(a) The Revenue Bond Law of 1941 (Chapter 6 (commencing with Section 54300) of Part 1 of Division 2 of Title 5 of the Government Code) is applicable to districts for the purpose of providing funds for the acquisition, construction, improving or financing of any public improvement authorized by this division which is not inconsistent with the provisions of Section 54310 of the Government Code. However, notwithstanding the provisions of Sections 54382, 54400, and 54402 of the Government Code and any other provisions of law, the board may determine and provide, in any resolution providing for the issuance of such revenue bonds, for the following:

(1) For maturity dates of the bonds not exceeding 50 years from their respective dates.

(2) If, before the issuance of the bonds, the board determines, to the best of its knowledge and belief, that the interest on the bonds will be subject to federal income taxation under then existing law, for interest on the bonds at a rate or rates not exceeding 10 percent a year, payable annually or semiannually.

(b) The powers conferred upon districts by this section are in addition to the powers conferred by Article 7 (commencing with Section 31480) of Chapter 2 of Part 6 of this division and none of the provisions of such Article 7 are applicable to proceedings taken by a district pursuant to this section.

(c) The board may issue revenue bonds under the Revenue Bond Law of 1941 on behalf of any portion of the district created as an improvement district pursuant to this division and any election for the issuance of such revenue bonds shall be limited to the area of such improvement district. If revenue bonds are so issued on behalf of an improvement district:

(1) No proceeds of such revenue bonds shall be used to finance public improvements to provide service outside the service area of the improvement district.

(2) Only revenues which are derived from rates or charges for the providing of service within the service area of the improvement district shall be pledged to or used to pay such revenue bonds.

(d) As used in this section, the words “service area of the improvement district” are defined to mean the territory of the improvement district as it existed at the time of the bond election plus lands outside the improvement district, if any, being served at the time of the bond election by the improvement district facilities plus additional territory, if any, annexed to the improvement district as the same existed at the time of the bond election, not exceeding in the aggregate 40 percent by area of the improvement district as the same existed at the time of the bond election.

(Amended by Stats. 1976, Ch. 1480.)