2005 California Education Code Sections 17400-17429 Article 2. Leasing Property

17400.  (a) Any school district may enter into leases and agreements
relating to real property and buildings to be used by the district
pursuant to this article.
   (b) As used in this article, "building" includes each of the
following:
   (1) One or more buildings located or to be located on one or more
sites.
   (2) The remodeling of any building located on a site to be leased
pursuant to this article.
   (3) Onsite and offsite facilities, utilities or improvements which
the governing board determines are necessary for the proper
operation or function of the school facilities to be leased.
   (4) The permanent improvement of school grounds.
   (c) As used in this article, "site" includes one or more sites,
and also may include any building or buildings located or to be
located on a site.
17401.  As used in this article "lease or agreement" shall include a
lease-purchase agreement.
17402.  Before the governing board of a school district enters into
a lease or agreement pursuant to this article, it shall have
available a site upon which a building to be used by the district may
be constructed and shall have complied with the provisions of law
relating to the selection and approval of sites, and it shall have
prepared and shall have adopted plans and specifications for the
building that have been approved pursuant to Sections 17280 to 17316,
inclusive.  A district has a site available for the purposes of this
section under any of the following conditions:
   (a) If it owns a site or if it has an option on a site that allows
the school district or the designee of the district to purchase the
site.  Any school district may acquire and pay for an option
containing such a provision.
   (b) If it is acquiring a site by eminent domain proceedings and
pursuant to Chapter 6 (commencing with Section 1255.010) of Title 7
of Part 3 of the Code of Civil Procedure, the district has obtained
an order for possession of the site, and the entire amount deposited
with the court as the probable amount of compensation for the taking
has been withdrawn.
   (c) In the case of a district qualifying under Section 17410, if
it is leasing a site from a governmental agency pursuant to a lease
having an original term of 35 years or more or having an option to
renew that, if exercised, would extend the term to at least 35 years.
17403.  The term of any lease or agreement entered into by a school
district pursuant to this article shall not exceed 40 years.
17404.  Sections 17455 to 17480, inclusive, shall not apply to
leases made pursuant to this article.
17405.  Any lease or agreement shall be subject to the following
requirements:
   (a) A building or structure that is to be used for school purposes
shall be subject to the provisions of Article 3 (commencing with
Section 17280) and Article 6 (commencing with Section 17365).  A
building or facility used by a school district under a lease or
lease-purchase agreement into which neither pupils nor teachers are
required to enter or that would be excluded from the definition of
"school building," as contained in Section 17368, shall not be
considered to be a "school building" within the meaning of Section
17283.
   (b) Subdivision (a) shall not apply to trailer coaches used for
classrooms or laboratories if the trailer coaches conform to the
requirements of Part 2 (commencing with Section 18000) of Division 13
of the Health and Safety Code, and the rules and regulations
promulgated thereunder concerning mobilehomes, are not expanded or
fitted together with other sections to form one unit greater than 24
feet in width, are used for special educational purposes, and are
used by not more than 12 pupils at a time, except that the trailer
coaches may be used by not more than 20 pupils at a time for driver
training purposes.
   (c) The site on which a leased relocatable structure is located
shall be owned by the school district, or shall be under the control
of the school district pursuant to a lease or a permit.
   "Relocatable structure" is any structure that is designed to be
relocated.
   (d) For purposes of interconnection of fire alarms, buildings
leased for 24 months or less shall be subject to Section 809 of the
Uniform Building Code until applicable regulations proposed by the
State Fire Marshal are adopted as part of Title 24 of the California
Code of Regulations.
   (e) Notwithstanding any other provision of law, this section shall
become operative on September 30, 1997.
17406.  (a) Notwithstanding Section 17417, the governing board of a
school district, without advertising for bids, may let, for a minimum
rental of one dollar ($1) a year, to any person, firm, or
corporation any real property that belongs to the district if the
instrument by which such property is let requires the lessee therein
to construct on the demised premises, or provide for the construction
thereon of, a building or buildings for the use of the school
district during the term thereof, and provides that title to that
building shall vest in the school district at the expiration of that
term.  The instrument may provide for the means or methods by which
that title shall vest in the school district prior to the expiration
of that term, and shall contain such other terms and conditions as
the governing board may deem to be in the best interest of the school
district.
   (b) Any rental of property that complies with subdivision (a)
shall be deemed to have thereby required the payment of adequate
consideration for purposes of Section 6 of Article XVI of the
California Constitution.
