and improvements, the cost of architectural, engineering, financial and legal services, plans, specifications, estimates, administrative expenses and other expenses necessary or incident to determining the feasibility of constructing any project or incident to the construction or acquisition or financing of any project. (c) "Participating party" means any person, company, corporation, partnership, firm, or other entity or group of entities engaged in operations within this state which requires financing pursuant to the terms of this division to aid and assist in the control or elimination of pollution of the environment of the state.

(d) "Pollution" means an alteration of quality of the environment of the state and shall be determined by the various standards prescribed from time to time by this state or the federal government or any agency, department, or political subdivision of this state or the federal government and may include, but is not limited to, earth, air, or water pollution, pollution caused by solid waste disposal, thermal pollution, radiation contamination, or noise pollution.

(e) "Project" and "pollution control facility," respectively, means any land, building, improvement thereto, work, property or structure, real or personal, providing or designed to provide for the control, reduction, abatement, elimination, or prevention of pollution, including, but not limited to, hydrostatic control facilities, dust collectors, smoke bags, settling ponds, filtration plants, sewage disposal facilities, garbage disposal facilities, recycling facilities, dumps, filling grounds, chlorination ponds, treatment works, and all other structures or facilities now or hereafter developed or useful in the control of pollution of any type or character, including any structure, equipment, or other facilities for the purpose of reducing, treating, neutralizing, or cooling the temperature of any liquid, gaseous, or solid waste substance or discharge resulting from the process of manufacture, industry, or commerce, or from the development, processing, or recovery of any natural resource of the generation of electricity, steam heat, or manufacturing gas, together with the recovery, treatment, neutralizing, stabilizing, or cooling equipment, facilities, plants, or structures necessary to reduce, control, or eliminate pollution, and any and all facilities which may hereafter be developed through science, study, and investigation to aid and assist in the control of pollution or the removal or treatment of any substance which might otherwise cause or contribute to such pollution.

(f) "Revenues" means all rents, receipts, purchase payments and all other income or receipts derived by the authority from the sale, lease, or other disposition of pollution control facilities and any income or revenue derived from the investment of any money in any fund or account of the authority.

(g) "Public agency" means any state agency, board, or commission, any county, city and county, city, regional agency, public district, or other political subdivision.

ARTICLE 2. ORGANIZATION OF AUTHORITY AND GENERAL POWERS AND DUTIES THEREOF

39604. There is in the state government the California Pollution Control Financing Authority. The authority constitutes a public instrumentality and a political subdivision of the State of California, and the exercise by the authority of the powers conferred by this division shall be deemed and held to be the performance of an essential public function. The authority shall consist of five members: the Director of Finance, the Chairman of the State Water Resources Control Board, the Chairman of the State Air Resources Board, the State Treasurer, and the State Controller.

The Director of Finance, the Chairman of the State Water Resources Control Board, and the Chairman of the State Air Resources Board may each designate a deputy or clerk in his agency to act for him and represent him at all meetings of the authority.

The first meeting of the authority shall be convened by the Director of Finance.

(Amended by Ch. 277/73, effective 8/15/73.)

39605. All members of the authority shall serve thereon without compensation as members of the authority.

39606. The provisions of this division shall be administered by the authority which shall have and is hereby vested with all powers reasonably necessary to carry out the powers and responsibilities expressly granted or imposed upon it under this division.

39607. The authority shall maintain an office in the City of Sacramento.

55-623 0-75-22

39608. The authority may employ an executive secretary and such other persons as are necessary to enable it properly to perform the duties imposed upon it by this division.

39609. The authority shall, in accordance with the provisions of Chapter 4.5 (commencing with Section 11371) of Part 1 of Division 3 of Title 2 of the Government Code, adopt all necessary rules and regulations to carry out the provisions of this division. The authority may call upon any board or department of the state government for aid and assistance in the preparation of plans and specifications and in the development of technology necessary to effectively control pollution.

39610. (a) The Attorney General shall be the legal counsel for the authority, but with the approval of the Attorney General, the authority may employ such legal counsel as in its judgment is necessary or advisable to enable it to carry out the duties and functions imposed upon it by this division, including the employment of such bond counsel as may be deemed advisable in connection with the issuance and sale of bonds.

(b) The State Treasurer shall be the treasurer for the authority. 39611. The authority is authorized and empowered :

(a) To adopt an official seal.

