Section 3237. Capital reserve fund

1. The corporation shall create and
  establish one or more special  funds  (each  herein  referred  to  as  a
  capital  reserve  fund),  which may be funded initially from proceeds of
  bonds or notes of the corporation issued pursuant to this title,  in  an
  amount  equal  to  the  capital reserve fund requirement of the bonds or
  notes secured thereby. All amounts held in a capital reserve fund  shall
  be  used solely for the payment of principal of or interest on the bonds
  or notes secured thereby, sinking fund payments thereon, the  redemption
  thereof  and payments to providers of bond or note facilities in respect
  of payments of such principal, interest or sinking fund payments made by
  them, in accordance with  the  applicable  provisions  of  any  and  all
  resolutions and trust indentures, if any, securing such bonds and notes.
  Any  income or interest, not required to be rebated to the United States
  to provide for continued exclusion from gross income for federal  income
  tax  purposes  of  interest  on  the bonds and notes of the corporation,
  earned by, or  increment  to,  the  capital  reserve  fund  due  to  the
  investment  thereof,  in  excess  of  the  amount  thereof needed to pay
  interest on the bonds or notes issued to fund the capital reserve  fund,
  shall  be  used  to  pay  debt  service  on bonds or notes issued by the
  corporation. Any amounts released from a capital reserve fund  shall  be
  applied, or set aside to be applied when practicable, by the corporation
  to  the  payment  of  principal  on the applicable bonds or notes, or to
  redemption thereof or to the providers of bond or note facilities.
    2. In computing the  amount  of  the  capital  reserve  fund  for  the
  purposes  of this section, obligations in which all or a portion of such
  fund shall be invested shall be valued at par if purchased at par or, if
  purchased at a premium above or a discount below par, the value  at  any
  given  date  obtained by dividing the total premium or discount at which
  such obligations were purchased by the number of interest payment  dates
  remaining  to  maturity  on such obligations after such purchase, and by
  multiplying the number so calculated by the number of  interest  payment
  dates having passed since the date of such purchase; and (i) in the case
  of  such  obligations  purchased  at a premium, by deducting the product
  thus obtained from the purchase price; and (ii)  in  the  case  of  such
  obligations purchased at a discount, by adding the product thus obtained
  to  the  purchase price. In lieu of a deposit of money or obligations to
  the capital reserve fund, the corporation, having  due  regard  for  the
  security  and marketability of all affected bonds and notes, may satisfy
  the whole or any portion of the  capital  reserve  fund  requirement  by
  providing  one  or more surety agreements, insurance agreements, letters
  of credit or other type  of  agreement  or  arrangement  satisfying  the
  provisions  of  all  applicable resolutions or trust indentures, if any,
  each of which provides for  the  availability,  at  all  times  required
  thereunder,  of  the  amount of money or the value of the obligations in
  lieu of the deposit of which such agreement or arrangement is provided.