Article 4. Reserve Funds of California Water Code >> Division 6. >> Part 3. >> Chapter 9. >> Article 4.

The proceedings authorizing the issuance of bonds may provide for the setting up of a reserve fund or funds out of the revenues not needed for the payment of operation, maintenance, and replacements, and not needed for the payment of principal and interest as they currently mature, and may provide for the preservation and continuance of such reserve fund or funds in the manner provided in the proceedings.

Any proceedings authorizing the issuance of bonds and providing for the setting up of a reserve fund may also require the immediate application of all surplus money in the revenue fund to the retirement of such bonds prior to maturity, by call or purchase, in such manner and upon such terms and the payment of such premiums as may be deemed advisable in the judgment of the department.

The money remaining in the revenue fund after providing the amount required for interest and redemption of bonds as provided in this article shall be held and applied as provided in the proceedings authorizing the issuance of the bonds.