Article 4. Purchase By State Of County Warrants For Aid of California Government Code >> Division 3. >> Title 3. >> Chapter 5. >> Article 4.

The purpose of this article is to maintain in effect in every county the state plans for aid to the needy aged, aid to needy children, and aid to the needy blind; to protect such plans from interruption of operation in any county because of the temporary financial exigencies of the county; and to preserve the eligibility of the State to receive assistance from the United States for such aid.

"Registered," as used in this article, means endorsed and signed by the county treasurer.

Any county which is liable under the Welfare and Institutions Code for the payment of aid to the needy aged, aid to the needy blind, or aid to needy children may apply to the Department of Finance for purchase by the State of registered warrants of the county in such amount as will enable the county to make payment of its liability, if all of the following conditions exist:
  (a) The county is without sufficient funds in its treasury to make the payment.
  (b) The county is unable to provide such funds, by temporary borrowing or otherwise.
  (c) Registered warrants of the county are not readily salable or exchangeable in the community by holders for their face value in cash.
  (d) The county has made provision in its current budget for the expenditures for the aids for which it is liable under the Welfare and Institutions Code and has levied the necessary taxes.

The county shall submit its application to the State Department of Social Services. The application shall be in such form and show such facts as are prescribed by the State Department of Social Services and the Department of Finance. If the State Department of Social Services approves the application, it shall transmit the application and a statement of its approval to the Department of Finance.

If the Department of Finance determines that the purchase will tend to effect the purpose of this article and that the county is eligible to make application, it may, with the approval of the Treasurer, purchase, in the name of the state, registered warrants of the county in the amount specified in the application or in any lesser amount agreed to by the county and approved by the State Department of Social Services.

The purchase shall be effected as follows:
  (a) In lieu of the issue of registered warrants to the persons to whom the county is liable for the payment of aid, a warrant or warrants in favor of the State in the amount agreed upon between the county and the Department of Finance shall be issued by the county auditor and registered by the county treasurer.
  (b) Upon the claim of the Department of Finance, the State Controller shall draw his warrant in favor of the county for the face value of the county registered warrants to be purchased under the agreement.
  (c) The county warrants shall be delivered to the Department of Finance which shall thereupon transmit the Controller's warrant to the county treasurer. The county warrants shall be deposited with the State Treasurer by the Department of Finance.

The funds received by a county from the State in payment for warrants of the county shall be kept in a separate fund and used only for the payment of the aid for which the county is liable under the Welfare and Institutions Code, relating to the needy aged, aid to the needy blind, and aid to needy children.

Any funds received by the Department of Finance in payment of county registered warrants purchased pursuant to this article shall be immediately deposited in the State Treasury. The proceeds received as the principal amount of the warrants shall be credited to the appropriations from which the respective warrants were purchased.

All registered warrants issued to the State pursuant to this article are subject in every respect to Article 2.