California Legislature—2013–14 Regular Session

Assembly Bill No. 2440

Introduced by Assembly Member Hagman

February 21, 2014

An act to amend Section 15144 of the Education Code, and to amend Section 53508.6 of the Government Code, relating to school bonds.

LEGISLATIVE COUNSEL’S DIGEST

AB 2440, as introduced, Hagman. School bonds: equipment purchases.

(1) Existing law authorizes the governing board of any school district or community college district to order an election and submit to the electors of the district the question whether the bonds of the district should be issued and sold to raise money for specified purposes. Existing law requires the number of years the whole or any part of the bonds are to run to not exceed 25 years.

This bill would require bonds to have a maturity that does not exceed 10 years if proceeds of the bond would be used to purchase equipment with a useful life of less than 5 years.

(2) Additionally and alternatively to the authority described above, existing law authorizes the legislative body of any issuer, by resolution, to provide for the issuance of bonds or refunding bonds. Existing law provides that bonds issued pursuant to this authority by a school district or community college district that do not allow for the compounding of interest may have a maturity that is greater than 30 years, but not greater than 40 years, if certain requirements are satisfied.

This bill would require bonds issued pursuant to this authority to have a maturity that does not exceed 10 years if proceeds of the bond would be used to purchase equipment with a useful life of less than 5 years.

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

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

SECTION 1.  

Section 15144 of the Education Code is amended
to read:

15144.  

begin delete The end delete begin insert (a) end insert begin insert   end insert begin insert Except as provided in subdivision (b), end insert begin insert the end insert
number of years the whole or any part of the bonds are to run shall
not exceed 25 years, from the date of the bonds or the date of any
series begin delete thereof end delete begin insert of the bonds end insert .

begin insert

(b) If bond proceeds will be used to purchase equipment with
a useful life of less than five years, bonds issued and sold pursuant
to this chapter and Chapter 1.5 (commencing with Section 15264)
shall have a maturity that does not exceed 10 years.

end insert

SEC. 2.  

Section 53508.6 of the Government Code is amended
to read:

53508.6.  

begin delete Notwithstanding end delete begin insert (a) end insert begin insert   end insert begin insert Except as provided in
subdivision (b), notwithstanding end insert any other law, a school district
or community college district may, pursuant to this article, issue
bonds that do not allow for the compounding of interest and that
have a maturity greater than 30 years, but not greater than 40 years,
if the school district or community college district does both of
the following:

begin delete

(a)

end delete

begin insert (1) end insert  Complies with the requirements of subdivisions (b) and (c)
of Section 15146 of the Education Code.

begin delete

(b)

end delete

begin insert (2) end insert  Makes a finding that the useful life of the facility financed
with the bonds that do not allow for the compounding of interest
and that have a maturity greater than 30 years, but not greater than
40 years, equals or exceeds the maturity date of those bonds.

begin insert

(b) If bond proceeds will be used to purchase equipment with
a useful life of less than five years, bonds issued and sold by a
school district or community college district pursuant to this article
shall have a maturity that does not exceed 10 years.

end insert