17407.  The governing board of any school district may enter into an
agreement with any person, firm, or corporation under which that
person, firm, or corporation shall construct, or provide for the
construction of, a building to be used by the district upon a
designated site and lease the building and site to the district.  The
instrument shall provide that the title to the building and site
shall vest in the district at the expiration of the lease, and may
provide the means or method by which the title to the building and
site shall vest in the district prior to the expiration of the lease,
and shall contain such other terms and conditions as the governing
board of the district deems to be in the best interest of the
district.
   The agreement entered into shall be with the lowest responsible
bidder who shall give the security that any board requires.  The
board may reject all bids.  For the purpose of securing bids the
board shall publish at least once a week for two weeks in some
newspaper of general circulation published in the district, or if
there is no paper, then in some paper of general circulation
circulated in the county, a notice calling for bids, stating the
proposed terms of the agreement and the time and place where bids
will be opened.
17408.  The governing board of a school district shall call and hold
an election, pursuant to Section 17409 or 17412, before or after
entering a lease or agreement, as the case may be, except that if the
lease or agreement does not effect an increase in the existing
applicable maximum tax rate of the district, the election
requirements of this section shall not apply.
17409.  Before entering into a lease or agreement pursuant to this
article, the governing board of the district shall call, hold, and
conduct an election in the manner provided in Section 42202, except
that the ballot used in the election shall contain substantially the
words: "Shall the governing board of the ____  District purchase (a
site, sites) prepare plans and specifications, (the reference to the
site or sites and plans and specifications shall not be included if,
prior to calling the election, the governing board of the district
has acquired a site or sites or proposes to lease a site or sites and
has prepared plans and specifications) and lease (a site and, sites
and) (a building, buildings) to be constructed for use by the school
district (designating the location of the site or sites on which the
building or buildings will be constructed and generally describing
the building or buildings), and, for such purposes, shall the maximum
tax rate of the district be increased by not to exceed ____, such
increase to be  in effect in the ____ District for the years 19_ to
__, be authorized and the amount of such increase used solely and
exclusively for such purposes?"
17410.  (a) If, at an election held pursuant to Section 17409, or
the predecessor to that section, a majority of the electors voting on
the proposition voted "Yes," the governing board may call an
election pursuant to this section.
   Before entering into one or more leases or agreements pursuant to
this section and this article, the governing board of the district
shall call, hold, and conduct an election in the manner provided in
Section 42202 of the Education Code, as it existed on December 31,
1979, except that the ballot used in the election shall contain
substantially the words:  "Shall the governing board of the ____
District purchase (a site, sites) prepare plans and specifications
(the reference to the site or sites and plans and specifications
shall not be included if, prior to calling the election, the
governing board of the district has acquired a site or sites or
proposes to lease a site or sites or has prepared plans and
specifications) and lease (a site, sites) and (a building, buildings)
to be constructed for use by the school district (designating the
location of the site or sites on which the building or buildings will
be constructed and generally describing the building or buildings)
and for those purposes, shall the tax rate increase authorized on
(the date of the original election), be used solely and exclusively
for those purposes in addition to those approved by the majority of
electors at the election held pursuant to Section 17409, or the
predecessor to that section, on (the date of the original election)?"
   If, at the election held pursuant to this section, a majority of
the electors voting on the proposition vote "Yes," the governing
board may proceed pursuant to this article to use that previously
authorized tax increase for the purpose or purposes authorized under
that election.
   (b) It is the intent of the Legislature, in enacting this section,
to permit the levy of a tax to the extent authorized at an election
held pursuant to Section 17409, or the predecessor to that section,
as modified to permit the proceeds of that tax to be expended for the
purposes authorized at the election held pursuant to subdivision
(a).
17411.  The governing board of the district, if the district
proposes at an election held pursuant to Section 17409 to lease more
than one building, may include in the ballot measure used in the
election a statement that the district reserves the right to lease
less than all of the proposed buildings designated in the ballot
measure.  If such a statement is included in the ballot measure, the
governing board may at any time thereafter determine to not lease one
or more of the buildings included in the ballot measure, and such
determination shall not breach any obligation of the district to the
voters of the district.
17412.  An election held pursuant to Section 17409 or Section 17413
shall be held in conjunction with either a statewide primary or
general election, or an election date specified in Section 2500 of
the Elections Code.
17413.  In lieu of calling an election pursuant to Section 17409,
the governing board of a school district may call an election
pursuant to this section.  Within 10 days after the governing board
has opened the proposals pursuant to Section 17417 or has adopted a
resolution pursuant to Section 17418 it may accept a proposal, if
proceeding under Section 17417, and execute the lease or agreement,
and immediately thereafter call an election pursuant to this section.
