State Law Allows Property Owners to Leave District and be Absolved of Bond Debt
Title 6. Districts Chapter 3.5 Notice of Formation or Change of Boundaries of Districts
California Government Code 58004 (a) defines “District” as a “tax or assessment district”.
California Government Code 58004 (d) defines “Supervising Authority” as “the board of supervisors of the county in which is situation all or most of the land i a district, or body authorized by law to initiate or hear proceedings for the creation of a district.”
California Govt. Code 58902:
Except as herein otherwise provided, this chapter shall apply to all districts. This chapter shall not apply to any boundary change which is approved by all of the owners of real property proposed to be included within, or proposed to be excluded from, the district, nor to any proceeding commenced or conducted with respect to forming a metropolitan water district or separation of grade district or changing the boundaries thereof.
58903.
Upon the filing or other submission of any proposal, the supervising authority shall give notice thereof as required by this chapter.
58904.
The notice of filing or other submission of the proposal shall contain the matters specified by the law under which the proposal is made. In lieu thereof it shall be sufficient if the notice of filing or other submission of the proposal shall contain the following:
(a) The nature of the proposal.
(b) A general description or map of the territory included in the proposal.
(c) The time and place of the first public hearing on the proposal if a public hearing is required by other provisions of law to be held upon the proposal, or the time and place upon which the supervising authority will take initial action upon the proposal.
CHAPTER 4. District Indebtedness [58950- 58950.] ( Chapter 4 added by Stats. 1972, Ch. 576. )
California Govt. Code 58950
If territory has been detached from a district and that detached territory is subject to terms and conditions imposed by the local agency formation commission pursuant to Section 56886 and those terms and conditions require that the detached territory continue to be taxed for the payment of principal and interest on outstanding bonds of the district, the governing body of the district from which the territory was detached may absolve and relieve the detached territory of its annual tax liability as follows:
(a) The district board shall, by resolution, declare its intention to relieve the detached territory of its annual tax liability for payment of principal and interest on outstanding district bonds. The resolution shall describe the detached territory, specify the annual liability the territory will be relieved of, state the reason or reasons why the detached territory should be relieved, and fix a time, date, and place for a public hearing on the proposed relief of liability.