(a) Taxes collected by the State Board of Equalization pursuant to Section 7204 of the Revenue and Taxation Code, that are derived from that portion of the taxes imposed by a county of the second class in excess of 1 percent, and for the period beginning on and after July 1, 2004, and ending when the rate modifications in subdivision (a) of Section 7203.1 of the Revenue and Taxation Code cease to apply, that are derived from that portion of the taxes imposed by that county in excess of one-half of 1 percent, pursuant to Part 1.5 (commencing with Section 7200) of Division 2 of the Revenue and Taxation Code, and that are permitted to be deposited in the general fund of a county pursuant to paragraph (1) of subdivision (a) of Section 29530.6 shall be pledged, without the necessity for specific authorization of the pledge by the board of supervisors, to all certificates of participation or lease revenue bonds executed and delivered or issued, as the case may be, during the year 1996, including obligations executed and delivered or issued before 2010 to refund those certificates of participation or lease revenue bonds, to finance or refinance the lease or lease-purchase of property of the county and having a stated maturity of 20 years or more. Any refunding obligations may not have a final maturity later than the final maturity of the refunded obligations. The amount so pledged with respect to any fiscal year of the county may not exceed the amount to be paid in that fiscal year on those certificates or lease revenue bonds.
(b) The pledge of taxes pursuant to this section shall constitute a contract between a county of the second class and the owners of any of the certificates of participation or lease revenue bonds and shall be protected from impairment by the United States and California Constitutions. The state hereby covenants with the owners of any certificates of participation or lease revenue bonds entitled to the pledge granted by this section that, so long as any of the certificates of participation or lease revenue bonds entitled to the pledge granted by this section shall remain outstanding, (1) the provisions of Section 7202 that authorize the imposition of the taxes may not be repealed and (2) the provisions of paragraph (1) of subdivision (a) of Section 29530.6 may not be repealed prior to July 1, 2011, nor may either section be altered or amended prior to that date in any manner that would adversely affect the security of, or the ability of the county to pay, the principal of and interest on the certificates of participation or lease revenue bonds entitled to the pledge granted by this section. However, nothing precludes any alteration or amendment if and when adequate provision has been made by law for the protection from impairment of the contract represented by the certificates of participation or lease revenue bonds, and the right to so alter or amend is hereby reserved. The county may include this covenant of the state in the agreements or other documents underlying the certificates of participation or lease revenue bonds.
(Amended by Stats. 2003, Ch. 757, Sec. 3.2. Effective January 1, 2004. Section conditionally operative as prescribed by Sec. 12 of Stats. 1998, Ch. 724 (which added this section).)