2007 California Government Code Chapter 5. Revenue Bonds

CA Codes (gov:15830-15843)

15830.  The bonds issued to finance the construction of a public
building or buildings pursuant to this part shall be special
obligations of this state secured solely by the revenues, rentals, or
receipts received from the operation of the public building or
buildings financed by such bonds.
   No bond issued or sold pursuant to this part shall be or become a
lien, charge, or liability against the State of California or against
its property or funds except to the extent of the pledges expressly
made by this part.  Every bond issued pursuant to this part shall
contain a recital on the face thereof stating that neither the
payment of the principal nor any part thereof, nor any interest
thereon, constitutes a debt, liability, or general obligation of the
State of California other than as provided in this part.  The board
has no power at any time or in any manner to pledge the credit or
taxing power of the state, other than as provided in this part.




15831.  All bonds issued under this part shall bear the facsimile
signature of the Governor and the facsimile countersignature of the
Controller and the Treasurer, and the bonds shall be signed,
countersigned, and endorsed by the officers who shall be in office on
the date of issuance thereof, and each of the bonds shall bear an
impress of the Great Seal of the State of California.  Interest
coupons attached to each bond shall bear the facsimile signature of
the Treasurer who shall be in office on the date of the bond to which
the coupons pertain.  The bonds or coupons so signed, countersigned,
endorsed, and sealed, when sold, are valid although the sale thereof
be made at a date or dates upon which the officers having signed,
countersigned, and endorsed the bonds or coupons, or any or either of
the officers, shall have ceased to be the incumbents of the offices
held by them at the time of signing, countersigning, or endorsing the
bonds or coupons.  Each bond issued under this part, if subject to
call or redemption prior to maturity, shall contain a recital to that
effect.
   The rate of interest to be borne by the bonds need not be uniform
for all bonds of the same issue or series or division and may be
determined and fixed by the board by resolution adopted at or after
the sale of the bonds.  The highest bid received on the sale of the
bonds shall be determined by deducting the total amount of the
premium bid (if any) from the total amount of interest which the
state would be required to pay from the date of the bonds or the last
preceding interest payment date, whichever is latest, to the
respective maturity dates of the bonds then offered for sale at the
coupon rate or rates specified in the bid, and the award shall be
made on the basis of the lowest net interest cost to the state.  The
Treasurer, when authorized by resolution of the board, may sell bonds
at less than their par or face value.



15832.  Upon receipt of a resolution of the board authorizing the
issuance of bonds, the Treasurer shall provide for their preparation
in accordance with the resolution.  The bonds authorized to be issued
shall be sold by the Treasurer, at public sale or at private sale,
as directed by the board.  In the case of public sale, (1) the bonds
shall be sold by the Treasurer, at such time as may be fixed by him
or her, and upon such notice as he or she may deem advisable, upon
sealed bids, to the bidder whose bid will result in the lowest net
interest cost on account of such bonds, and (2) if no bids are
received, or if the Treasurer determines that the bids are not
satisfactory, the Treasurer may reject all bids received, if any, and
either readvertise or sell the bonds at private sale.
   Temporary or interim bonds, certificates, or receipts of any
denomination whatever and with or without coupons attached thereto,
to be signed by the Treasurer, may be issued and delivered until the
definitive bonds are executed and available for delivery.  Signature
of the Treasurer may be by signature stamp.



15832.5.  The board is authorized from time to time to issue its
negotiable notes, including commercial paper notes or other forms of
negotiable short-term indebtedness, or may in anticipation of the
sale of bonds issue its negotiable bond anticipation notes and may
renew the same from time to time.  The board may issue notes partly
to renew notes or to discharge other obligations then outstanding and
partly for any other purpose.  Any notes may be authorized, sold,
executed and delivered in the same manner as bonds.  Any resolution
or resolutions authorizing notes of the board or any issue thereof
may contain any provisions that the board is authorized to include in
any resolution or resolutions authorizing bonds of the board, and
the board may include in any notes any terms, covenants, or
conditions that it is authorized to include in any bonds.  All of
these notes shall be paid from any revenues of the board or other
moneys available therefor and not otherwise pledged, or from the
proceeds of the sale of the bonds of the board in anticipation of
which they were issued, subject only to any contractual rights of the
holders of any of its notes or other obligations then outstanding.




15834.  It is the intent of the Legislature that, prior to the
appropriation of any moneys for purposes of Chapter 3.5 (commencing
with Section 15820), Chapter 3.6 (commencing with Section 15820.15),
Chapter 3.7 (commencing with Section 15820.30), or Chapter 3.8
(commencing with Section 15820.50), consideration be given to funding
those purposes from general obligation bond proceeds or from the
Capital Outlay Fund for Public Higher Education.



