N.Y. Public Authorities Law § 2472: Reserve fund

* § 2472. Reserve fund. 1. The authority may create and establish one

or more reserve funds to be known as debt service reserve funds and may

pay into such reserve funds (a) any payments received from a

participating municipality (b) any moneys appropriated and made

available by the state for the purposes of such funds (c) any proceeds

of sale of bonds and notes to the extent provided in the resolution of

the authority authorizing the issuance thereof (d) any moneys directed

to be transferred by the authority to such funds, and (e) any other

moneys which may be made available to the authority for the purposes of

such funds from any other source or sources. The moneys held in or

credited to any debt service reserve fund established under this

subdivision, except as hereinafter provided, shall be used solely for

the payment of the principal of and interest on bonds of the authority

secured by such reserve fund, as the same mature, required payments to

any sinking fund established for the amortization of such bonds

(hereinafter referred to as "sinking fund payments"), the purchase or

redemption of such bonds of the authority or the payment of any

redemption premium required to be paid when such bonds are redeemed

prior to maturity; provided, however, that moneys in any such fund shall

not be withdrawn therefrom at any time in such amount as would reduce

the amount of such fund to less than the maximum amount of principal and

interest maturing and becoming due in the then current or any succeeding

calendar year on the bonds of the authority then outstanding and secured

by such reserve fund, except for the purpose of paying principal and

interest on the bonds of the authority secured by such reserve fund

maturing and becoming due and sinking fund payments for the payment of

which other moneys of the authority are not available. Any income or

interest earned by, or increment to, any such debt service reserve fund

due to the investment thereof may be transferred to any other fund or

account of the authority to the extent it does not reduce the amount of

such debt service reserve fund below the maximum amount of principal and

interest maturing and becoming due in the then current or any succeeding

calendar year on all bonds of the authority then outstanding and secured

by such reserve fund. In computing the amount of any debt service

reserve fund for the purposes of this section, securities in which all

or a portion of such reserve fund are invested shall be valued at par if

purchased at par or, if purchased at other than par, at amortized value.

2. The authority shall not issue bonds at any time if the maximum

amount of principal and interest maturing and becoming due in the then

current or any succeeding calendar year on the bonds outstanding and

then to be issued and secured by a debt service reserve fund will exceed

the amount of such reserve fund at the time of issuance, unless the

authority, at the time of issuance of such bonds, shall deposit in such

reserve fund from the proceeds of the bonds so to be issued, or

otherwise, an amount which together with the amount then in such reserve

fund, will be not less than the maximum amount of principal and interest

maturing and becoming due in the then current or any succeeding calendar

year on the bonds then to be issued and on all other bonds of the

authority then outstanding and secured by such reserve fund.

3. To assure the continued operation and solvency of the authority for

the carrying out of the public purposes of this act, provision is made

in subdivision one of this section for the accumulation in each debt

service reserve fund of an amount equal to the maximum amount of

principal and interest maturing and becoming due in the then current or

any succeeding calendar year on all bonds of the authority then

outstanding and secured by such reserve fund.

4. Upon full amortization of any outstanding bonds issued for the

acquisition, construction or rehabilitation of sports facilities, the

authority is empowered to provide for the transfer or sale of such

facilities to the participating municipality.

* NB (Disbanded March, 1980)