California Code, Health and Safety Code - HSC § 4902

If the territory annexed to the district comprises all of another district, formed under the provisions of this chapter, or under the provisions of Chapter 26 (commencing at Section 5820), Part 3, Division 7 of the Streets and Highways Code, the theretofore existing district is thereupon dissolved. The funds of the dissolved district shall be transferred to the district to which all its territory has been annexed and all contracts or obligations of the dissolved district become the obligations of the district to which the territory has been annexed.