Amended in Senate April 15, 2015

Senate Bill No. 222

Introduced by Senator Block

February 12, 2015

An act to begin delete amend Section 15251 of the Education Code, relating to school bonds. end delete begin insert add Article 5.5 (commencing with Section 53515) to Chapter 3 of Part 1 of Division 2 of Title 5 of the Government Code, relating to local government. end insert

LEGISLATIVE COUNSEL’S DIGEST

SB 222, as amended, Block. begin delete School bonds: school facilities: statutory lien. end delete begin insert Local agencies: general obligation bonds: statutory lien. end insert

begin insert

Existing law authorizes local agencies to issue general obligation bonds, as provided.

end insert begin insert

This bill would require general obligation bonds issued and sold by or on behalf of a local agency to be secured by a statutory lien on all revenues received pursuant to the levy and collection of the property tax imposed to service those bonds, as provided.

end insert begin delete

Except as otherwise provided by law, existing law provides that the governing board of a school district or community college district may, when in its judgment it is advisable, and shall, upon a petition of the majority of the qualified electors residing in the school district or community college district, order an election and submit to the electors of the district the question whether the bonds of the district shall be issued and sold for the purpose of raising money for certain school facilities purposes, including the purchasing of school lots and the building or purchasing of school buildings.

end delete begin delete

If the bond measure is approved by the electors, existing law requires the board of supervisors of the county whose county superintendent of schools has jurisdiction over the school district or community college district to annually, at the time of making the levy of taxes for county purposes, levy a tax for that year upon the property in the district for the interest and redemption of all outstanding bonds of the school district or community college district. Existing law requires that all taxes levied, when collected, to be paid into the county treasury, as provided, to be used for the payment of the principal and interest of the bonds and for no other purpose.

end delete begin delete

This bill would require bonds issued and sold pursuant to these provisions to be secured by a statutory lien on all revenues received pursuant to the levy and collection of the tax, as provided.

end delete

Vote: majority. Appropriation: no. Fiscal committee: no. State-mandated local program: no.

The people of the State of California do enact as follows:

begin insert

begin insert SECTION 1. end insert   

end insert

begin insert Article 5.5 (commencing with Section 53515) is
added to Chapter 3 of Part 1 of Division 2 of Title 5 of the end insert begin insert Government Code end insert begin insert , to read: end insert

begin insert

 

Article begin insert 5.5. end insert   Lien for General Obligation Bonds

 

begin insert 53515. end insert   

(a) General obligation bonds issued and sold by or on
behalf of a local agency shall be secured by a statutory lien on all
revenues received pursuant to the levy and collection of the tax.
The lien shall automatically arise without the need for any action
or authorization by the local agency or its governing body. The
lien shall be valid and binding from the time the bonds are executed
and delivered. The revenues received pursuant to the levy and
collection of the tax shall be immediately subject to the lien, and
the lien shall immediately attach to the revenues and be effective,
binding, and enforceable against the local agency, its successors,
transferees, and creditors, and all others asserting rights therein,
irrespective of whether those parties have notice of the lien and
without the need for any physical delivery, recordation, filing, or
further act.

(b) This section is not intended to supplement or limit a local
agency’s power to issue general obligation bonds conferred by
any other law.

(c) For purposes of this section, both of the following shall
apply:

(1) “Local agency” means any city, county, city and county,
school district, community college district, authority, or special
district.

(2) “General Obligation bonds” means bonds, warrants, notes,
or other evidence of indebtedness of a local agency payable, both
principal and interest, from the proceeds of ad valorem taxes which
may be levied pursuant to paragraphs (2) and (3) of subdivision
(b) of Section 1 of Article XIII A of the California Constitution.

end insert

begin delete

SECTION 1.  

Section 15251 of the Education Code is amended
to read:

15251.  

(a) When collected, all taxes levied shall be paid into
the county treasury of the county whose superintendent of schools
has jurisdiction over the school district on behalf of which the tax
was levied, to the credit of the interest and sinking fund of the
school district, or community college district as designated by the
California Community Colleges Budget and Accounting Manual,
and shall be used for the payment of the principal and interest of
the bonds and for no other purpose.

(b) Bonds issued and sold pursuant to this chapter shall be
secured by a statutory lien on all revenues received pursuant to
the levy and collection of the tax. The lien shall automatically
attach without further action or authorization by the governing
board of the school district or community college district. The lien
shall be valid and binding from the time the bonds are executed
and delivered. The revenues received pursuant to the levy and
collection of the tax shall be immediately subject to the lien, and
the lien shall automatically attach to the revenues and be effective,
binding, and enforceable against the school district or community
college district, its successors, transferees, and creditors, and all
others asserting rights therein, irrespective of whether those parties
have notice of the lien and without the need for any physical
delivery, recordation, filing, or further act.

end delete