(1) In lieu of creating and funding a guaranty fund under Section 11-42-701 for an issue of assessment bonds or refunding assessment bonds, a local entity may establish a reserve fund to secure the issue.
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Terms Used In Utah Code 11-42-702

  • Assessment bonds: means bonds that are:
         (3)(a) issued under Section 11-42-605; and
         (3)(b) payable in part or in whole from assessments levied in an assessment area, improvement revenues, and a guaranty fund or reserve fund. See Utah Code 11-42-102
  • Bonds: means assessment bonds and refunding assessment bonds. See Utah Code 11-42-102
  • Guaranty fund: means the fund established by a local entity under Section 11-42-701. See Utah Code 11-42-102
  • Local entity: means :
         (31)(a) a county, city, town, special service district, or special district;
         (31)(b) an interlocal entity as defined in Section 11-13-103;
         (31)(c) the military installation development authority, created in Section 63H-1-201;
         (31)(d) a public infrastructure district under Title 17D, Chapter 4, Public Infrastructure District Act, including a public infrastructure district created by a development authority;
         (31)(e) the Utah Inland Port Authority, created in Section 11-58-201; or
         (31)(f) any other political subdivision of the state. See Utah Code 11-42-102
  • Property: includes real property and any interest in real property, including water rights and leasehold rights. See Utah Code 11-42-102
  • Refunding assessment bonds: means assessment bonds that a local entity issues under Section 11-42-607 to refund, in part or in whole, assessment bonds. See Utah Code 11-42-102
  • Reserve fund: means a fund established by a local entity under Section 11-42-702. See Utah Code 11-42-102
  • State: when applied to the different parts of the United States, includes a state, district, or territory of the United States. See Utah Code 68-3-12.5
(2) If a local entity establishes a reserve fund under this section:

     (2)(a) the bonds secured by the reserve fund are not secured by a guaranty fund under Section 11-42-701;
     (2)(b) the local entity is not required to fund a guaranty fund under Section 11-42-701 for those bonds; and
     (2)(c) unless otherwise provided in this part or in the proceedings authorizing the issuance of bonds, the provisions of this part regarding a guaranty fund have no application to the bonds that are secured by the reserve fund.
(3) Each local entity that establishes a reserve fund shall:

     (3)(a) fund and replenish the reserve fund in the amounts and manner provided in the proceedings authorizing the issuance of the bonds that are secured by the reserve fund; and
     (3)(b) invest the funds on deposit in the reserve fund as provided in Title 51, Chapter 7, State Money Management Act.
(4)

     (4)(a) Subject to Subsection (4)(b), a local entity may replenish a reserve fund under this section by any of the methods described in Subsection 11-42-701(1)(b).
     (4)(b) The proceedings authorizing the issuance of assessment bonds or refunding assessment bonds shall provide that if a local entity uses any of the methods described in Subsection 11-42-701(1)(b) to replenish a reserve fund, the local entity shall be reimbursed, with interest at a rate that the local entity determines, with money that the local entity receives from foreclosing on delinquent property.
(5) Upon the retirement of bonds secured by a reserve fund, the local entity shall:

     (5)(a) terminate the reserve fund; and
     (5)(b) disburse all remaining money in the fund as provided in the proceedings authorizing the issuance of the bonds.
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