Article 2. Transactions And Use Taxes And Revenue Bonds of California Public Utilities Code >> Division 10. >> Part 4. >> Chapter 8. >> Article 2.

Transactions and use taxes (to be designated in the ballot proposition set forth in Section 40334 as a "sales tax") may be imposed by the board in accordance with the provisions of Part 1.6 (commencing with Section 7251) of Division 2 of the Revenue and Taxation Code, except that the rate shall be as set forth in Section 40335.

Any transactions and use taxes ordinance adopted pursuant to this article shall be operative on the first day of the first calendar quarter commencing more than 120 days after the approval of such ordinance by the electors as provided in this article. Prior to the operative date of the ordinance, the district shall contract with the State Board of Equalization to perform all functions incident to the administration and operation of the ordinance.

(a) The revenues from the taxes imposed pursuant to this article may be used for any lawful purpose of the district.
  (b) During the first three years the taxes are imposed pursuant to this article, 25 percent of the revenues generated from such taxes shall be allocated by the district to Orange County and the cities therein in the proportion that the population of the county or city, as the case may be, bears to the total population of the district. For purposes of this subdivision, the population of the county shall be the population of the unincorporated territory of the county.
  (c) The revenues allocated pursuant to subdivision (b) shall be used by the county and the cities to finance public transit services, which shall be coordinated with the public transit services operated by the district. The county or any city may also use the revenues to finance public transit services operated by the district.
  (d) At the end of four years, as measured from the initial imposition of the taxes pursuant to this article, any of the revenues allocated pursuant to subdivision (b) which has not been expended for public transit services shall revert to the district.

The taxes authorized by this article shall not be imposed unless the board shall have authorized it by ordinance adopted by a vote of two-thirds of all members of the board and the ordinance shall be approved by two-thirds of the votes cast by the qualified electors of the district voting on the proposition at an election called for that purpose. The board, in the ordinance, shall state the nature of the tax to be imposed, shall provide the tax rate or rates or the maximum tax rate or rates, and shall specify the purposes for which the revenue derived from the tax will be used.

The actual wording of the proposition on any short form of ballot card, label, or other device, regardless of the system of voting used, shall read as follows:

-------------------------------------+------+----- | | TRANSIT | Yes | Authorizes the Orange County Transit | | District to impose a ____ percent | | sales tax for transit purposes. +------+----- | No | -------------------------------------+------+-----

The proposition shall set forth the actual percent of the transaction and use taxes upon which the electors are voting. The sample ballot to be mailed to the voters, under Section 13303 of the Elections Code, shall be the full proposition as set forth in the ordinance adopted pursuant to Section 40333.

The board is authorized to impose a maximum tax rate of 1 percent under this article and the board may state the maximum tax rate in terms of not to exceed 1 percent, or any lesser percentage thereof. The district shall not levy the tax at a rate other than 1, 3/4, 1/2, or 1/4 percent, unless specifically authorized by the Legislature. The board, in the ordinance, may provide for limitations upon the time when the tax shall be in effect, or the board may provide that the tax shall be in effect until repealed. Any tax rate or maximum tax rate adopted pursuant to this article, unless otherwise prohibited, may be increased when authorized by the board by ordinance adopted in the manner and by the vote stated in Section 40333 and approved by a majority of the votes cast by the qualified electors of the district voting at an election called for that purpose.

The district is hereby authorized to issue revenue bonds, payable, in whole or in part, from revenues made available under this article. Such revenues are hereby declared to be revenues of the enterprise for all purposes of the Revenue Bond Law of 1941 (Chapter 6 (commencing with Section 54300), Part 1, Division 2, Title 5 of the Government Code), and the restrictions therein provided against the securing of bonds by the taxing power or the proceeds of taxation shall not apply. The district shall be deemed a "local agency" and the planning, acquiring, constructing, operating, or maintaining of the district's transit facilities, or any part thereof, shall be deemed an "enterprise" within the meaning of the Revenue Bond Law of 1941. The provisions of such law not inconsistent with any of the provisions of this article are hereby made applicable to the district, except that no election shall be required for the issuance of bonds under such law which are secured, in whole or in part, by the revenues of the tax imposed pursuant to this article. The resolution or indenture authorizing the issuance of any revenue bonds secured, in whole or in part, by the revenues of the tax imposed pursuant to this article shall provide that use of such revenues by the district to redeem such bonds shall be continued in effect until such bonds are fully paid or provision has been made for their payment in full. The district may borrow money in anticipation of the revenues made available under this article and may, from time to time, issue negotiable notes for that purpose. In addition to pledging revenues for the payment of any revenue bonds, the district may pledge for the payment of such bonds all other income or receipts of the district which are not required by law to be used for other purposes.