A. A municipality acquiring a municipal gas or geothermal utility may, by ordinance, contract to lease the gas or geothermal utility to a lessee. The term of the lease shall not exceed twenty-five years, and, consistent with the provisions of this section, the ordinance may contain such provisions and be in such form as the governing body determines.

B. The governing body shall set forth in the ordinance or in the proceedings under which the revenue bonds are proposed to be issued provisions requiring payments to the municipality by the lessee adequate to meet and discharge when due:

(1)     all amounts found by the governing body to be necessary in connection with the transaction;

(2)     the amount necessary in each year to pay the principal and interest on the revenue bonds proposed to be issued;

(3)     the amount necessary to be paid each year into any reserve fund which the governing body deems advisable to establish in connection with the retirement of the proposed bonds or the maintenance of the natural gas or geothermal utility or both; and

(4)     the estimated cost to the municipality of maintaining the utility in good repair and keeping it properly insured unless the terms under which the utility is to be leased provide that the lessee shall maintain the utility and carry all proper insurance relating to the utility.

C. The lease agreement shall also:

utility;

(1)     require the lessee to complete and connect the natural gas or geothermal (2)     require the lessee to place the utility in operation; and

(3)     obligate the lessee through the utility to provide the supply and service of natural gas or geothermal energy.

The original lessee and any succeeding holder of the lease shall be subject to regulation as a public utility under the Public Utility Act [Chapter 62, Articles 1 to 6 and 8 to 13 NMSA 1978].

D. The lease may contain an option to purchase the natural gas or geothermal utility at the election of the lessee upon compliance by the lessee with the terms of the lease. Any option to purchase the natural gas or geothermal utility shall provide for a purchase price not less than the amount:

(1)     necessary to discharge in full the principal and interest of any outstanding revenue bonds issued by the municipality to finance the acquisition of the natural gas or geothermal utility; and

(2)     of all expenses incurred or to be incurred in completing the transaction. E. No ordinance providing for the acquisition of a natural gas or geothermal utility, the issuance of revenue bonds and the leasing of the natural gas or geothermal utility to a lessee shall become effective until the question of acquiring the natural gas or geothermal utility, issuing the revenue bonds and leasing the natural gas or geothermal utility, as proposed, has, as a single question, been submitted to the qualified electors at a regular or special municipal election, which election shall be substituted for the election required in Section 3-23-2 N.M. Stat. Ann.. A special election may be called for the purpose of voting on the question, but no special election shall be called for a date less than ninety days prior to the date of the regular municipal election. The ordinance authorizing the acquisition of the natural gas or geothermal utility, the issuance of revenue bonds for the acquisition of the utility and the leasing of the natural gas or geothermal utility shall be published in full once a week for two successive weeks, and the last publication shall be at least seven days before the date of the election.

F. The ballot provided for the election shall set forth in general terms the question to be voted upon substantially as follows:

“Shall the (city, town or village – choose the applicable term) of …………, New Mexico proceed with the program for acquisition of natural gas or geothermal facilities, the issuance and sale of not to exceed $ ……… principal amount of revenue bonds for the cost thereof and incidental purposes and the leasing of such facilities to ………., a public utility, all according to Ordinance No. ……. adopted on the .. day of ………, 19 …?” The ballot shall provide for each voter to indicate whether he favors or opposes such proposition.

G. If a majority of the qualified electors voting on the question approve the proposition, the ordinance shall become effective.

H. No municipality shall pay from its general fund or otherwise contribute any property or asset to pay any part of the cost of acquiring a natural gas or geothermal system which is to be leased as provided in this section; provided that nothing herein shall be construed to prevent a municipality from accepting private donations of property or other assets to be used for defraying any part of the cost of the natural gas or geothermal system.