16720. This chapter shall be known and may be cited as the State
General Obligation Bond Law.
16721. The purpose of this chapter is to provide a procedure which
may be adopted by other acts for use with whatever modifications are
necessary in authorizing the issuance and sale of state general
obligation bonds and providing for the repayment of such bonds. This
chapter does not itself authorize the issuance or sale of any bonds.
16722. As used in this chapter, the following terms shall have the
following meaning unless the context otherwise requires:
(a) "Board" means the state board, department, or agency
authorized by that act to request the committee to cause bonds to be
issued for the purpose of creating a fund that is to be expended by
the board for the purposes specified in that act.
(b) "Bond" means a state general obligation bond issued pursuant
to an act adopting the provisions of this chapter.
(c) "Bond act" means the act authorizing the issuance of state
general obligation bonds and adopting this chapter by reference.
(d) "Committee" means the finance committee or other body created
by that act and authorized to cause bonds to be issued by the
adoption of a resolution or resolutions.
(e) "Fund" means the fund created by that act, and into which the
proceeds from the sale of the bonds are paid.
(f) "Tender" means a term of a bond that gives the holder the
right to have the bond purchased from the holder at a predetermined
price prior to maturity.
16723. Any bond act may adopt the provisions of this chapter by
reference to its short title, and such reference shall serve to
incorporate the provisions of this chapter in said act as though set
out in full therein. Notwithstanding such adoption by reference, the
bond act may contain provisions applicable to the bonds issued
thereunder, and, in case of conflict, the provisions in the bond act
shall prevail.
16724. The bond act shall contain all of the following provisions:
(a) A statement of the total amount of bonds authorized to be
issued and the purpose for which the proceeds from the sale of the
bonds may be used.
(b) The creation of a committee and fund, and the naming of the
board as these items are defined in Section 16722.
(c) A statement that the bonds are valid obligations of the state
and a pledge of the full faith and credit of the state for the
punctual payment of both principal and interest thereof.
(d) An appropriation from the General Fund in the State Treasury
of the sum annually as shall be necessary to pay the principal and
interest on the bonds as they become due and payable.
(e) A requirement that there be collected annually in the same
manner and at the same time as other state revenue is collected the
sum, in addition to the ordinary revenues of the state, as is
required to pay the principal and interest on the bonds; and a
provision making it the duty of all officers charged by law with any
duty in regard to the collections of the revenue to do and perform
each and every act which is necessary to collect that additional sum.
(f) If the bond act provides that the fund shall have any receipts
other than the proceeds of the sale of bonds, the proceeds of
interim financing, or the investment earnings on the proceeds of bond
sales or interim financing, then the bond act shall also specify
whether those receipts shall be transferred to the General Fund as a
reimbursement for debt service payments or be used for the same
purpose for which the proceeds of the sale of the bonds may be used.
(g) A provision incorporating the provisions of this chapter, and
a declaration that the provisions hereof are included in the act as
though set out in full therein.
(h) A statement that the bonds may be refunded in accordance with
Article 6 (commencing with Section 16780), and that approval of the
authorization of the bonds by the electors includes approval of any
bonds issued to refund the bonds originally issued.
(i) A statement that notwithstanding any other provision of the
bond act, or of the State General Obligation Bond Law (Chapter 4
(commencing with Section 16720) of Part 3 of Division 4 of Title 2 of
the Government Code), if the Treasurer sells bonds pursuant to this
bond act that include a bond counsel opinion to the effect that the
interest on the bonds is excluded from gross income for federal tax
purposes under designated conditions, the Treasurer may maintain
separate accounts for the bond proceeds invested and the investment
earnings on those proceeds, and may use or direct the use of those
proceeds or earnings to pay any rebate, penalty, or other payment
required under federal law, or take any other action with respect to
the investment and use of those bond proceeds, as may be required or
desirable under federal law in order to maintain the tax-exempt
status of those bonds and to obtain any other advantage under federal
law on behalf of the funds of this state.
(j) A statement that the board may request the Pooled Money
Investment Board to make a loan from the Pooled Money Investment
Account, in accordance with Section 16312, for the purposes of
carrying out the bond act. The amount of the request shall not exceed
the amount of the unsold bonds that the committee has by resolution
authorized to be sold for the purpose of carrying out the bond act.
The board shall execute any documents required by the Pooled Money
Investment Board to obtain and repay the loan. Any amounts loaned
shall be deposited in the fund to be allocated by the board in
accordance with the bond act.
