SECTIONS 36400-36409 - California Statutes

WATER CODE

SECTION 36400-36409

36400. A district may borrow money and incur indebtedness as
provided in this chapter by action of the board and without the
necessity of calling and holding an election in the district, except
as otherwise provided in Section 36402.1.

36401. Indebtedness may be incurred pursuant to this chapter for
any purpose for which the district is authorized to expend funds,
including provisions for the payment of current expenses of the
district and for the funding or refunding of any outstanding
warrants.

36402. Indebtedness incurred under this chapter shall be evidenced
by warrants or negotiable notes of the district payable at stated
times fixed by the board and bearing interest at a rate not exceeding
8 percent per annum, payable annually or semiannually.

36402.1. Except as provided in Section 36407.1, no warrants or
negotiable notes issued pursuant to this chapter shall be valid
unless their issuance is authorized by a majority of the voters
voting at an election called by the board for the purpose of
determining whether or not the warrants or negotiable notes shall be
authorized.

36402.2. Notice of the election shall be given and the election
shall be held and the result determined as nearly as practicable in
the manner provided for bond elections.

36402.3. The proceeds of such warrants or negotiable notes may be
used and applied to the purchase or redemption of any outstanding
warrants or negotiable notes of the district.

36403. Such warrants shall be issued in the name of the district
after the adoption, by a four-fifths vote of all the members of the
board, of a resolution setting forth the form of the warrant, the
maturity date or dates thereof, and the manner of execution thereof.

36404. The board may, in its resolution authorizing the issuance of
such warrants, provide that the warrants shall be subject to call
and redemption prior to maturity, at the option of the district, at
such price or prices as may be fixed in the resolution, not exceeding
a premium of 6 percent of the par value of the warrants so subject
to redemption. The resolution shall fix the method of giving notice
of redemption to the holders of warrants to be redeemed and the price
or prices at which the warrants shall be subject to redemption.
Warrants so subject to call and redemption prior to maturity shall
contain a recital to that effect on their face, and no warrant issued
under this chapter shall be subject to call or redemption prior to
its fixed maturity date unless it contains such recital.

36405. Coupons payable to bearer shall be in a form and signed as
prescribed by the board and may be attached to warrants issued under
this chapter to evidence their interest.

36406. Warrants or negotiable notes issued under this chapter shall
be offered for public sale upon notice inviting sealed bids
therefor. Such notice shall be given by publication pursuant to
Section 6061 of the Government Code in a newspaper of general
circulation printed and published in the district or if such a
newspaper is not printed and published in the district by posting in
three public places in the district, and the sale shall not be held
before 10 days after such publication or posting. The board may
reject all bids received on public sale and either readvertise or
sell the warrants or negotiable notes at private sale, but no sale at
private sale shall be made for less than the par value of the
warrants or negotiable notes and accrued interest thereon.

36407. Warrants or negotiable notes issued under this chapter and
authorized by the voters pursuant to Section 36402.1 shall constitute
general obligations of the district for the payment of both
principal and interest of which all land in the district subject to
assessment by the district shall be assessed without limitation of
rate or amount. It shall be the duty of the board to include in its
annual estimate filed with the board of supervisors all sums
necessary to pay the principal of, and interest on, all warrants or
negotiable notes issued under this chapter coming due during the next
year, and any sums that the board shall direct to be set aside in a
special fund for the future payment of principal of and interest on
any outstanding warrants or negotiable notes issued under this
chapter which will come due in any year following the next year. It
shall be the duty of the board of supervisors, at the time and in the
manner provided in this division for making the annual assessment,
to fix an ad valorem rate of assessment sufficient to pay the
principal of and interest on all warrants or negotiable notes issued
under this chapter as the same become due, and the sums required for
the special fund established by the board. Such ad valorem assessment
shall be in addition to all other assessments in this division
provided for and when collected shall be used for no purpose other
than the payment of said warrants or negotiable notes and the
interest thereon.

36407.1. Warrants or negotiable notes payable in five years or less
from the date of issuance may be issued under this section without
the approval of the voters pursuant to Section 36402.1 and shall
constitute obligations of the district payable from annual
assessments and other revenues of the district and subject to the
maximum property tax rate contained in Chapter 3 (commencing with
Section 2201) of Part 4 of Division 1 of the Revenue and Taxation
Code.

36408.4. Warrants or negotiable notes payable at a future date or
times may also be issued to obtain funds or property for any lawful
purpose of the district; provided, the total amount of the warrants
or negotiable notes payable in any one year shall not exceed
one-fourth of one (1) percent of the total valuation of the land in
the district according to the last equalized assessment roll.

