2005 California Government Code Sections 16920-16929 Article 2. Issuance of Bonds to Finance the Program

16920.  (a) Solely for the purpose of the issuance and sale of the
bonds and ancillary obligations authorized by this chapter and by
Chapter 8 (commencing with Section 16940), the Pension Obligation
Bond Committee is hereby created.  The committee consists of the
Governor or his or her designee, the Director of Finance, the
Controller, the  Treasurer, the Secretary of Business, Transportation
and Housing, the Director of General Services, and the Director of
Transportation.  Notwithstanding Section 7.5 or other provisions of
law, any member may designate a deputy to act as the member in his or
her place and stead for all purposes, as though the member were
personally present.  The Legislature hereby finds and declares that
each member of the committee has previously acted as a member of a
similar finance committee, and has duties in relation to the payment
of pension obligations relating to employees under supervision of the
member.
   (b) A majority of the committee shall constitute a quorum of the
committee and may act for the committee.  The Director of Finance
shall serve as chairperson of the committee.
   (c) No member, officer, or agent of the committee is subject to
personal liability on any bonds or ancillary obligations or other
obligations issued or entered into under this chapter or Chapter 8
(commencing with Section 16940) or for any acts or omissions of
members, officers, or agents in carrying out the powers and duties
conferred by this chapter or Chapter 8 (commencing with Section
16940).
16921.  The committee is authorized and empowered, for and in the
name and on behalf of the state, to do all of the following:
   (a) 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.
16922.  The committee, at any time or from time to time, upon the
request of the Director of Finance, may issue bonds, for and in the
name and on behalf of the state, for the purpose of financing or
refinancing the program as authorized by this chapter.  Bonds for the
purpose of financing the program as authorized by this chapter may
not be issued after June 30, 2004.  However, bonds issued pursuant to
this section may be refunded pursuant to Section 16923 whether the
date of refunding occurs before, on, or after June 30, 2004.  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, subject only to the prior application of
moneys in the General Fund for (a) support of the public school
system and public institutions of higher education, (b) payment of
debt service on state general obligation bonds and commercial paper
notes, (c) reimbursement of state special funds, to the extent
required by law, for internal borrowings, and (d) payment of debt
service on state revenue anticipation notes or registered
reimbursement warrants.
16923.  (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, provided that the time of maturity of any bonds
does not exceed five years.
   (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), as amended from time to time.
16924.  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 of this code, Section 22955 of the Education Code, or any other
provision of law, the proceeds of the bonds may be applied to the
prepayment of pension obligations.
16925.  If proceeds of bonds issued pursuant to this chapter are
used to pay the state's pension obligations to the Public Employees'
Retirement System for members whose compensation is paid from a fund
other than the General Fund and notwithstanding any other provision
of law, the Controller shall 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.
16926.  If proceeds of bonds issued pursuant to this chapter are
used to pay the state's pension obligations to the Public Employees'
Retirement System for members whose compensation is paid from the
General Fund and notwithstanding any other provision of law, the
Controller shall 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.
16927.  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.
16928.  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 date of maturity of bonds issued to
refund any outstanding bonds may not exceed the date of maturity of
the outstanding bonds they refund.  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.
16929.  There is hereby created in the State Treasury the Pension
Obligation Bond Fund.  The net proceeds of bonds issued and sold
pursuant to this chapter and bonds issued and sold pursuant to
Chapter 8 (commencing with Section 16940) shall be deposited in the
Pension Obligation Bond Fund.  Notwithstanding Section 13340, the
Pension Obligation Bond Fund is hereby continuously appropriated for
the purposes specified in this chapter and Chapter 8 (commencing with
Section 16940).