16724.4. Any state bond measure approved by the voters on or after
January 1, 2004, shall be subject to an annual reporting process, as
follows:
(a) The head of the lead state agency administering the bond
proceeds shall report to the Legislature and the Department of
Finance no later than January 1, 2005, or the January 1 of the second
year following the enactment of the bond measure, whichever is
later, and at least once a year thereafter. The annual report shall
contain all of the following:
(1) A list of all projects and their geographical location that
have been funded or are required or authorized to receive funds.
(2) The amount of funds allocated on each project.
(3) The status of any project required or authorized to be funded.
(b) Costs of the report may be included in the cost of
administering the bond measure unless the measure specifically
prohibits those expenses.
16724.5. (a) For purposes of this section, "revolving fund" means
the General Obligation Bond Expense Revolving Fund created pursuant
to this section.
(b) There is in the State Treasury the General Obligation Bond
Expense Revolving Fund, which shall consist of all moneys
appropriated by the Legislature into that fund or payable into that
fund in accordance with this section.
(c) All moneys in the revolving fund are hereby appropriated and
shall be available without regard to fiscal years for all of the
following:
(1) The payment of the expenses incurred by the Treasurer in
having the bonds prepared and in advertising their sale or their
prior redemption, and of the other costs described in subdivision (e)
of Section 16727.
(2) For expenses incurred by the committee pursuant to Section
16758.
(3) For payment for legal services pursuant to Section 16760.
(d) Whenever bonds are sold, out of the first moneys realized from
their sale, there shall be redeposited in the revolving fund the
sums that have been expended for the purposes specified in
subdivision (c), which may be used for the same purposes and repaid
in the same manner whenever additional sales are made.
16724.6. There is hereby transferred from any bond fund created for
the proceeds of sales of state general obligation bonds, the amounts
necessary to reimburse the Treasurer, the Controller, and the
Department of Finance for actual expenses incurred in: (1)
administering or reviewing loans from the Pooled Money Investment
Account to the bond fund including review by the Public Works Board
staff, (2) assuring bond program compliance with federal laws and
regulations related to tax-exempt government obligations by tracking
arbitrage and expenditures, calculating and remitting federal rebates
and penalties, investing bond sale proceeds, establishing and
maintaining special accounting systems, and providing other services
the Treasurer determines are necessary to maintain the tax-exempt
status of the bonds.
16724.7. Costs incurred by the state in connection with state
general obligation bonds bearing variable interest rates that are
different from costs determined by the Treasurer to be customary
costs for state general obligation bonds bearing interest at fixed
rates (including, but not limited to, fees and charges of
underwriters, remarketing or auction agents, tender and paying
agents, rating agencies, financial advisors, counsel, and staff costs
directly associated with the foregoing), shall be paid from annual
appropriations from the General Fund if the bonds are issued under a
bond act approved by the voters prior to January 1, 2002. If the
bonds are issued under a bond act approved by the voters after
January 1, 2002, these costs are authorized to be paid, and may be
paid, from the General Obligation Bond Expense Revolving Fund created
by Section 16724.5 or from proceeds from the sale of any bonds
issued pursuant to this chapter.
16725. The Controller, the State Treasurer and the committee shall
keep full and particular account and record of all their proceedings
under the bond act and this chapter and they shall transmit to the
Governor an abstract of all such proceedings thereunder, with an
annual report, to be transmitted by the Governor to the Legislature
annually. All books and papers pertaining to the matters provided for
in the bond act and this chapter shall at all times be open to the
inspection of the Governor, the Attorney General, any committee of
either branch of the Legislature, or any joint committee of both, any
citizen of the State, or any interested party.
16726. Upon request of the board stating that the purposes for
which the bonds were issued and sold has been effected, the committee
shall certify this fact to the State Controller, and thereupon the
unencumbered balance of cash remaining from the proceeds of the sale
of the bonds in the fund shall, on order of the State Controller, be
transferred therefrom to the General Fund.
16727. Proceeds from the sale of any bonds issued pursuant to this
chapter shall be used only for the following purposes:
(a) The costs of construction or acquisition of capital assets.
