Article 4. Payment of California Government Code >> Division 4. >> Title 2. >> Part 4. >> Chapter 2. >> Article 4.
All warrants are payable in such coin or currency of the
United States of America as at the time of payment is legal tender
for the payment of public and private debts. The Controller shall
cause to be endorsed upon the face of each warrant drawn upon the
Treasurer a provision that it is so payable.
(a) A registered warrant that bears a maturity date shall be
paid by the Treasurer upon that date out of any unapplied money in
the General Fund on the due date, available therefor.
(b) Notwithstanding subdivision (a), accrued interest on a
registered reimbursement warrant shall be paid by the Treasurer on
each payment date established pursuant to Section 17243 out of any
unapplied money in the General Fund available therefor on the payment
date.
(c) Notwithstanding subdivision (a), a registered reimbursement
warrant may provide that it may be redeemed at the option of the
committee prior to the maturity date of the warrant at a redemption
price not to exceed 110 percent of the principal amount of the
warrant plus accrued interest. The optional redemption price shall be
paid by the Treasurer out of any unapplied money in the General Fund
available therefor on the optional redemption date.
Registered warrants not bearing a maturity date, and
registered warrants bearing a maturity date, but for the payment of
which refunding warrants have not been sold or unapplied money is not
available on the due date, shall be paid, together with all interest
due, at such times as the Controller determines, with the approval
of the committee. Upon approval the Controller shall notify the
Treasurer of the numbers of the warrants which are to be redeemed.
The Treasurer shall immediately publish notice that such
registered warrants are redeemable by advertising for six consecutive
days, Sundays excepted, in newspapers publishing legal notices in
the cities of Sacramento, San Francisco, and Los Angeles.
The notice of redemption shall read substantially as
follows:
"NOTICE TO HOLDERS OF STATE OF
CALIFORNIA WARRANTS
State Controller's warrants number______to
number______, inclusive, drawn against the
General Fund in the state treasury will be
payable on
_________________________ upon presentation to
(redemption date)
the State Treasurer.
_________________________________
(Name of State Treasurer)
State Treasurer."
Any interest paid on any registered warrant shall accrue to
the person holding the warrant on the date of redemption, except a
registered reimbursement warrant may provide otherwise. A registered
warrant ceases to bear interest on the first of the following dates:
(a) The maturity date endorsed on its face, if any, if on that
date unapplied money or the proceeds of refunding warrants are
available for its payment.
(b) The date of redemption, so long as the date is at least three
days following the first day of published notice pursuant to Section
17273.
(c) The date a registered warrant is used by a taxpayer, pursuant
to Section 17280.1, or by a beneficial owner of a state bond,
pursuant to Section 17280.3, to offset a tax liability of the
taxpayer or beneficial owner.
(a) If on the maturity date indorsed on a registered
reimbursement warrant, there is no money available for its payment,
either from unapplied money, or from the proceeds of refunding
warrants the registered reimbursement warrant shall continue to bear
interest on the principal amount of the warrant and shall become
payable in the same manner as registered warrants not bearing
maturity dates.
(b) Notwithstanding Section 17222, if at any time it is necessary
to register warrants pursuant to this chapter for the payment of any
interest payment on a registered reimbursement warrant, those
warrants shall bear interest at the fixed or variable rate determined
by the Controller and as specified in the registered reimbursement
warrant as the interest rate for those warrants. Interest on those
warrants shall be payable only upon redemption of the warrants.
(c) Notwithstanding subdivision (b), in no case shall the total
sum of interest payments on the registered reimbursement warrant and
the warrants registered for the payment of any interest payment on
that registered reimbursement warrant exceed an amount equal to the
interest that could have accrued on the registered reimbursement
warrant at the maximum interest rate that could have been fixed by
the committee thereon pursuant to subdivision (a) of Section 17244.
If it appears to the Controller that, on the maturity date
on the face of any registered reimbursement warrant, there will be
insufficient unapplied money in the General Fund available for its
payment he or she may issue a refunding warrant, with the written
approval of the Treasurer.
Refunding warrants issued, registered, and sold for the
purpose of paying and retiring registered reimbursement warrants
theretofore issued shall be based upon the same claims and shall be
identical in form and amount to the warrants to be paid and retired
except as to serial number, date of registration, due date, and
interest rate. The provisions of this chapter applicable to
reimbursement warrants are applicable to refunding warrants.
Refunding warrants may be issued with or without a fixed
maturity date and shall be sold in the same manner as reimbursement
warrants. The proceeds shall be held by the Treasurer and applied
exclusively to the payment of the registered reimbursement warrants
for the payment of which the refunding warrants were issued.
