(1) (a) The clean energy improvement debt reserve fund is hereby created in the state treasury. The principal of the fund shall consist of up to ten million dollars of legally available moneys from nonstate sources under the control of the Colorado energy office, which the state treasurer shall promptly credit to the fund if instructed in writing to do so by the director of the Colorado energy office, and any fees paid to the state treasurer in accordance with subparagraph (II) of paragraph (b) of this subsection (1). All interest and income derived from the deposit and investment of moneys in the fund shall be credited to the fund, and all unexpended and unencumbered moneys in the fund at the end of any fiscal year shall remain in the fund. The fund is hereby continuously appropriated to the state treasurer, who may expend moneys from the fund solely for the purposes of paying principal and interest on bonds issued by a local improvement district or other special district as specified in paragraph (c) of this subsection (1) and defraying any direct and indirect costs incurred by the state treasurer in executing duties required by this section.

(b)

(I) If the Colorado energy office instructs the state treasurer to credit moneys from nonstate sources to the clean energy improvement debt reserve fund, with prior written authorization from the director of the Colorado energy office and the state treasurer and after agreeing to pay fees to be credited to the fund to the state treasurer as specified in subparagraph (II) of this paragraph (b), a local improvement district or other special district that imposes special assessments on real property and issues bonds payable from the revenues generated by the special assessments to generate the moneys needed to pay the up-front costs of making renewable energy improvements or clean energy improvements as authorized by part 6 of article 20 of title 30, C.R.S., or any other provision of law may rely on the clean energy improvement debt reserve fund as a backup source of moneys that may be used, after the depletion of any district debt service reserve fund, for the payment of principal and interest owed to holders of the district's bonds.

(II) A local improvement district or other district that issues bonds and that wishes to rely on the clean energy improvement debt reserve fund as a backup source of moneys for the payment of principal and interest owed to holders of the bonds shall enter into a written agreement with the Colorado energy office to pay to the state treasurer for crediting to the fund such fees for the privilege of relying on the fund as the Colorado energy office may require. Fees to be paid by a district as required by the Colorado energy office shall be deemed to be a portion of the amount of the interest rate savings resulting from more favorable financing terms attributable to the reliance upon the fund. The Colorado energy office may, in its discretion, require that fees be paid on an annual basis, commencing and calculated on the date of issuance of the bonds and on each one-year anniversary of the issuance of the bonds thereafter while the bonds remain outstanding, in an amount equal to a number of basis points of the principal amount of the bonds outstanding as of each calculation date agreed upon by the office and the district.

(c) Whenever the paying agent responsible for making payments to the holders of any bonds issued by a district that has relied upon the clean energy improvement debt reserve fund as a backup source of repayment for the district's bonds has not received payment of principal or interest on the bonds on the tenth business day immediately prior to the date on which such payment is due and any debt service reserve fund for the local improvement district or other special district that issued the bonds has been depleted, the paying agent shall so notify the state treasurer and the district by telephone, facsimile, or other similar communication, followed by written verification, of such payment status. The state treasurer shall immediately contact the district and determine whether the district will make the payment by the date on which it is due and, if the state treasurer confirms that the district will not make the payment, the state treasurer shall expend moneys from the clean energy improvement debt reserve fund to make the payment in a timely manner. If the amount of moneys in the clean energy improvement debt reserve fund is not sufficient to cover the entire amount of the payment, the state treasurer shall pay only so much of the payment as can be paid from available moneys in the fund. If payments on more than one series of bonds issued in reliance upon the clean energy improvement debt reserve fund as a backup source of moneys for repayment are required to be made from the fund at the same time and the amount of moneys in the fund is not sufficient to cover the entire amount of the payments, the state treasurer shall pay from available moneys in the fund only an equal percentage of the amount of each payment due.

(2) This section shall not be construed to create any state debt, to require the state to make any bond payments on behalf of any local improvement district or other special district from any source of moneys other than the clean energy improvement debt reserve fund, or to require the state to fully pay off any outstanding bonds of a district that cannot make scheduled bond payments.

(3) In accordance with section 11 of article II of the state constitution, the state hereby covenants with the purchasers of any outstanding bonds issued in reliance upon the existence of the clean energy improvement debt reserve fund that the state will not repeal, revoke, or rescind the provisions of this section concerning the fund or modify or rescind the same so as to limit or impair the rights and remedies granted by this section to the purchasers of such bonds and that any moneys in the fund shall not revert to the general fund.