"Capital assets" mean tangible physical property with an expected
useful life of 15 years or more. "Capital assets" also means tangible
physical property with an expected useful life of 10 to 15 years,
but these costs may not exceed 10 percent of the bond proceeds net of
all issuance costs. "Capital assets" include major maintenance,
reconstruction, demolition for purposes of reconstruction of
facilities, and retrofitting work that is ordinarily done no more
often than once every 5 to 15 years or expenditures that continue or
enhance the useful life of the capital asset. "Capital assets" also
include equipment with an expected useful life of two years or more.
Costs allowable under this section include costs incidentally but
directly related to construction or acquisition, including, but not
limited to, planning, engineering, construction management,
architectural, and other design work, environmental impact reports
and assessments, required mitigation expenses, appraisals, legal
expenses, site acquisitions, and necessary easements.
(b) To make grants or loans, if the proceeds of the grants or
loans are used for the costs of construction or acquisition of
capital assets. Bond proceeds may also be used to pay the costs of a
state agency for administering the grant or loan program.
(c) To repay funds borrowed in anticipation of the sale of the
bonds, including interest, or to pay interest on the bonds
themselves.
(d) To pay the costs of a state agency with responsibility for
administering the bond program. These costs include those incurred by
the Treasurer, the Controller, the Department of Finance, and the
Public Works Board for staff, operating expenses and equipment, and
consultants' costs.
(e) The costs of the Treasurer's office directly associated with
the sale and payment of the bonds, including, but not limited to,
underwriting discounts, costs of printing, bond counsel,
registration, and fees of trustees.
Nothing in this section is intended to prohibit the investment of
bond proceeds or the use of proceeds of those investments in any
manner authorized by law.
16720. This chapter shall be known and may be cited as the State
General Obligation Bond Law.
16721. The purpose of this chapter is to provide a procedure which
may be adopted by other acts for use with whatever modifications are
necessary in authorizing the issuance and sale of state general
obligation bonds and providing for the repayment of such bonds. This
chapter does not itself authorize the issuance or sale of any bonds.
16722. As used in this chapter, the following terms shall have the
following meaning unless the context otherwise requires:
(a) "Board" means the state board, department, or agency
authorized by that act to request the committee to cause bonds to be
issued for the purpose of creating a fund that is to be expended by
the board for the purposes specified in that act.
(b) "Bond" means a state general obligation bond issued pursuant
to an act adopting the provisions of this chapter.
(c) "Bond act" means the act authorizing the issuance of state
general obligation bonds and adopting this chapter by reference.
(d) "Committee" means the finance committee or other body created
by that act and authorized to cause bonds to be issued by the
adoption of a resolution or resolutions.
(e) "Fund" means the fund created by that act, and into which the
proceeds from the sale of the bonds are paid.
(f) "Tender" means a term of a bond that gives the holder the
right to have the bond purchased from the holder at a predetermined
price prior to maturity.
16723. Any bond act may adopt the provisions of this chapter by
reference to its short title, and such reference shall serve to
incorporate the provisions of this chapter in said act as though set
out in full therein. Notwithstanding such adoption by reference, the
bond act may contain provisions applicable to the bonds issued
thereunder, and, in case of conflict, the provisions in the bond act
shall prevail.
16724. The bond act shall contain all of the following provisions:
(a) A statement of the total amount of bonds authorized to be
issued and the purpose for which the proceeds from the sale of the
bonds may be used.
(b) The creation of a committee and fund, and the naming of the
board as these items are defined in Section 16722.
(c) A statement that the bonds are valid obligations of the state
and a pledge of the full faith and credit of the state for the
punctual payment of both principal and interest thereof.
(d) An appropriation from the General Fund in the State Treasury
of the sum annually as shall be necessary to pay the principal and
interest on the bonds as they become due and payable.
(e) A requirement that there be collected annually in the same
manner and at the same time as other state revenue is collected the
sum, in addition to the ordinary revenues of the state, as is
required to pay the principal and interest on the bonds; and a
provision making it the duty of all officers charged by law with any
duty in regard to the collections of the revenue to do and perform
each and every act which is necessary to collect that additional sum.
(f) If the bond act provides that the fund shall have any receipts
other than the proceeds of the sale of bonds, the proceeds of
interim financing, or the investment earnings on the proceeds of bond
sales or interim financing, then the bond act shall also specify
whether those receipts shall be transferred to the General Fund as a
reimbursement for debt service payments or be used for the same
purpose for which the proceeds of the sale of the bonds may be used.
(g) A provision incorporating the provisions of this chapter, and
a declaration that the provisions hereof are included in the act as
though set out in full therein.
