Code Section Group

Government Code - GOV

TITLE 5. LOCAL AGENCIES [50001 - 57607]

  ( Title 5 added by Stats. 1949, Ch. 81. )

DIVISION 2. CITIES, COUNTIES, AND OTHER AGENCIES [53000 - 55821]

  ( Division 2 added by Stats. 1949, Ch. 81. )

PART 1. POWERS AND DUTIES COMMON TO CITIES, COUNTIES, AND OTHER AGENCIES [53000 - 54999.7]

  ( Part 1 added by Stats. 1949, Ch. 81. )

CHAPTER 6.3. Employee Rental Housing [54700.1 - 54702.15]

  ( Heading of Chapter 6.3 renumbered from Chapter 6.4 by Stats. 1984, Ch. 144, Sec. 148. )

ARTICLE 3. Bonds and Notes [54702.1 - 54702.15]
  ( Article 3 added by Stats. 1981, Ch. 1092, Sec. 1. )

54702.1.
  

(a) A local agency may, from time to time, issue its bonds for the purpose of financing construction of rental housing for employees. In anticipation of the sale of bonds, the local agency may issue negotiable bond anticipation notes and may renew such notes from time to time. Bond anticipation notes may be paid from the proceeds of sale of the bonds of the local agency in anticipation of which they were issued. Bond anticipation notes and the resolution or resolutions authorizing such note may contain any provisions, conditions, or limitations which a bond, agreement relating thereto, or bond resolution of the local agency may contain except that any such note or renewal thereof shall mature at a time not later than two years from the date of the issuance of the original note.

(b) The bonds shall be a special obligation of the local agency payable from all or any part of the rental or lease revenues or other funds as specified in this chapter. The bonds shall be negotiable instruments for all purposes, subject only to the provisions of such bonds for registration.

(Added by Stats. 1981, Ch. 1092, Sec. 1.)

54702.2.
  

In determining the amount of bonds to be issued, the local agency may include all costs of the issuance of such bonds, bond reserve funds, and bond interest.

(Added by Stats. 1981, Ch. 1092, Sec. 1.)

54702.3.
  

The bonds may be issued as serial bonds or as term bonds, or the local agency, in its discretion, may issue bonds of both types. The bonds shall be authorized by resolution of the local agency and shall bear interest at such fixed or variable rate or rates, be payable at such time or times, be in such denominations, be in such form either coupon or registered, carry such registration privileges, be executed in such manner, be payable in lawful money of the United States of America at such place or places, and be subject to such terms of redemption as the resolution or resolutions of the local agency may provide. The bonds may be sold at either a public or private sale and for such prices as the local agency shall determine. Pending preparation of the definitive bonds, the local agency may issue interim receipts, certificates, or temporary bonds, which shall be exchanged for such definitive bonds. The local agency may sell bonds at a price below the par value thereof, but the discount on any bond so sold shall not exceed 6 percent of the par value thereof.

(Added by Stats. 1981, Ch. 1092, Sec. 1.)

54702.4.
  

Any resolution or resolutions authorizing any bonds or any issue of bonds may contain provisions respecting any of the following terms and conditions, which shall be a part of the contract with the holders of the bonds:

(a) The pledge of all or any part of the rental and lease revenues, subject to such agreements with bondholders as may then exist.

(b) The setting aside of reserves or sinking funds and the regulation and disposition thereof.

(c) Limitations on the purposes to which the proceeds of a sale of any issue of bonds, then or thereafter issue, may be applied, and pledging such proceeds to secure the payment of the bonds or any issue of bonds.

(d) Limitations on the issuance of additional bonds, the terms upon which additional bonds may be issued and secured, and the refunding of outstanding bonds.

(e) The procedure, if any, by which the terms of any contract with bondholders may be amended or abrogated, the amount of bonds the holders of which must consent thereto, and the manner in which such consent may be given.

(f) Limitation on expenditures for operation, administration, or other expenses of the local agency.

(g) Specification of the acts or omissions to act which shall constitute a default in the duties of the local agency to holders of the bonds, and providing the rights and remedies of such holders in the event of default.

(h) The mortgaging of any housing and the site thereof for the purpose of securing the bondholders.

(Added by Stats. 1981, Ch. 1092, Sec. 1.)

54702.5.
  

No member of the legislative body nor any person executing the bonds shall be liable personally on the bonds or be subject to any personal liability or accountability by reason of the issuance thereof.

(Added by Stats. 1981, Ch. 1092, Sec. 1.)

54702.6.
  

The local agency may purchase its bonds from any source of funds available therefor. The local agency may hold, pledge, cancel, or resell such bonds, subject to and in accordance with agreements with the bondholders.

(Added by Stats. 1981, Ch. 1092, Sec. 1.)

54702.7.
  

In the discretion of the local agency, any bonds issued under the provisions of this chapter may be secured by a trust agreement by and between the local agency and a corporate trustee or trustees, which may be any trust company or bank having the powers of a trust company within or without this state. Such a trust agreement or the resolution providing for the issuance of bonds may pledge or assign the revenues to be received and may convey or mortgage any housing the construction of which is to be financed from the proceeds of such bonds. Such trustee agreement or resolution providing for the issuance of bonds may contain such provisions for protecting and enforcing the rights and remedies of the bondholders as may be reasonable and proper and not in violation of law, including such provisions as may be included in any resolution or resolutions of the local agency authorizing the issuance of the bonds. Any such trust agreement may set forth the rights and remedies of the bondholders and of the trustee or trustees, and may restrict the individual right of action by bondholders. In addition to the foregoing, any such trustee agreement or resolution may contain such other provisions as the local agency may deem reasonable and proper for the security of the bondholders. All expenses incurred in carrying out the provisions of such trustee agreement or resolution may be treated as a part of the cost of issuance of the bonds.

