ARTICLE 1. General Provisions [53398. - 53398.8.]

Cal. Government Code - GOV 1.

in effect

Cal. Government Code - GOV § 53398. Section 53398.

(a) The Legislature finds and declares that the North American Free Trade Agreement has resulted in a dramatic increase in trade with Mexico. In 1998 companies in California exported over $13.3 billion worth of goods to Mexico, and more than 80,000 jobs throughout the state are the direct result of this trade. This increased trade has strained the inadequate public infrastructure in the region just north of the international border. (b) The Legislature further finds and declares that there is a significant opportunity for industrial development, including high technology and biotechnology manufacturing, in the region along the border. However, this region lacks the public infrastructure necessary to support new development or to provide for the rapid and reliable delivery of supplies to, and distribution of products from, companies throughout the state. (c) The Legislature finds and declares that the state and federal governments have withdrawn in whole or in part from their former role in financing infrastructure facilities, including highways, roads and interchanges, sewage facilities and water reclamation works, water supply and treatment works, flood control and drainage works, schools, libraries, parks, parking facilities, open space, and seismic retrofit and rehabilitation of public facilities. (d) The Legislature further finds and declares that the methods available to local agencies to finance public works often place an undue and unfair burden on buyers of new homes, especially for public works that benefit the broader community. (e) The Legislature further finds and declares that the absence of practical and equitable methods for financing both regional and local public works leads to a declining standard of public works, a failure to construct new public works needed to support new commercial and industrial development in the region along the border, a reduced quality of life and decreased safety for affected citizens, increased objection to otherwise desirable development, and excessive costs for homebuyers. (f) The Legislature further finds and declares that it is equitable and in the public interest to provide alternative procedures for financing public works and services needed to support new commercial and industrial development in the region along the border that would generate significant new employment opportunities.

Cal. Government Code - GOV § 53398.1. Section 53398.1.

Unless the context otherwise requires, the definitions contained in this article shall govern the construction of this chapter. (a) “Affected taxing entity” means any governmental taxing agency that levied or had levied on its behalf a property tax on all or a portion of the property located in the proposed district in the fiscal year prior to the designation of the district, but not including any county office of education, school district, community college district, or the Educational Revenue Augmentation Fund. (b) “Border development zone” means a strip of land three miles wide with the international border with Mexico on the south, the mean high tide of the Pacific Ocean on the west, and the border with the State of Arizona on the east. (c) “City” means a city, a county, or a city and county. (d) “Debt” means any binding obligation to repay a sum of money, including obligations in the form of bonds, certificates of participation, long-term leases, loans from government agencies, or loans from banks, other financial institutions, private businesses, or individuals. (e) “Designated official” means the city engineer or other appropriate official designated pursuant to Section 53398.13. (f) “District” means an infrastructure financing district located in the border development zone. (g) “Infrastructure financing district” means a legally constituted governmental entity established pursuant to this chapter for the sole purpose of financing public facilities. (h) “Landowner” or “owner of land” means any person shown as the owner of land on the last equalized assessment roll or otherwise known to be the owner of the land by the legislative body. The legislative body has no obligation to obtain other information as to the ownership of land, and its determination of ownership shall be final and conclusive for the purposes of this chapter. A public agency is not a landowner or owner of land for purposes of this chapter. (i) “Legislative body” means the city council or board of supervisors.

Cal. Government Code - GOV § 53398.2. Section 53398.2.

(a) The revenues available pursuant to Article 3 (commencing with Section 53398.30) may be used directly for work allowed pursuant to Section 53398.3 (including use as matching funds to accomplish this work), may be accumulated for a period not to exceed five years to provide a fund for that work, may be pledged to pay the principal of, and interest on, bonds issued pursuant to Article 4 (commencing with Section 53398.40), or may be pledged to pay the principal of, and interest on, bonds issued pursuant to the Improvement Bond Act of 1915 (Division 10 (commencing with Section 8500) of the Streets and Highways Code) or the Mello-Roos Community Facilities Act of 1982 (Chapter 2.5 (commencing with Section 53311)), the proceeds of which have been or will be used entirely for allowable purposes of the district. The revenue of the district may also be advanced for allowable purposes of the district to an Integrated Financing District established pursuant to Chapter 1.5 (commencing with Section 53175), in which case the district may be party to a reimbursement agreement established pursuant to that chapter. The revenues of the district may also be committed to paying for any completed public facility acquired pursuant to Section 53398.3 over a period of time, including the payment of a rate of interest not to exceed the bond buyer index rate on the day that the agreement to repay is entered into by the city. (b) The legislative body may enter into an agreement with any affected taxing entity providing for the construction of, or assistance in, financing public facilities.

Cal. Government Code - GOV § 53398.3. Section 53398.3.

