2007 California Health and Safety Code Article 6. Construction And Leases Of Facilities

CA Codes (hsc:44550-44557)

44550.  The authority may contract with any participating party for
the construction of a project by such participating party.  All such
contracts for the construction of a project by a participating party
shall provide that the participating party shall be responsible for
the architectural and engineering design and for the construction and
completion thereof subject to such standards for architectural and
engineering design as may be established, and subject to such
supervision as the authority deems necessary.  The authority may
agree to pay the cost of such project constructed by any
participating party and to advance such costs from time to time in
installments or otherwise as required by the contract for the
construction thereof.  Title to all such projects shall be vested in
the authority subject to the terms of any lease thereof to the
participating party or the rights of a participating party under any
contract for the purchase of such project including the payment of
the purchase price under installment sales contracts.




44551.  The authority may, as lessor or lessee, enter into leases
and agreements with any participating party relating to the
acquisition, construction, and installation of any project, including
real property, buildings, equipment, and pollution control
facilities of any kind or character.  The terms and conditions of
such leases may be as mutually agreed upon.  Any such lease may
provide the means or methods by which title shall vest in a
participating party upon the termination of the lease and shall
contain such other terms and conditions as the authority may
determine.  The authority is authorized to fix, revise, charge, and
collect rates, rents, fees, and charges for each project.  Such
rates, rents, fees, and charges shall be fixed and adjusted in
respect of the aggregate of rates, rents, fees, and charges from all
projects so as to provide funds sufficient with other revenues and
moneys available therefor, if any, to do all of the following:
   (a) Pay the principal of and the interest on outstanding bonds,
notes, or other evidences of indebtedness of the authority financing
such project as the same shall become due and payable.
   (b) Create and maintain reserves required or provided for in any
resolution authorizing, or trust agreement securing, such bonds,
notes, or other evidences of indebtedness.  A sufficient amount of
the revenues derived from a project may be set aside at such regular
intervals as may be provided in such resolution or trust agreement in
a sinking or other similar fund which is hereby pledged to, and
charged with, the payment of the principal of and interest on such
bonds, notes, or other evidences of indebtedness as the same shall
become due, and the redemption price or the purchase price of bonds,
notes, or other evidences of indebtedness retired by call or purchase
as therein provided.  Such pledge shall be valid and binding from
the time when the pledge is made; the rates, rents, fees, and charges
and other revenues or other moneys so pledged and thereafter
received by the authority shall immediately be subject to the lien of
such pledge without any physical delivery thereof or further act,
and the lien of any such pledge shall be valid and binding as against
all parties having claims of any kind in tort, contract, or
otherwise against the authority, irrespective of whether such parties
have notice thereof.  Neither the resolution nor any trust agreement
nor any other agreement nor any lease by which a pledge is created
need be filed or recorded except in the records of the authority.
The use and disposition of moneys to the credit of such sinking or
other similar fund shall be subject to the provisions of the
resolution authorizing the issuance of such bonds or of such trust
agreement.  Except as may otherwise be provided in such resolution or
such trust agreement, such sinking or other similar fund may be a
fund for all bonds, notes, or other evidences of indebtedness of the
authority financing projects of a particular participating party
without distinction or priority of one over another; provided, that
the authority in any such resolution or trust agreement may provide
that such sinking or other similar fund shall be the fund for a
particular project or projects and for the bonds financing a
particular project or projects and may, additionally, permit and
provide for the issuance of bonds having a subordinate lien in
respect of the security herein authorized to other bonds, notes, or
other evidences of indebtedness of the authority, and, in such case,
the authority may create separate sinking or other similar funds in
respect of such subordinate lien bonds, notes, or other evidences of
indebtedness.
   (c) Pay operating and administrative costs of the authority.




44552.  The authority may enter into contracts of sale with any
participating party covering any project financed by the authority.
The purchase price pursuant to such contract of sale shall be
sufficient to provide funds for all the purposes provided in Section
44551 and may be paid in installments, together with interest on the
unpaid balance, or otherwise, as may be mutually agreed and set forth
in such contract of sale.  All payments received by the authority
under any installment sales or conditional sales contract shall be
applied by the authority substantially in the same manner as
hereinabove provided in Section 44551 in the case of lease payments
or rental charges received by the authority.



