Cal. PUC § 13093

Whenever a district exercises the power to borrow money pursuant to this chapter the board may authorize the issuance of bonds in any amount which, when added to the aggregate amount of bonds of the district issued under this chapter and outstanding at the time of the acceptance of a proposal for the purchase of the bonds so authorized and payable out of the revenues out of which the bonds so authorized are to be payable shall not exceed the amount of the earned surplus derived from the operation of the electric system to which those revenues pertain, as of the end of the last fiscal year which ended not less than four months prior to the making of the finding and determination provided for in Section 13161. The aggregate amount of bonds issued under this chapter shall not exceed in face value the sum of ten million dollars ($10,000,000) in any one calendar year. The term “earned surplus” whenever used in this chapter means the excess of revenues from the inception of operation of the electric system over related expenses thereof, plus accumulated price-level depreciation, plus or minus any additional amounts credited to or charged against customers’ equity employed in the business of the electric system, as determined in accordance with the then current accounting practice of the district. The term “accumulated price-level depreciation” as used in this section means the accumulated additional amounts by which depreciation based on the cost of depreciable property adjusted to reflect current price levels exceeds depreciation computed on cost.