This law section explains that California can issue and sell bonds totaling up to four billion dollars to fund certain projects or purposes as outlined in this division. The bonds, once issued, represent a binding commitment by the state to repay both the principal and interest, supported by the state's full faith and credit.
The State Treasurer is responsible for selling these bonds, following terms and conditions set by a committee's resolution in compliance with government regulations.
(a)CA Public Resources Code § 80160(a) Bonds in the total amount of four billion dollars ($4,000,000,000), and any additional bonds authorized, issued, and appropriated in accordance with this division pursuant to other provisions of law, not including the amount of any refunding bonds issued in accordance with Section 80172, may be issued and sold to provide a fund to be used for carrying out the purposes expressed in this division and to reimburse the General Obligation Bond Expense Revolving Fund pursuant to Section 16724.5 of the Government Code. The bonds, when sold, issued, and delivered, shall be and constitute a valid and binding obligation of the State of California, and the full faith and credit of the State of California is hereby pledged for the punctual payment of both the principal of, and interest on, the bonds as the
principal and interest become due and payable.
(b)CA Public Resources Code § 80160(b) The Treasurer shall sell the bonds authorized by the committee pursuant to this section. The bonds shall be sold upon the terms and conditions specified in a resolution to be adopted by the committee pursuant to Section 16731 of the Government Code.
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(Added by Stats. 2017, Ch. 852, Sec. 3. Approved in Proposition 68 at the June 5, 2018, election.)
This law section states that bonds authorized under this division must follow procedures outlined in the State General Obligation Bond Law. This means everything related to these bonds, from their creation to their redemption, should comply with existing law, including any future amendments.
The bonds authorized by this division shall be prepared, executed, issued, sold, paid, and redeemed as provided in 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), as amended from time to time, and all of the provisions of that law apply to the bonds and to this division.
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(Added by Stats. 2017, Ch. 852, Sec. 3. Approved in Proposition 68 at the June 5, 2018, election.)
This section establishes a special finance committee in California to handle the issuance and sale of bonds related to drought, water, parks, climate, coastal protection, and outdoor access projects. The committee is made up of three officials: the Director of Finance, the Treasurer, and the Controller. Any of these officials can send a representative on their behalf. The Treasurer acts as the chairperson of the committee, and the committee can make decisions if a majority of its members agree.
(a)CA Public Resources Code § 80162(a) Solely for the purpose of authorizing the issuance and sale, pursuant to 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), of the bonds authorized by this division, the California Drought, Water, Parks, Climate, Coastal Protection, and Outdoor Access For All Finance Committee is hereby created. For purposes of this division, the California Drought, Water, Parks, Climate, Coastal Protection, and Outdoor Access For All Finance Committee is the “committee” as that term is used in the State General Obligation Bond Law.
(b)CA Public Resources Code § 80162(b) The committee consists of the Director of Finance, the Treasurer, and the Controller. Notwithstanding
any other law, any member may designate a representative to act as that member in his or her place for all purposes, as though the member were personally present.
(c)CA Public Resources Code § 80162(c) The Treasurer shall serve as the chairperson of the committee.
(d)CA Public Resources Code § 80162(d) A majority of the committee may act for the committee.
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(Added by Stats. 2017, Ch. 852, Sec. 3. Approved in Proposition 68 at the June 5, 2018, election.)
This section says that a committee must decide if it's needed or beneficial to issue bonds for the purposes outlined in this division. If they decide to issue bonds, they must also determine how much should be issued and sold. The bonds can be issued progressively, meaning not all have to be sold at one time.
The committee shall determine whether or not it is necessary or desirable to issue bonds authorized by this division in order to carry out the actions specified in this division and, if so, the amount of bonds to be issued and sold. Successive issues of bonds may be authorized and sold to carry out those actions progressively, and it is not necessary that all of the bonds authorized to be issued be sold at any one time.
