California Code, Public Resources Code - PRC § 13118

Any bonds issued by any area organized under this division are hereby given the same force, value, and use as bonds issued by any municipality and shall be exempt from all taxation within the state.

All bonds issued by any area payable from taxes are legal investments for all trust funds, for the trust funds of all insurance companies, the state school funds, and any funds that may be invested in bonds of cities, counties, cities and counties, school districts, or municipalities in the state.