(h) A statement that the bonds may be refunded in accordance with
Article 6 (commencing with Section 16780), and that approval of the
authorization of the bonds by the electors includes approval of any
bonds issued to refund the bonds originally issued.
(i) A statement that notwithstanding any other provision of the
bond act, or of the State General Obligation Bond Law (Chapter 4
(commencing with Section 16720) of Part 3 of Division 4 of Title 2 of
the Government Code), if the Treasurer sells bonds pursuant to this
bond act that include a bond counsel opinion to the effect that the
interest on the bonds is excluded from gross income for federal tax
purposes under designated conditions, the Treasurer may maintain
separate accounts for the bond proceeds invested and the investment
earnings on those proceeds, and may use or direct the use of those
proceeds or earnings to pay any rebate, penalty, or other payment
required under federal law, or take any other action with respect to
the investment and use of those bond proceeds, as may be required or
desirable under federal law in order to maintain the tax-exempt
status of those bonds and to obtain any other advantage under federal
law on behalf of the funds of this state.
(j) A statement that the board may request the Pooled Money
Investment Board to make a loan from the Pooled Money Investment
Account, in accordance with Section 16312, for the purposes of
carrying out the bond act. The amount of the request shall not exceed
the amount of the unsold bonds that the committee has by resolution
authorized to be sold for the purpose of carrying out the bond act.
The board shall execute any documents required by the Pooled Money
Investment Board to obtain and repay the loan. Any amounts loaned
shall be deposited in the fund to be allocated by the board in
accordance with the bond act.
16724.4. Any state bond measure approved by the voters on or after
January 1, 2004, shall be subject to an annual reporting process, as
follows:
(a) The head of the lead state agency administering the bond
proceeds shall report to the Legislature and the Department of
Finance no later than January 1, 2005, or the January 1 of the second
year following the enactment of the bond measure, whichever is
later, and at least once a year thereafter. The annual report shall
contain all of the following:
(1) A list of all projects and their geographical location that
have been funded or are required or authorized to receive funds.
(2) The amount of funds allocated on each project.
(3) The status of any project required or authorized to be funded.
(b) Costs of the report may be included in the cost of
administering the bond measure unless the measure specifically
prohibits those expenses.
16724.5. (a) For purposes of this section, "revolving fund" means
the General Obligation Bond Expense Revolving Fund created pursuant
to this section.
(b) There is in the State Treasury the General Obligation Bond
Expense Revolving Fund, which shall consist of all moneys
appropriated by the Legislature into that fund or payable into that
fund in accordance with this section.
(c) All moneys in the revolving fund are hereby appropriated and
shall be available without regard to fiscal years for all of the
following:
(1) The payment of the expenses incurred by the Treasurer in
having the bonds prepared and in advertising their sale or their
prior redemption, and of the other costs described in subdivision (e)
of Section 16727.
(2) For expenses incurred by the committee pursuant to Section
16758.
(3) For payment for legal services pursuant to Section 16760.
(d) Whenever bonds are sold, out of the first moneys realized from
their sale, there shall be redeposited in the revolving fund the
sums that have been expended for the purposes specified in
subdivision (c), which may be used for the same purposes and repaid
in the same manner whenever additional sales are made.
16724.6. There is hereby transferred from any bond fund created for
the proceeds of sales of state general obligation bonds, the amounts
necessary to reimburse the Treasurer, the Controller, and the
Department of Finance for actual expenses incurred in: (1)
administering or reviewing loans from the Pooled Money Investment
Account to the bond fund including review by the Public Works Board
staff, (2) assuring bond program compliance with federal laws and
regulations related to tax-exempt government obligations by tracking
arbitrage and expenditures, calculating and remitting federal rebates
and penalties, investing bond sale proceeds, establishing and
maintaining special accounting systems, and providing other services
the Treasurer determines are necessary to maintain the tax-exempt
status of the bonds.
16724.7. Costs incurred by the state in connection with state
general obligation bonds bearing variable interest rates that are
different from costs determined by the Treasurer to be customary
costs for state general obligation bonds bearing interest at fixed
rates (including, but not limited to, fees and charges of
underwriters, remarketing or auction agents, tender and paying
agents, rating agencies, financial advisors, counsel, and staff costs
directly associated with the foregoing), shall be paid from annual
appropriations from the General Fund if the bonds are issued under a
bond act approved by the voters prior to January 1, 2002. If the
bonds are issued under a bond act approved by the voters after
January 1, 2002, these costs are authorized to be paid, and may be
paid, from the General Obligation Bond Expense Revolving Fund created
by Section 16724.5 or from proceeds from the sale of any bonds
issued pursuant to this chapter.
