21-16-709. Debt service reserve funds; use of monies.
(a) Unless otherwise provided in the resolution or indenture providing for the issuance of particular obligations, the monies held in or credited to any debt service reserve fund established under this section shall be used solely for:
(i) Payment of the principal of obligations of the authority secured by the reserve fund, as the obligations mature or are redeemed prior to maturity;
(ii) Purchase of the obligations of the authority;
(iii) Payment of interest on the obligations of the authority; or
(iv) Payment of any redemption premium required to be paid when the obligations are redeemed prior to maturity.
(b) The interest earned on the amount deposited in any reserve fund may be used for defraying the cost of the operations of the authority. Money in any debt service reserve fund shall not be withdrawn if it would reduce the amount of the fund to less than the amount which is pledged in the proceedings authorizing the issuance of the obligations secured by the debt service reserve fund, except for paying principal and interest on obligations maturing and becoming due and for the payment of which other monies of the authority are not available.
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