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(Added by Stats. 2017, Ch. 852, Sec. 3. Approved in Proposition 68 at the June 5, 2018, election.)
This law section clarifies that in the context of the State General Obligation Bond Law, when you see the term “board,” it is referring to the Secretary of the Natural Resources Agency.
For purposes of the State General Obligation Bond Law, “board,” as defined in Section 16722 of the Government Code, means the Secretary of the Natural Resources Agency.
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(Added by Stats. 2017, Ch. 852, Sec. 3. Approved in Proposition 68 at the June 5, 2018, election.)
Each year, the state collects extra money, alongside regular state revenue, to pay off bond principal and interest. All officials responsible for revenue collection must ensure this additional amount is collected.
There shall be collected each year and in the same manner and at the same time as other state revenue is collected, in addition to the ordinary revenues of the state, a sum in an amount required to pay the principal of, and interest on, the bonds each year. It is the duty of all officers charged by law with any duty in regard to the collection of the revenue to do and perform each and every act that is necessary to collect that additional sum.
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(Added by Stats. 2017, Ch. 852, Sec. 3. Approved in Proposition 68 at the June 5, 2018, election.)
This law states that money from California's General Fund is set aside to ensure the payment of bonds related to a specific division, covering both principal and interest as they become due. It also allocates funds needed to implement another section (80169), irrespective of fiscal year limits.
Notwithstanding Section 13340 of the Government Code, there is hereby appropriated from the General Fund in the State Treasury, for the purposes of this division, an amount that will equal the total of the following:
(a)CA Public Resources Code § 80166(a) The sum annually necessary to pay the principal of, and interest on, bonds issued and sold pursuant to this division, as the principal and interest become due and payable.
(b)CA Public Resources Code § 80166(b) The sum that is necessary to carry out the provisions of Section 80169, appropriated without regard to fiscal years.
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(Added by Stats. 2017, Ch. 852, Sec. 3. Approved in Proposition 68 at the June 5, 2018, election.)
This law section allows the board to request a loan from a specific state investment account to finance its activities under this division. The loan amount should not exceed the unsold bonds previously authorized, minus any prior loans not repaid and funds withdrawn but not yet returned. All necessary documents for obtaining and repaying the loan must be completed, and the borrowed money will go into a fund for allocation as per this division.
The board may request the Pooled Money Investment Board to make a loan from the Pooled Money Investment Account, including other authorized forms of interim financing that include, but are not limited to, commercial paper, in accordance with Section 16312 of the Government Code for the purpose of carrying out this division. 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 this division, excluding refunding bonds authorized pursuant to Section 80172, less any amount loaned and not yet repaid pursuant to this section and withdrawn from the General Fund pursuant to Section 80169 and not yet returned to the General Fund. The board shall execute those 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 in accordance with this division.
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(Added by Stats. 2017, Ch. 852, Sec. 3. Approved in Proposition 68 at the June 5, 2018, election.)
This section allows the California Treasurer to manage the proceeds from sold bonds in a special way if those bonds have received a legal opinion saying that their interest is tax-exempt or has other federal tax benefits. Specifically, the Treasurer can keep separate accounts for the money from these bonds and the earnings from investing that money, and use these funds to comply with federal laws to maintain their tax-exempt status. This may involve paying any required rebates, penalties, or taking other necessary actions to ensure federal tax advantages are preserved for the state's funds.
Notwithstanding any other provision of this division, or of the State General Obligation Bond Law, if the Treasurer sells bonds 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 or is otherwise entitled to any federal tax advantage, the Treasurer may maintain separate accounts for the bond proceeds invested and for 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.
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(Added by Stats. 2017, Ch. 852, Sec. 3. Approved in Proposition 68 at the June 5, 2018, election.)
This law allows the Director of Finance to temporarily take money out of the General Fund up to the amount of unsold bonds approved for sale, to help fund activities under the specified division. However, this does not include certain refunding bonds. Any funds borrowed must be deposited in the designated fund and should be paid back to the General Fund with interest, using money from bond sales.
