New Jersey § 40a:2-54

§ 40a:2-54.

If the local government board shall find that a special refunding program is in the

public interest and is based upon a sound financial plan for equalizing or reducing

the debt service of a local unit, a refunding bond ordinance may authorize refunding

bonds for refunding some or all of any bonds of the local unit which will become due

over a period of not exceeding 5 years. Such refunding bond ordinance shall provide for the sale annually during such period,

or at such other time or times as the local government board may approve, of blocks

or series of refunding bonds to provide funds to pay the bonds and interest to be

refunded and such ordinance may also provide for the investment and application of

the proceeds of such refunding bonds, pending the maturity or maturities of the bonds

to be refunded and for reinvestment or other application of income and realizations

upon such investments. Such investment and reinvestment shall be restricted to (a) purchase and holding of

unlimited bonds or notes or other obligations (whether or not interest-bearing) issued

or unconditionally guaranteed as to both principal and interest by the United States

of America and which mature or which the United States of America is on demand obligated

to pay, not later than the end of the respective calendar years of the maturities

of the several bonds to be refunded, or (b) purchase and cancellation of any of the

bonds to be refunded in the manner or mode of procedure prescribed by the Fiscal Affairs

Law. 1 1

N.J.S.A. § 40A:5-1 et seq.