(a) A district may finance (1) the purchase, construction, expansion, improvement, seismic retrofit, or rehabilitation of any real or other tangible property with an estimated useful life of 15 years or longer that satisfies the requirements of subdivision (b), (2) the planning and design work that is directly related to the purchase, construction, expansion, or rehabilitation of that property, and (3) the costs described in Sections 53398.5 and 53398.31. A district may only finance the purchase of facilities for which construction has been completed, as determined by the legislative body. The facilities need not be physically located within the boundaries of the district. A district may not finance routine maintenance, repair work, or the costs of ongoing operation or providing services of any kind. (b) The district shall finance only public capital facilities that provide significant benefits to the area of the border development zone, including, but not limited to, all of the following: (1) Highways, interchanges, ramps and bridges, major and minor arterial streets, major and minor collector streets, parking facilities, and transit facilities. Phased road widening projects shall also be permitted. (2) Sewage collection, pumping, treatment and water reclamation plants and interceptor pipes. (3) Facilities for the collection and treatment of water for urban uses. (4) Flood control levees and dams, retention basins, and drainage facilities. (5) Child care facilities. (6) Libraries. (7) Parks, recreational facilities, and open space. (8) Facilities for the transfer and disposal of solid waste, including transfer stations and vehicles. (9) Public safety facilities. (c) Any district that constructs dwelling units shall set aside not less than 20 percent of those units to increase and improve the community’s supply of low- and moderate-income housing available at an affordable housing cost, as defined by Section 50052.5 of the Health and Safety Code, to persons and families of low and moderate income, as defined in Section 50093 of the Health and Safety Code. (d) A district may also finance the purchase of sewage treatment capacity that provides significant benefits to the area of the border development zone. The facility providing the sewage treatment capacity need not be physically located within the boundaries of the district.

Cal. Government Code - GOV § 53398.4. Section 53398.4.

(a) A district may not include any portion of a redevelopment project area that is or has been previously created pursuant to Part 1 (commencing with Section 33000) of Division 24 of the Health and Safety Code, whether the creation is or was proper or improper. A redevelopment project area may not include any portion of a district created pursuant to this chapter. (b) A district may finance only the facilities or services authorized in this chapter to the extent that the facilities or services are in addition to those provided in the territory of the district before the district was created. The additional facilities or services may not supplant facilities or services already available within that territory when the district was created but may supplement those facilities and services as needed to serve new developments. (c) A district may include areas that are not contiguous.

Cal. Government Code - GOV § 53398.5. Section 53398.5.

It is the intent of the Legislature that the area of the districts created be substantially undeveloped, and the establishment of a district should not ordinarily lead to the removal of existing dwelling units. If, however, any dwelling units are proposed to be removed or destroyed in the course of private development or public works construction within the area of the district, the legislative body shall do all of the following: (a) Within four years of the removal or destruction, cause or require the construction or rehabilitation, for rental or sale to persons or families of low or moderate income, of an equal number of replacement dwelling units at affordable housing cost, as defined in Section 50052.5 of the Health and Safety Code, within the territory of the district if the dwelling units removed were inhabited by persons or families of low or moderate income, as defined in Section 50093 of the Health and Safety Code. (b) Within four years of the removal or destruction, cause or require the construction or rehabilitation, for rental or sale to persons of low or moderate income, a number of dwelling units that is at least one unit but not less than 20 percent of the total dwelling units removed at affordable housing cost, as defined in Section 50052.5 of the Health and Safety Code, within the territory of the district if the dwelling units removed or destroyed were not inhabited by persons of low or moderate income, as defined in Section 50093 of the Health and Safety Code. (c) Provide relocation assistance and make all the payments required by Chapter 16 (commencing with Section 7260) of Division 7 of Title 1, to persons displaced by any public or private development occurring within the territory of the district. This displacement shall be deemed to be the result of public action. (d) Ensure that removal or destruction of any dwelling units occupied by persons or families of low or moderate income does not take place unless and until there are suitable housing units, at comparable cost to the units from which the persons or families were displaced, available and ready for occupancy by the residents of the units at the time of their displacement. The housing units shall be suitable to the needs of these displaced persons or families and shall be decent, safe, sanitary, and otherwise standard dwellings.

Cal. Government Code - GOV § 53398.6. Section 53398.6.

Any action or proceeding to attack, review, set aside, void, or annul the creation of a district or the adoption of an infrastructure financing plan, including a division of taxes thereunder, shall be commenced within 30 days after the enactment of the ordinance creating the district pursuant to Section 53398.21. Consistent with the time limitations of this section, such an action or proceeding with respect to a division of taxes under this chapter may be brought pursuant to Chapter 9 (commencing with Section 860) of Title 10 of Part 2 of the Code of Civil Procedure, except that Section 869 of the Code of Civil Procedure shall not apply.

Cal. Government Code - GOV § 53398.7. Section 53398.7.

An action to determine the validity of the issuance of bonds pursuant to this chapter may be brought pursuant to Chapter 9 (commencing with Section 860) of Title 10 of Part 2 of the Code of Civil Procedure. However, notwithstanding the time limits specified in Section 860 of the Code of Civil Procedure, the action shall be commenced within 30 days after adoption of the resolution pursuant to Section 53398.43 providing for issuance of the bonds if the action is brought by an interested person pursuant to Section 863 of the Code of Civil Procedure. Any appeal from a judgment in that action or proceeding shall be commenced within 30 days after entry of judgment.

Cal. Government Code - GOV § 53398.8. Section 53398.8.

An infrastructure financing district in the border development zone is a “district” within the meaning of Section 1 of Article XIII A of the California Constitution.

Source: CA Legislative Counsel Bulk DataURL: https://downloads.leginfo.legislature.ca.gov/pubinfo_2025.zipFetched: 6/27/2026