(a) The board shall designate one or more banks in the district to serve as depository for the district’s money.
(b) District money shall be deposited with a designated depository bank or banks, except that:
(1) money pledged to pay bonds may be deposited with the trustee bank named in the trust agreement; and
(2) money shall be remitted to the bank of payment for the payment of principal of and interest on bonds.

(c) To the extent that money in a depository bank or a trustee bank is not insured by the Federal Deposit Insurance Corporation, the money must be secured in the manner provided by law for the security of county funds.
(d) The board shall prescribe the terms of service for depositories.
(e) Before designating a depository bank, the board shall issue a notice that:
(1) states the time and place at which the board will meet to designate a depository bank or banks; and
(2) invites the banks in the district to submit an application to be designated as a depository.
(f) The notice must be published one time in a newspaper or newspapers published in the district and specified by the board.
(g) At the time stated in the notice, the board shall:
(1) consider the application and the management and condition of each bank that applies; and
(2) designate as a depository the bank or banks that:
(A) offer the most favorable terms for handling the money; and
(B) the board finds have proper management and are in condition to handle the money.
(h) Membership on the board of an officer or director of a bank does not disqualify the bank from being designated as a depository.
(i) If the board does not receive any applications before the time stated in the notice, the board shall designate one or more banks located inside or outside the district on terms that the board finds advantageous to the district.