Article 7. Dissolution of California Health And Safety Code >> Division 5. >> Part 3. >> Chapter 4. >> Article 7.

A district may be dissolved by the board as provided in this chapter.
A petition for dissolution, signed by 50 or more freeholders and residents of the district, or by a majority of the freeholders and residents if there are less than 100 freeholders and residents in the district, may be filed with the board to initiate dissolution proceedings, or the board may by resolution initiate dissolution proceedings.
Upon receiving a petition for dissolution, or adopting a resolution to initiate dissolution proceedings, the board shall fix a time for a hearing of the petition or resolution, which shall not be less than 15 nor more than 30 days after its receipt or adoption.
At least ten days prior to the time fixed, the board shall publish a notice of the hearing by one insertion in a newspaper circulated in the district.
At the time appointed for the hearing or at any time to which it is continued, the board shall hear and pass upon the petition or resolution and may grant or deny the proposed dissolution, and its decision is final.
If the proposed dissolution is granted, the board shall by resolution order the dissolution of the district and the district is thereupon dissolved. The property of the district remains the property of the county in which the district is located. If at the time of the dissolution there is any indebtedness of the district outstanding, the district shall be dissolved for all purposes except the levy and collection of taxes for the payment of such outstanding indebtedness. From the time the district is thus dissolved until the indebtedness is fully paid, the board of supervisors of the county wherein the district is located shall be the ex officio governing body of the district. That body shall levy such taxes and perform such other acts as may be necessary to pay the outstanding indebtedness of the district.
Upon the inclusion of all the territory of a district in one or more cities, either by reason of annexation or by reason of the incorporation of one or more cities, all funds paid into the county treasury to the credit of the district shall be paid over by the board as provided in this article.
If all of the district is included in one city, the fund shall be paid to the treasurer of the city and administered by the governing body of the city.
If a part only of the district is so included in one city and the remaining part of the district is included in one or more other cities then such proportionate part of the funds shall be paid to the treasurer of each city as the assessed valuation of the real property of the portion of the district included in each city bore, before being so included, to the total assessed valuation of the real property of the district.
The funds paid over by the district to a city shall be administered by its governing body for the benefit of such portions of the district as are included in the city, and for the purpose of operating and maintaining the sewers in it formerly maintained by the district.
When all territory in a district has been included in a city the district is thereupon, by reason of the inclusion, dissolved.
If less than the whole of a district is included in a city either by reason of annexation or by reason of incorporation proceedings, the territory so included within the city shall continue to remain a part of the district for all purposes until a copy of a resolution adopted by the city requesting exclusion of such territory from the district is received by the board. Upon receipt of such a resolution requesting exclusion of the territory contained within the city, such territory shall be excluded from the district and the remaining territory shall continue as a district. But the exclusion of such territory from the district shall not be effective until all outstanding contracts of the districts have expired or the contracts, with the consent of the parties, have been modified or canceled so as to relieve the district of further obligation to pay for future maintenance in the affected territory.
If all of the district is included within a sanitary district, the district is dissolved upon the filing with the Secretary of State of a resolution adopted by the district board of the sanitary district and approved by the board of supervisors which states that the sanitary district is able to provide the same service as is being provided by the sewer maintenance district and declares that the sewer maintenance district is dissolved. A copy of the resolution shall be filed with the board of supervisors. Upon the dissolution of the sewer maintenance district, the property and funds which are held by the county for the sewer maintenance district vest in the sanitary district and the county shall convey such property and pay over such funds, to the sanitary district. The sanitary district shall also succeed to any liability or outstanding obligation of the sewer maintenance district at the time of its dissolution.