KRS 106.080: Proceeds of bonds not to be diverted -- Lien on waterworks property.

All moneys received from the bonds shall be applied solely for the purchase by agreement

or condemnation or establishment or erection of the waterworks and extensions and

appurtenances thereto, or to advance the payment of the interest on the bonds during the

first three (3) years following the date of the bonds. A statutory mortgage lien shall exist

upon the waterworks and appurtenances and extensions so acquired in favor of the

holders of the bonds and coupons.