(Added by Stats. 1981, Ch. 1092, Sec. 1.)

54702.8.
  

Any holder of bonds issued under the provisions of this chapter or any of the coupons appertaining thereto, and the trustee or trustees appointed pursuant to any resolution authorizing the issuance of such bonds, except to the extent the rights thereof may be restricted by the resolution authorizing the issuance of the bonds, may, either at law or in equity, by suit, action, mandamus, or other proceedings, protect or enforce any and all rights specified in the laws of this state or in such resolution, and may enforce and compel the performance of all duties required by this chapter or by such resolution to be performed by the local agency or by any officer, employee, or agent thereof.

(Added by Stats. 1981, Ch. 1092, Sec. 1.)

54702.9.
  

Any local agency may provide for the issuance of bonds of the city for the purpose of refunding any bonds of the local agency then outstanding, including the payment of any redemption premiums thereof and any interest accrued or to accrue to the earliest or subsequent date of redemption, purchase, or maturity of such bonds, and, if deemed advisable by the local agency, for the additional purpose of paying all or any part of the cost of additional construction of rental housing for employees.

The proceeds of bonds issued pursuant to this section may, in the discretion of the local agency, be applied to the purchase or retirement at maturity or redemption of outstanding bonds, either at their earliest or any subsequent redemption date or upon the purchase or retirement at the maturity thereof and, pending such application, that portion of the proceeds allocated for such purpose may be placed in escrow, to be applied to such purchase or retirement at maturity or redemption on such date, as may be determined by the local agency. Pending use for purchase, retirement at maturity, or redemption of outstanding bonds, any proceeds held in such an escrow may be invested and reinvested as provided in the resolution authorizing the issuance of the refunding bonds. Any interest or earnings realized on any such investment may also be applied to the payment of the outstanding bonds to be refunded. After the terms of the escrow have been fully satisfied and carried out, any balance of such proceeds and any interest or increment earned or realized from the investment thereof may be returned to the local agency to be used by it for any of the purposes of this chapter. That portion of the proceeds of any bonds issued pursuant to this section which is designated for the purpose of paying all or any part of the cost of additional construction may be invested and reinvested in obligations of, or guaranteed by, the United States of America or in certificates of deposit or time deposits secured by obligation of, or guaranteed by, the United States of America, maturing not later than the time or times when such proceeds will be needed for the purpose of paying all or any part of such costs.

All bonds issued pursuant to this section shall be subject to the provisions of this chapter in the same manner and to the same extent as other bonds issued pursuant to this chapter.

(Added by Stats. 1981, Ch. 1092, Sec. 1.)

54702.10.
  

Notwithstanding any other provision of law, revenue bonds issued pursuant to this chapter shall be legal investments for all trust funds, insurance companies, savings and loan associations, investment companies and banks, both savings and commercial, and shall be legal investments for executors, administrators, guardians, conservators, trustees, and all other fiduciaries. Such bonds shall be legal investments for state school funds and for any funds which may be invested in county, municipal, or school district bonds, and such bonds shall be deemed to be securities which may properly and legally be deposited with, and received by, any state or municipal officer or by any agency or political subdivision of the state for any purpose for which the deposit of bonds or obligations of the state is now, or may hereafter be authorized by law, including deposits to secure public funds.

(Added by Stats. 1981, Ch. 1092, Sec. 1.)

54702.11.
  

The exercise of the powers granted by this chapter shall be in all respects for the benefit of the people of this state and for their health and welfare. Any bonds issued under the provisions of this chapter, their transfer and the income therefrom, shall at all times be free from taxation of every kind by the state and by the municipalities and other political subdivisions of the state, except inheritance and gift taxes.

(Added by Stats. 1981, Ch. 1092, Sec. 1.)

54702.12.
  

If the jurisdiction of the local agency to order a proposed act is not affected, an omission of any officer or the local agency in proceedings under this chapter or any other defect in the proceedings shall not invalidate the proceedings or bonds issued pursuant to this chapter.

(Added by Stats. 1981, Ch. 1092, Sec. 1.)

54702.13.
  

This chapter is full authority for the issuance of bonds by a local agency for the purpose of financing construction of rental housing for employees.

(Added by Stats. 1981, Ch. 1092, Sec. 1.)

54702.14.
  

This chapter shall be deemed to provide a complete, additional, and alternative method for doing the things authorized thereby, and shall be regarded as supplemental and additional to the powers conferred by other laws. The issuance of bonds and refunding bonds under the provisions of this chapter need not comply with the requirements of any other law applicable to the issuance of bonds except that Sections 8855, 8856, and 8857 shall apply.

(Amended by Stats. 1981, Ch. 1092, Sec. 2.)

54702.15.
  

An action may be brought pursuant to Chapter 9 (commencing with Section 860) of Title 10 of Part 2 of the Code of Civil Procedure to determine the validity of any issuance or proposed issuance of bonds under this chapter and the legality and validity of all proceedings previously taken or proposed in a resolution of a local agency to be taken for the authorization, issuance, sale, and delivery of the bonds and for the payment of the principal thereof and interest thereon.

(Added by Stats. 1981, Ch. 1092, Sec. 1.)

GOVGovernment Code - GOV3