Code of Alabama
Article 1 - General Provisions.
Section 11-47-3 - Contracts and Indebtedness for Municipal Buildings and Public Utility Systems; Consolidation of Systems; Ancillary Service Contracts.

(a) The governing body of any city or town may contract for the construction, reconstruction, extension, or repair of any municipal building, plant, waterworks system, or electric light and power plant or system or may on credit employ labor and purchase on credit all materials and supplies needed in such construction, reconstruction, extension, or repair and may, without an election, issue evidences of indebtedness in the forms and of the maturities described in Section 11-47-2 to the extent of any indebtedness incurred in such contract or purchase or construction, reconstruction or extension and may secure such evidences of indebtedness by mortgage or deed of trust (in such form and with such provisions as such governing body may determine) on such municipal building, plant, waterworks system, or electric light and power plant or system.
(b) The governing body may consolidate or combine their waterworks systems or plants with their lighting or power plants and systems and use any part of the one system or plant for the operation of the other plant or system, and may use the net proceeds, receipts and revenues from the lighting or power plant for the payment or security of any debt incurred in the construction, maintenance, extension, or operation of the waterworks system.
(c) The governing body may enter into agreements with companies duly registered as service contract providers under Chapter 32 of Title 8 to make available ancillary service contracts to residential utility customers of the city or town's utilities system, including residential water, sewer, gas, and electric utility services customers, with the endorsement of the city or town if deemed appropriate, and the governing body may apply any fees it receives pursuant to the agreements to its general revenue fund. No city or town shall require utility customers to purchase an ancillary service contract.

Structure Code of Alabama