Article 7. Investments of California Public Utilities Code >> Division 6. >> Chapter 6. >> Article 7.

A district may invest any surplus money in its treasury, including money in any sinking fund, in any of the following:
  (a) Its own bonds, whether issued on behalf of the entire district or any special district.
  (b) Treasury notes, certificates of indebtedness, bills, bonds of the United States, or any other evidence of indebtedness secured by the full faith and credit of the United States.
  (c) Obligations issued pursuant to the Federal Home Loan Bank Act or the National Housing Act.
  (d) Treasury notes or bonds of this state, or of any public corporation, municipal corporation, public district, or political subdivision within this state which are legal as security for the deposit of public funds.
  (e) Obligations issued by federal intermediate credit banks, federal land banks, and banks for cooperatives.
  (f) Obligations issued or assumed by the International Bank for Reconstruction and Development, the Tennessee Valley Authority, the Inter-American Development Bank, or Export-Import Bank of Washington participation certificates.
  (g) Banker's acceptances of banks having total deposits of one billion dollars ($1,000,000,000) or more.
  (h) Any securities in which savings banks in this state may legally invest their funds pursuant to Sections 1350 to 1366, inclusive, of the Financial Code; provided, that the provisions of said sections limiting the amount which a savings bank may invest in securities to a specified percent of its paid-up capital and surplus, or savings deposits, shall not apply to investments authorized by the terms of this section.

Such investment may be made by direct purchase of any issue of such bonds, treasury notes, or obligations, or part thereof, at the original sale or by the subsequent purchase of the bonds, treasury notes, or obligations.

Any bonds, treasury notes, or obligations purchased and held as investments by the district may from time to time be sold and the proceeds reinvested in bonds, treasury notes, or obligations as provided in this article.

Sales of any bonds, treasury notes, or obligations purchased and held by the district shall from time to time be made in season so that the proceeds may be applied to the purposes for which the money with which the bonds, treasury notes, or obligations were originally purchased was placed in the treasury of the district.

Notwithstanding any other provision of law, a district which has owned and operated a water distribution or sewage disposal system for at least eight years and which has a population of 250,000 or more may enter into contracts commonly known as "interest rate swap agreements" or "forward payment conversion agreements" with any person providing for the exchange of payments between the person and the district including, without limitation, contracts providing for the exchange of fixed interest payments for floating payments or floating interest payments for fixed payments, or a combination thereof, after giving due consideration for the creditworthiness of the counter parties, where applicable, including any rating by a nationally recognized agency or such other criteria as may be appropriate. The contracts may be made upon the terms and conditions established by the board. The authority conferred by this section includes the authority to enter into any and all contracts incident to the exercise of the authority conferred by this section including, without limitation, contracts to obtain credit enhancement devices and contracts for the performance of professional services.