(b) To sue and be sued in its own name.

(c) To determine the location and character of any project to be financed under the provisions of this division, subject to the certification under Section 39615, to lend financial assistance to any participating party, to construct, reconstruct, renovate, replace, lease, as lessor or lessee and regulate the same, and to enter into contracts for the sale of any pollution control facilities, including installment sales or sales under conditional sales contracts.

(d) To issue bonds, notes, bond anticipation notes, and other obigations of the authority for any of its corporate purposes, and to fund or refund the same, all as provided in this division.

(e) To fix fees and charges for pollution control facilities, and to revise from time to time such fees and charges, and to collect rates, rents, fees and charges for the use of and for any facilities or services furnished, or to be furnished, by a project or any part thereof and to contract with any person, partnership, association, corporation, or public agency with respect thereto, and fix the terms and conditions upon which any pollution control facilities may be sold or disposed of, whether upon installment sales contracts or otherwise.

(f) To employ and fix the compensation of bond counsel, financial consultants and advisers as may be necessary in its judgment in connection with the issuance and sale of any bonds, notes, bond anticipation notes, or other obligations of the authority; to contract for engineering, architectural, accounting, or other services of appropriate state agencies as may be necessary in the judgment of the authority for the successful development of any project; and to pay the reasonable costs of consulting engineers, architects, accountants, and construction experts employed by any participating party if, in the judgment of the authority, such services are necessary to the successful development of any project, and provided such services are not obtainable from any state agency.

(g) To do all things generally necessary or convenient to carry out the purposes of this division.

39612. All expenses incurred in carrying out the provisions of this division shall be payable solely from funds provided under the authority of this division and no liability or obligation shall be imposed upon the State of California and, except as provided in Section 39626, none shall be incurred by the authority beyond the extent to which moneys shall have been provided under the provisions of this division. Under no circumstances shall the authority create any debt, liability, or obligation on the part of the State of California payable from any source whatsoever other than the moneys provided under the provisions of this division.

39613. (a) All projects shall be constructed or completed subject to the rules and regulations of the authority.

(b) The authority is authorized to acquire, by deed, purchase, lease, contract, gift, devise, or otherwise, any real or personal property, structures, rights, rightsof-way, franchises, easements, and other interests in lands located within this state necessary or convenient for the construction or operation of a project, upon such terms and conditions as it deems advisable, and to lease, sell, or dispose of the same in such manner as may be necessary or desirable to carry out the objects and purposes of this division. Nothing in this division shall authorize the authority to exercise the power of eminent domain.

39614. When the principal of and interest on bonds of the authority issued to finance the cost of a particular project for a participating party, including any refunding bonds issued to refund and refinance such bonds, shall have been fully paid and retired or when adequate provision shall have been made for the payment and retirement of the same, and all other conditions of the resolution, indenture, or agreement authorizing and securing the same shall have been satisfied and the lien of such resolution, indenture, or agreement shall have been released in accordance with the provisions thereof, the authority is authorized, upon such terms and conditions as may be prescribed by the authority, to execute such deeds and conveyances as are necessary or required to convey title to such project to such participating party.

39615. No project, or portion thereof, shall be eligible for financing under this division for which, at the time an application is submitted to the authority, financing has been otherwise obtained.

No project shall be eligible for financing under this division unless the appropriate state control agency certifies that there is reasonable assurance that:

(a) The project is necessary to further compliance with applicable federal, state and local standards and requirements.

(b) The project is consistent with an approved regional, basin, or state plan for environmental protection.

(c) The project, in the event that such project is concerned with water pollution control, cannot reasonably be financed by being included, or otherwise participating, in a water pollution control project directly funded by a public agency. For purposes of this section the "appropriate state control agency" shall be the State Water Resources Control Board for projects affecting water quality, the State Air Resources Board for projects affecting air quality, or the Resources Agency for a project affecting other than water quality or air quality. The authority shall reimburse the control agencies for their reasonable and necessary expenses in making the certification.

(Amended by Ch. 1473/74, effective 9/26/74.)

39616. Throughout each calendar quarter the authority shall accept applications for financing proposed projects. Eligible applicants shall be limited to participating parties who own or operate facilities requiring pollution control equipment which may be provided pursuant to this chapter. After the close of each such quarter, the authority shall determine by resolution those projects which it will finance. The financing of projects shall be determined on the basis of the following priorities:

(a) First priority shall be given to projects which are necessary to meet an established federal, state, or local deadline for correction of existing pollution problems caused by existing facilities.