36408.5. Any warrant or negotiable notes authorized in the
preceding section shall draw interest at a rate to be fixed by the
board not to exceed eight (8) percent per year payable annually or
semiannually as the board may prescribe. Negotiable notes shall be
issued payable to bearer with a right of the district to provide for
the registration and deregistration thereof in the same manner as
bonds of the district. Interest coupons to bearer in a form and
signed as prescribed by the board may be attached to such warrants or
negotiable notes.

36408.6. Warrants or negotiable notes of any district may be issued
to evidence the indebtedness allowed to be incurred prior to the
levy of the first district assessment, bearing interest fixed by the
board at not more than eight (8) percent per year. These warrants or
negotiable notes shall be made payable on a date not later than the
first day of July next after the first annual assessment in the
district is levied.

36408.7. A district may borrow money in anticipation of the sale
of, but not in excess of the principal amount of, authorized bonds of
the district which have not yet been sold and delivered, and for
that purpose may issue and sell negotiable bond anticipation notes,
and may refund such notes from time to time, but the maximum maturity
of any such notes, as originally issued or as refunded, shall not
exceed five years from the date of the original notes. The notes
shall be sold in such manner as the board may determine, and such
notes and the resolution providing for the issuance of such notes may
contain any provision, condition or limitation which a bond, or any
resolution or ordinance providing for the issuance of bonds, may
contain. The interest on bond anticipation notes shall be payable at
the time or times provided in such notes and may be represented by
interest coupons attached to the notes and shall be payable from the
same funds from which the interest on bonds of the district are
payable. The principal of such notes may be paid from any moneys of
the district available for such purpose. If such notes, or any
portion thereof, have not been previously paid, they shall be paid
from the proceeds of the next sale of bonds in anticipation of which
the notes were issued. The resolution providing for the issuance of
bond anticipation notes may contain a provision that, if for any
reason bonds of the district are not sold in time to provide funds to
pay any unpaid note, and, if other funds of the district are not
available for such payment, ad valorem assessments shall be levied
upon the assessable land in the district for such payment in the same
manner provided for the payment of bonds in such amount each year
for such period of years as may be set forth in such resolution. To
the extent bond anticipation notes are paid from such assessment,
authorized bonds in a corresponding amount shall be canceled and not
issued thereafter. When bonds of the district are issued and any
portion of the proceeds of the sale are to be used to pay bond
anticipation notes, such bonds shall mature not later than the
maximum permissible years for such bonds as provided in Section
36195, with the maximum permissible maturity determined from the date
of such notes as originally issued.

36408.8. A district may borrow money in anticipation of the sale
of, but not in excess of the principal amount of, authorized bonds of
an improvement district formed pursuant to this division which have
not yet been sold and delivered, and for that purpose may issue and
sell negotiable bond anticipation notes, and may refund such notes
from time to time, but the maximum maturity of any such notes, as
originally issued or as refunded, shall not exceed five years from
the date of the original notes. The notes shall be sold in such
manner as the board may determine, and such notes and the resolution
providing for the issuance of such notes may contain any provision,
condition or limitation which a bond, or any resolution or ordinance
providing for the issuance of bonds, may contain. The interest on
bond anticipation notes shall be payable at the time or times
provided in such notes and may be represented by interest coupons
attached to the notes and shall be payable from the same funds from
which the interest on bonds of the improvement district are payable.
The principal of such notes may be paid from any moneys of the
improvement district available for such purpose. If such notes, or
any portion thereof, have not been previously paid, they shall be
paid from the proceeds of the next sale of bonds in anticipation of
which the notes were issued. The resolution providing for the
issuance of bond anticipation notes may contain a provision that, if
for any reason bonds of the improvement district are not sold in time
to provide funds to pay any unpaid note, and, if other funds of the
improvement district are not available for such payment, ad valorem
assessments shall be levied upon the assessable land in the
improvement district for such payment in the same manner provided for
the payment of bonds in such amount each year for such period of
years as may be set forth in such resolution. To the extent bond
anticipation notes are paid from such assessments, authorized bonds
in a corresponding amount shall be canceled and not issued
thereafter. When bonds of the improvement district are issued and any
portion of the proceeds of the sale are to be used to pay bond
anticipation notes, such bonds shall mature not later than the
maximum permissible years for such bonds as provided in Section
36195, with the maximum permissible maturity determined from the date
of such notes as originally issued.

36409. The provisions of this chapter shall constitute an addition
to all other power of the district to borrow money, incur
indebtedness, and issue warrants or negotiable notes in connection
therewith, and shall not be deemed a restriction or limitation on
such other power. A district may issue negotiable notes as provided
in this chapter in lieu of the issuance of warrants of the district
or for an improvement district as provided in this division.