Vermont § 2186 - Reserve funds

§ 2186. Reserve funds

• (a) The Vermont State Colleges may create and establish one or more special funds, referred
  to in this section as “debt service reserve funds,” and shall pay into each debt service
  reserve fund: (1) any monies appropriated and made available by the State for the purpose of the fund; (2) any proceeds of the sale of notes or bonds, to the extent provided in the resolution
  or resolutions of the Vermont State Colleges authorizing the issuance thereof; and (3) any other monies that may be made available to the Vermont State Colleges for the
  purpose of the fund from any other source or sources. (b) All monies held in any debt service reserve fund, except as provided in this section,
  shall be used, as required, solely for the payment of the principal or purchase or
  redemption price of or interest or redemption premium on bonds or notes secured in
  whole or in part by the fund or of sinking fund payments with respect to the bonds
  or notes; provided, however, that monies in any fund shall not be withdrawn from the
  fund at any time in an amount as would reduce the amount of the fund to less than
  the debt service reserve requirement established by resolution of the Vermont State
  Colleges for the fund as hereafter provided, except for the purpose of making payments,
  when due, of principal, interest, redemption premiums, and sinking fund payments with
  respect to bonds and notes secured in whole or in part by the fund for the payment
  of which other monies of the Vermont State Colleges are not available. Any income
  or interest earned by any debt service reserve fund may be transferred to other funds
  or accounts of the Vermont State Colleges to the extent that it does not reduce the
  amount of the fund below the requirement for the fund. (c) The Vermont State Colleges shall not at any time issue bonds or notes secured in whole
  or in part by a debt service reserve fund if upon the issuance of the bonds or notes
  the amount in the debt service reserve fund will be less than the debt service reserve
  requirement established by resolution of the Vermont State Colleges for the fund,
  unless the Vermont State Colleges at the time of issuance of the bonds or notes shall
  deposit in the fund from the proceeds of the bonds or notes so to be issued, or from
  other sources, an amount that, together with the amount then in the fund, will not
  be less than the debt service reserve requirement established for the fund. The debt
  service reserve requirement for any debt service reserve fund shall be established
  by resolution of the Vermont State Colleges prior to the issuance of any bonds or
  notes secured in whole or in part by the fund and shall not be required to exceed
  “maximum debt service,” which shall mean, as of any particular date of computation,
  an amount equal to the greatest of the respective amounts, for the then-current or
  any future fiscal year of the Vermont State Colleges, of annual debt service on the
  bonds and notes of the Vermont State Colleges secured or to be secured in whole or
  in part by the debt service reserve fund. (d) In the computation of the amount of the debt service reserve funds for the purpose
  of this section, securities in which any of the funds shall be invested shall be valued
  at par if purchased at par or at amortized value, as the term is defined by resolution
  of the Vermont State Colleges, if purchased at other than par. (e) In order to ensure the maintenance of the debt service reserve requirement in each
  debt service reserve fund established by the Vermont State Colleges, there may be
  appropriated annually and paid to the Vermont State Colleges for deposit in each fund
  the sum as shall be certified by the Chair of the Board of Trustees of the Vermont
  State Colleges to the Governor, the President of the Senate, and the Speaker of the
  House as is necessary to restore each such debt service reserve fund to an amount
  equal to the debt service reserve requirement for the fund. The Chair shall annually,
  on or about February 1, make and deliver to the Governor, the President of the Senate,
  and the Speaker of the House his or her certificate stating the sum required to restore
  each debt service reserve fund to the amount equal to the debt service reserve requirement
  for the fund, and the sum so certified may be appropriated, and if appropriated, shall
  be paid to the Vermont State Colleges during the then-current State fiscal year. The
  principal amount of bonds or notes outstanding at any one time and secured in whole
  or in part by a debt service reserve fund to which State funds may be appropriated
  pursuant to this subsection shall not exceed $34,000,000.00, provided that the foregoing
  shall not impair the obligation of any contract or contracts entered into by the Vermont
  State Colleges in contravention of the Constitution of the United States of America. (f) The proceeds of any bonds or notes secured by a debt service reserve fund to which
  State funds may be appropriated pursuant to this section shall be applied solely to
  costs of reconstruction, rehabilitation, or improvement of existing facilities or
  property of the Vermont State Colleges. (Added 2007, No. 200 (Adj. Sess.), § 48; amended 2019, No. 131 (Adj. Sess.), § 94.)