   The governing board of the district shall call, hold, and conduct
an election in the manner provided in Section 42202, except that the
ballot used in the election shall contain substantially the words:
"Shall the governing board of the ____ District lease (a site (sites)
and) a building (buildings) to be constructed for use by the school
district (designating the location of the site or sites on which the
building or buildings will be constructed, and generally describing
the building or buildings and the cost thereof), and, for such
purposes, shall the maximum tax rate of the district be increased by
not to exceed ____, such increase to be in effect in the ____
District for the years 19__ to ____, be authorized and the amount of
such increase used solely and exclusively for such purposes?"
17414.  If, at the election held pursuant to Section 17409 or
Section 17413, a majority of the electors voting on the proposition
vote "Yes," the governing board may proceed pursuant to this article.
17415.  Whenever the electors of a school district, at an election
held pursuant to Section 17409 or 17413, have approved an increase in
the maximum tax rate of the district for the purpose of enabling the
district to enter into a lease or agreement for a site or building,
or both, and before the lease or agreement is entered into, or during
the term of the lease or agreement, territory is taken from the
district and annexed to or included in another district by any means,
the acquiring district shall automatically assume and shall pay to
the district from which the territory is transferred a proportionate
share of any remaining payments due under the lease or agreement, as
the payments become due, for so long as the lease or agreement runs.
   The acquiring district's proportionate share shall be in the ratio
which the total assessed valuation of taxable property in the
transferred territory bore to the total assessed valuation of taxable
property in the whole district from which the territory is
transferred for the year immediately preceding the date on which the
transfer became effective for all purposes.
   This section shall be applicable only with respect to transfers of
school district territory which become effective for all purposes
after the effective date of enactment of this section, and shall be
applicable whether the election under Section 17409 or 17413 occurred
prior to or after the effective date of this section.
17416.  (a) Unless the time allowed for the governing board to enter
into the lease agreement is extended pursuant to subdivision (b), if
the governing board of the district fails to enter into a lease
pursuant to this article within three years after an election, held
pursuant to Section 17409, at which a majority of the votes cast
favors the proposition submitted, the authorization for an increase
in the maximum tax rate shall become void.
   (b) If litigation is filed challenging in any way the election
held pursuant to Section 17409 or the competitive bidding proceedings
or contract for the construction of the building to be used by the
district; compliance with the California Environmental Quality Act;
or the validity of or the proceedings for the issuance of any bonds,
notes, warrants, or other evidences of indebtedness of a nonprofit
corporation to be sold to finance construction of the building, the
authorization for an increase in the maximum tax rate shall not
become void because of the failure of the governing board to enter
into a lease pursuant to this article until three years after the
date upon which this subdivision becomes effective.
   This subdivision shall apply only to school districts which had an
average daily attendance of 65,000 or more in the 1975-76 fiscal
year.
17417.  After the governing board of a school district has complied
with Section 17402, it shall, in a regular open meeting, adopt a
resolution declaring its intention to enter into a lease or agreement
pursuant to this article.  The resolution shall describe, in any
manner to identify it, the available site upon which the building to
be used by the district shall be constructed, shall generally
describe the building to be constructed and state that the building
shall be constructed pursuant to the plans and specifications adopted
by the governing board therefor, shall, if that is the case, state
the minimum yearly rental at which the governing board will lease
real property belonging to the district upon which the building is to
be constructed, and shall state the maximum number of years for
which the school district will lease the building or site and
building, as the case may be, and shall state that the proposals
submitted therefor shall designate the amount of rental, which shall
be annual, semiannual, or monthly, to be paid by the school district
for the use of the building, or building and site, as the case may
be.  The resolution shall fix a time, not less than three weeks
thereafter for a public meeting of the governing board to be held at
its regular place of meeting, at which sealed proposals to enter a
lease or agreement with the school district will be received from any
person, firm, or corporation, and considered by the governing board.
Notice thereof shall be given in the manner provided in Section
17469.
   At the time and place fixed in the resolution for the meeting of
the governing body, all sealed proposals which have been received
shall, in public session, be opened, examined, and declared by the
board. Of the proposals submitted which conform to all terms and
conditions specified in the resolution of intention to enter a lease
or agreement and which are made by responsible bidders, the proposal
which calls for the lowest rental shall be finally accepted, or the
board shall reject all bids.  The board is not required to accept a
proposal, or else reject all bids, on the same day as that in which
the proposals are opened.
