Wat. Code, § 11807

When the department, with the concurrence of the Department of Finance, deems it in the best interests of the state, it may authorize the State Treasurer, upon such terms and conditions as may be fixed by the department, to issue notes, in the manner prescribed by this section, maturing within a period not to exceed five years, payable from revenues received from the operation of the project or from federal reimbursements received under the National Disaster Act, or both. Notes authorized to be issued shall be issued at public sale on a competitive-bid basis upon such notice as the State Treasurer may deem advisable, except that if no bids are received or if such bids are not satisfactory to the State Treasurer, such notes may be issued on a negotiated-bid basis. The proceeds from the sale of such notes shall be used only for the purpose of providing funds for emergency repairs to the project necessitated by natural disasters.

All notes issued and any renewals thereof shall be payable at a fixed time, solely from revenues received from the operation of the project or from federal reimbursements received under the National Disaster Act, or both, and not otherwise, except that in the event that sufficient revenues or reimbursements, or both, are not received prior to the maturity of the notes, the State Treasurer shall, in order to meet the notes then maturing, issue renewal notes for such purpose.

Every note and any renewal thereof shall be payable from revenues received from the operation of the project or from federal reimbursements received under the National Disaster Act, or both, and not otherwise. The total amount of such notes or renewals thereof issued and outstanding shall at no time exceed anticipated revenues from the operation of the project or federal reimbursements under the National Disaster Act, or both, to be received during the following two years.