Colo. Rev. Stat. § 31-35-301
When any city or town is the owner of a municipal water plant with water mains in operation throughout the greater portion of said city or town and is unable to extend the same so as to cover the entire area contained within the municipal limits of said city or town, the citizens and resident taxpayers of any area containing four blocks or more situated in said city or town not having water mains therein may agree among themselves or a majority of the owners of the lots therein for the construction of the same. Upon application to the governing body by a majority of such owners, the governing body shall have authority to enter into a contract with said owners of said four blocks or more or with the majority thereof to allow them to construct such water mains in such territory and to connect the same with the supply of water of said city or town. The governing body has authority to enter into a contract with such citizens to allow all the proceeds derived from water rentals going to such addition through such water mains and collected as rental therefor to be applied to the payment of such water pipes, the cost thereof to be limited by the city or town to not more than the actual cost thereof upon any basis by which the city or town itself could secure the construction of the same. Said payments shall be made without interest and upon such terms not exceeding ten years as may be agreed upon by contract between the parties thereto.
C.R.S. § 31-35-301
This section is similar to former § 31-35-301 as it existed prior to 1975.