a. The authority may create and establish one or more special funds to be known as housing finance funds and may pay into such housing finance funds: (1) any proceeds of the sale of the bonds, notes or other obligations to the extent provided in the resolution of the authority authorizing the issuance thereof; (2) the moneys directed to be transferred by the authority to such funds; and, (3) 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 housing finance fund established under this act, except as hereinafter provided, shall be used solely for the payment of the principal of and interest on bonds or other obligations of the authority secured by such housing finance fund, as the same mature, required payments to any sinking fund established for the amortization of such bonds or other obligations (hereinafter referred to as “sinking fund payments” ), the purchase or redemption of such bonds or other obligations of the authority or the payment of any redemption premium to be paid when such bonds or other obligations are redeemed prior to maturity; provided, however, that moneys in any such fund shall not be withdrawn therefrom at any time in such amount as would reduce the amount of such fund to less than the amount of principal (including sinking fund payments) and interest maturing and becoming due in the succeeding calendar year on the bonds or other obligations of the authority then outstanding and secured by such housing finance fund (such amount being hereafter referred to as the “required minimum capital reserve” ), except for the purpose of paying principal and interest on the bonds or other obligations of the authority secured by such housing finance 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 housing finance 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 housing finance fund below the required minimum capital reserve. In computing the amount of any housing finance fund for the purposes of this section, securities in which all or a portion of such housing finance fund are invested shall be valued at par, if purchased at par, or, if purchased at other than par, at amortized value.

b. The authority shall not issue bonds or other obligations at any time when the maximum amount of principal (including sinking fund payments) and interest maturing and becoming due in the succeeding calendar year on the bonds or other obligations outstanding and then to be issued and secured by a housing finance fund will exceed the amount of such housing finance fund at the time of issuance, unless the authority, at the time of issuance of such bonds or other obligations, shall deposit in such housing finance fund, from the proceeds of the bonds or other obligations so to be issued or otherwise, an amount which, together with the amount then in such housing finance fund, will be not less than the required minimum capital reserve.

L.1979, c. 275, s. 18, eff. Jan. 3, 1980.