44552.5.  (a) As an alternative to leasing or selling a project to a
participating party, the authority may finance the acquisition,
construction, or installation of a project by means of a loan to the
participating party.  The principal amount of the participating party'
s obligation as borrower shall be sufficient to provide funds for all
the purposes specified in subdivisions (a), (b), and (c) of Section
44551 and may be paid in installments, together with interest on the
unpaid balance, or otherwise as may be mutually agreed by the
authority and the participating party and set forth in the loan
agreement. Loans made pursuant to this section may be secured or
unsecured in the discretion of the authority.
   (b) The authority may also purchase or acquire from a financial
institution part or all of a loan made to a participating party for a
project meeting the requirements of this division.  In the case of
such a purchase, subdivision (a) of Section 44533 shall be deemed to
have been complied with if the financial institution in making the
loan is participating in a financing program of the authority
pursuant to terms and conditions specified by the authority.  The
authority may by resolution waive the requirement of subdivision (a)
of Section 44533 for the purchase of loans of small businesses
eligible for assistance pursuant to Section 44548.
   (c) Section 44550 shall not  apply to projects constructed with
moneys loaned pursuant to this section.



44553.  All moneys received pursuant to the provisions of this
division, whether as proceeds from the sale of bonds, notes, or other
evidences of indebtedness or as revenues, shall be deemed to be
trust funds to be held and applied solely as provided in this
division.  Any bank or trust company with which such moneys shall be
deposited shall act as trustee of such moneys and shall hold and
apply the same for the purposes hereof, subject to such regulations
as the resolution authorizing the bonds of any issue or the trust
agreement securing such bonds may provide.



44554.  Any holder of bonds, notes, or other obligations issued
under the provisions of this division or any of the coupons
appertaining thereto, and the trustee or trustees under any trust
agreement, except to the extent the rights herein given may be
restricted by any resolution authorizing the issuance of, or any such
trust agreement securing, such bonds, notes, or other obligations,
may, either at law or in equity, by suit, action, mandamus, or other
proceedings, protect and enforce any and all rights under the laws of
the state or granted hereunder or under such resolution or trust
agreement, and may enforce and compel the performance of all duties
required by this division or by such resolution or trust agreement to
be performed by the authority or by any officer, employee, or agent
thereof, including the fixing, charging, and collecting of the rates,
rents, fees, and charges herein authorized and required by the
provisions of such resolution or trust agreement to be fixed,
established, and collected.


44555.  The exercise of the powers granted by this division shall be
in all respects for the benefit of the people of this state, for
their health and welfare, and protection of the state's environment.
Any bonds, notes, or other obligations issued under the provisions
of this division, their transfer and the income therefrom, shall at
all times be free from taxation of every kind by the state and by
municipalities and other political subdivisions of the state.
Provided, however, that the preceding sentence shall not apply with
respect to any bonds, notes or other obligations, or the income
therefrom, for any period during which such bonds, notes or other
obligations are held by (a) any participating party, (b) persons,
organizations, trades, or businesses (whether or not incorporated,
organized in this state, or affiliated with such participating party)
owned or controlled, directly or indirectly, by such participating
party, or (c) persons, organizations, trades or businesses (whether
or not incorporated, organized in this state, or affiliated with such
participating party (which own or control, directly or indirectly,
such participating party.



44556.  The authority shall not be required to pay any property
taxes or assessments upon, or in respect to, a project or any
property acquired by or for the authority under the provisions of
this division or upon the income therefrom, so long as the authority
holds title to such project or the property or facilities comprised
in the project.  The exemption of the authority from taxation of any
project herein provided shall cease forthwith when title to such
property is transferred from the authority to any participating
party.  The provisions of this section shall not exempt any
participating party from taxation with respect to any project, or the
property or facilities comprised in any project, which may otherwise
be applicable to such participating party.



44557.  Subject to Section 44562, the existence of the authority may
be terminated at any time by the Legislature.  Upon dissolution of
the authority, the title to all properties owned by it shall vest in
and become the property of the State of California and shall not
inure to the benefit of any private party.