16725. The Controller, the State Treasurer and the committee shall
keep full and particular account and record of all their proceedings
under the bond act and this chapter and they shall transmit to the
Governor an abstract of all such proceedings thereunder, with an
annual report, to be transmitted by the Governor to the Legislature
annually. All books and papers pertaining to the matters provided for
in the bond act and this chapter shall at all times be open to the
inspection of the Governor, the Attorney General, any committee of
either branch of the Legislature, or any joint committee of both, any
citizen of the State, or any interested party.
16726. Upon request of the board stating that the purposes for
which the bonds were issued and sold has been effected, the committee
shall certify this fact to the State Controller, and thereupon the
unencumbered balance of cash remaining from the proceeds of the sale
of the bonds in the fund shall, on order of the State Controller, be
transferred therefrom to the General Fund.
16727. Proceeds from the sale of any bonds issued pursuant to this
chapter shall be used only for the following purposes:
(a) The costs of construction or acquisition of capital assets.
"Capital assets" mean tangible physical property with an expected
useful life of 15 years or more. "Capital assets" also means tangible
physical property with an expected useful life of 10 to 15 years,
but these costs may not exceed 10 percent of the bond proceeds net of
all issuance costs. "Capital assets" include major maintenance,
reconstruction, demolition for purposes of reconstruction of
facilities, and retrofitting work that is ordinarily done no more
often than once every 5 to 15 years or expenditures that continue or
enhance the useful life of the capital asset. "Capital assets" also
include equipment with an expected useful life of two years or more.
Costs allowable under this section include costs incidentally but
directly related to construction or acquisition, including, but not
limited to, planning, engineering, construction management,
architectural, and other design work, environmental impact reports
and assessments, required mitigation expenses, appraisals, legal
expenses, site acquisitions, and necessary easements.
(b) To make grants or loans, if the proceeds of the grants or
loans are used for the costs of construction or acquisition of
capital assets. Bond proceeds may also be used to pay the costs of a
state agency for administering the grant or loan program.
(c) To repay funds borrowed in anticipation of the sale of the
bonds, including interest, or to pay interest on the bonds
themselves.
(d) To pay the costs of a state agency with responsibility for
administering the bond program. These costs include those incurred by
the Treasurer, the Controller, the Department of Finance, and the
Public Works Board for staff, operating expenses and equipment, and
consultants' costs.
(e) The costs of the Treasurer's office directly associated with
the sale and payment of the bonds, including, but not limited to,
underwriting discounts, costs of printing, bond counsel,
registration, and fees of trustees.
Nothing in this section is intended to prohibit the investment of
bond proceeds or the use of proceeds of those investments in any
manner authorized by law.
16720. This chapter shall be known and may be cited as the State
General Obligation Bond Law.
16721. The purpose of this chapter is to provide a procedure which
may be adopted by other acts for use with whatever modifications are
necessary in authorizing the issuance and sale of state general
obligation bonds and providing for the repayment of such bonds. This
chapter does not itself authorize the issuance or sale of any bonds.
16722. As used in this chapter, the following terms shall have the
following meaning unless the context otherwise requires:
(a) "Board" means the state board, department, or agency
authorized by that act to request the committee to cause bonds to be
issued for the purpose of creating a fund that is to be expended by
the board for the purposes specified in that act.
(b) "Bond" means a state general obligation bond issued pursuant
to an act adopting the provisions of this chapter.
(c) "Bond act" means the act authorizing the issuance of state
general obligation bonds and adopting this chapter by reference.
(d) "Committee" means the finance committee or other body created
by that act and authorized to cause bonds to be issued by the
adoption of a resolution or resolutions.
(e) "Fund" means the fund created by that act, and into which the
proceeds from the sale of the bonds are paid.
(f) "Tender" means a term of a bond that gives the holder the
right to have the bond purchased from the holder at a predetermined
price prior to maturity.
16723. Any bond act may adopt the provisions of this chapter by
reference to its short title, and such reference shall serve to
incorporate the provisions of this chapter in said act as though set
out in full therein. Notwithstanding such adoption by reference, the
bond act may contain provisions applicable to the bonds issued
thereunder, and, in case of conflict, the provisions in the bond act
shall prevail.