If at any time it is necessary to register warrants for the
payment of principal and interest on State bonds, warrants so
registered have a prior lien in the order of their issuance on any
money thereafter received into the General Fund, and shall be paid
before any other warrants regardless of the prior issuance of the
latter.
(a) A taxpayer who has a tax liability, including any
liability for periodic estimated tax payments, with respect to
personal income taxes or bank and corporation taxes, and who is a
payee named in a registered warrant as defined in Section 17221 which
is received in payment of an obligation of the State of California
to the taxpayer, may pay any tax liability specified above, in whole
or in part, by a check in an amount not to exceed the amount of the
registered warrant, exclusive of any interest thereon. That check
shall not be presented for payment by the state or paid by the bank
on which it is drawn until the registered warrant payable to the
taxpayer is payable upon its presentation to the Treasurer. The
provisions of this section shall be applicable only if the taxpayer's
check in payment of a tax liability pursuant to this section is
accompanied by a copy of the registered warrant, as specified above,
which clearly discloses the name of the payee, the amount to be paid,
the number of the warrant, and the completed and signed legend as
provided for in subdivision (d).
(b) Any taxpayer submitting a check for the payment of taxes
pursuant to subdivision (a) shall be precluded from receiving
interest on his or her registered warrant from the date the check for
the payment of taxes is submitted.
(c) In the event that a taxpayer who submits a check for the
payment of taxes pursuant to subdivision (a) presents his or her
registered warrant to a bank or other institution for payment, the
taxpayer shall make a declaration upon presentment that he or she is
ineligible pursuant to subdivision (b) to receive interest from the
date he or she submitted the check.
(d) To facilitate the taxpayer in making the declaration required
by subdivision (c), all registered warrants issued shall bear a
legend on the reverse side in substantially the following form:
"In endorsing this warrant, I declare that I
have ( ) or have not ( ) (check one) submitted a
check on _______
(date)
for the payment of tax liability in an amount
not to exceed the amount of this warrant. I
further declare that by submitting that check, I
am ineligible for the receipt of interest on
this warrant after the above date."
In the event a tax liability is paid, in whole or in part,
with a registered warrant which is redeemable at the time the tax
liability is paid, interest as specified in this article, shall be
credited to the taxpayer's account.
(a) If a registered warrant, as defined in Section 17221,
is issued for payment of any principal or interest due and payable on
a state bond that is held in book entry form by a securities
settlement system, the beneficial owner of the state bond may offset
the portion of the principal amount of the registered warrant
(exclusive of interest thereon) that is attributable to that
beneficial owner's beneficial interest in the state bond against an
existing tax liability, as defined in subdivision (a) of Section
17280.1, of that beneficial owner, in accordance with Sections
17280.1 and 17280.2, or otherwise in accordance with procedures
established by the Controller, notwithstanding that the securities
settlement system, or its nominee, is the registered owner of the
state bond or the named payee of the registered warrant. The amount
of that beneficial owner's tax liability that may be offset pursuant
to this section shall not exceed the portion of the principal amount
of the registered warrant, exclusive of interest thereon, that is
attributable to the taxpayer's beneficial ownership of the state
bond. Any beneficial owner who exercises the offset right set forth
in this section in payment of an existing tax liability shall not be
entitled to receive payment of any interest accruing on the portion
of the registered warrant attributable to that beneficial owner's
beneficial interest in the state bond after the date on which the
beneficial owner exercises the offset right in accordance with the
applicable procedures, and the beneficial owner shall be required to
promptly repay to the state any interest accruing on the registered
warrant after that date that may be paid to or ultimately received by
the beneficial owner, if any. The preceding sentence shall apply
even if the portion of the principal amount of the registered warrant
that is attributable to the beneficial owner's ownership interest in
the state bond is larger than the amount of the tax liability offset
by the beneficial owner with that registered warrant. Upon
exercising the right of offset pursuant to this subdivision, the
beneficial owner shall not be permitted to sell, transfer, or assign
his or her beneficial ownership of the applicable state bond until
the applicable registered warrant has been redeemed by the state and
the beneficial owner has repaid any interest received on his or her
portion of that registered warrant attributable to the period after
that beneficial owner's exercise of the right of offset as provided
in this subdivision. For purposes of this subdivision and subdivision
(b), "state bond" means any general obligation bond or revenue
anticipation note issued by the state.
(b) No state entity shall take any action that would materially
adversely impair, limit, or restrict the rights of a beneficial owner
of a state bond, as set forth in this section, Section 17280.1, or
Section 17280.2, or any successor provisions, as those provisions
were in effect when the person or party became a beneficial owner of
the state bond, until the state bond is fully paid and discharged.