For the purposes of carrying out this division, the Director of Finance may authorize the withdrawal from the General Fund of an amount or amounts not to exceed the amount of the unsold bonds that have been authorized by the committee to be sold for the purpose of carrying out this division, excluding refunding bonds authorized pursuant to Section 80172, less any amount loaned pursuant to Section 80167 and not yet repaid and any amount withdrawn from the General Fund pursuant to this section and not yet returned to the General Fund. Any amounts withdrawn shall be deposited in the fund to be allocated in accordance with this division. Any moneys made available under this section shall be returned to the General Fund, with interest at the rate earned by the moneys in the Pooled Money Investment Account, from proceeds received
from the sale of bonds for the purpose of carrying out this division.
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(Added by Stats. 2017, Ch. 852, Sec. 3. Approved in Proposition 68 at the June 5, 2018, election.)
Money from bond sales, specifically from premiums and interest, is kept in a special fund. This money can be transferred to the General Fund to help cover bond interest costs. However, any premium money can first be used to pay for bond issuance costs before being moved to the General Fund.
All moneys deposited in the fund that are derived from premium and accrued interest on bonds sold pursuant to this division shall be reserved in the fund and shall be available for transfer to the General Fund as a credit to expenditures for bond interest, except that amounts derived from premiums may be reserved and used to pay the cost of bond issuance prior to any transfer to the General Fund.
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(Added by Stats. 2017, Ch. 852, Sec. 3. Approved in Proposition 68 at the June 5, 2018, election.)
This law section explains that the costs associated with issuing bonds can be covered by the funds raised from selling those bonds, including any extra premiums obtained. If these premiums don't cover the bond issuance costs, these expenses should be fairly shared among the programs financed by the bond sale.
Pursuant to Chapter 4 (commencing with Section 16720) of Part 3 of Division 4 of Title 2 of the Government Code, the cost of bond issuance shall be paid or reimbursed out of the bond proceeds, including premiums, if any. To the extent the cost of bond issuance is not paid from premiums received from the sale of bonds, these costs shall be allocated proportionally to each program funded through this division by the applicable bond sale.
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(Added by Stats. 2017, Ch. 852, Sec. 3. Approved in Proposition 68 at the June 5, 2018, election.)
This law allows for bonds issued and sold under this division to be refinanced according to specific government regulations. When voters approve the issuance of bonds, they are also agreeing to the possibility of refinancing these bonds, including those that were earlier refunded. Refinancing must follow legal guidelines detailed in a resolution, which can be changed over time.
The bonds issued and sold pursuant to this division may be refunded in accordance with Article 6 (commencing with Section 16780) of Chapter 4 of Part 3 of Division 4 of Title 2 of the Government Code, which is a part of the State General Obligation Bond Law. Approval by the voters of the state for the issuance of the bonds under this division shall include approval of the issuance of any bonds issued to refund any bonds originally issued under this division or any previously issued refunding bonds. Any bond refunded with the proceeds of a refunding bond as authorized by this section may be legally defeased to the extent permitted by law in the manner and to the extent set forth in the resolution, as amended from time to time, authorizing that refunded bond.
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(Added by Stats. 2017, Ch. 852, Sec. 3. Approved in Proposition 68 at the June 5, 2018, election.)
This law states that money made from selling certain bonds does not count as tax revenue under the rules of the California Constitution. Therefore, these funds are not restricted by the spending limits typically applied to tax money.
The proceeds from the sale of bonds authorized by this division are not “proceeds of taxes” as that term is used in Article XIII B of the California Constitution, and the disbursement of these proceeds is not subject to the limitations imposed by that article.
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(Added by Stats. 2017, Ch. 852, Sec. 3. Approved in Proposition 68 at the June 5, 2018, election.)