16724. The bond act shall contain all of the following provisions:
(a) A statement of the total amount of bonds authorized to be
issued and the purpose for which the proceeds from the sale of the
bonds may be used.
(b) The creation of a committee and fund, and the naming of the
board as these items are defined in Section 16722.
(c) A statement that the bonds are valid obligations of the state
and a pledge of the full faith and credit of the state for the
punctual payment of both principal and interest thereof.
(d) An appropriation from the General Fund in the State Treasury
of the sum annually as shall be necessary to pay the principal and
interest on the bonds as they become due and payable.
(e) A requirement that there be collected annually in the same
manner and at the same time as other state revenue is collected the
sum, in addition to the ordinary revenues of the state, as is
required to pay the principal and interest on the bonds; and a
provision making it the duty of all officers charged by law with any
duty in regard to the collections of the revenue to do and perform
each and every act which is necessary to collect that additional sum.
(f) If the bond act provides that the fund shall have any receipts
other than the proceeds of the sale of bonds, the proceeds of
interim financing, or the investment earnings on the proceeds of bond
sales or interim financing, then the bond act shall also specify
whether those receipts shall be transferred to the General Fund as a
reimbursement for debt service payments or be used for the same
purpose for which the proceeds of the sale of the bonds may be used.
(g) A provision incorporating the provisions of this chapter, and
a declaration that the provisions hereof are included in the act as
though set out in full therein.
(h) A statement that the bonds may be refunded in accordance with
Article 6 (commencing with Section 16780), and that approval of the
authorization of the bonds by the electors includes approval of any
bonds issued to refund the bonds originally issued.
(i) A statement that notwithstanding any other provision of the
bond act, or of the State General Obligation Bond Law (Chapter 4
(commencing with Section 16720) of Part 3 of Division 4 of Title 2 of
the Government Code), if the Treasurer sells bonds pursuant to this
bond act that include a bond counsel opinion to the effect that the
interest on the bonds is excluded from gross income for federal tax
purposes under designated conditions, the Treasurer may maintain
separate accounts for the bond proceeds invested and the investment
earnings on those proceeds, and may use or direct the use of those
proceeds or earnings to pay any rebate, penalty, or other payment
required under federal law, or take any other action with respect to
the investment and use of those bond proceeds, as may be required or
desirable under federal law in order to maintain the tax-exempt
status of those bonds and to obtain any other advantage under federal
law on behalf of the funds of this state.
(j) A statement that the board may request the Pooled Money
Investment Board to make a loan from the Pooled Money Investment
Account, in accordance with Section 16312, for the purposes of
carrying out the bond act. The amount of the request shall not exceed
the amount of the unsold bonds that the committee has by resolution
authorized to be sold for the purpose of carrying out the bond act.
The board shall execute any documents required by the Pooled Money
Investment Board to obtain and repay the loan. Any amounts loaned
shall be deposited in the fund to be allocated by the board in
accordance with the bond act.
16724.4. Any state bond measure approved by the voters on or after
January 1, 2004, shall be subject to an annual reporting process, as
follows:
(a) The head of the lead state agency administering the bond
proceeds shall report to the Legislature and the Department of
Finance no later than January 1, 2005, or the January 1 of the second
year following the enactment of the bond measure, whichever is
later, and at least once a year thereafter. The annual report shall
contain all of the following:
(1) A list of all projects and their geographical location that
have been funded or are required or authorized to receive funds.
(2) The amount of funds allocated on each project.
(3) The status of any project required or authorized to be funded.
(b) Costs of the report may be included in the cost of
administering the bond measure unless the measure specifically
prohibits those expenses.
16724.5. (a) For purposes of this section, "revolving fund" means
the General Obligation Bond Expense Revolving Fund created pursuant
to this section.
(b) There is in the State Treasury the General Obligation Bond
Expense Revolving Fund, which shall consist of all moneys
appropriated by the Legislature into that fund or payable into that
fund in accordance with this section.
(c) All moneys in the revolving fund are hereby appropriated and
shall be available without regard to fiscal years for all of the
following:
(1) The payment of the expenses incurred by the Treasurer in
having the bonds prepared and in advertising their sale or their
prior redemption, and of the other costs described in subdivision (e)
of Section 16727.
(2) For expenses incurred by the committee pursuant to Section
16758.
