CCLME.ORG - HNC Division 8 (commencing with HNC §5800) HNC § 7002 HNC § 7148

State
California
HNC Sec 7000-7340 Small Craft Harbor Districts (HARBOR AND PORT DISTRICTS)

HARBORS AND NAVIGATION CODE
SECTION 7000-7340

7000. This part shall be known and may be cited as the Small Craft
Harbor District Law.

7001. This part and all of its provisions shall be liberally
construed to the end that its purpose may be effective. This part
does not affect any other law covering the same subject, nor apply to
any proceedings had thereunder, nor does it in any manner interfere
with existing harbors or prevent the formation, operation or
government of harbors within the State under any other law.

7002. "Harbor" means a portion of the Pacific Ocean or inland
waters, including rivers, streams, lakes, bays, estuaries, inlets,
straits and other waters within the jurisdiction of the State,
naturally or artificially protected or capable of being artificially
protected so as to be a place of safety for vessels, including the
artificially protective works, the public lands underlying, washed
by, ashore of, or abutting any of said waters and the structures and
facilities provided within, beneath, abutting or ashore of any
enclosed body of any of said waters for any of the uses or purposes
set forth in Section 7149, including the moving and servicing of
vessels and the servicing of their crews and passengers.

7003. "District" means any small craft harbor district formed
pursuant to this part.

7004. "Board" means the board of directors of a district.

7005. "Develop" and "development" includes without limitation the
acquisition, construction, repair, leasing improvement or any
combination thereof necessary to create or develop a harbor.

7010. A district may be formed consisting of any portion or
portions of a county, whether contiguous or not, lying entirely
within a city or entirely within unincorporated territory of the
county or wholly or partially including territory of all or part of
one or more cities within the county, including within its boundaries
the whole or some part of the harbor proposed to be developed.

7011. Fifty or more registered, qualified electors in a county
residing within the proposed district may sign and present to the
board of supervisors of the county a petition in writing for the
formation of a district.

7012. The petition shall:
(a) Set forth the exterior boundaries of the proposed district.
(b) Generally describe the proposed harbor development.
(c) A request that the territory included within the described
boundaries be formed into a district pursuant to this part.

7013. Within 10 days from the filing thereof the county registrar
of voters, or if there be none, the county clerk, shall examine the
petition and report in writing to the board of supervisors as to the
sufficiency thereof. If the report shows the petition to be
insufficient a supplemental petition may be filed within one month
from the date of the report.

7014. If the report shows the petition to be sufficient the
petition shall be published as provided in Section 6066 of the
Government Code in a newspaper of general circulation in the county
in which the proposed district is located together with a notice
setting forth the day, hour and place at which the petition will be
heard by the board of supervisors and stating that at the designated
time and place all persons interested may appear and be heard. The
notice shall also state that any interested person, including any
owner of taxable real property within the proposed district, may file
with the clerk of the body conducting the hearing at any time prior
to the time fixed for the hearing a written protest or objection to
the formation of the district. The names of only three signers of
the petition need be published. The time fixed for the hearing shall
not be less than 30 nor more than 60 days after the first publication
of the petition and notice of hearing.

7020. At the time and place specified in the notice the board of
supervisors shall hold the hearing, consider the petition and may
continue the hearing from time to time.

7021. At the hearing the board of supervisors, without further
notice, may change the exterior boundaries of the proposed district,
as set forth in the petition, by excluding lands which would not be
benefited by the proposed harbor development.
The board of supervisors may also change the exterior boundaries
of the proposed district by adding to the district and including
therein other lands which will be benefited by the proposed harbor
development. Land may not be added to the proposed district unless
notice is given by the board of supervisors of the proposed addition
or additions to the district by publication of its intention to do
so. The notice shall contain a description of the additional lands
to be included in the proposed district, and it shall state the day,
hour and place for the owners of land within the proposed addition to
appear before the board of supervisors and state their objections,
if any, to the inclusion. The notice shall be published as provided
in Section 6066 of the Government Code in a newspaper of general
circulation in the county in which the proposed district is located,
the first publication to be at least 15 days before the day so fixed.

7022. If the territory included within the proposed district lies
entirely within one city, the petition shall be filed with the city
clerk and the clerk and the legislative body of the city shall
conduct all the formation proceedings in the same manner as herein
provided for the board of supervisors.

7023. Except for proceedings to which Section 7022 applies, no
territory lying within a city may be included in a district formed
pursuant to this part without the consent of the city given by its
legislative body, and filed with the board of supervisors prior to
the adoption by the board of supervisors of the resolution provided
for in Section 7024.

