Conn. Gen. Stat. § 13b-68: Special Transportation Fund. Use of fund. Transportation Grants and Restricted Accounts Fund. Reduction of outstanding special tax obligation indebtedness.

(a) There is established a fund to be known as the “Special Transportation Fund”. The fund may contain any moneys required or permitted by law to be deposited in the fund and any moneys recovered by the state for overpayments, improper payments or duplicate payments made by the state relating to any transportation infrastructure improvements that have been financed by special tax obligation bonds issued pursuant to sections 13b-74 to 13b-77, inclusive, and shall be held by the Treasurer separate and apart from all other moneys, funds and accounts. Investment earnings credited to the assets of said fund shall become part of the assets of said fund. Any balance remaining in said fund at the end of any fiscal year shall be carried forward in said fund for the fiscal year next succeeding.

(b) The Special Transportation Fund shall be a perpetual fund, the resources of which shall be expended solely for transportation purposes. Such purposes include the payment of debt service on obligations of the state incurred for transportation purposes. All sources of moneys, funds and receipts of the state required to be credited, deposited or transferred to said fund by state law on or after June 30, 2015, shall continue to be credited, deposited or transferred to said fund, so long as the sources of such moneys, funds and receipts are collected or received by the state or any officer thereof. No law shall be enacted authorizing the resources of said fund to be expended other than for transportation purposes.

(c) There is established a fund to be known as the “Transportation Grants and Restricted Accounts Fund”. Upon certification by the Comptroller and the Secretary of the Office of Policy and Management that the CORE-CT project for fiscal services is operational, the fund shall contain all transportation moneys that are restricted, not available for general use and previously accounted for in the Special Transportation Fund as “Federal and Other Grants”. The Comptroller is authorized to make such transfers as are necessary to provide that, notwithstanding any provision of the general statutes, all transportation moneys that are restricted and not available for general use are in the Transportation Grants and Restricted Accounts Fund.

(d) (1) For the fiscal year ending June 30, 2025, and each fiscal year thereafter, after the accounts for the Special Transportation Fund have been closed for each fiscal year and the Comptroller has determined the balance remaining in said fund, after any amounts required by provision of law to be transferred for other purposes have been deducted, if the balance remaining exceeds eighteen per cent of the net Special Transportation Fund appropriations for the current fiscal year, the portion of the balance exceeding said eighteen per cent shall be deemed to be appropriated for the following, as selected by the Treasurer:

(A) Redeeming prior to maturity any outstanding special tax obligation indebtedness of the state selected by the Treasurer in the best interests of the state;

(B) Purchasing outstanding special tax obligation indebtedness of the state in the open market at such prices and on such terms and conditions as the Treasurer determines to be in the best interests of the state for the purpose of extinguishing or defeasing such debt;

(C) Providing for the defeasance of any outstanding special tax obligation indebtedness of the state selected by the Treasurer in the best interests of the state by irrevocably placing with an escrow agent in trust an amount used solely for, and sufficient to satisfy, scheduled payments of both interest and principal on such indebtedness; or

(D) Any combination of these methods.

(2) For any method or combination of methods selected by the Treasurer pursuant to subdivision (1) of this subsection, (A) such method or combination of methods shall provide a reduction in projected debt service for the current fiscal year and each of the nine subsequent fiscal years, and (B) for the second fiscal year after the fiscal year in which the balance was used in accordance with the provisions of this subsection and each of the seven subsequent fiscal years, the amount of the reduction in projected debt service shall not vary by more than (i) one million dollars, or (ii) ten per cent of the least amount by which projected debt service is reduced for the seven subsequent fiscal years, whichever is greater.

(3) The Treasurer shall include in the annual report required under section 3-37 information concerning the use of a portion of the balance of the Special Transportation Fund pursuant to this subsection.