§ 4671 - Reserve fund
§ 4671. Reserve fund
(a) The bank shall establish and maintain a special fund called the "Vermont Municipal Bond Bank Reserve Fund" in which there shall be deposited:
(1) All moneys appropriated by the state for the purpose of the fund;
(2) All proceeds of bonds required to be deposited therein by terms of any contract between the bank and its bondholders or any resolution of the bank with respect to the proceeds of bonds; and
(3) Any other moneys or funds of the bank which it determines to deposit therein.
(b) Moneys in the reserve fund shall be held and applied solely to the payment of the interest on and principal of presently outstanding bonds of the bank and any bonds issued on a parity therewith and any bonds issued to refund such bonds, all as they become due and payable and for the retirement of bonds. Money may not be withdrawn if it reduces the amount in the reserve fund to an amount less than the "required debt service reserve," as defined in this subsection, except for payment of interest then due and payable on bonds and the principal of bonds then maturing and payable and for the retirement of bonds in accordance with the terms of any contract between the bank and its bondholders and for which payments other moneys of the bank are not then available. As used in this subsection "required debt service reserve" means, as of any date of computation, the amount or amounts required to be on deposit in the reserve fund as provided by resolution of the bank. Required debt service reserve shall not be required by resolution of the bank to exceed "maximum debt service." As used in this subsection "maximum debt service" means, as of any date of computation, the largest amount of money required by the terms of all contracts between the bank and its bondholders to be raised in any succeeding calendar year for the payment of interest on and maturing principal of outstanding bonds and payments required by the terms of any contracts to sinking funds established for the payment or redemption of bonds, all calculated on the assumption that the bonds will cease to be outstanding after date of the computation by reason of the payment of the bonds at their respective maturities and the payments of the required moneys to sinking funds and the application thereof in accordance with the terms of all contracts to the retirement of bonds. (Added 1969, No. 216 (Adj. Sess.), § 3, eff. March 27, 1970; amended 1971, No. 148 (Adj. Sess.), § 7, eff. Feb. 14, 1972; 1987, No. 55, § 20, eff. May 15, 1987.)