(3) For payment for legal services pursuant to Section 16760.
(d) Whenever bonds are sold, out of the first moneys realized from
their sale, there shall be redeposited in the revolving fund the
sums that have been expended for the purposes specified in
subdivision (c), which may be used for the same purposes and repaid
in the same manner whenever additional sales are made.
16724.6. There is hereby transferred from any bond fund created for
the proceeds of sales of state general obligation bonds, the amounts
necessary to reimburse the Treasurer, the Controller, and the
Department of Finance for actual expenses incurred in: (1)
administering or reviewing loans from the Pooled Money Investment
Account to the bond fund including review by the Public Works Board
staff, (2) assuring bond program compliance with federal laws and
regulations related to tax-exempt government obligations by tracking
arbitrage and expenditures, calculating and remitting federal rebates
and penalties, investing bond sale proceeds, establishing and
maintaining special accounting systems, and providing other services
the Treasurer determines are necessary to maintain the tax-exempt
status of the bonds.
16724.7. Costs incurred by the state in connection with state
general obligation bonds bearing variable interest rates that are
different from costs determined by the Treasurer to be customary
costs for state general obligation bonds bearing interest at fixed
rates (including, but not limited to, fees and charges of
underwriters, remarketing or auction agents, tender and paying
agents, rating agencies, financial advisors, counsel, and staff costs
directly associated with the foregoing), shall be paid from annual
appropriations from the General Fund if the bonds are issued under a
bond act approved by the voters prior to January 1, 2002. If the
bonds are issued under a bond act approved by the voters after
January 1, 2002, these costs are authorized to be paid, and may be
paid, from the General Obligation Bond Expense Revolving Fund created
by Section 16724.5 or from proceeds from the sale of any bonds
issued pursuant to this chapter.
16725. The Controller, the State Treasurer and the committee shall
keep full and particular account and record of all their proceedings
under the bond act and this chapter and they shall transmit to the
Governor an abstract of all such proceedings thereunder, with an
annual report, to be transmitted by the Governor to the Legislature
annually. All books and papers pertaining to the matters provided for
in the bond act and this chapter shall at all times be open to the
inspection of the Governor, the Attorney General, any committee of
either branch of the Legislature, or any joint committee of both, any
citizen of the State, or any interested party.
16726. Upon request of the board stating that the purposes for
which the bonds were issued and sold has been effected, the committee
shall certify this fact to the State Controller, and thereupon the
unencumbered balance of cash remaining from the proceeds of the sale
of the bonds in the fund shall, on order of the State Controller, be
transferred therefrom to the General Fund.
16727. Proceeds from the sale of any bonds issued pursuant to this
chapter shall be used only for the following purposes:
(a) The costs of construction or acquisition of capital assets.
"Capital assets" mean tangible physical property with an expected
useful life of 15 years or more. "Capital assets" also means tangible
physical property with an expected useful life of 10 to 15 years,
but these costs may not exceed 10 percent of the bond proceeds net of
all issuance costs. "Capital assets" include major maintenance,
reconstruction, demolition for purposes of reconstruction of
facilities, and retrofitting work that is ordinarily done no more
often than once every 5 to 15 years or expenditures that continue or
enhance the useful life of the capital asset. "Capital assets" also
include equipment with an expected useful life of two years or more.
Costs allowable under this section include costs incidentally but
directly related to construction or acquisition, including, but not
limited to, planning, engineering, construction management,
architectural, and other design work, environmental impact reports
and assessments, required mitigation expenses, appraisals, legal
expenses, site acquisitions, and necessary easements.
(b) To make grants or loans, if the proceeds of the grants or
loans are used for the costs of construction or acquisition of
capital assets. Bond proceeds may also be used to pay the costs of a
state agency for administering the grant or loan program.
(c) To repay funds borrowed in anticipation of the sale of the
bonds, including interest, or to pay interest on the bonds
themselves.
(d) To pay the costs of a state agency with responsibility for
administering the bond program. These costs include those incurred by
the Treasurer, the Controller, the Department of Finance, and the
Public Works Board for staff, operating expenses and equipment, and
consultants' costs.
(e) The costs of the Treasurer's office directly associated with
the sale and payment of the bonds, including, but not limited to,
underwriting discounts, costs of printing, bond counsel,
registration, and fees of trustees.
Nothing in this section is intended to prohibit the investment of
bond proceeds or the use of proceeds of those investments in any
manner authorized by law.