17418.  (a) As an alternative to obtaining sealed proposals as
required by Sections 17407 and 17417, the governing board may, in a
public meeting, adopt a resolution declaring its intention to enter
into a lease or agreement pursuant to this article with a nonprofit
public benefit corporation organized under the Nonprofit Public
Benefit Corporation Law (Part 2 (commencing with Section 5110) of
Division 2 of Title 1 of the Corporations Code) if the articles of
incorporation or bylaws of the nonprofit public benefit corporation
provide both of the following:
   (1) That no person shall be eligible to serve as a member or
director of the corporation except a person initially approved by
resolution of the governing board of the school district.
   (2) That no part of the net earnings of the corporation shall
inure to the benefit of any member, private shareholder, individual,
person, firm or corporation excepting only the school district.
   (b) The resolution adopted by the governing board shall do all of
the following:
   (1) Describe, in a manner to identify it, the available site upon
which the building to be used by the district shall be constructed.
   (2) Generally describe the building to be constructed and state
that the building shall be constructed pursuant to the plans and
specifications adopted by the governing board therefor.
   (3) If that is the case, state the minimum yearly rental at which
the governing board will lease real property belonging to the
district upon which the building is to be constructed.
   (4) State the maximum number of years for which the school
district will lease the building, or building and site, as the case
may be.
   (c) Any building constructed by a nonprofit public benefit
corporation pursuant to a lease or agreement entered into pursuant to
this section shall be constructed under a contract awarded to the
lowest responsible bidder pursuant to Article 42 (commencing with
Section 20670) of Part 3 of Division 2 of the Public Contract Code.
Section 17424 applies to the contract.
17419.  Any bonds, notes, warrants, or other evidences of
indebtedness to be issued by a nonprofit corporation to finance the
construction of a building pursuant to a lease or agreement entered
into pursuant to Section 17418 shall be sold pursuant to Chapter 10
(commencing with Section 5800) of Division 6 of Title 1 of the
Government Code.
17420.  All bonds, notes, warrants or other evidences of
indebtedness referred to in Section 17419 and the interest thereon,
and all bonds, notes, warrants, or other evidences of indebtedness
issued to refinance any bonds, notes, warrants, or other evidences of
indebtedness referred to in Section 17419 and the interest thereon,
are exempt from all taxation in the state other than inheritance,
gift and franchise taxes.
17421.  Any building constructed for the use of a school district
pursuant to this article is subject to Sections 17280 to 17313,
inclusive.
17422.  For the purposes of Sections 15102 and 15106 and Chapter 6
(commencing with Section 16000) of Part 10, 50 percent of any
remaining payments for use of the building or site and building which
would become due from the district under any leases and agreements
entered into by the district pursuant to this article, if the leases
and agreements were to run their full term, shall be considered
outstanding bonded indebtedness.
17423.  No district shall enter into any lease or agreement pursuant
to this article if at the time 50 percent of any remaining rental
payments for use of the building or site and building which would
become due from the district pursuant to this article, including the
lease or agreement to be entered into, if the leases and agreements
were to run their full term, plus the total amount of district bonded
indebtedness outstanding at the time, shall exceed 7.5 percent for
elementary school districts and high school districts and 12.5
percent for unified school districts of the taxable property of the
district as shown by the last equalized assessment of the county or
counties in which the district is located.  For the purpose of this
section, the taxable property of the district shall be determined
upon the basis that the district's assessed value has not been
reduced by the exemption of the assessed value of business
inventories in the district or reduced by the homeowners' property
tax exemption.
17424.  The governing board of the school district shall obtain the
general prevailing rate of per diem wages from the Director of the
Department of Industrial Relations for each craft, classification or
type of workman needed for the construction of the building and shall
specify in the resolution and in the notice, required by Section
17417, or in the resolution required by Section 17418 and in the
lease or agreement made pursuant to this article, what the general
prevailing rate of per diem wages and the general prevailing rate for
holiday and overtime work in the locality is for each craft,
classification or type of workmen needed for the construction of the
building.  The holidays upon which such rate shall be paid need not
be specified by the governing board, but shall be all holidays
recognized in the collective bargaining agreement applicable to the
particular craft, classification or type of workmen employed on the
project.
   Any agreement or lease entered into pursuant to this article shall
require that such general prevailing rates will be paid.  It shall
also require that work performed by any workman employed upon the
project in excess of eight hours during any one calendar day shall be
permitted only upon compensation for all hours worked in excess of
eight hours per day at not less than 11/2 times the basic rate of
pay.  There may also be included in leases or agreements entered into
pursuant to this article any other requirements with respect to
matters related to the subject of this section which the governing
board deems necessary or desirable.
