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assessments), until all costs of the Project have been fully paid. The City Manager shall maintain <br />the Project Fund until payment of all costs and expenses incurred in connection with the <br />construction of the Project and all costs of issuance of the Bonds have been paid. <br />The City may deposit funds, including prepaid assessments and funds from other available <br />sources, into the Project Fund. From the Project Fund there shall be paid all costs and expenses <br />related to the construction and acquisition of the Project. In addition, costs of issuance are expected <br />to be paid from proceeds of the Bonds in the Project Fund and are included in the respective <br />accounts above. After payment of all such costs and expenses, the Project Fund shall be <br />terminated. All funds on hand in the Project Fund when terminated shall be credited to the Bond <br />Fund described in Section 4 hereof, unless and except as such proceeds may be transferred to some <br />other fund or account as to which the City has received from bond counsel an opinion that such <br />other transfer is permitted by applicable laws and does not impair the exemption of interest on the <br />Bonds from federal income taxes. In no event shall funds remain in the Project Fund later than <br />three years following the date of issuance of the Bonds. <br />SECTION 4. GENERAL OBLIGATION IMPROVEMENT BONDS. SERIES 2024A BOND <br />FUND. The Bonds shall be payable from a separate General Obligation Improvement Bonds, <br />Series 2024A Bond Fund (the "Bond Fund") of the City, which shall be created and maintained <br />on the books of the City as a separate debt redemption fund until the Bonds, and all interest thereon, <br />are fully paid. Into the Bond Fund shall be paid (a) the amounts specified in Section 3 above upon <br />termination of the Project Fund; (b) any funds received from the Purchaser upon delivery of the <br />Bonds in excess of the amounts specified in Section 3 above; (c) special assessments levied and <br />collected in accordance with this Resolution except prepaid assessments applied to the Project <br />Fund; (d) any taxes collected pursuant to Section 7 hereof; and (e) any other funds appropriated <br />by this Council for the payment of the Bonds. The principal of and interest on the Bonds shall be <br />payable from the Bond Fund, and the money on hand in the Bond Fund from time to time shall be <br />used only to pay the principal of and interest on the Bonds. On or before each principal and interest <br />payment date for the Bonds, the City Finance Director is directed to remit to the Registrar from <br />funds on deposit in the Bond Fund the amount needed to pay principal and interest on the Bonds <br />on the next succeeding principal and interest payment date. <br />There are hereby established two accounts in the Bond Fund, designated as the "Debt <br />Service Account" and the "Surplus Account." There shall initially be deposited into the Debt <br />Service Account upon the issuance of the Bonds the amount set forth in clause (b) above. <br />Thereafter, during each bond year (each twelve month period commencing on February 1 and <br />ending on the following January 31, a "Bond Year"), as monies are received into the Bond Fund, <br />the City Finance Director shall first deposit such monies into the Debt Service Account until an <br />amount has been appropriated thereto sufficient to pay all principal and interest due on the Bonds <br />through the end of the Bond Year. All subsequent monies received in the Bond Fund during the <br />Bond Year shall be appropriated to the Surplus Account. If at any time the amount on hand in the <br />Debt Service Account is insufficient for the payment of principal and interest then due, the City <br />Finance Director shall transfer to the Debt Service Account amounts on hand in the Surplus <br />Account to the extent necessary to cure such deficiency. Investment earnings (and losses) on <br />amounts from time to time held in the Debt Service Account and Surplus Account shall be credited <br />or charged to said accounts. <br />7 <br />