204.420. Board may authorize establishment of various accounts by resolution — may limit issuance of additional bonds and limit rights of holders of such bonds.

366 words·~2 min read·/mo/chapter-204/204-420

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

204.420. Board may authorize establishment of various accounts by resolution — may limit issuance of additional bonds and limit rights of holders of such bonds. — 1. The resolution of the board of trustees of the common sewer district authorizing the issuance of revenue bonds under the authority of sections 204.250 to 204.470 may provide that periodic allocations of the revenues to be derived from the operation of the system for the benefit of which the bonds are issued shall be made into such accounts, separate and apart from any other accounts of the district, as shall be deemed to be advisable to assure the proper operation and maintenance of the system and the prompt payment of the indebtedness chargeable to the revenues of the system.

The accounts may include, but shall not be limited to:

(1)An account for the purpose of providing funds for the operation and maintenance of the system;

(2)An account to provide funds for the payment of the bonds as to principal and interest as they come due;

(3)An account to provide an adequate reserve for depreciation, to be expended for replacements of the system;

(4)An account for the accumulation of a reserve to assure the prompt payment of the bonds and the interest thereon whenever and to the extent that other funds are not available for the purpose;

(5)An account to provide funds for contingent expenses in the operation of the system;

(6)An account to provide for the accumulation of funds for the construction of extensions and improvements to the system; and

(7)Such other accounts as may be desirable in the judgment of the board of trustees.

2. The resolution may also establish such limitations as may be expedient upon the issuance of additional bonds, payable from the revenues of the system, or upon the rights of the holders of such additional bonds. Such resolution may include other agreements with the holders of the bonds or covenants or restrictions necessary or desirable to safeguard the interests of the bondholder and to secure the payment of the bonds and the interest thereon.

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(L. 1967 p. 310 § 23, A.L. 1992 H.B. 948)

Effective 2-18-92