SECTIONS 16945-16954 - California Statutes

GOVERNMENT CODE

SECTION 16945-16954

16945. The committee is authorized and empowered, for and in the
name and on behalf of the state, to do all of the following:
(a) Upon the request of the Director of Finance, and following
receipt of the determination of the Director of Finance pursuant to
Section 16941, issue taxable or tax-exempt bonds for the purpose of
funding or refunding pension obligations, paying related costs and
ancillary obligations, or refunding any bonds previously issued
pursuant to this chapter.
(b) Execute debentures or other instruments evidencing the pension
obligations.
(c) Enter into ancillary obligations and other contracts deemed
necessary by the committee in connection with any bonds issued under
this chapter.
(d) Establish the terms and conditions for the program undertaken
pursuant to this chapter.
(e) Employ or contract for legal, consulting, underwriting, or
other services in connection with the program as may be necessary in
the judgment of the committee, as approved by the Treasurer, as agent
for sale of the bonds, for the successful financing of the program
and the issuance and sale of bonds.
(f) In addition to the powers specifically granted in this
chapter, do all things necessary or convenient, including delegation
of necessary duties to the Director of Finance, as chairperson, and
to the Treasurer, as agent for sale of the bonds, to carry out the
purposes of this chapter.

16946. Every issue of bonds, and any ancillary obligation entered
into with respect to those bonds, shall be a debt and liability of
the state payable from the General Fund of the state or, in the case
of bond anticipation notes, payable from the proceeds of bonds to be
issued pursuant to this chapter.

16947. (a) The cumulative amount of outstanding bonds issued
pursuant to this chapter may not exceed the lesser of (1) the sum of
two billion dollars ($2,000,000,000); or (2) the amount which, when
added to all anticipated interest and related costs of the bonds,
does not exceed the anticipated reduction of the state's pension
obligations as a result of changes in the retirement law that reduce
contributions to the retirement system, as determined by the Director
of Finance.
(b) Notwithstanding subdivision (a), the cumulative amount of
bonds issued pursuant to this chapter in any one fiscal year may not
exceed the total unpaid amount of the state's pension obligations for
that fiscal year.
(c) Bonds may be issued pursuant to this chapter in any two fiscal
years after June 30, 2004, but may not be issued in any more than
two fiscal years.

16948. (a) The resolution, certificate, or other instrument of the
committee authorizing the issuance of the bonds may provide, or the
committee may delegate to the Treasurer, as agent for sale of the
bonds, responsibility to determine, any or all of the following for
the bonds:
(1) The form of the bonds, which may be issued as serial bonds,
term bonds, or installment bonds, or any combination of those.
(2) The date to be borne by any bonds.
(3) The time of maturity of any bonds, which maturities may be
before or after the term of the related pension obligation to be
funded or refunded.
(4) The interest, fixed or variable, to be borne by the bonds.
(5) The time that the bonds shall be payable.
(6) The denominations, form, and registration privileges of the
bonds.
(7) The manner of execution of the bonds.
(8) The place the bonds are payable, which may include any paying
agent within or outside of the state.
(9) The terms of redemption of the bonds.
(10) The establishment of funds and accounts to be held by a
trustee to provide for payment or security for the bonds or ancillary
obligations or related costs.
(11) Any other terms and conditions deemed necessary by the
committee.
(b) Pursuant to Section 5702, the Treasurer shall serve as agent
for the offer and sale of the bonds. The bonds may be sold at either
a competitive or negotiated sale, at times and at prices, for
consideration, and with all other terms and conditions as the
Treasurer, in his or her capacity as agent for sale of the bonds,
shall determine.
(c) The Treasurer is authorized to invest or direct the investment
of any amounts held in trust for payment of the bonds in any
securities or obligations authorized pursuant to Chapter 3
(commencing with Section 16430) of Part 2, as amended from time to
time.

16949. The proceeds of the bonds shall be applied to the funding or
refunding of pension obligations, or refunding of bonds previously
issued under this chapter, together with all costs of issuing the
bonds and refunding pension obligations or prior bonds and the costs
of any ancillary obligation. Notwithstanding Sections 20822 and
20824, or any other provision of law, the proceeds of the bonds may
be applied to the prepayment of pension obligations.

16950. When proceeds of bonds issued pursuant to this chapter are
used to pay the state's pension obligations to the retirement system
for members whose compensation is paid from a fund other than the
General Fund, the Controller shall, notwithstanding any other
provision of law, transfer quarterly from the special fund or
nongovernmental cost fund to the General Fund an amount equal to the
quarterly pension obligations paid from bond proceeds with respect to
those members, as certified by the Director of Finance and
authorized in any appropriation item or in any category thereof.

16951. When proceeds of bonds issued pursuant to this chapter are
used to pay the state's pension obligations to the retirement system
for members whose compensation is paid from the General Fund, the
Controller shall, notwithstanding any other provision of law, abate
quarterly to the General Fund an amount equal to the quarterly
pension obligations paid from bond proceeds with respect to those
members, as certified by the Director of Finance and authorized in
any General Fund appropriation item or in any category thereof.

16952. In the discretion of the committee, any bonds issued under
this chapter may be secured by a trust agreement, indenture, or
resolution between the state and any trustee, which may be the
Treasurer or any trust company or bank having the powers of a trust
company chartered under the laws of any state or the United States
and designated by the Treasurer. The trust agreement, indenture, or
resolution may contain provisions for protecting and enforcing the
rights and remedies of the bond owners as may be reasonable and not
in violation of law. Any trust agreement, indenture, or resolution
may set forth the rights and remedies of the bond owners and of the
trustee and may restrict the individual right of action by bond
owners. In addition to the foregoing, any trust agreement, indenture,
or resolution may contain other provisions as the committee may deem
reasonable for the security of the bond owners, including, but not
limited to, provisions specifying the date or dates on which debt
service payments on the bonds shall be transferred to the trustee.
Any trust accounts created by the trust agreement, indenture, or
resolution may be held outside the State Treasury.

16953. The committee may provide for the issuance of bonds any
portion of which is to be used for the purpose of refunding
outstanding bonds issued to fund or refund pension obligations,
including the payment of the principal thereof and interest and
redemption premiums, if any. The proceeds of bonds issued to refund
any outstanding bonds may be applied to the retirement of those
outstanding bonds at maturity, or the redemption, on any redemption
date, or purchase of those outstanding bonds prior to maturity,
subject to the terms and conditions as the committee deems advisable.

16954. The net proceeds of bonds issued and sold pursuant to this
chapter shall be deposited in the Pension Obligation Bond Fund
established pursuant to Section 16929.