Vermont § 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 monies 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 monies or funds of the Bank that it determines to deposit therein. (b) Monies 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 Money may not be withdrawn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 monies 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.)