec. 5.06. SWORN STATEMENT.  As soon as practicable after the close of the fiscal year, the treasurer of the district shall prepare for the board a sworn statement of the amount of money that belongs to the district and an account of the disbursements of that money.
Sec. 5.07. DEPOSITORY.    (a)  The board shall name one or more banks to serve as depository for district funds.
(b) District funds, other than those transmitted to a bank for payment of bonds issued by the district, shall be deposited as received with the depository bank and must remain on deposit.  This section does not limit the power of the board to invest the district's funds as provided by Section 5.08 of this Act.
(c) Before the district deposits funds in a bank in an amount that exceeds the maximum amount secured by the Federal Deposit Insurance Corporation, the bank must execute a bond or provide other security in an amount sufficient to secure from loss the district's funds that exceed the amount secured by the Federal Deposit Insurance Corporation.
Sec. 5.08. INVESTMENTS.    (a)  Funds of the district may be invested and reinvested by the board or its authorized representative in those investments specified by Article 836 or 837, Revised Statutes, or the Public Funds Investment Act of 1987 (Article 842a-2, Vernon's Texas Civil Statutes).
(b) Funds of the district may be placed in certificates of deposit of state or national banks or state or federal savings and loan associations within the state provided that funds are secured in the manner required for the security of the funds of counties of the state.
(c) The board by resolution may provide that an authorized representative of the district may invest and reinvest the funds of the district and provide for money to be withdrawn from the appropriate accounts of the district for investments on terms the board considers advisable.
Sec. 5.09. PAYMENT OF EXPENSES.    (a)  The district's directors may pay all costs and expenses necessarily incurred in the creation, organization, and operation of the district, legal fees, and other incidental expenses and may reimburse any person for money advanced for those purposes.
(b) Payments may be made from money obtained from the sale of bonds issued by the district or out of taxes, fees, or other revenues of the district.
Sec. 5.10. BORROWING MONEY.  The district may borrow money for any purpose authorized under this Act or any combination of those purposes.
ARTICLE 6. BONDS

Sec. 6.01. AUTHORITY TO ISSUE BONDS.  The board may issue and sell bonds in the name of the district to acquire land and construct works, improvements, and waste disposal, treatment, and other facilities, plants, pipelines, equipment, and appliances as provided by this Act.
Sec. 6.02. BOND PAYMENT.  The board may provide for the payment of the principal of and interest on the bonds:
(1) from the levy and collection of property taxes on all taxable property within the district;
(2) by pledging all or part of the designated revenues from the ownership or operation of the district's works, improvements, and facilities;  or
(3) from a combination of the sources listed by Subdivisions (1) and (2) of this section.
Sec. 6.03. BOND ELECTION.    (a)  Bonds may not be issued by the district until authorized by a majority vote of individuals qualified to vote and actually voting in the area within the boundaries of the district at an election called and held for that purpose.
(b) The board may order a bond election.  The order calling the election must state the nature and the date of the election, the hours during which the polls will be open, the location of the polling places, the amount of bonds to be authorized, and the maximum maturity of the bonds.
(c) Notice of a bond election must be given as provided by the Election Code.
(d) At an election to authorize bonds, the ballot must be printed to provide for voting for or against the issuance of bonds and the levy of property taxes for payment of the bonds.
(e) The board shall canvass the returns and declare the results of the election.  If a majority of the votes cast at the election favor the issuance of the bonds, the bonds may be issued by the board, but if a majority of the votes cast at the election do not favor issuance of the bonds, the bonds may not be issued.
Sec. 6.04. TERMS;  FORM.    (a)  The district may issue its bonds in various series or issues.
(b) Bonds may mature serially or otherwise not more than 50 years after the date of issuance and shall bear interest at a rate permitted by state law.
(c) The district's bonds and interest coupons, if any, are investment securities under the terms of Chapter 8, Business & Commerce Code, and may be issued registrable as to principal or as to principal and interest or may be issued in book entry form and may be made redeemable before maturity at the option of the district or may contain a mandatory redemption provision.
(d) The district's bonds may be issued in the form, denominations, and manner and under the terms, conditions, and details and shall be signed and executed as provided by the board in the resolution or order authorizing the bonds.
Sec. 6.05. BOND PROVISIONS.    (a)  In the orders or resolutions authorizing the issuance of bonds, including refunding bonds, the board may provide for the flow of funds, the establishment and maintenance of the interest and sinking fund, the reserve fund, and other funds and may make additional covenants with respect to the bonds and the pledged fees.
(b) The orders or resolutions of the board authorizing the issuance of bonds may prohibit the further issuance of bonds or other obligations payable from the pledged fees or may reserve the right to issue additional bonds to be secured by a pledge of and payable from the fees on a parity with or subordinate to the pledge in support of the bonds being issued.
(c) The orders or resolutions of the board issuing bonds may contain other provisions and covenants as the board may determine.
(d) The board may adopt and have executed any other proceedings or instruments necessary and convenient in the issuance of bonds.
Sec. 6.06. APPROVAL AND REGISTRATION.    (a)  Bonds issued by the district and the records relating to their issuance must be submitted to the attorney general for examination as to their validity.
(b) If the attorney general finds that the bonds have been authorized in accordance with the law, the attorney general shall approve them, and the comptroller of public accounts shall register the bonds.
(c) Following approval and registration, the bonds are incontestable and are binding obligations according to their terms.
Sec. 6.07. REFUNDING BONDS.    (a)  Refunding bonds of the district may be issued to refund and pay off an outstanding indebtedness the district has issued or assumed.
(b) The bonds must be issued in the manner provided by Chapter 784, Acts of the 61st Legislature, Regular Session, 1969 (Article 717k-3, Vernon's Texas Civil Statutes).
(c) The refunding bonds may be sold and the proceeds applied to the payment of outstanding indebtedness or may be exchanged in whole or in part for not less than a similar principal amount of outstanding indebtedness.  If the refunding bonds are to be sold and the proceeds applied to the payment of outstanding indebtedness, the refunding bonds must be issued and payments made in the manner provided by Chapter 503, Acts of the 54th Legislature, Regular Session, 1955 (Article 717k, Vernon's Texas Civil Statutes).
Sec. 6.08. LEGAL INVESTMENTS;  SECURITY FOR DEPOSITS.    (a)  District bonds are legal and authorized investments for:
(1) a bank;
(2) a savings bank;
(3) a trust company;
(4) a savings and loan association;
(5) an insurance company;
(6) a fiduciary;
(7) a trustee;
(8) a guardian;  and
(9) the sinking fund of a municipality, county, school district, or other political subdivision of the state and other public funds of the state and its agencies, including the permanent school fund.
(b) District bonds may secure deposits of public funds of the state or a municipality, county, school district, or other political subdivision of the state.  The bonds are lawful and sufficient security for deposits to the extent of their value, if accompanied by all unmatured coupons.
Sec. 6.09. MANDAMUS BY BONDHOLDERS.  In addition to all other rights and remedies provided by law, if the district defaults in the payment of principal, interest, or redemption price on its bonds when due or if it fails to make payments into any fund or funds created in the orders or resolutions authorizing the issuance of the bonds or defaults in the observation or performance of any other covenants, conditions, or obligations set forth in the orders or resolutions authorizing the issuance of its bonds, the owners of any of the bonds are entitled to a writ of mandamus issued by a court of competent jurisdiction compelling and requiring the district and its officials to observe and perform the covenants, obligations, or conditions prescribed in the orders or resolutions authorizing the issuance of the district's bonds.
Sec. 6.10. APPLICATION OF OTHER LAWS.  Bonds of the district are considered bonds under the Bond Procedures Act of 1981 (Article 717k-6, Vernon's Texas Civil Statutes).
ARTICLE 7. TAXES

