Code Section

12937.  

The ways and means for the payment of the interest on and the principal of such bonds shall be as follows:

(a) There shall be collected annually in the same manner and at the same time as other state revenue is collected such a sum, in addition to the ordinary revenues of the State, as shall be required to pay the principal and interest on said bonds as herein provided, and it is hereby made the duty of all officers charged by law with any duty in regard to the collection of said revenue, to do and perform each and every act which shall be necessary to collect such additional sum.

There is hereby appropriated from the General Fund in the State Treasury such sum annually as will be necessary to pay the principal of and the interest on the bonds issued and sold pursuant to the provisions of this chapter, as said principal and interest become due and payable.

On the several dates on which funds are remitted pursuant to Section 16676 of the Government Code for the payment of the then maturing principal and interest on the bonds, to wit, on the several dates of maturity of said principal and interest in each fiscal year there shall be transferred into the General Fund in the State Treasury from revenues deposited in the fund as provided in subdivision (b) of this Section 12937, and from any accrued interest and premiums received on any sale, or sales of the bonds, so far as available therein, amounts equal to, but not in excess of, all sums so becoming due for principal and interest and in the event such money received from such sources and so returned on said remittance dates is less than the principal and interest then due and payable then the balance remaining unpaid shall be transferred to the General Fund out of moneys in the fund received from such sources as soon thereafter as it shall become available, together with simple interest thereon, from such remittance dates until so returned at the same rate as borne by the bonds.

(b) All revenues derived from the sale, delivery or use of water or power, and all other income or revenue, derived by the State, from the State Water Resources Development System shall be deposited in a special account or accounts in the California Water Resources Development Bond Fund and shall be accounted for and used annually only for the following purposes and in the following order, to wit:

1. The payment of the reasonable costs of the annual maintenance and operation of the State Water Resources Development System and the replacement of any parts thereof.

2. The annual payment of the principal of and interest on the bonds issued pursuant to this chapter.

3. Transfer to the California Water Fund as reimbursement for funds utilized from said fund for construction of the State Water Resources Development System.

4. Any surplus revenues in each year not required for the purpose specified in the foregoing subparagraphs (1), (2) and (3) of this subdivision (b) of Section 12937 and not required to be transferred to the General Fund pursuant to subparagraph (a) of this Section 12937, shall, during the time any of the bonds authorized herein are outstanding, be deposited in a special account in the California Water Resources Development Bond Fund and are hereby appropriated for use and shall be available for expenditure by the department for acquisition and construction of the State Water Resources Development System as described in Section 12931 hereof.

All such revenues shall constitute a trust fund and are hereby pledged for the uses and purposes above set forth and such pledge shall inure to the direct benefit of the owners and holders of all general obligation bonds issued under this chapter. The department, subject to such terms and conditions as may be prescribed by the Legislature, shall enter into contracts for the sale, delivery or use of water or power, or for other services and facilities, made available by the State Water Resources Development System with public or private corporations, entities, or individuals. Such contracts shall not be impaired by subsequent acts of the Legislature during the time when any of the bonds authorized herein are outstanding and the State may sue and be sued with respect to said contracts. Said contracts shall be for a stated term and, insofar as practicable and feasible, for the full term of the life of the general obligation bonds issued under this chapter and each such contract shall recite (i) that it is entered into for the direct benefit of the holders and owners of all general obligation bonds issued under this chapter, and (ii) that the income and revenues derived from such contracts are pledged to the purposes and in the priority herein set forth. Such pledge of revenues as herein set forth is hereby declared to be and shall constitute an essential term of this chapter and upon its ratification by the people of the State of California shall be binding upon the State so long as any general obligation bonds authorized hereunder are outstanding and unpaid. Such income and revenues, subject to the priorities herein set forth, shall constitute additional security for all of the bonds authorized and issued hereunder irrespective of the date of their issuance and sale and so long as any of the bonds authorized and issued hereunder, or the interest thereon, are unpaid, such income and revenues shall not be used for any other purpose. The bonds authorized hereunder shall be equally secured by a lien upon all income and revenues derived from the State Water Resources Development System without priority for number, amount, date of bonds, of sale, of execution, or of delivery pursuant to this chapter. Notwithstanding the pledge of revenues herein contained, the State of California shall remain liable for the payment of the principal of and interest upon all of the bonds authorized and issued under this chapter.