BILL NUMBER: AB 1964	CHAPTERED
	BILL TEXT

	CHAPTER   360
	FILED WITH SECRETARY OF STATE   AUGUST 24, 1998
	APPROVED BY GOVERNOR   AUGUST 24, 1998
	PASSED THE SENATE   AUGUST 6, 1998
	PASSED THE ASSEMBLY   APRIL 30, 1998
	AMENDED IN ASSEMBLY   MARCH 23, 1998

INTRODUCED BY   Assembly Member Aguiar

                        FEBRUARY 17, 1998

   An act to add Section 870.5 to the Code of Civil Procedure,
relating to validation proceedings.


	LEGISLATIVE COUNSEL'S DIGEST


   AB 1964, Aguiar.  Bonds:  validating proceedings.
   Existing law provides that a local agency may bring an action to
determine the validity of its bonds, warrants, contracts,
obligations, or evidences of indebtedness pursuant to the provisions
governing validating proceedings.
   This bill would provide that any local public agency that pledges
sales or retail transaction and use tax revenues for bond payments or
payment of other security obligations, if it receives those revenues
from another public agency which imposes the taxes, shall, in any
validation action it files involving those  bonds or other
obligations, provide written notice thereof to the public agency
imposing the taxes at the time it files the validation action.
   The bill would impose a state-mandated local program by requiring
new duties of local public agencies.
  The California Constitution requires the state to reimburse local
agencies and school districts for certain costs mandated by the
state. Statutory provisions establish procedures for making that
reimbursement, including the creation of a State Mandates Claims Fund
to pay the costs of mandates that do not exceed $1,000,000 statewide
and other procedures for claims whose statewide costs exceed
$1,000,000.
   This bill would provide that, if the Commission on State Mandates
determines that the bill contains costs mandated by the state,
reimbursement for those costs shall be made pursuant to these
statutory provisions.


THE PEOPLE OF THE STATE OF CALIFORNIA DO ENACT AS FOLLOWS:


  SECTION 1.  Section 870.5 is added to the Code of Civil Procedure,
to read:
   870.5.  Any local public agency that pledges sales or retail
transaction and use tax revenues received from taxes imposed by
another public agency for bond payments or payment of other security
obligations shall, in any validation action it files involving those
bonds or other obligations, provide written notice thereof to the
public agency imposing the taxes pledged as security for the bonds or
other obligations at the time it files the validation action.
  SEC. 2.  Notwithstanding Section 17610 of the Government Code, if
the Commission on State Mandates determines that this act contains
costs mandated by the state, reimbursement to local agencies and
school districts for those costs shall be made pursuant to Part 7
(commencing with Section 17500) of Division 4 of Title 2 of the
Government Code.  If the statewide cost of the claim for
reimbursement does not exceed one million dollars ($1,000,000),
reimbursement shall be made from the State Mandates Claims Fund.
   Notwithstanding Section 17580 of the Government Code, unless
otherwise specified, the provisions of this act shall become
operative on the same date that the act takes effect pursuant to the
California Constitution.