ARTICLE 6. Finances [2070. - 2079.]

Cal. Health and Safety Code - HSC 6.

in effect

Cal. Health and Safety Code - HSC § 2070. Section 2070.

(a) On or before August 1 of each year, the board of trustees shall adopt a final budget, which shall conform to the accounting and budgeting procedures for special districts contained in Subchapter 3 (commencing with Section 1031.1) of, and Article 1 (commencing with Section 1121) of Subchapter 4 of Division 2 of Title 2 of the California Code of Regulations. The board of trustees may divide the annual budget into categories, including, but not limited to: (1) Maintenance and operation. (2) Employee compensation. (3) Capital outlay. (4) Interest and redemption for indebtedness. (5) Restricted reserve for public health emergencies. (6) Restricted reserve for capital and asset preservation. (7) Restricted reserve for contingencies. (8) Unallocated general reserve. (b) The board of trustees shall forward a copy of the final budget to the auditor of each county in which the district is located.

Cal. Health and Safety Code - HSC § 2071. Section 2071.

(a) In its annual budget, the board of trustees may establish one or more restricted reserves. When the board of trustees establishes a restricted reserve, it shall declare the exclusive purposes for which the funds in the reserve may be spent. The funds in the restricted reserve shall be spent only for the exclusive purposes for which the board of trustees established the restricted reserve. The reserves shall be maintained according to generally accepted accounting principles. (b) Any time after the establishment of a restricted reserve, the board of trustees may transfer any funds to that restricted reserve. (c) Notwithstanding any other provision of this section, in a public health emergency, a board of trustees may, by majority vote of the total membership of the board of trustees, temporarily transfer funds from other restricted reserves to the restricted reserve for public health emergencies. (d) If the board of trustees finds that the funds in a restricted reserve are no longer required for the purpose for which the restricted reserve was established, the board of trustees may, by a four-fifths vote of the total membership of the board of trustees, discontinue the restricted reserve or transfer the funds that are no longer required from the restricted reserve to the district’s general fund.

Cal. Health and Safety Code - HSC § 2072. Section 2072.

(a) On or before July 1 of each year, the board of trustees shall adopt a resolution establishing its appropriations limit and make other necessary determinations for the following fiscal year pursuant to Article XIII B of the California Constitution and Division 9 (commencing with Section 7900) of the Government Code. (b) Pursuant to subdivision (c) of Section 9 of Article XIII B of the California Constitution, this section shall not apply to a district which existed on January 1, 1978, and that did not as of the 1977–78 fiscal year levy an ad valorem tax on property in excess of twelve and one-half cents ($0.125) per one hundred dollars ($100) of assessed value.

Cal. Health and Safety Code - HSC § 2073. Section 2073.

The auditor of each county in which a district is located shall allocate to the district its share of property tax revenue pursuant to Chapter 6 (commencing with Section 95) of Part 0.5 of Division 1 of the Revenue and Taxation Code.

Cal. Health and Safety Code - HSC § 2074. Section 2074.

(a) A district may accept any revenue, money, grants, goods, or services from any federal, state, regional, or local agency or from any person for any lawful purpose of the district. (b) In addition to any other existing authority, a district may borrow money and incur indebtedness pursuant to Article 7 (commencing with Section 53820), Article 7.4 (commencing with Section 53835), Article 7.5 (commencing with Section 53840), Article 7.6 (commencing with Section 53850), and Article 7.7 (commencing with Section 53859) of Chapter 4 of Part 1 of Division 2 of Title 5 of the Government Code.

Cal. Health and Safety Code - HSC § 2075. Section 2075.

All claims for money or damages against a 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.

Cal. Health and Safety Code - HSC § 2076. Section 2076.

