The term of any lease or lease-purchase agreement shall not exceed the estimated useful life of the item but in no event shall the term exceed 10 years. A lease, but not a lease-purchase agreement, may be renewable at the option of the lessee and the lessor, jointly, at the end of each term at a rate not more than 7 percent annually above the rate set pursuant to the existing agreement. In no event shall the combined period of the original lease and renewals or extensions exceed 10 years. Any contract for the lease or lease-purchase of equipment or service systems which was in existence prior to the effective date of this act shall remain in effect and such terms are hereby ratified.

(Enacted by Stats. 1976, Ch. 1010.)

Terms Used In California Education Code 81552

  • Contract: A legal written agreement that becomes binding when signed.
  • equipment: includes (1) schoolbuses, (2) other motor vehicles, (3) test materials, educational films, and audiovisual materials, and (4) all other items defined as equipment or service systems in the Community College Budget and Accounting Manual. See California Education Code 81550
  • Lease: A contract transferring the use of property or occupancy of land, space, structures, or equipment in consideration of a payment (e.g., rent). Source: OCC
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