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S.B. 230

             1     

WATER COMPANIES AND ASSOCIATIONS

             2     
ASSESSMENTS

             3     
2001 GENERAL SESSION

             4     
STATE OF UTAH

             5     
Sponsor: Mike Dmitrich

             6      This act modifies the Corporations Assessments Code by allowing assessments on other than
             7      a pro rata basis if the articles of incorporation so permit or as required by a contract or law.
             8      The act makes other technical changes.
             9      This act affects sections of Utah Code Annotated 1953 as follows:
             10      AMENDS:
             11          16-4-7, as last amended by Chapter 29, Laws of Utah 1961
             12          16-4-24, Utah Code Annotated 1953
             13      ENACTS:
             14          16-4-1.5, Utah Code Annotated 1953
             15      Be it enacted by the Legislature of the state of Utah:
             16          Section 1. Section 16-4-1.5 is enacted to read:
             17          16-4-1.5. Definitions.
             18          For purposes of this chapter:
             19          (1) "Articles of incorporation" is as defined in Section 16-6a-102 .
             20          (2) "Bylaws" is as defined in Section 16-6a-102 .
             21          Section 2. Section 16-4-7 is amended to read:
             22           16-4-7. Equal assessments required.
             23          [In the case of full-paid stock,] Except as provided in Section 16-4-24 , all fully paid stock
             24      subject to assessment [must] shall be assessed equally.
             25          Section 3. Section 16-4-24 is amended to read:
             26           16-4-24. Certain water companies and associations -- Assessments -- Other than pro
             27      rata basis.


             28          [Any] (1) If the conditions of Subsection (2) are met, an irrigation company, canal
             29      company, ditch company, reservoir company, or water users' association [hereafter] organized
             30      under the laws of this state [shall have the power to] may make assessments against its shares of
             31      stock on other than a pro rata basis:
             32          (a) for the purpose of raising funds to accomplish the [purpose or] one or more purposes
             33      for which the company or association is organized; or
             34          (b) to pay [its] the company's or association's debts or obligations [when].
             35          (2) A company or association described in Subsection (1) may make assessments against
             36      its shares of stock on other than a pro rata basis if:
             37          (a) at the time of the assessments, the articles of incorporation [so] permit[.] assessments
             38      on other than a pro rata basis;
             39          [The provisions of this section shall also apply to any irrigation company, canal company,
             40      ditch company, reservoir company or water users' association heretofore organized the articles of
             41      incorporation of which now expressly so permit assessments to be made on other than a pro rata
             42      basis or to any irrigation company, canal company, ditch company, reservoir company, or water
             43      users' association heretofore or hereafter organized when]
             44          (b) the company or association is required to make assessments on other than a pro rata
             45      basis under [existing or future] a contract [or contracts] between:
             46          (i) the United States and [any such] the company or [water users'] association [or
             47      between];
             48          (ii) the United States and stockholders of [any such] the company or [water users']
             49      association; or [between any such]
             50          (iii) the company or [water users'] association and [its] the stockholders [or when] of the
             51      company or association;
             52          (c) required by [any] a contract of subscription for shares of stock to [any such] the
             53      company or [water users'] association [so] contracting with the United States; or [under present
             54      or future]
             55          (d) required by the laws or regulations of the United States.





Legislative Review Note
    as of 2-2-01 3:47 PM


A limited legal review of this legislation raises no obvious constitutional or statutory concerns.

Office of Legislative Research and General Counsel


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