ARTICLE 4.5. General Obligation Bonds [53506. - 53509.5.]

Law Codes -> Government Code -> Article 53506 to 53509.5

• 53506.

  (a)This article is full authority for the issuance of bonds or refunding bonds by any city, county, city and county, school district, community college district, or special district, secured by the levy of ad valorem taxes, authorized in accordance with the Constitution and, in the case of a chartered city, county, or city and county, with the charter thereof, or in the case of a special district, with the district's principal act.

  (b)This article is intended to provide a complete additional and alternative method for doing the things authorized by this article. The powers conferred by this article are supplemental and additional to the powers conferred by any other laws, and the limitations imposed by this article do not affect the powers conferred by any other law.

• 53506.5.

  This article shall be liberally construed to promote its objectives. If inconsistent with any other law, this article shall be controlling.

• 53507.

  As used in this article, the following terms shall have the meanings assigned to them in this section.

  (a)"Bonds" means bonds, notes, warrants, or other evidence of indebtedness payable, both principal and interest, from the proceeds of ad valorem taxes that may be levied without limitation as to rate or amount upon property subject to taxation by the legislative body.

  (b)"Issuer" means a city, county, city and county, school district, community college district, or special district, secured by the levy of ad valorem taxes, authorized to issue bonds pursuant to this article.

  (c)"Legislative body" means the governing body of the issuer.

• 53507.5.

  (a)The legislative body may, by resolution, provide for the issuance of bonds pursuant to this article.

  (b)The resolution shall state that the bonds are being issued pursuant to this article.

• 53508.

  The resolution authorizing any bonds or any issue of bonds may provide for any of the following:

  (a)The form of the bonds to be issued as serial bonds, or sinking fund bonds, with serial or term maturities, or any combination thereof.

  (b)The number of series in which the bonds are to be issued.

  (c)The form of the bonds as coupon, registered, or book entry.

  (d)The interest on the bonds, either fixed or variable, and the interest rate or rates, payable at the times and in the manner specified therein, and whether all or part of any series of the bonds shall be issued as zero coupon or capital appreciation bonds; provided, however, that under no conditions may the annual interest rate, whether fixed or variable, exceed the maximum rate permitted by Section 53531 or 53532.

  (e)The time, medium, and place or places of payment.

  (f)The time or times of maturity of the bonds, not exceeding 40 years from their respective dates.

  (g)The date or dates to be borne by the bonds of each series.

  (h)The denomination of the bonds.

  (i)The registration and conversion privileges of the bonds.

  (j)The manner in which the bonds are to be executed.

  (k)The terms of redemption, with or without premium.

  (l)Other terms and conditions of the bonds and of their execution, issuance, and sale deemed necessary and appropriate by the legislative body.

• 53508.3.

  (a)No bond shall be subject to mandatory tender for purchase or redemption prior to its fixed maturity date unless it contains a recital to that effect.

  (b)Any bond protected by its terms or by the terms of this section from mandatory tender for purchase or redemption prior to its fixed maturity date or for a specified period of time after issuance, may specify terms upon which the issuer may sell or transfer its right to require the bond to be tendered for purchase or redemption prior to its fixed maturity date.

• 53508.7.

  (a)The bonds shall be sold at a public or private sale and at a price at, above, or below par, as the legislative body determines.

  (b)Any bonds sold at a discount below the par value of the bonds shall be sold in compliance with the provisions of Section 53532.

  (c)The private sale of bonds is limited to the sale of school districts' and community college districts' bonds pursuant to Sections 15140 or 15146 of the Education Code.

• 53508.9.

  (a)Notwithstanding Section 53508.7, a local agency may sell bonds at a negotiated sale for a price at, above, or below par value, as authorized by the legislative body, without further approval, if the legislative body adopts a resolution before the negotiated sale, as an agenda item at a public meeting, that includes all of the following:

  (1)Express approval of the negotiated method of sale.

  (2)Statement of the reasons for selecting the negotiated method of sale.

  (3)Disclosure of the identity of the bond counsel.

  (4)Disclosure of the identity of the bond underwriter and the financial adviser, if used for the negotiated bond sale. If a bond underwriter or financial adviser has not been selected at the time the legislative body adopts the resolution, the legislative body shall disclose the identity at the public meeting first occurring after the bond underwriter or financial adviser has been selected.

  (5)Estimate of the costs associated with the bond issuance.

  (b)For purposes of this section, the following definitions shall apply:

  (1)"Legislative body" means the governing body of a local agency.

  (2)"Local agency" means a city, county, city and county, and special district. "Special district" means an agency of the state formed for the performance of governmental or proprietary functions within limited geographic boundaries, and shall not include a school district or community college district.

• 53509.

  (a)Any bond issued under the authority of this article may be refunded pursuant to this or any other applicable law. Any bond may be refunded pursuant to this article regardless of whether the bond or the legislation under which its issuance was authorized explicitly provides that the bond may be refunded.

  (b)Refunding bonds shall not be issued if the total net interest cost to maturity on the refunding bonds plus the principal amount of the refunding bonds exceeds the total net interest cost to maturity on the bonds to be refunded plus the principal amount of the bonds to be refunded. Subject to that limitation, the principal amount of the refunding bonds may be more than, less than, or the same as the principal amount of the bonds to be refunded.

• 53509.3.

  Nothing in this article shall limit the authority of the legislative body to enter into any contract in connection with the issuance of the bonds which it is permitted by Section 5922 to enter into.

• 53509.5.

  After the sale of bonds issued under the authority of this article, the legislative body shall do both of the following:

  (a)Present actual cost information for the sale at its next scheduled public meeting.

  (b)Submit an itemized summary of the costs of the bond sale to the California Debt and Investment Advisory Commission.