All necessary preliminary expenses incurred by the governing body in carrying out this chapter, including the making of surveys, plans, and estimates of costs and revenues, compensation of employees, the giving of notices, taking of options, and all other expenses of whatsoever nature, necessary to be paid prior to the issue and sale of the bonds, may be advanced out of the general fund of the district. The general fund shall be fully reimbursed out of the first money received from the sale of the bonds, and before any other disbursements are made therefrom.
Sewer Revenue BondsFinances
Section § 5025
This law allows a governing body to use the general fund of a district to cover initial costs associated with projects under this chapter, like surveys, plans, and personnel expenses. These upfront costs will be repaid from the proceeds of bond sales before any other spending occurs.
preliminary expenses governing body expenses project costs
Section § 5026
This law states that any costs related to employee salaries and other expenses for implementing this chapter must be covered only by funds that come from this chapter's own budget.
All compensation of employees, and all other expenses, incurred in carrying out the provisions of this chapter shall be paid solely from funds provided under the authority of this chapter.
employee compensation expenses funding
Section § 5027
This law states that once the district has been fully reimbursed for any initial expenses related to a project, all additional money made from selling bonds—excluding premiums and any interest that's built up—must be used strictly to cover the costs of the project itself.
After reimbursement and repayment to the district of all amounts advanced for preliminary expenses, all money, other than premiums and accrued interest, received from the sale of bonds shall be applied solely to the cost of the works.
bond sales reimbursement preliminary expenses
Section § 5028
This law says that any money made from rates and other revenue from operations should be placed in a bank account by the treasurer. This process is similar to how cities deposit public money. The money must be kept in dedicated funds and used according to the rules in this chapter.
The money received from the collection of the rates, together with any other revenue derived from the operation of the works, shall be deposited in a bank by the treasurer in the same manner that public money is deposited by cities. The money so deposited shall be kept in a fund or funds and shall be applied as provided in this chapter.
treasurer bank deposit public money
Section § 5029
This law is about how money earned from operating a public utility project with bonds should be spent. Firstly, it must cover paying off the principal and interest of those bonds on time, and also for keeping the operations running smoothly. Once these costs are covered, any leftover money can be used to buy back outstanding bonds, improve or expand the project, or for any other legal needs of the district.
In the ordinance for the issuance of bonds the governing body shall provide that the revenues derived from the operation of the works shall be used only for:
(a)CA Health & Safety Code § 5029(a)
The payment or providing for payment, including payments into any reserve or sinking funds, as the same falls due, of the principal of and the interest on the bonds;
(b)CA Health & Safety Code § 5029(b)
The management, maintenance, operation and repair costs of the works.
After provision has been made for the payment of the foregoing, any surplus remaining may be used as follows: (a) for the purchase in the open market of the outstanding unmatured bonds of the district; (b) for extensions, or for the enlargement, replacement or betterment of the works; (c) for any lawful purpose of the district.
bond payments reserve funds sinking funds
Section § 5030
This law lets the governing body decide through an ordinance that money earned from running a project (like utilities or other works) should first cover costs like management, maintenance, operation, and repairs before paying off any bond-related debts.
In its discretion the governing body may provide in the ordinance providing for the issuance of bonds that the management, maintenance, operation and repair costs of the works shall be paid from the revenue derived from the operation of the works prior to paying the principal, interest and sums for other security funds.
bond issuance governing body discretion management costs
Section § 5031
This law states that any money received from premiums and interest must be put into a fund. This fund is specifically used to pay the interest on bonds and for the reasons it was originally set up.
All money received for premium and accrued interest shall be paid into a fund for the payment of interest on the bonds and used for the purposes for which it was created.
premium payments accrued interest bond fund
Section § 5032
This law requires districts that issue bonds to keep clear financial records showing their revenue and how it's used. At least once a year, these accounts must be audited by a skilled auditor. The audit report should be available for inspection by any taxpayer, user of the district's services, bondholder, or their representatives.
A district issuing bonds shall install and maintain a proper system of accounts, showing the amount of revenue received and its application. The district shall at least once a year cause the accounts to be properly audited by a competent auditor. The report of the audit shall be open for inspection at all times by any taxpayer, user of the works, holder of bonds, or any representative of such person.
district bonds financial records revenue accounting
Section § 5033
The treasurer is responsible for managing the funds received from the income generated by projects that are built or bought according to this chapter.
The treasurer is custodian of the funds derived from income received from the works constructed or acquired under the provisions of this chapter.
treasurer funds management income
Section § 5034
This law requires the treasurer to obtain a surety bond to ensure they perform their job duties honestly and reliably. The bond amount must be set and approved by the governing body, and its cost is covered by the district.
The treasurer shall give a proper surety bond for the faithful discharge of his duties as custodian, which bond shall be fixed and approved by the governing body. The premium on the surety bond shall be paid by the district.
treasurer duties surety bond bond premium