7023.5. If, prior to the time fixed for the hearing, the owners of
taxable real property in the proposed district having an assessed
valuation of more than one-half of the assessed valuation of all
taxable real property in the proposed district have filed with the
clerk of the body conducting the hearing written protest or objection
to the formation of the district, the body conducting the hearing
shall so find and the proceeding shall be terminated and no further
proceedings shall be had or taken pursuant to the petition. If the
proceeding is so terminated by the filing of a written majority
protest or objection, a new petition for the same or substantially
the same district may not be filed until the expiration of two years
from the date of the finding that such protest or objection has been
filed.

7024. If, after concluding the hearing, the board of supervisors
determines that the proposed harbor development will benefit the
property within the proposed district, as originally proposed or as
changed by the board of supervisors, and that the proceedings have
been regularly had and taken it shall so find by resolution. The
resolution shall also contain:
(a) The name of the proposed district, as determined by the board
of supervisors.
(b) The official name by which the harbor will be known, as
determined by the board of supervisors.
(c) A description of the exterior boundaries of the proposed
district, as finally determined by the board of supervisors.

7025. A finding of the board of supervisors of the genuineness and
sufficiency of the petition and that notice shall be conclusive
against all persons.

7030. After adoption of the resolution provided for in Section 7024
the board of supervisors shall call and give notice of an election
to be held in the proposed district for the purpose of determining
whether or not it shall be formed and for the election of five
persons who shall serve as the first directors of the district if the
district is formed.

7031. The resolution calling the election shall contain:
(a) The date of the election.
(b) The name of the proposed district.
(c) The official name by which the harbor will be known.
(d) A description of the exterior boundaries of the proposed
district.
(e) The hours that the polls will be open, the election precincts,
the polling place or places and the election board or boards
appointed to conduct the election.
(f) The statement of the proposition to be voted upon.

7032. The election shall be called and conducted and candidates
nominated in the manner provided for general district elections,
except that the board of supervisors shall establish election
precincts, designate the polling place or places, appoint the
election board or boards and canvass the returns.

7033. The resolution calling the election shall be published
pursuant to Section 6066 of the Government Code in a newspaper of
general circulation in the county in which the proposed district is
located, the first publication to be at least 30 days prior to the
date of election.

7033.1. Within five days after the district formation election has
been called, the legislative body which has called the election shall
transmit, by registered mail, a written notification of the election
call to the executive officer of the local agency formation
commission of the county or principal county in which the territory
or major portion of the territory of the proposed district is
located. Such written notice shall include the name and a
description of the proposed district, and may be in the form of a
certified copy of the resolution adopted by the legislative body
calling the district formation election.
The executive officer, within five days after being notified that
a district formation election has been called, shall submit to the
commission, for its approval or modification, an impartial analysis
of the proposed district formation.
The impartial analysis shall not exceed 500 words in length and
shall include a specific description of the boundaries of the
district proposed to be formed.
The local agency formation commission, within five days after the
receipt of the executive officer's analysis, shall approve or modify
the analysis and submit it to the officials in charge of conducting
the district formation election.

7033.2. The board of supervisors or any member or members of the
board authorized by the board, or any individual voter or bona fide
association of citizens entitled to vote on the district formation
proposition, or any combination of such voters and associations of
citizens, may file a written argument for or a written argument
against the proposed district formation.
Arguments shall not exceed 300 words in length and shall be filed
with the officials in charge of conducting the election not less than
54 days prior to the date of the district formation election.

7033.3. If more than one argument for or more than one argument
against the proposed district formation is filed with the election
officials within the time prescribed, such election officials shall
select one of the arguments for printing and distribution to the
voters.
In selecting the arguments, the election officials shall give
preference and priority in the order named to the arguments of the
following:
(a) The board of supervisors or any member or members of the board
authorized by the board.
(b) Individual voters or bona fide associations of citizens or a
combination of such voters and associations.

7033.4. The elections officials in charge of conducting the
election shall cause a ballot pamphlet concerning the district
formation proposition to be voted on to be printed and mailed to each
voter entitled to vote on the district formation question.
The ballot pamphlet shall contain the following, in the order
prescribed:
(a) The complete text of the proposition.
(b) The impartial analysis of the proposition, prepared by the
local agency formation commission.
(c) The argument for the proposed district formation.
(d) The argument against the proposed district formation.
The elections officials shall mail a ballot pamphlet to each voter
entitled to vote in the district formation election at least 10 days
prior to the date of the election. The ballot pamphlet is "official
matter" within the meaning of Section 13303 of the Elections Code.

7034. The vote shall be canvassed by the board of supervisors not
more than 10 days after the election.

7035. If less than a majority of the votes cast upon the
proposition are in favor of forming the district the board of
supervisors shall declare the proceedings terminated.

