Find Legal Information

107.180 Sums received and deposited in sinking fund -- How held -- Debt service reserve -- Deficiency assessment -- Refund of surplus.

Download pdf

107.180 Sums received and deposited in sinking fund -- How held -- Debt service reserve -- Deficiency assessment -- Refund of surplus. All sums received and deposited in the sinking fund shall be held inviolate and applied by <br>the city solely for the payment of the principal of, and interest on, the bonds issued for the <br>financing of the identified improvement project. The amount collected, and deposited in <br>the sinking fund from the first improvement assessment levied in connection with any <br>project, in excess of maturing principal and interest of the bonds, and for the purpose of <br>creating a &quot;debt service reserve,&quot; shall be held in the sinking fund for that purpose. If the <br>collections from the first annual improvement assessment levy shall fail to produce a sum <br>sufficient to provide a &quot;debt service reserve&quot; equal to twenty percent (20%) of future <br>average annual principal and interest requirements, the next annual improvement <br>assessment shall be fixed at such level as may be calculated to restore the &quot;debt service <br>reserve&quot; to such level after providing for current principal and interest maturities. The <br>debt service reserve requirement of a wastewater collection project by a metropolitan <br>sewer district may be funded from the proceeds of the bonds. If, at the time of any annual <br>levy of the improvement assessment, the sum held in the sinking fund as said &quot;debt <br>service reserve&quot; shall exceed the level herein specified, such excess may be taken into <br>account in fixing the rate of the improvement assessment for the ensuing year; and if the <br>amount so held in said &quot;debt service reserve&quot; is below said specified level, the next <br>annual improvement assessment levy shall be increased in a corresponding manner. In <br>making the improvement assessment levy for the year preceding the final maturity of <br>bonds for any improvement project, the governing body may take into account, and make <br>allowance for, the amount held in the sinking fund of the particular project as a &quot;debt <br>service reserve&quot;; and if in making such levy the governing body shall miscalculate and <br>provide funds insufficient to pay the final maturing principal and interest, the governing <br>body shall be authorized to, and shall be required, to make a subsequent improvement <br>assessment levy upon the benefited properties sufficient to make up the deficiency, with <br>interest to date of payment. If the procedures required by this chapter shall result in a <br>surplus after payment of the bonds, and all interest thereon to date of payment, such <br>surplus shall be refunded, pro rata, to the owners of benefited properties, as determined at <br>the date such surplus is ascertained by the governing body to exist. History: Amended 1976 (1st Extra. Sess.) Ky. Acts ch. 13. sec. 23. -- Created 1956 Ky. Acts ch. 239, sec. 18, effective February 29, 1956.