Pursuant to the procedure set forth in this chapter, two or more existing coterminous improvement districts formed pursuant to the provisions of Chapter 4.9 (commencing with Section 36410) of this part may be consolidated into one improvement district. In such instance the consolidated improvement district may be designated in such manner as the board may designate. Any authorized but unissued bonds of any of the coterminous improvement districts may be issued and sold as the bonds of the consolidated improvement district. Such bonds, as well as any funds on hand from bonds previously issued by any of the improvement districts consolidated into one improvement district as hereinafter provided or any other funds of any such improvement districts, shall be used in the manner provided by law for the original authorized purposes. However, any such use of funds shall be to accomplish the plan of works originally established or as subsequently amended.

Any bonds which were issued by any of the coterminous improvement districts prior to their consolidation and which remain outstanding at the time of consolidation shall be assumed by and become the liability of the consolidated improvement district.

To the extent assessment, standby charges, or other charges are necessary to be levied or collected by reason of any such improvement districts consolidated hereunder into one improvement district, such assessment, standby charges, or other charges may be collected by the consolidated improvement district provided for hereunder. Thereafter, the amount so collected shall be utilized to satisfy the obligations for which such assessments or standby charges were levied and collected, except that any amount over and above that necessary to satisfy said obligations may be used for any of the purposes of the consolidated improvement district.

(Added by Stats. 1978, Ch. 5.)