Chapter 5. Negotiable Promissory Notes of California Water Code >> Division 21. >> Part 6. >> Chapter 5.

The district may issue negotiable promissory notes bearing interest at a rate not exceeding the rate set by Article 7 (commencing with Section 53530) of Chapter 3 of Part 1 of Division 2 of Title 5 of the Government Code. The notes shall be general obligations of the district payable from revenues and assessment taxes, unless paid from other available funds of the district, in the same manner as bonds of the district. The maturity of the notes shall not be later than five years from the date thereof and the total aggregate amount of the notes outstanding at any one time shall not exceed the lesser of 2 percent of the assessed valuation of the taxable property in the district, according to the last assessment roll or five million dollars ($5,000,000), except that a district which has been formed for less than 18 months may not borrow an amount exceeding twenty-five thousand dollars ($25,000).

"Taxable property," as used in Section 74950, means:
  (a) All lands and improvements within a district or improvement district, as the case may be, if the provisions of Section 74056 were complied with in the formation of the district or district within which the improvement district is created.
  (b) All lands and improvements within an improvement district if the basis of taxation in the improvement district has been changed pursuant to Section 75151 from land to land and improvements.
  (c) Land only within any district or improvement district not mentioned in subdivision (a) or (b) of this section.

If a district undertakes to issue promissory notes pursuant to the limitations set forth in Section 74950, the limitations provided in Sections 75357 and 75358 shall not apply.