California Code, Government Code - GOV § 6571

The bonds shall be issued and sold as the governing body may determine and for not less than par and accrued interest to date of delivery, except that, in the case of a project for the generation or transmission of electric energy, a project for the disposal, treatment, or conversion of energy and reusable materials of solid waste, a project for a purpose specified in Section 6546.6, a project for the construction of bridges and major thoroughfares pursuant to Section 66484.3, a project for an intermodal container transfer facility specified in Section 6546.6, a project for a consolidated transportation corridor pursuant to Section 6546.13, a project funded by a joint powers authority formed to provide port or harbor infrastructure pursuant to Part 1 (commencing with Section 1690) of Division 6 of the Harbors and Navigation Code, or in the case of bonds of a fair and exhibition authority, the bonds may be sold at less than par if the governing body determines that the sale will result in more favorable terms for the bonds. The sale shall be conducted in compliance with Chapter 10 (commencing with Section 5800) of Division 6 of Title 1, unless, in the case of a project for the generation or transmission of electric energy, a project for the disposal, treatment, or conversion of energy and reusable materials of solid waste, a project for the development and construction of an intermodal container transfer facility specified in Section 6546.6, a project for a consolidated transportation corridor pursuant to Section 6546.13, a project for the construction of bridges and major thoroughfares pursuant to Section 66484.3, a project funded by a joint powers authority formed to provide port or harbor infrastructure pursuant to Part 1 (commencing with Section 1690) of Division 6 of the Harbors and Navigation Code, or in the case of bonds of a fair and exhibition authority, the governing body shall determine that a negotiated sale of the bonds is necessary, in which case the bonds shall be sold on the terms approved by the governing body.

The proceeds from the sale (except premium and accrued interest, which shall be paid into the bond service or other fund designated or established for the payment of the principal and interest of the bonds) shall be paid into the construction fund or other fund designated by the indenture authorizing the issuance of the bonds and shall be applied exclusively to the objects and purposes set forth in the indenture, including all expenses incidental thereto or in connection therewith, and also including the payment of interest on the bonds during the period of study and construction of the project and for a period not to exceed 12 months after completion of the construction.