(b) Second priority shall be given to projects which are necessary to enable existing facilities to comply with federal, state, or local plans for environmental protection but for which no specific compliance date has been established. (c) Third priority shall be given to other eligible projects.

(Repealed by Ch. 1473/74, effective 9/26/74.) (Added by Ch. 1473/74, effective 9/26/74.)

39617. Projects approved for financing pursuant to Section 39616 shall not exceed fifty million dollars ($50,000,000) in aggregate for each calendar quarter; provided that the authority may at the beginning of any calendar quarter, determine by resolution to finance a lesser aggregate amount of projects during such calendar quarter. In the event that eligible applications exceed, in any quarter, an aggregate of fifty million dollars ($50,000,000), or such lesser amount as may be available for financing during such quarter, projects shall be financed in the following order:

(a) Projects estimated to cost less than one million dollars ($1,000,000). (b) Projects estimated to cost more than one million dollars ($1,000,000) which provide for pretreatment of wastes discharged into a publicly operated sewerage system.

(c) Projects estimated to cost more than one million dollars ($1,000,000) which provide for conservation and reuse of natural resources.

(d) All other eligible projects estimated to cost more than one million dollars ($1,000,000).

The order of financing specified in this section shall be applied, as appropriate, to applications within the respective priority classifications established pursuant to Section 39616.

(Added by Ch. 1473/74, effective 9/26/74.)

39617.5. Eligible applications not approved for financing by the authority in any calendar quarter shall, unless withdrawn by the applicant, be automatically considered for financing in the next succeeding calendar quarter along with any new applications which may be submitted in such quarter and shall be subject to the same priorities for financing as such new applications.

(Added by Ch. 1473/74, effective 9/26/74.)

39618. Prior to the beginning of each calendar quarter, the authority shall obtain from the appropriate state control agencies, designated in Section 39615, a list of the names and addresses of those business associations, corporations, or individuals which have been required, by a specified deadline, to correct pollution problems caused by existing facilities. The authority shall notify such business associations, corporations, or individuals of its programs for financing pollution control facilities.

In addition, the authority shall take all reasonable steps to publicize its programs so that eligible applicants may be aware of them.

(Added by Ch. 1473/74, effective 9/26/74.)

39618.2. The authority shall provide maximum opportunity for use of its financing by individuals and small businesses or corporations by providing information, assistance, and coordination to facilitate financing for small projects. (Added by Ch. 1473/74, effective 9/26/74.)

39618.5. The authority, no later than March 1 of each year, shall submit to the Legislature a report of its activities for the preceding calendar year ended December 31. Such report shall include (1) a listing of applications received, (2) a listing of applications accepted for financing, (3) specification of bonds sold, interest rates thereon, and whether bond sales were pursuant to public bid or were negotiated, (4) specification of the amount of bonds authorized but currently unsold, (5) a projection of the authority's needs and requirements for the coming year, and (6) a report of revenues and expenditures for the preceding fiscal year.

(Added by Ch. 1473/74, effective 9/26/74.)

39619. An applicant for financing for a project involving a waste water treatment plant shall provide evidence satisfactory to the Senate Water Resources Control Board that the waste water treatment facilities will be operated and maintained by competent personnel. Such evidence shall include, but not be limited to, a description of operating procedures, organizational structure, minimum personnel requirements and training programs. (Added by Ch. 1473/74, effective 9/26/74.)

ARTICLE 3. BONDS AND NOTES

39620. The authority is authorized to incur indebtedness and to issue securities of any kind or class, and to renew the same, provided that all such indebtedness, howsoever evidenced, shall be payable solely from revenues of the authority and the proceeds of its bonds, as hereinafter defined, shall not exceed the sum of two hundred million dollars ($200,000,000) of new debt, except as provided in this article, "New debt" shall not include indebtedness incurred to replenish or refund existing debts except to the extent that such indebtedness exceeds the amount of such debts

39620.5 (a) At such times as the authority desires to issue bonds, as defined in Section 39621, in excess of the amount provided in Section 39620, it shall adopt a resolution specifying the total amount of such bonds proposed to be issued. The amount specified in any such resolution shall not exceed two hundred million dollars ($200,000,000) of new debt.