7036. If a majority of the votes cast upon the proposition are in
favor of forming the district the board of supervisors shall by
resolution declare the district duly organized under this part. Said
resolution shall state:
(a) The name of the district.
(b) The official name by which the harbor will be known.
(c) The exterior boundaries of the district.
A certified copy of the resolution declaring the district formed
shall be filed with the Secretary of State. The organization of the
district shall then be complete.

7037. No informality in any proceeding, including informality in
the conduct of the election not substantially affecting adversely the
legal rights of any person, shall invalidate the formation of the
district. Any proceedings wherein the validity of the formation of a
district is denied shall be commenced within six months from the
date of filing of the certified copy of the resolution declaring the
district formed with the Secretary of State; otherwise the formation
and legal existence of the district and all proceedings in respect
thereto shall be incontestable.

7040. Each district shall have a board of five directors all of
whom shall be registered electors residing within the boundaries of
the district and all of whom shall be elected at large. The
directors first elected upon the formation of the district shall
classify themselves by lot so that two of them shall hold office
until the election and qualification of their successors at the first
succeeding general district election, and three of them shall hold
office until the election and qualification of their successors in
the second general district election.

7041. The term of office of each director, other than directors
first elected or directors appointed to fill an unexpired term, shall
be four years.

7042. If a person elected fails to qualify, the office shall be
filled as if there were a vacancy in the office.

7043. All vacancies occurring in the office of director shall be
filled by appointment by the remaining directors.

7044. An appointment to fill a vacancy in the office of director
shall be for the unexpired term of the office in which the vacancy
exists.

7045. Each director elected or appointed shall hold office until
his successor qualifies.

7046. If and when the territory included within the district lies
entirely within a single city, the legislative body of such city
shall be ex officio the board of directors of the district. In such
a case, the presiding officer of such legislative body shall be ex
officio the president of the district.

7047. Each director shall receive a sum as may be fixed by the
board, not exceeding fifty dollars ($50) for each meeting of the
board attended by him or her, for not exceeding four meetings in any
calendar month. A director may also receive traveling and other
expenses incurred by him or her when performing duties for the
district other than attending board meetings. For purposes of this
section, the determination of whether a director's activities on any
specific day are compensable shall be made pursuant to Article 2.3
(commencing with Section 53232) of Chapter 2 of Part 1 of Division 2
of Title 5 of the Government Code. Reimbursement for these expenses
is subject to Sections 53232.2 and 53232.3 of the Government Code.

7048. Before entering upon the duties of his office each director
shall take and subscribe the official oath and file it with the
secretary. The oath of office may be taken before the secretary, any
member of the board of directors, or any officers authorized by law
to administer oaths.

7050. The board is the governing body of the district.

7051. The powers of the district shall, except as otherwise
provided in this part, be exercised by the board.

7052. Within 30 days after the formation of the district the
directors shall meet and organize as a board. The board shall:
(a) Elect one of its members president except in a case where
Section 7046 applies.
(b) Provide for the time and place of holding its regular
meetings.

7053. At its organization meeting the board may transact any
business of the district.

7053.5. A district may destroy a record pursuant to Chapter 7
(commencing with Section 60200) of Division 1 of Title 6 of the
Government Code.

7054. A majority of the board shall constitute a quorum for the
transaction of business.

7055. The board may act either by ordinance, resolution, order or
motion. No ordinance or resolution shall be passed or become
effective without at least the affirmative votes of a majority of the
then members of the board.

7056. Separate books may be maintained for the filing of ordinances
and resolutions but the ayes and noes shall be taken upon the
passage of all ordinances and resolutions and entered upon the
minutes of the board.

7057. The enacting clause of all ordinances passed by the board
shall be in substantially the following form: "Be it Ordained by the
Board of Directors of (____ naming the district) as follows:".

7058. The board may pass all ordinances necessary for the
regulation of the district. All ordinances shall be signed by the
president and attested by the secretary.

7059. The board shall establish rules for its proceedings.

7060. The board may adopt a seal for the district and alter it at
pleasure.

7061. By resolution the board may change the name of the district.
A change of name shall be effective upon the filing of a certified
copy of the resolution with the Secretary of State and recording a
certified copy in the office of the county recorder of the county in
which the district is situated.

7070. The board shall at its first meeting, or as soon thereafter
as practical, appoint a secretary and treasurer. The board shall
also appoint other officers that are necessary or convenient for the
business of the district.

7071. A director shall not be treasurer. The secretary and
treasurer shall receive the compensation determined by the board and
shall serve at its pleasure.

