(1) The district has the power to make general rules for the conduct of its business, as well as the conduct of the business of any subdistrict therein, and by such rules may provide for the rental of water or other services that are to be furnished by said subdistrict to any municipality, public irrigation district, irrigation district, other quasi-municipal corporation in this state, or any agency of the state of Colorado or the United States, and to make contracts for the payment of the rental to be charged for any such water or services. (2) Where a board of managers is established to carry out the general supervision and operational management of a plan of water management of a subdistrict, such board of managers shall, before undertaking any water management function, formulate and propose to the board of directors of the district rules and regulations which shall define the scope of the responsibility of the board of managers and the functional relationship between such board and the board of directors of the district in terms consistent with the requirements of this article. If such responsibility and relationship are described in the petition for the creation of the subdistrict, the rules and regulations must incorporate and be consistent therewith. Such rules and regulations shall also include operational rules and regulations for the plan of water management and any other operational function undertaken by the board of managers. Such rules and regulations, and any amendments thereto, may be adopted by the board of managers only after having been approved by the board of directors of the district.
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