Article 3. Sale of California Water Code >> Division 15. >> Part 8. >> Chapter 3. >> Article 3.

The board, in lieu of exchanging refunding bonds for outstanding bonds, may declare by resolution that it will be for the best interests of the district to sell all or any specific portion of the refunding bonds.

The board, having adopted a resolution of sale, may declare by resolution, on or before the February 1st or the August 1st prior to the date of maturity of the outstanding bonds next maturing and to be refunded, either in whole or in part, that any portion of the refunding bonds available for the refunding of the outstanding bonds next maturing shall be sold.

The resolution shall direct the county treasurer to sell the refunding bonds on a date not less than five days, nor more than 10 days, prior to the April 1st or October 1st prior to the maturity of the bonds to be refunded, and shall declare whether the refunding bonds may be sold for less than the face value thereof, plus accrued interest. In no event shall refunding bonds be sold for less than 90 percent of their face value plus accrued interest.

The refunding bonds shall be sold by the county treasurer in the manner provided in Article 3, Chapter 1 of this part for the sale of bonds and refunding bonds.

A sale by the county treasurer is conclusive evidence in favor of the purchaser and all subsequent holders of the refunding bonds that the sale was made upon due authority and notice.

Refunding bonds which are not sold when offered for sale may again be offered for sale from time to time prior to their fixed maturity, or may be exchanged for outstanding bonds as provided in this chapter.

The proceeds of the sale of refunding bonds shall be placed in the county treasury to the credit of the bond fund, and used only in payment of the principal of the outstanding bonds to be refunded by the refunding bonds so sold.

The board shall sell or exchange refunding bonds only of such maturities as have been declared in the notice of election for the issuance of refunding bonds to be available for the refunding of particular maturities of the district's outstanding bonds.

If any district authorized the issuance of refunding bonds prior to August 14, 1929, and the same or any part thereof are unsold, the board may call an election in the manner and upon the notice prescribed for the issuance of refunding bonds, at which election there shall be submitted the question of whether such refunding bonds of any maturity shall be sold or exchanged to refund any maturity of outstanding bonds of the district as the board shall determine, or as may otherwise be specified in the notice of such election.

If the board, in its resolution, determines that the refunding bonds may be sold for an amount less than their aggregate par value, and that it is necessary or advisable that an amount be made available for the payment of interest upon the refunding bonds from the date of the sale thereof to the date of maturity of the bonds to be refunded out of the proceeds of the sale, the resolution of sale shall direct that a warrant be forthwith drawn against the general or maintenance fund of the district in favor of the county treasurer as trustee of the bond fund and delivered to the county treasurer.

The warrant shall be drawn for an amount equal to the sum of:
  (a) The excess of the par value of the refunding bonds directed to be sold over the amount for which the board has determined the refunding bonds may be sold, which shall not in any event, exceed 10 percent of the par value of the refunding bonds directed to be sold.
  (b) An amount sufficient to pay interest at the rate provided in the refunding bonds from the date of sale thereof to the date of the maturity of the bonds to be refunded out of the proceeds of the sale. Items (a) and (b) are incidental expenses of the district as defined in Section 51336.

When the warrant has been drawn, there shall be included in the next succeeding assessment call levied for maintenance purposes, an amount equal to that of the warrant, and that amount shall be assessed against the several parcels in the same proportion as the original assessment, or any subsequent reapportionments thereof, which secures the payment of the refunding bonds, and, when collected, shall be placed to the credit of the maintenance fund, in reimbursement of that fund.