7072. The board may, at any time, appoint or employ, fix the
compensation of and prescribe the authority and duties of other
officers, employees, attorneys, engineers and consultants necessary
or convenient for the business of the district, each of whom shall
serve at the pleasure of the board.
When, pursuant to Section 7046, the legislative body of a city is
the board of directors of a district, and appoints the administrative
officer of the district, he shall have the authority to appoint,
employ, and to fix the compensation of and prescribe the authority
and duties of, the employees of the district, excluding attorneys,
auditors or consultants. The employees employed or appointed by the
administrative officer shall serve at his pleasure.

7073. The board may require the secretary, treasurer or other
officers, employees or assistants of the district to give a bond to
the district conditioned upon the faithful performance of his duties
in an amount as the board may provide.

7074. The treasurer shall receive and safely keep all moneys of the
district. He shall comply with all provisions of law governing the
deposit and securing of public funds.

7080. (a) Except for the first election, directors shall be elected
at general district elections. All other elections are special
district elections. The first general district election shall be
held on the same day as and shall be fully consolidated with the next
statewide direct primary which is held more than six months
subsequent to the formation of the district and succeeding general
district elections shall be held on the same day and shall be fully
consolidated with the succeeding statewide direct primaries.
(b) No notice of a general district election need be given. The
precincts, polling places and election officers shall, within the
district, be the same as those provided for the statewide direct
primary and the elections shall be held in all respects as if there
were only one election and only one form of ballot shall be used
unless some precincts are not entirely the same for both elections,
in which case separate ballots may be provided as necessary.
(c) The district shall pay to the county the actual cost of the
services rendered in conducting the election upon presentation to the
board of a properly approved bill from the county. The returns
shall be canvassed by the county officer or officers required to
canvass the returns of the statewide direct primary and a certificate
stating the result of the canvass shall be filed with the board who
shall declare the result and declare elected the persons having the
highest number of votes given for each office.
(d) The certificate shall be retained in the district records and
the results and declaration shall be entered on the minutes of the
board. The secretary shall deliver to each person elected a
certificate of election signed by the secretary and authenticated
with the seal of the district.

7081. Nomination papers for the office of director shall be signed
by 25 or more registered electors in the district and filed with the
secretary not more than 65 nor less than 40 days before the day of
election. Otherwise the directors shall be nominated in accordance
with the provisions for independent nominations set forth in Part 2
(commencing at Section 8300) of Division 8 of the Elections Code so
far as they may be applicable.

7082. The provisions of the Elections Code relating to the
qualifications of electors, the manner of voting, the duties of
election officers, the canvassing of returns, and all other
particulars in respect to the management of general elections so far
as they may be applicable shall govern all district elections,
except:
(a) To the extent that the provisions of the Elections Code
pertaining to the conduct of local elections are inconsistent with
the provisions of that code pertaining to general elections the
provisions of the Elections Code pertaining to local elections shall
control.
(b) Inconsistent provisions of this part shall control over any
provisions of the Elections Code.

7083. If there is but one person to be elected to an office, the
candidate receiving the highest number of votes cast for the
candidates for that office shall be declared elected.

7084. If there are two or more persons to be elected to an office,
those candidates equal in number to the number to be elected who
receive the highest number of votes for the office shall be declared
elected.

7085. If a proposition has been submitted at the election it shall
be declared carried if a majority of those voting thereon, or a
higher number as may be required by law, vote in favor thereof.
Otherwise it shall be declared defeated.

7086. Special district elections held under this part or under any
other law shall be called, held and conducted as provided in this
part or in said other law if it so provides, but if no provision is
made therein the election shall be called by resolution which shall
state:
(a) The date of the election.
(b) The hours during which the polls shall remain open.
(c) The election precinct or precincts, the polling place or
places and the names of the officers selected to conduct the
election, who shall consist of one inspector, one judge and two
clerks in each precinct.
(d) The measure or measures to be submitted to the voters.

7087. Notice of the holding of the election shall be given by
publishing the resolution calling the election pursuant to Section
6066 of the Government Code in at least one newspaper published in
the district, the first publication to be at least two weeks prior to
the date of the election. If there is no newspaper published in the
district the resolution shall be posted in three public places in
the district not less than two weeks prior to the date of the
election. No other notice of the election need be given.

7088. The returns of the election shall be made, the votes
canvassed at least seven days following the election, and the results
thereof ascertained and declared in accordance with the provisions
of the Elections Code, so far as they may be applicable, except as
otherwise provided in this part. The secretary, as soon as the
result is declared, shall enter in the district records a statement
of the result.

7089. No irregularities or informalities in conducting any district
election shall invalidate the same, if the election shall have been
otherwise fairly conducted.

7090. All the expenses of district elections shall be borne by the
district.

7100. If, on the tenth day after the time for nominating directors
has expired, only one person has been nominated for each of the
positions of director to be filled at that election and a petition
signed by 5 percent of the voters of the district requesting that the
election be held has not been presented to the board of supervisors,
an election shall not be held.