15835.  The bond or interim receipt is a negotiable instrument
unless there is an express recital on its face that the bond or
interim receipt in nonnegotiable.



15836.  Bonds, negotiable notes, and negotiable bond anticipation
notes issued pursuant to this part are a legal investment for any
state special or trust fund notwithstanding any provision of law
limiting the investments which may be made by such special or trust
fund.  The bonds, negotiable notes, and negotiable bond anticipation
notes of the board shall be legal investments in which all public
officers and public bodies of the state, its political subdivisions,
all municipalities and municipal subdivisions, all insurance
companies and associations and other persons carrying on an insurance
business, all banks, bankers, banking institutions, including
savings and loan associations, building and loan associations, trust
companies, savings banks and savings associations, investment
companies, and other persons carrying on a banking business, all
administrators, guardians, executors, trustees and other fiduciaries,
and all other persons authorized to invest in bonds or in other
obligations of the state, may properly and legally invest funds,
including capital, in their control or belonging to them.  The bonds,
negotiable notes, and negotiable bond anticipation notes may be used
by any such private financial institution, person, or association as
security for  public deposits.  The bonds, negotiable notes, and
negotiable bond anticipation notes are also hereby made securities
which may properly and legally be deposited with and received by all
public officers and bodies of the state or any agency or political
subdivision of the state and all municipalities and public
corporations for any purpose for which the deposit of bonds or other
obligations of the state is authorized by law, including deposits to
secure public funds.


15837.  Whenever the board deems that it will increase the
salability or the price of the bonds, negotiable notes, or negotiable
bond anticipation notes to obtain, prior to or after sale, a legal
opinion, other than that of the Attorney General, as to the validity
of the bonds, negotiable notes, or negotiable bond anticipation
notes, the board may authorize the Treasurer, or the Department of
Finance, or both, to obtain such a legal opinion.  Payment for such
legal services shall be made out of the proceeds of the sale of the
bonds, negotiable notes, or negotiable bond anticipation notes.



15837.5.  The board is authorized and empowered to employ financial
consultants, advisers, and accountants as may be necessary in its
judgment in connection with the issuance and sale of any bonds or
other obligations of the board.  Payment for these services may be
made out of the proceeds of the sale of the bonds or other
obligations.



15837.6.  The provisions of Section 10295 and Sections 10335 to
10382, inclusive, of the Public Contract Code shall not apply to
agreements entered into by the board or Treasurer in connection with
the obtaining of financing.


15838.  Any resolutions authorizing any bonds may contain provisions
which are part of the contract with the bondholders as to:
   (a) Pledging all or any of the revenues, rentals or receipts of
the board from all or any public buildings.
   (b) The acquisition, construction, improvement, operation,
extension, enlargement, maintenance, and repair of any public
buildings and the duties of the board with reference thereto.
   (c) The terms and provisions of the bonds.
   (d) Limitations on the purposes to which the proceeds of the
bonds, then or thereafter to be issued, or of any loan or grant by
the United States, may be applied.
   (e) The rate of rentals and other charges for use of the public
buildings of, or for the services rendered by, the board, including
limitations upon the power of the board to modify any leases or other
agreement pursuant to which any rentals or other charges are
payable.
   (f) The setting aside of reserves or sinking funds and the
regulation and disposition of them.
   (g) Limitations on the issuance of additional bonds or
certificates.
   (h) The terms and provisions of any deed of trust or indenture
securing the bonds, or under which the bonds are issued.
   (i) Any other agreements with the bondholders.



15838.5.  (a) The Treasurer may be appointed to act as trustee for
the board and the holders of its bonds.  Any resolution authorizing
any bonds or issue thereof shall prescribe the duties of the
Treasurer with respect to the issuance,  authentication, sale, and
delivery of the bonds, the payment of principal and interest thereon,
and the redemption of the bonds.
   (b) The board may provide by resolution for the deposit of all
revenue pledged for the security of such bonds in one or more
separate accounts in the Public Buildings Construction Fund under the
control of the Treasurer as trustee.  The money in the accounts
shall be disbursed only as provided in the resolution.
   (c) The board may authorize the Treasurer to act as trustee on
behalf of the holders of its bonds, or any stated percentage thereof,
for the purpose of exercising and prosecuting on behalf of the
holders of the bonds the rights and remedies as may be available to
the holders.



15839.  The board may enter into any deeds of trust, indentures, or
other agreements with any bank or trust company, or other person in
the United States having power to enter into such agreements,
including any federal agency, as security for such bonds, and may
assign and pledge the revenues, rentals, or receipts of the board
thereunder.  The deeds of trust, indentures, or other agreements may
contain such provisions as are customary in the instruments, or as
the board authorizes, including but without limiting provisions as
to:
   (a) The acquisition, construction, improvement, operation,
maintenance and repair of any public buildings, and the duties of the
board with reference thereto.
   (b) The application of funds and the safeguarding of funds on hand
or on deposit.
   (c) The rights and remedies of the trustee and the holders of the
bonds, which may include restrictions upon the individual right of
action of the bondholders.
   (d) The terms and provisions of the bonds, or the resolutions
authorizing the issuance of the bonds.



