11-681.04. Securing principal and interest

356 words·~2 min read·/az/title-11/11-681-04

A research copy — for the controlling text, always check the official state or federal source. Not legal advice.

In connection with issuing bonds authorized by this article and to enhance the security of the bonds, the board by resolution may:

1. Segregate the debt service fund into one or more accounts and subaccounts.

2. Provide that the bonds issued under this article are secured by a first lien on the monies paid into the debt service fund and pledge and assign to or in trust for the benefit of the holder or holders of the bonds all or part of the monies in the debt service fund or an account or subaccount as necessary to secure and pay the principal, the interest and any premium on the bonds as they come due.

3. Establish priorities among bondholders based on criteria adopted by the board.

4. Set aside, regulate and dispose of reserves and sinking accounts.

5. Prescribe the procedure, if any, by which the terms of any contract with bondholders may be amended or abrogated, the amount of bonds the holders of which must consent to and the manner in which the consent may be given.

6. Provide for payment of bond related expenses from the proceeds of the sale of the bonds or other revenues available to the board.

7. Provide for the services of trustees, cotrustees, agents, consultants and other specialized services with respect to the bonds.

8. Provide additional security for the bonds in the form of a line of credit, letter of credit, insurance policy or other security and:

(a)Pay the cost of the additional security from amounts produced from the bond issue or from other available sources.

(b)Enter into reimbursement obligations in connection with the additional security.

9. Refund any bonds issued pursuant to this article, if the new bonds are secured from the same source of revenues as the original bonds, by issuing new bonds, whether at or before maturity of the bonds being refunded.

10. Issue bonds partly to refund outstanding bonds and partly for any other purpose consistent with this article.

11. Take any other action that in any way may affect the security and protection of the bonds or interest on the bonds.