§ 9-7-110 — Community development authority; revenue bonds; debt service reserve funds; use of monies therein

(a) Prior to the delivery of each bond issue, the
authority may create one (1) or more debt service reserve funds
and, at the time the authority determines, shall pay into the
funds an amount, as determined by the authority, from:
(i) Proceeds of sale of bonds to the extent provided
in the resolution of the authority authorizing the issuance; and
(ii) Other monies which may be received or made
available to the authority for the purposes of funds from any
other source.
(b) Unless otherwise provided, the monies held in or
credited to any debt service reserve fund established under this
section shall be used solely for the payment of the principal of
bonds of the authority secured by the reserve fund, as the bonds
mature or are redeemed prior to maturity, the purchase of such
bonds of the authority, the payment of interest on such bonds of
the authority or the payment of any redemption premium required
to be paid when the bonds are redeemed prior to maturity. The
interest earned on the amount deposited in any reserve fund may
be used for the purpose of defraying the cost of the authority's
operations. Money in any debt service reserve fund shall not be
withdrawn if it would reduce the amount of the fund to less than
the amount which is pledged in the proceedings authorizing the
issuance of the bonds secured by the debt service reserve fund,
except for the purpose of paying principal and interest on bonds
maturing and becoming due, and for the payment of which other
monies of the authority are not available.