7101. In such case the board of supervisors of the county in which
the district is situated shall, at its next regular meeting, appoint
to the positions of directors those persons nominated, and the person
shall qualify, take office, and serve exactly as if elected at the
general district election.

7120. Ordinances may be enacted by and for any district by
initiative in the same manner and with the same effect as ordinances
of counties under Article 1 (commencing at Section 9100) of Chapter 2
of Division 9 of the Elections Code and the terms used therein shall
have the following meanings:
(a) "County" shall mean district.
(b) "Board of supervisors" shall mean board.
(c) "Elections official" shall mean secretary.

7121. (a) No ordinance shall become effective until 30 days from
and after the date of its passage, except the following:
(1) An ordinance calling or otherwise relating to an election.
(2) An ordinance for the immediate preservation of the public
peace, health, or safety, that contains a declaration of, and the
facts constituting, its urgency, and is passed by a four-fifths vote
of the board.
(b) Prior to the effective date thereof ordinances shall be
subject to referendum in the same manner and with the same effect as
ordinances of counties under Article 2 (commencing with Section 9140)
of Chapter 2 of Division 9 of the Elections Code and terms used
therein shall have the meanings set forth in Section 7120.

7140. The district may exercise the powers expressly granted in
this part or in any other law or necessarily implied therefrom. The
district has the power generally to perform all acts necessary to
carry out fully the provisions, powers and purposes of this part.

7141. The district has perpetual succession.

7142. The district may sue and be sued in all actions and
proceedings, in all courts and tribunals of competent jurisdiction.

7143. The district may levy and cause to be collected taxes for the
purpose of paying the principal of and interest on any indebtedness,
whether evidenced by bonds, notes, or other similar evidences of
indebtedness, or to pay amounts required by contracts or leases, or
to pay any other expenses or claims incurred in carrying out fully
the provisions, powers and purposes of this part.

7144. The district may make contracts for any and all purposes
necessary or convenient for the full exercise of its powers.

7145. The district may employ labor, professional services, agents,
servants and employees necessary to manage, maintain, and control
the harbor and to enable the district to exercise its powers.

7146. The district may take by grant, purchase, gift, devise or
lease or other acquisition, hold, use, enjoy, lease or dispose of
real and personal property of every kind, within or without the
district necessary to the full or convenient exercise of its powers.

7147. The district may acquire by eminent domain any property
necessary, convenient or useful to the exercise of its powers, but
may exercise the power to acquire property outside the district by
eminent domain only with the consent of the governing body of the
county, or city if any, in which the property is located.

7148. Any county, city and county, city, or other political
subdivision or agency of the State, in this section referred to as
"public agency," which has been invested by grant from the State with
the ownership, possession, control or management of tide and
submerged lands or any other lands lying under, washed by or abutting
the Pacific Ocean, or inland waters of the State, including the beds
of navigable rivers, streams, lakes, bays, estuaries, inlets and
straits, may, with the prior written consent of the State Lands
Commission, agree in writing that any district formed pursuant to
this part shall for the term stated in the writing have all or any
right, title and interests of any such public agency and exercise all
or any jurisdiction of any such public agency in the lands over the
lands or any portion thereof.

7149. The district may acquire, construct, reconstruct, improve,
repair, develop, maintain, and operate a harbor and all facilities
appurtenant thereto, connected therewith, or incidental thereto,
including, but not limited to, all of the following:
(a) The dredging of channels, shipways, berths, anchorage places,
and turning basins.
(b) The acquisition, reconstruction, repair, and maintenance of
jetties, breakwaters, bulkheads, seawalls, wharves, docks, ways,
ferry slips, warehouses, streets, roads, drives, parkways, avenues,
approaches, marinas, aquatic playgrounds, beach parks, bathing
beaches, and other recreation facilities, together with structures
and facilities incidental thereto.
(c) The acquisition, construction, reconstruction, repair,
maintenance, operation, development, and regulation of fueling,
loading and unloading, towing, repair, warehousing, shipping and
reshipping, and other facilities, aids, equipment, or property
necessary for, or incidental to, the development and operation of the
harbor.
(d) The acquisition, construction, reconstruction, repair,
maintenance, and operation of fireboats, sanitary, and other
facilities necessary for the proper protection of the harbor.

7150. The district may lease any property, whether real or
personal, and any interest therein to, of and from any person, firm
or public or private corporation, or public agency with the privilege
of purchasing or otherwise.

7151. The district may join with the United States or any
department or agency thereof, the State or any department or agency
thereof, any county, city and county, city, district or other public
or private corporation, or one or more or any other combination of
the foregoing, for the purpose of carrying out any of the powers of
the district, including, without limitation, provisions for the
financing of acquisitions, constructions, developments and
operations.

