Conservancy districts may borrow money in any amount, which, exclusive of interest, does not exceed the assessments then levied but not collected, for any purpose incident to its powers and functions and for any purpose provided by law, and may evidence such debt by contract, agreement, notes or warrants payable within any term not to exceed forty (40) years, and to bear interest at not to exceed the market prime rate per year, provided that the interest rate not exceed twelve and one-half percent (12 1/2%) per year. To secure such loan or loans, the directors may pledge any assessment then levied but not collected by the district and may agree to such other terms and conditions, not incompatible with the provisions of this title. Before any such loan is entered into by the district, the board of directors shall make application to the district court having jurisdiction of said district for approval of such loan. The application shall set forth, the amount of the loan, the interest rate, the purpose for which the loan is needed and a plan of repayment. The application shall be set for hearing by the court and notice by publication given to all owners of land upon which assessment has been made by the district, without naming such owners individually. Upon said hearing, if the owners of land in the district upon which a majority of assessment has been made have not filed written protests before the date of the hearing, and if the court finds that such loan is necessary and in the best interests of the district, the court shall approve the application.
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