Sec. 7.01. TAX STATUS OF BONDS.  Since the district created under this Act is a public entity performing an essential public function, bonds issued by the district, any transaction relating to the bonds, and profits made in the sale of the bonds are free from taxation by the state or by a municipality, county, special district, or other political subdivision of the state.
Sec. 7.02. LEVY OF TAXES.    (a)  The board may annually levy taxes in the district in an amount necessary to pay the principal of and interest on bonds issued by the district and the expense of assessing and collecting taxes.  
(b) The district may annually levy and collect a maintenance and operating tax in an amount not to exceed five cents on each $100 of assessed valuation of property in the district to pay maintenance and operating expenses of the district.
(c) The combined tax rate for all purposes may not exceed 10 cents on each $100 of assessed valuation of property in the district.
Sec. 7.03. BOARD AUTHORITY.    (a)  The board may levy taxes for the entire year in which the district is created.  
(b) The board shall levy taxes on all property within the boundaries of the district subject to district taxation.
Sec. 7.04. TAX RATE.  In setting the tax rate, the board shall take into consideration the income of the district from sources other than taxation.  On determination of the amount of tax required to be levied, the board shall make the levy and certify it to the tax collector.
Sec. 7.05. TAX APPRAISAL, ASSESSMENT, AND COLLECTION.    (a)  The Tax Code governs the appraisal, assessment, and collection of district taxes.  
(b) The board may provide for the appointment of a tax collector for the district or may contract for the collection of taxes as provided by the Tax Code.
ARTICLE 8. CHANGE IN BOUNDARIES

Sec. 8.01. EXPANSION OF DISTRICT TERRITORY.    (a)  Registered voters of a defined territory that is not included in the district may file a petition with the secretary of the board requesting the inclusion of the territory in the district.  The petition must be signed by at least 50 registered voters of the territory or a majority of those voters, whichever is less.  
(b) The board by order shall set a time and place to hold a hearing on the petition to include the territory in the district.  The board shall set a date for the hearing that is after the 30th day after the date the board issues the order.
(c) If after the hearing the board finds that annexation of the territory into the district would be feasible and would benefit the district, the board may approve the annexation by a resolution entered in its minutes.  The board is not required to include all of the territory described in the petition if the board finds that a modification or change is necessary or desirable.
(d) Annexation of territory is final when approved by a majority of the voters at an election held in the district and by a majority of the voters at a separate election held in the territory to be annexed.  If the district has outstanding debts or taxes, the voters in the election to approve the annexation must also determine if the annexed territory will assume its proportion of the debts or taxes if added to the district.
(e) The election ballots shall be printed to provide for voting for or against the following, as applicable:
(1) "Adding (description of territory to be added) to the Gaines County Solid Waste Management District."
(2) "(Description of territory to be added) assuming its proportionate share of the outstanding debts and taxes of the Gaines County Solid Waste Management District, if it is added to the district."
(f) The election shall be held after the 45th day and on or before the 60th day after the date the election is ordered.  The election shall be ordered and notice of the election shall be given in accordance with the Election Code.  Section 41.001(a), Election Code, does not apply to an election held under this section.