California Code, Government Code - GOV § 23262

Except as provided by the commission, when the boundary change is effected the territory which is transferred shall be relieved of annual tax liability for the outstanding indebtedness of the transferring county in the year following the year in which the election on the question of the boundary change is held.

Territory remaining in the transferring county when the boundary change is effected shall be relieved of annual tax liability for any outstanding indebtedness of that county which the commission determines is to be assumed by the accepting county.  Such relief shall become effective in the year following the year in which the election on the question of the boundary change is held.

Nothing in this section shall be construed as in any way limiting the power of a bondholder to enforce contractual rights or affecting the ultimate liability of territory of the transferring county, or of the accepting county for bonded indebtedness in case of default.