Upon adoption of the resolution, the authority shall immediately cause copies thereof to be transmitted to the Senate Rules Committee and to the Speaker of the Assembly.

(b) Upon receipt of such a resolution, the Senate Rules Committee and the Speaker of the Assembly shall refer the resolution to a standing committee of their respective houses for study and a report. Such a report shall be made no later than the 50th calendar day of continuous session of the Legislature after the date on which the resolution was transmitted to each house of the Legislature.

(c) A resolution of either house of the Legislature, disapproving of the issuance of the bonds as proposed in the resolution of the authority may be made by floor motion within 10 calendar days following the submission of the report

provided for in subdivision (b). Such a resolution shall be voted on without referral to committee.

If either house shall adopt such a resolution of disapproval, the authority shall not issue the bonds as proposed in its resolution. If neither house has adopted a resolution of disapproval within 10 calendar days as provided in this subdivision, the authority shall be authorized to issue the bonds as specified in its resolution.

(d) If the authority, pursuant to this section, submits to the Legislature a resolution proposing the issuance of bonds and the Legislature adjourns sine die before 60 continuous calendar days have elapsed, the authority shall not issue the proposed bonds. The authority may submit the same resolution, or a new resolution, proposing the issuance of bonds to the Legislature when it next

convenes.

39621. (a) The authority is authorized from time to time to issue its negotiable bonds, notes, debentures, or other securities (hereinafter collectively called "bonds") for any corporate purpose. Such bonds may be authorized, without limiting the generality of the foregoing, to finance a single project for a single participating party, a series of projects for a single participating party, a single project for several participating parties, or several projects for several participating parties. In anticipation of the sale of such bonds as authorized by Section 39620, or as may be authorized pursuant to Section 39620.5, the authority may issue negotiable bond anticipation notes and may renew the same from time to time. Such bond anticipation notes may be paid from the proceeds of sale of the bonds of the authority in anticipation of which they were issued. Notes and agreements relating thereto and bond anticipation notes, hereinafter collectively called notes, and the resolution or resolutions authorizing the same may contain any provisions, conditions or limitations which a bond, agreement relating thereto, and bond resolution of the authority may contain; except that such note or renewal thereof shall mature at such time not exceeding two years from the date of issue of the original note.

(b) Except as may otherwise be expressly provided by the authority, every issue of its bonds, notes, or other obligations shall be general obligations of the authority payable from any revenues or moneys of the authority available therefor and not otherwise pledged, subject only to any agreements with the holders of particular bonds, notes, or other obligations pledging any particular revenues or moneys and subject to any agreements with any participating party. Notwithstanding that such bonds, notes, or other obligations may be payable from a special fund, they shall be and be deemed to be for all purposes negotiable instruments, subject only to the provisions of such bonds, notes or other obligations for registration.

(c) Subject to the limitations in Sections 39620 and 39620.5, the bonds may be issued as serial bonds or as term bonds, or the authority, in its discretion, may issue bonds of both types. The bonds shall be authorized by resolution of the authority and shall bear such date or dates, mature at such time or times, not exceeding 50 years from their respective dates, bear interest at such rate or rates, be payable at such time or times, be in such denominations, be in such form, either coupon or registered, carry such registration privileges, be executed in such manner, be payable in lawful money of the United States of America at such place or places, and be subject to such terms of redemption, as such resolution or resolutions may provide. The bonds or notes shall be sold by the State Treasurer within 60 days of receipt of a certified copy of the authority's resolution authorizing the sale of the bonds; provided, that the authority, at its discretion, may adopt a resolution extending such 60-day period. Such sales may be at public or private sale, and for such price or prices and on such terms and conditions, as the authority shall determine after giving due consideration to the recommendations of any participating party to be assisted from the proceeds of such bonds or notes. Pending preparation of the definitive bonds, the State Treasurer may issue interim receipts, certificates, or temporary bonds which shall be exchanged for such definitive bonds. The State Treasurer may sell any bonds, notes, or other evidence of indebtedness at a price below the par value thereof; provided, however, that the discount on and security so sold shall not exceed 6 percent of the par value thereof.

(d) Any resolution or resolutions authorizing any bonds or any issue of bonds may contain provisions, which shall be a part of the contract with the holders of the bonds to be authorized, as to: