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HomeHealth and Safety CodeDiv. 31Pt. 3Ch. 7§ 51355 Bond Revenue Pledging Rules

§ 51355 Bond Revenue Pledging Rules

Health and Safety Code·California
AI Summary·Official Text·Key Terms·Related Statutes·References
AI SummaryVerified

§ 51355 Bond Revenue Pledging Rules

Key Takeaways

  • •This law lets a government agency promise to use its money or property to pay back bonds (like loans) it issues.
  • •The agency can set rules on how it spends the money from selling bonds and how it handles payments.
  • •If the agency doesn’t follow the rules, bondholders (people who lent money) have ways to protect their investment.
  • •The agency can also decide how much money it spends on its own operations.

Example

A city wants to build a new park but doesn’t have enough money, so it sells bonds to investors to raise funds.

The city promises to use the money from the bonds only for the park and to pay back the investors using money from taxes or park fees. If the city doesn’t pay back the money, the investors can take action to get their money back.

AI-generated — May contain errors. Not legal advice. Always verify source.

Official Source
View on CA.gov

§ 51355 Bond Revenue Pledging Rules

Any resolution or resolutions authorizing any bonds or issue therefor may contain provisions, which shall be a part of the contract or contracts with the holders thereof, as to: (a)  Pledging all or any part of the revenues of the agency to secure the payment of the bonds or any issue thereof, subject to such agreements with bondholders as may then exist. (b)  Pledging all or any part of the assets of the agency, including mortgages and obligations securing the same, to secure the payment of the bonds or any issue thereof, subject to such agreements with bondholders as may then exist. (c)  The use and disposition of the gross income from mortgages owned by the agency and payment of principal of mortgages owned by the agency. (d)  The setting aside of reserves or sinking funds and the regulation and disposition thereof. (e)  Limitations on the purposes to which the proceeds of a sale of bonds may be applied and pledging such proceeds to secure the payment of the bonds or of any issue thereof. (f)  Limitations on the issuance of additional bonds, the terms upon which additional notes or bonds may be issued and secured, and the refunding of outstanding bonds. (g)  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. (h)  Limitations on the amount of moneys to be expended by the agency for operating expenses of the agency. (i)  Vesting in a trustee or trustees such property, rights, powers, and duties in trust as the agency may determine, and providing for or limiting or abrogating the right of the bondholders to appoint a trustee or limiting the rights, powers, and duties of such trustee. (j)  Defining the acts or omissions to act which shall constitute a default in the obligations and duties of the agency to the holders of the bonds and providing for the rights and remedies of the holders of the bonds in the event of such default. However, such rights and remedies shall not be inconsistent with the general laws of the state and the other provisions of this division. (k)  Any other matters of like or different character, which in any way affect the security, protection, or investment return of the holders of the bonds. (Added by Stats. 1977, Ch. 610.)

Last verified: January 24, 2026

Key Terms

agreementregulationresolutioncontractpropertymortgageobligationfine

Related Statutes

  • § 37932 Bond Terms And Conditions
  • § 51352 Bond Repayment Obligations
  • § 51368 Bond Security Reserve Accounts
  • § 1371.38 Health Plan Dispute Resolution
  • § 33661 Bondholder Rights In Default

References

  • Official text at leginfo.legislature.ca.gov
  • California Legislature. Health and Safety Code. Section 51355.
View Official Source