(a) All claims against a district shall be audited, allowed, and paid by the board of trustees by warrants drawn on the county treasurer. (b) As an alternative to subdivision (a), the board of trustees may instruct the county treasurer to audit, allow, and draw his or her warrant on the county treasury for all legal claims presented to him or her and authorized by the board of trustees. (c) The county treasurer shall pay the warrants in the order in which they are presented. (d) If a warrant is presented for payment and the county treasurer cannot pay it for want of funds in the account on which it is drawn, the treasurer shall endorse the warrant, “NOT PAID BECAUSE OF INSUFFICIENT FUNDS” and sign his or her name and the date and time the warrant was presented. From that time until it is paid, the warrant bears interest at the maximum rate permitted pursuant to Article 7 (commencing with Section 53530) of Chapter 3 of Part 1 of Division 2 of Title 5 of the Government Code.

Cal. Health and Safety Code - HSC § 2077. Section 2077.

(a) Notwithstanding Section 2076, a district that has total annual revenues greater than two hundred fifty thousand dollars ($250,000) may withdraw its funds from the control of the county treasurer pursuant to this section. (b) The board of trustees shall adopt a resolution that does each of the following: (1) States its intent to withdraw its funds from the county treasury. (2) Adopt a procedure for the appointment of a district treasurer. The board of trustees may appoint the district treasurer, or the board of trustees may delegate the appointment of the district treasurer to the district’s general manager. The district treasurer may be a member of the board of trustees, the secretary of the board of trustees, the general manager, or a district employee. (3) Fix the amount of the bond for the district treasurer and other district employees who will be responsible for handling the district’s finances. (4) Adopt a system of accounting and auditing that shall completely and at all times show the district’s financial condition. The system of accounting and auditing shall adhere to generally accepted accounting principles. (5) Adopt a procedure for drawing and signing warrants, provided that the procedure adheres to generally accepted accounting principles. The procedure shall provide that bond principal and salaries shall be paid when due. The procedure may provide that warrants to pay claims and demands need not be approved by the board of trustees before payment if the district treasurer determines that the claims and demands conform to the district’s approved budget. (6) Designate a bank or a savings and loan association as the depositary of the district’s funds. A bank or savings and loan association may act as a depositary, paying agent, or fiscal agency for the holding or handling of the district’s funds, notwithstanding the fact that a member of the board of trustees whose funds are on deposit in that bank or savings and loan association is an officer, employee, or stockholder of that bank or savings and loan association, or of a holding company that owns any of the stock of that bank or savings and loan association. (c) The board of trustees and the board of supervisors of the principal county shall determine a mutually acceptable date for the withdrawal of the district’s funds from the county treasury, not to exceed 15 months from the date on which the board of trustees adopts its resolution. (d) In implementing this section, the district shall comply with Article 1 (commencing with Section 53600) and Article 2 (commencing with Section 53630) of Chapter 4 of Part 1 of Division 2 of Title 5 of the Government Code. Nothing in this section shall preclude the district treasurer from depositing the district’s funds in the county treasury of the principal county or the State Treasury pursuant to Article 11 (commencing with Section 16429.1) of Chapter 2 of Part 2 of Division 4 of Title 2 of the Government Code. (e) The district treasurer shall make annual or more frequent written reports to the board of trustees, as the board of trustees shall determine, regarding the receipts and disbursements and balances in the accounts controlled by the district treasurer. The district treasurer shall sign the reports and file them with the secretary.

Cal. Health and Safety Code - HSC § 2078. Section 2078.

The board of trustees may establish a revolving fund pursuant to Article 15 (commencing with Section 53950) of Chapter 4 of Part 1 of Division 2 of Title 5 of the Government Code to make change and pay small bills directly.

Cal. Health and Safety Code - HSC § 2079. Section 2079.

(a) The board of trustees shall provide for regular audits of the district’s accounts and records pursuant to Section 26909 of the Government Code. (b) The board of trustees shall provide for the annual financial reports to the Controller pursuant to Article 9 (commencing with Section 53890) of Chapter 4 of Part 1 of Division 2 of Title 5 of the Government Code.

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