If it appears to the treasurer that there is danger of an ultimate loss accruing to the bondholders for any reason, he or she shall withhold payment on all matured bonds and interest and report the facts to the legislative body so that proper action may be taken by that body to equitably protect all bondholders.
Cal. Sts. & High. Code § 8770
REDEMPTION FUND DEFICIENCIES
Known as the Improvement Bond Act
The act spans §§ 8500 to 8887 (148 sections).
Amended by Stats. 1993, Ch. 194, Sec. 19
Official source: California Legislative Information. Reproduced from public-domain California statutes; confirm against the official source for the current text. Not legal advice.