15840.  The board may provide, by resolution, for the issuance of
refunding bonds for the purpose of refunding any bonds of the board
issued pursuant to this part and then outstanding, either by
voluntary exchange with the holders of the outstanding bonds, or to
provide funds to redeem and retire the outstanding bonds, with
accrued interest, and any premium payable on the bond at maturity or
at any call date.  The issuance of the refunding bonds, the
maturities and other details of the bonds, the rights of the
bondholders, and the duties of the board in respect to the bonds, are
governed by the foregoing provisions of this part insofar as they
are applicable.  Refunding bonds may be issued by the board to refund
bonds originally issued, or to refund bonds of the board previously
issued for refunding purposes.



15841.  The rights and remedies conferred by this part upon or
granted to bondholders are in addition to and not in limitation of
any rights and remedies lawfully granted to such bondholders by the
resolutions providing for the issuance of bonds, or by any deed of
trust, indenture, or other agreement under which the bonds are
issued.
   If the board defaults in the payment of principal or interest on
any of the bonds after the principal or interest becomes due, whether
at maturity or upon call for redemption, and if such default
continues for a period of 60 days, or if the board fails or refuses
to comply with the provisions of this part or defaults in any
agreement made with the bondholders, the holders of 25 percent in
aggregate principal amount of the bonds then outstanding by
instruments filed in the Office of the County Recorder of the County
of Sacramento, and acknowledged in the same manner as a deed to be
recorded except as this right is limited under the provisions of any
deed of trust, indenture, or other agreement, may appoint a trustee
to represent the bondholders for the purposes provided in this part.
The trustee or any trustee under any deed of trust, indenture, or
other agreement may, and upon written request of the holders of 25
percent in principal amount of the bonds then outstanding, or such
other percentage as is specified in the deed of trust, indenture or
other agreement, shall in his name:
   (a) By proper proceedings and actions enforce all rights of the
bondholders, including the right to require the board to collect
rates, rentals, and other charges adequate to carry out any agreement
as to the revenues, or the pledge of the revenues or receipts of the
board, to lease public buildings to state agencies or otherwise, and
require the board to carry out any other agreements with or for the
benefit of the bondholders, and to perform its duties under this
part.
   (b) Bring suit upon the bonds.
   (c) By an action require the board to account as if it were the
trustee of an express trust for the bondholders.
   (d) By an action enjoin any acts or things which may be unlawful
or in violation of the bondholders' rights.
   (e) By notice in writing to the board declare bonds due and
payable, and if all defaults are made good then with the consent of
the holders of 25 percent of the principal amount of the bonds then
outstanding, or such other percentage as is specified in any deed of
trust, indenture, or other agreement, annul the declaration that
bonds are due and payable.


15842.  A trustee, appointed pursuant to Section 15841, or acting
under a deed of trust, indenture, or other agreement, whether or not
all bonds have been declared due and payable, may have a receiver
appointed.  The receiver may, to the same extent that the board
itself could do, enter and take possession of the public buildings of
the board, or any parts thereof, the revenues, rentals, or receipts
from which are applicable to the payment of the bonds in default, and
operate and maintain the public buildings and collect and receive
all rentals and revenues thereof arising therefrom in the same manner
as the board might do.  The receiver shall deposit money in a
separate account and apply it in such manner as the court directs.
In any action or proceeding by the trustees, the fees, counsel fees,
and expenses of the trustees, and of the receiver, and all costs and
disbursements allowed by the court, are a first charge on any
revenues and receipts derived from the public buildings of the board,
the revenues or receipts from which are or may be applicable to the
payment of the bonds in default.  The trustee shall have and possess
all the powers necessary or appropriate for the exercise of any
functions specifically set forth in this part or incident to the
general representation of the bondholders in the protection and
enforcement of their rights; provided, however, that nothing in this
section or any other section in this part shall authorize any trustee
appointed pursuant to Section 15841, for the purpose of operating
and maintaining any public buildings of the board, to sell, assign,
mortgage, or otherwise dispose of, any of the assets of whatever kind
and character belonging to the board.



15843.  In addition to all other rights and all other remedies the
holder of bonds of the board may by an action at law enforce his
rights against the board, including the right to require the board to
collect fees, rentals, and other charges adequate to carry out any
agreement as to fees, rentals, or other charges or income, revenue
and receipts and require the board to carry out any of its convenants
and agreements with the bondholders and perform its duties under
this part.