Chapter 12. Authority For Issuance And Sale Of District Bonds of California Streets And Highways Code >> Division 16. >> Part 3. >> Chapter 12.

Whenever the board deems it necessary for the district to incur a bonded indebtedness it shall, by resolution so declare. The resolution shall contain:
  (a) A statement of the proposition to be submitted to the electors, including the purpose for which the proposed debt is to be incurred.
  (b) The amount of debt to be incurred, which shall not exceed 15 per cent of the assessed value of all taxable property in the district.
  (c) The maximum term, which shall not exceed 40 years, that the bonds proposed to be issued shall run before maturity.
  (d) The maximum rate of interest to be paid, which shall not exceed 6 per cent per annum.
  (e) A statement that interest, to be paid upon such bonds, during the period of construction of the works of the district and before any revenue is obtained therefrom shall be a capital charge, and shall be payable out of the principal sum realized from the sale of the bonds.

The board shall fix a date upon which a special election shall be held for the purpose of authorizing the bonded indebtedness to be incurred and shall provide for holding the election on the date so fixed.

The board shall give notice of the holding of the election. The notice shall:
  (a) Refer to the resolution adopted by the board calling the election.
  (b) Specify the precincts or consolidated precincts in each county or portion of a county which are adopted for the purposes of the election.
  (c) Designate the location of the balloting places, and the names of the officers selected to conduct the election, who shall consist of one inspector and two judges in each precinct.

The notice shall be published for two weeks in at least one newspaper and not more than three newspapers designated by the board, which are published in each county or portion of a county within the district. The notice as published in each county shall contain only the reference to the precincts, polling places and election officers in the county or portion of the county in which it is published. If there is no newspaper published in any county the notice shall be posted in three public places in that county.

All the expenses of holding the election shall be borne by the district.

The returns of the election shall be made and the votes canvassed by the board within 30 days after the holding of the election, and the results thereof designated and declared in accordance with the general election laws of the State in so far as they may be applicable, and except as otherwise provided in this chapter. As soon as the result is declared the secretary shall enter a statement of the results in the records of the board.

If more than two-thirds of the votes cast at the election are in favor of incurring the indebtedness, the board may by resolution at any time it deems proper provide for the form and execution of the bonds, and for the issuance of any part thereof, and may sell or dispose of the bonds so issued at such times or in such manner either for cash in lawful money of the United States, or its equivalent as it may deem to be to the public interest.

All bonds issued by the district shall be legal investments for savings banks, and shall have the same force and effect and shall be equivalent to bonds issued by any municipality, and shall be exempt from all taxation within this State.

Whenever the board deems it necessary or advisable to refund any outstanding bonds, it may, by resolution, declare such necessity or advisability and outline a general plan of refunding, including the issuance of refunding bonds and the terms and conditions thereof. Upon adopting a general plan of refunding, the board shall, by resolution, provide for submitting to the qualified electors of the district the proposition of whether the refunding bonds shall issue. The resolution shall provide for the manner of submitting the proposition to the electors, and shall state the purpose of the refunding, the terms and conditions of the bonds, and any other facts essential for the information of the electors. The election held on the proposition shall conform to the provisions of this article. If the proposition is favorably voted upon, the board of directors has plenary power in the matter of executing the bonds and providing for their sale and disposition.