California Harbors And Navigation Code Section 77
(a) The department, subject to the approval of the Director of
Finance, may borrow funds from the Harbors and Watercraft Revolving
Fund when a borrower has defaulted from any financial obligation and
funds are required to protect the security interest of the department
with respect to any loan made under Section 76.3.
(b) The funds borrowed under this section shall be repaid within
three years from the date of the approval of the Director of Finance.
The repayment shall include the principal amount of the loan, plus
interest equal to the rate of earnings of money deposited in the
Surplus Money Investment Fund at the time the loan is approved by the
Director of Finance.
(c) A maximum of ten million dollars ($10,000,000) per year may be
used for purposes of this section.
(d) The borrowed funds may be used to do any of the following:
(1) Pay any administrative and legal expenses incurred in
connection with those defaults.
(2) Acquire through negotiated purchase or bid at auction any
property which serves as collateral for those defaulted loans.
(3) Pay any costs of operating and maintaining a recreational
marina acquired as a result of a failed loan, until the marina is