17425.  The provisions of this article prevail over any provisions
of law which conflict therewith.
17426.  All acts and proceedings taken prior to the effective date
of the enactment of this section, by or on behalf of any district
under this article, or under color of this article, for the
authorization of an increase in the maximum tax rate of the district
and for the leasing of a building or buildings for the purposes of
the district are hereby confirmed, ratified, validated, and declared
legally effective.  This shall include all acts and proceedings of
the governing board of the district and of any person, public
officer, board, or agency, heretofore done or taken upon the question
of the authorization of the tax rate increase or the leasing.
Whenever an election has been called and held prior to the effective
date of the enactment of this section, for the purpose of submitting
to the voters of any district the question of an increase in the
maximum tax rate of the district and for the leasing of a building or
buildings for the purposes of the district, the election and all
proceedings attendant thereon are hereby confirmed, ratified,
validated, and declared to be legally effective for all purposes, and
the tax rate increase, if authorized by the required vote and in
accordance with the proceedings heretofore taken, shall be a legal
and valid authorization, in accordance with its terms, and any tax
heretofore or hereafter levied pursuant to that authorization shall
be legal and valid.  The foregoing provisions of this section shall
operate to supply any legislative authorization that may be necessary
to validate the acts and proceedings heretofore taken which the
Legislature could have supplied or provided for in this article.  The
foregoing provisions of this section shall be limited to the
validation of acts and proceedings to the extent to which the same
can be effectuated under the California and United States
Constitutions.  The foregoing provisions of this section shall not
operate to confirm, ratify, validate, or legalize any act,
proceeding, or other matter the legality of which is being contested
or inquired into in any legal proceeding now pending and undetermined
or which may be pending and undetermined during the period of 30
days from and after the effective date of this section, and shall not
operate to confirm, ratify, validate, or legalize any act,
proceeding, or other matter which has heretofore been determined in
any legal proceeding to be illegal, void, or ineffective.
   In any school district in which an election was called and held
prior to the effective date of this section in which the voters of
the district authorized an increase in the maximum tax rate of the
district and the leasing of a building or buildings for the purposes
of the district, the law in effect at the date of the school district
election shall govern the terms of the lease, the terms of the sale
of related bonds, notes, and warrants, and the school district's
maximum bonded indebtedness, and Section 17423 shall not be
applicable to the school district's entry into any lease or agreement
authorized at an election called and held prior to the effective
date of this section.
17427.  The State Allocation Board shall consider community school
pupils housed in leased facilities  that do not conform to the
requirements of Part 2 (commencing with Section 2-101), Part 3
(commencing with Section 3-089-1), Part 4 (commencing with Section
4-403), and Part 5 (commencing with Section 5-102), of Title 24 of
the California Code of Regulations as unhoused for the purposes of
determining priority for the leasing of portable classrooms pursuant
to Chapter 14 (commencing with Section 17085) of Part 10.
17428.  The governing board of a school district may lease property
in an adjoining school district for garage, warehouse, or other
utility purposes or may purchase property in an adjoining school
district for those purposes and may dispose of the property in the
same manner as property within the boundary of the district is
purchased and disposed of.
   The power of eminent domain shall not be applicable and the
acquisitions by purchase shall be subject to the approval of the
governing board of the school district in which the property is
located.
17429.  (a) This section shall apply only to a school district in
which the electorate authorizes an increase in the maximum tax rate
of the district pursuant to this article for the lease of one or more
schools, and there exists at the time of the election on a site
owned by the district a school facility not owned by the district
meeting all of the requirements of Article 3 (commencing with Section
17280) of this chapter, which site and school facility are
designated and described in the ballot proposition approved by the
voters.
   (b) Notwithstanding any other law, a school district may lease
from a California nonprofit corporation an existing school and may
pay rentals therefor from funds derived from the increase in the
maximum tax rate approved by the voters at an election.  The purchase
price of the school paid by the nonprofit corporation to the owners
of the school shall not exceed the actual audited cost of
construction thereof including actual interest paid on money borrowed
to finance such construction.  Prior to the purchase of the school
by the nonprofit corporation, an independent certified public
accountant shall be retained by the school district to verify the
actual cost of construction and any interest paid to finance the
construction, and the nonprofit corporation may conclusively rely
upon any certificate or opinion setting forth the actual cost of
construction and the interest prepared by the independent certified
public accountant.
   (c) A school district, the electorate of which, prior to the
effective date of this section, authorized an increase in the maximum
tax rate in the manner, for the purposes, and under the
circumstances specified in subdivision (a), may avail itself of the
authority afforded by subdivision (b).