Chapter 14.5. Higher Education Facilities Bond Act Of 1986 of California Education Code >> Division 5. >> Title 3. >> Part 40. >> Chapter 14.5.

This chapter shall be known and may be cited as the Higher Education Facilities Bond Act of 1986.

The State General Obligation Bond Law (Chapter 4 (commencing with Section 16720) of Part 3 of Division 4 of Title 2 of the Government Code) is adopted for the purpose of the issuance, sale, and repayment of, and otherwise providing with respect to, the bonds authorized to be issued by this chapter, and the provisions of that law are hereby incorporated in this chapter as though set out in full in this chapter. All references in this chapter to "herein" shall be deemed to refer both to this chapter and that law.

As used in this chapter, and for the purposes of this chapter as used in the State General Obligation Bond Law, the following words shall have the following meanings:
  (a) "Board" means the State Public Works Board.
  (b) "Committee" means the Higher Education Facilities Finance Committee, created pursuant to Section 67353.
  (c) "Fund" means the Higher Education Capital Outlay Bond Fund, created pursuant to subdivision (e) of Section 67354.

The Higher Education Facilities Finance Committee is hereby created, consisting of the Governor, the Controller, the Treasurer, the Director of Finance, the President of the University of California, the Chancellor of the California State University, and the Chancellor of the California Community Colleges, or their designees. The Treasurer shall serve as chairperson of the committee.

(a) For the purpose of funding aid to the University of California, the California State University, the California Community Colleges, and the California Maritime Academy for the construction, including the construction of buildings and the acquisition of related fixtures, renovation, and reconstruction of facilities, for the acquisition of sites upon which these facilities are to be constructed, for the equipping of new, renovated, or reconstructed facilities, which equipment shall have a useful life of at least 10 years, to provide funds for payment of preconstruction costs, including, but not limited to, preliminary plans and working drawings, and to provide funds to reimburse the General Obligation Bond Expense Revolving Fund pursuant to Section 16724.5 of the Government Code, the committee shall be and is hereby authorized and empowered to create a debt or debts, liability or liabilities, of the State of California, in the aggregate amount of four hundred million dollars ($400,000,000) in the manner provided in this chapter, but not in excess thereof.
  (b) The committee shall authorize the issuance of bonds under this chapter only to the extent necessary to fund the apportionments that are expressly authorized by the Legislature in the annual Budget Act. Pursuant to that legislative direction, the committee shall determine when the bonds authorized under this chapter shall be issued in order to fund the authorized apportionments, and the amount of the bonds to be issued and sold.
  (c) Up to two hundred fifty million dollars ($250,000,000) shall be available for apportionment in the 1986-87 fiscal year, and up to one hundred fifty million dollars ($150,000,000) shall be available for apportionment for the 1987-88 fiscal year, and in each subsequent fiscal year, except that the maximum aggregate debt or liability amount set forth in subdivision (a) shall not be exceeded.
  (d) Pursuant to this section, the Treasurer shall sell the bonds authorized by the committee at such different times as necessary to service expenditures required by the apportionments.
  (e) The proceeds of bonds issued and sold pursuant to this chapter shall be deposited in the Higher Education Capital Outlay Bond Fund, which is hereby created in the State Treasury.

The proceeds of the bonds may also be used to provide short-term loans to community colleges for the purchase of instructional equipment. Those loans shall be repaid from the first moneys available in the Capital Outlay Fund for Public Higher Education beginning in the 1987-88 fiscal year.

All bonds herein authorized, which shall have been duly sold and delivered as herein provided, shall constitute valid and legally binding general obligations of the State of California, and the full faith and credit of the State of California is hereby pledged for the punctual payment of both principal and interest thereof. There shall be collected annually in the same manner and at the same time as other state revenue is collected a sum, in addition to the ordinary revenues of the state, as is required to pay the principal and interest on the bonds as herein provided, and it is hereby made the duty of all officers charged by law with any duty in regard to the collection of the revenue, to do and perform each and every act which is necessary to collect the additional sum.

There is hereby appropriated from the General Fund in the State Treasury for the purpose of this chapter, an amount that will equal the following:
  (a) The sum annually as will be necessary to pay the principal of and the interest on the bonds issued and sold pursuant to the provisions of this chapter, as the principal and interest become due and payable.
  (b) The sum as is necessary to carry out Section 67357, which sum is appropriated without regard to fiscal years.

For the purposes of carrying out the provisions of this chapter, the Director of Finance may, by executive order, authorize the withdrawal from the General Fund of an amount or amounts not to exceed the amount of the unsold bonds which the committee has by resolution authorized to be sold for the purpose of carrying out this chapter. Any amounts withdrawn shall be deposited in the fund to be allocated by the board in accordance with this chapter. Any moneys made available under this section to the board shall be returned by the board to the General Fund, together with interest in the amount that those moneys would have earned in the Pooled Money Investment Account, which repayment shall be made from moneys received from the sale of bonds sold for the purpose of carrying out this chapter.

Notwithstanding any other provision of this bond act, or of the State General Obligation Bond Law (Chapter 4 (commencing with Section 16720) of Part 3 of Division 4 of Title 2 of the Government Code), if the Treasurer sells bonds pursuant to this bond act that include a bond counsel opinion to the effect that the interest on the bonds is excluded from gross income for federal tax purposes under designated conditions, the Treasurer may maintain separate accounts for the bond proceeds invested and the investment earnings on those proceeds, and may use or direct the use of those proceeds or earnings to pay any rebate, penalty, or other payment required under federal law, or take any other action with respect to the investment and use of those bond proceeds, as may be required or desirable under federal law in order to maintain the tax-exempt status of those bonds and to obtain any other advantage under federal law on behalf of the funds of this state.