7152. The board may, by ordinance, establish general rules for the
government of the harbor, including, without limiting the generality
of the foregoing:
(a) The regulation of anchoring, mooring, towing, wharfage and
dockage of vessels and the establishment and collection of rates,
fees and charges therefor.
(b) The establishment and collection of rates, fees and charges
for service from or use of any of the facilities owned, controlled,
furnished or operated by the district.
(c) The supervision of pilots and the pilotage of all vessels
within the harbor and the establishment and collection of fees and
charges therefor.
(d) The regulation of the construction of wharves, docks,
buildings and improvements of all types on property owned or
controlled by the district.
(e) The issuance of licenses and permits for privileges to be
exercised in and about the harbor upon equal terms and the
establishment and collection of rates, fees and charges therefor.

7153. The district may construct any works along, under, or across
any street, road, or watercourse upon payment of compensation
therefor, if required, in a manner that will afford security for life
and property.

7154. The district may use any lands acquired or owned by the
district for street or highway purposes. If it is necessary or
expedient to convey any of the lands owned by the district for street
or highway purposes, the board, by resolution, may authorize the
president and secretary to execute the deed to the public entity
entitled thereto and deliver it to the proper authority representing
the grantee.

7155. The district may sell and issue franchises relating to the
harbor and its works, appurtenances, properties, and rights in
accordance with procedure as may be prescribed by ordinance.

7156. The district may advertise its advantages and solicit
business within or without the district, within other states or any
foreign countries through such employees or agents as are expedient.

7158. The district may accept aid from the United States or any
department or agency thereof or from the State or any department or
agency thereof and from any county, city and county, city, district
or other public or private corporation or person. Any county, or
city and county, or city, any portion of which is within the district
may provide such money as in the opinion of its legislative body may
be required, necessary or expedient to be provided in aid of any of
the uses or purposes set forth in Section 7149.

7170. A district may borrow money, incur indebtedness, and issue
bonds or other evidences of indebtedness as provided in this part.

7171. A district may issue warrants payable in not to exceed two
years from their date, to pay the formation expenses of the district,
which warrants may bear interest at a rate of not exceeding 6
percent per annum from date of issue until paid, which formation
expenses may include fees of attorneys and others employed to conduct
formation proceedings.

7172. All claims for money or damages against the district are
governed by Part 3 (commencing with Section 900) and Part 4
(commencing with Section 940) of Division 3.6 of Title 1 of the
Government Code except as provided therein, or by other statutes or
regulations expressly applicable thereto. Except for bonds and
interest coupons which shall be paid when due, all claims shall be
approved in writing by the president or a member of the board
designated for such purpose, or approved by the board in open
meeting.

7173. Warrants shall be drawn by the treasurer and signed by the
president, or a member of the board designated for the purpose and by
the secretary.

7174. The treasurer shall install and maintain a system of auditing
and accounting that shall completely and at all times show the
financial condition of the district.

7175. The treasurer shall make annual, or oftener if the board so
orders, written reports to the board as to the receipts and
disbursements and balances in the several accounts under his control.
The report shall be signed by him and filed with the secretary. At
least yearly the books and accounts of the district shall be audited
by an independent certified public accountant or public accountant
or firm of certified public accountants or public accountants
employed by the district.

7176. A bank may act as depositary, paying agent or fiscal agent
for the holding or handling of district funds, notwithstanding the
fact that a member of the board is an officer, employee or
stockholder of the bank, or of a holding company that owns any of the
stock of the bank.

7190. As an alternative to the procedures of Article 1 (commencing
at Section 7170) the board may by resolution designate the county
treasurer of the county in which the district is situated to be the
depositary and have the custody of all the district's money. The
resolution shall be filed with the county treasurer.

7191. The county treasurer shall:
(a) Receive and receipt for all the district's money and place it
in the county treasury to the credit of the district.
(b) Be responsible upon his official bond for the safekeeping and
disbursing of all district money so held by him.

7192. The county treasurer shall pay, when due, out of district
money, all sums payable on outstanding bonds and coupons of the
district; and the county treasurer shall pay any other sums out of
district money, or any portion thereof, only upon warrants of the
county auditor.

7193. The county auditor shall draw warrants to pay claims made
against the district when the claims have been approved in writing by
the president or a member of the board designated for the purpose or
approved by the board in open meeting.

7194. The county treasurer shall report in writing on the first day
of July, October, January and March of each year to the board with
respect to each of the following:
(a) The amount of money he then holds for the district.
(b) The amount of receipts since his last report.
(c) The amount paid out since his last report. The report shall
be verified and filed with the secretary.

