The board, whenever the interest of the district shall require it, may cause a report to be made to the effect that the acquisition of certain property or works or the construction of such works is convenient or necessary to serve or fulfill the purposes of the district and that the cost thereof cannot be paid for out of the annual revenue of the district. The report shall be in such detail and shall be accompanied by such exhibits as will disclose the purpose sought to be accomplished and the means to be employed therefor. The report shall be printed in convenient form for distribution to the electors of the district.
BondsInitiation of Proceedings
Section § 74800
This law allows the board overseeing a district to prepare a report when acquiring property or constructing projects is considered necessary for the district's goals, but the costs exceed what the district can pay from its annual revenue. The report must clearly explain the purpose and methods of the project and be distributed to the district's voters.
district board decisions property acquisition construction projects
Section § 74801
This law allows the board of a district to hold an election to decide whether the district should take on debt through bonds. This can happen after they've completed and printed their report, and only if a majority of the board members agree to it through a resolution.
After the printing of the report the board, by resolution adopted by a majority of its members, may call an election to be held in the district for the purpose of authorizing the incurring of a bonded indebtedness by the district.
bonded indebtedness district election board resolution
Section § 74802
This section outlines what must be included in a resolution when a government entity decides to issue bonds. The resolution needs to state why the debt is being taken on, the total amount of the bonds, the highest interest rate allowed, and the maximum time frame—up to 40 years—for the bonds to reach maturity.
The resolution shall specify all of the following:
(a)CA Water Code § 74802(a) The purpose for which the indebtedness is to be incurred.
(b)CA Water Code § 74802(b) The amount of bonds proposed to be issued.
(c)CA Water Code § 74802(c) The maximum rate of interest the bonds shall bear.
(d)CA Water Code § 74802(d) The number of years, not exceeding 40, the whole or any part of the bonds are to run until maturity.
bond issuance public debt interest rate cap
Section § 74803
This law states that before a district can take on new debt, it must first ask the voters in that district for approval through a special election.
The resolution shall further provide for submitting the question of the incurring of the indebtedness to the qualified electors of the district at an election called for that purpose.
district debt approval incurring indebtedness qualified electors
Section § 74804
This law section states that when deciding how much money to borrow by issuing bonds, the board can include several expenses. These expenses can cover costs related to buying, building, or financing projects, including engineering and legal fees, costs for bond elections, issuing the bonds, and interest that may accumulate during and shortly after construction.
In determining the amount of bonded indebtedness to be incurred, the board may include all costs and estimated costs incidental to or connected with the acquisition, construction or financing of the works or property set forth in the report required by Section 74800, and all engineering, inspection, legal and fiscal agent’s fees, costs of the bond election and of the issuance of the bonds, and bond interest estimated to accrue during the construction period and for a period of not to exceed 12 months after completion of construction.
bonded indebtedness cost estimation engineering fees
