§ 37-7-210 — Disposition of proceeds from sale of bonds; funds to be used only on system; unexpended balance; purchase and cancellation of bonds

The commissioners of any such power district shall require that
the proceeds of the sale of bonds issued under the provisions of
this act be deposited in a special account or accounts in a bank
or banks which are members of the federal reserve system, and
shall require, insofar as practicable, that each such deposit be
secured by the United States government securities having an
aggregate market value at least equal to the sum at the time on
deposit, or, in any event, the proceeds shall be deposited in
some bank or other depository, either within or without the
state, which will secure such deposit satisfactorily to said
governing body. All moneys received from any such bonds shall be
used solely for the purchase, construction, improvement,
enlargement, extension or repair of the system for which issued,
including any engineering, legal and other expenses incident
thereto; provided, however, that such moneys may be used also to
advance the payment of the interest on such bonds during the
first three (3) years following the date of such bonds.
Provided, that any unexpended balance of the proceeds of the
sale of any such bonds remaining after the completion of the
project for which issued shall be paid immediately into the bond
and interest redemption fund for such bonds, and the same shall
be used only for the payment of the principal of the bonds, and
interest for the first three (3) years following the date of the
bonds, or, in the alternative, to acquire outstanding bonds of
the general issue from which the proceeds were derived, by
purchase of such bonds at a price (exclusive of accrued
interest) not exceeding the face amount thereof. Any bonds so
acquired by purchase shall be cancelled and shall not be
reissued.