7195. The board of supervisors of the county shall determine the
charge to be made against the district for any services of either or
both of:
(a) The county treasurer as custodian of the district's money.
(b) The county auditor in drawing warrants to pay demands, made
and approved, against the district.

7200. A district may incur indebtedness for any purpose for which
the district is authorized to expend funds by the issuance of
negotiable promissory notes pursuant to this article without an
election.

7201. Said notes shall be payable in not to exceed five years from
their date and shall bear interest at not exceeding 6 percent per
annum, payable as provided therein.

7202. The total aggregate amount of said notes outstanding at any
one time shall not exceed a limit of 2 percent of the assessed
valuation of the taxable property in the district or, if the assessed
valution is not obtainable, 2 percent of the county auditor's
estimate of the taxable property in the district evidenced by his
certificate, provided:
(a) A district which has been formed for less than 18 months may
exceed said limit and in the event may borrow an aggregate amount of
not to exceed thirty-five thousand dollars ($35,000).
(b) No district shall borrow more than an aggregate amount of one
hundred fifty thousand dollars ($150,000).

7210. Whenever the board deems if necessary for the district to
incur a general obligation bonded indebtedness for (a) the
acquisition, construction, completion or repair of any or all
improvements, works or property mentioned in this part, or (b) the
funding or refunding of any outstanding indebtedness of the district,
including premiums, if any be payable, the board shall, by
resolution, so declare and call an election to be held in the
district for the purpose of submitting to the qualified voters the
proposition of incurring indebtedness by the issuance of bonds of the
district.

7211. The resolution shall state:
(a) The purpose for which the proposed debt is to be incurred,
which may include expenses of all proceedings for the authorization,
issuance and sale of the bonds.
(b) The amount of debt to be incurred.
(c) The maximum term the bonds proposed to be issued shall run
before maturity, which shall not exceed 40 years.
(d) The maximum rate of interest to be paid, which shall not
exceed 6 percent per annum, payable semiannualy, except that interest
for the first year may be payable at the end of the year.
(e) The measure to be submitted to the voters.
(f) The date upon which an election shall be held for the purpose
of authorizing the bonded indebtedness to be incurred; and
(g) The designation of the precincts, the location of the polling
places and the names of the officers selected to conduct the
election, who shall consist of one inspector, one judge, and two
clerks in each precinct.

7212. Notice of the holding of the election shall be given by
publishing the resolution calling the election pursuant to Section
6066 of the Government Code in at least one newspaper published in
the district. The first publication to be at least two weeks prior
to the date of the election. If there is no newspaper published in
the district the resolutions shall be posted in three public places
in the district for not less than two weeks prior to the date of the
election. No other notice of the election need be given.

7213. The returns of the election shall be made, the votes
canvassed at least seven days following the election, and the results
thereof ascertained and declared in accordance with the provisions
of the Elections Code, so far as they may be applicable, except as
otherwise provided in this part. The secretary, as soon as the
result is declared, shall enter in the district records a statement
of the result of the election.

7214. No irregularities or informalities in conducting the election
shall invalidate the same, if the election shall have been otherwise
fairly conducted.

7215. Any action or proceeding wherein the validity of the election
or of the proceedings in relation thereto is contested, questioned
or denied, shall be commenced within three months from the date of
the election; otherwise the election and all proceedings in relation
thereto shall be held to be valid and in every respect legal and
incontestable.

7216. If from the election returns it appears that more than
two-thirds of the votes cast upon the measure were in favor of and
assented to the incurring of the general obligation bonded
indebtedness, then the board may, by resolution, at the time or times
it deems proper, issue bonds of the district for the whole or any
part of the amount of the indebtedness so authorized, and may from
time to time provide for the issuance of such amounts as the
necessity thereof may appear, until the full amount of the bonds
authorized shall have been issued.

7217. The full amount of bonds may be divided into two or more
series and different dates fixed for the bonds of each series. The
maximum term which the bonds of any series shall run before maturity
shall not exceed 40 years from the date of each series respectively.

7218. The board shall, by resolution, prescribe the form of the
bonds and the form of the coupons attached thereto and fix the time
when the whole or any part of the principal shall become due and
payable. The payment of the first installment of principal may be
deferred for a period of not more than five years from the date of
the bonds or the date of the bonds of each series respectively.

7219. The bonds shall bear interest at a rate or rates not to
exceed 6 percent per annum payable semiannually, except that interest
for the first year shall be payable at the end of the year.

7220. The board may also provide for the call and redemption of
bonds prior to maturity at the time and prices and upon such other
terms as it may specify. A bond shall not be subject to call or
redemption prior to maturity unless it contains a recital to that
effect, or unless a statement to that effect is printed thereon.

7221. The denomination of the bonds shall be stated in the
resolution providing for their issuance, but shall not be less than
one hundred dollars ($100).

7222. The principal and interest shall be payable in lawful money
of the United States at the office of the treasurer of the district
or at any other place or places as may be designated, or at either
place or places at the option of the holder of the bond.

7223. The bonds shall be dated, numbered consecutively, and be
signed by the president of the board and the treasurer of the
district and countersigned by the secretary of the district and the
official seal of the district affixed. The interest coupons of the
bonds shall be signed by the treasurer of the district. All the
signatures and countersignatures may be printed, lithographed or
mechanically reproduced, except that one of said signatures or
countersignatures to said bonds shall be manually affixed.
If any officer whose signature or countersignature appears on any
bonds or coupons ceases to be an officer before the delivery of the
bonds to the purchaser, the signature or countersignature either on
the bonds or the coupons, or on both, is nevertheless valid and
sufficient for all purposes the same as if the officer had remained
in office until the delivery of the bonds, and the signature upon the
coupons of the person who is treasurer at the date of the bonds, is
valid although the bonds themselves may be attested by a different
person who is treasurer at the time of delivery of the bonds.

7224. Before selling the bonds, or any part thereof, the board
shall give notice inviting sealed bids in such manner as it may
prescribe. If satisfactory bids are received, the bonds offered for
sale shall be awarded to the highest responsible bidder. If no bids
are received or if the board determines that the bids received are
not satisfactory as to price or responsibility of the bidders, it may
reject all bids received, if any, and either readvertise or sell the
bonds at private sale.

7225. The proceeds from the sale of the bonds shall be paid into
the treasury of the district and placed to the credit of a special
improvement fund and expended only for the purpose for which the
indebtedness was created; however, when the purpose has been
accomplished, any moneys remaining in the special improvement fund
may be transferred to the fund to be used for the payment of the
principal of and interest on the bonds.

7226. Any action or proceeding, wherein the validity of any such
bonds or of proceedings in relation thereto is contested, questioned
or denied, shall be commenced within three months from the date of
the issuance thereof; otherwise said bonds and all proceedings in
relation thereto shall be held to be valid and in every respect legal
and incontestable.

7227. Any general obligation bonds issued by a district shall have
the same force, value and use as bonds issued by any city and shall
be exempt from all taxation within the State of California.

7240. The district may issue revenue bonds for any purpose
mentioned in this part under the provisions of the Revenue Bond Law
of 1941 (Chapter 6 (commencing at Section 54300) of Division 2 of
Title 5 of the Government Code).

7241. If revenue bonds are issued, the bonds shall be authorized by
a majority of the qualified electors as provided in the Revenue Bond
Law of 1941 (Chapter 6 (commencing at Section 54300) of Division 2
of Title 5 of the Government Code).

7243. In any ordinance or resolution calling an election to
authorize the issuance of revenue bonds of the district, the board
may insert a provision that it intends to provide, as further
security for the bonds, for a limited tax levy (stating the limit as
to rate) which shall be levied from time to time to the extent to
which revenues pledged to the payment of the principal of and
interest on the bonds have been or are expected to be insufficient in
any year to pay said principal and interest or to the extent to
which any reserve fund established for said bonds has been or will be
used to pay, or to provide for the payment of, such principal or
interest. If such provision is so inserted and if the bonds are
authorized by a fifty-one percent (51%) favorable vote, the board may
insert in the ordinance or resolution providing for the issuance of
such bonds a provision for such limited tax levy and such terms,
conditions and covenants as may be necessary or convenient for the
carrying out of such provision. The limited tax levies authorized by
this section shall not in the aggregate exceed in any one year
seventy-five cents ($0.75) on each one hundred dollars ($100) of
assessed valuation.

7260. After the incurring of any general obligation indebtedness,
evidenced by general obligation bonds, and annually thereafter until
the indebtedness is paid or until there is a sum in the treasury of
the district set apart for that purpose sufficient to meet all
payments of principal of and interest on the indebtedness as it
becomes due, the board shall cause a tax to be levied, as herein
provided sufficient to pay the interest and principal as will become
due before the proceeds of a tax levied at the next general tax levy
will be available.

7261. To the extent to which moneys are in the treasury from a
source other than the annual tax levy required by Section 7260 and
are set apart for the payment of principal of and interest on
indebtedness as provided in Section 7260, the tax therein required
may be reduced.

7262. On or before the first day of August the board of directors
of the district shall furnish to the board of supervisors and to the
auditor, respectively, in writing:
(a) An estimate of the minimum amount of money required by Section
7243 to be raised by taxation during the fiscal year.
(b) An estimate of the minimum amount of money required to be
raised by taxation to comply with, but subject to the limitations of, (continued)