Section 314. Bond payment account and city account.
(a) Payment of certain tax revenue.--When bonds or payments due to the authority from a city are secured by and payable from a tax or taxes levied for authority purposes or made available for use by the authority or levied by the assisted city, which tax has been pledged by the authority to secure payment of such bonds or by the assisted city to secure payments due to the authority, the proceeds of such taxes shall be paid by the collector or receiver of such taxes directly to the bond payment account, any debt service reserve fund established pursuant to section 313, and the city account of the authority which are hereby directed to be established by the authority as trust funds with a bank with trust powers or a trust company with a place of business in the Commonwealth selected by the authority. Any payments of authority operating expenses in amounts permitted pursuant to section 206 shall be paid to or on the order of the authority after required payments to the bond payment account and any debt service reserve fund and before any payments to the city account. Such payments of authority operating expenses shall be no more frequent than monthly and shall be subject to any further limitation set forth in any agreement of the authority with the obligees of the authority.
(b) Bond payment account as trust fund.--The bond payment account shall be a trust fund held for the exclusive and equal and ratable benefit of the holders of the bonds of the authority secured by and payable from the proceeds of any tax pledged by the authority or secured by the payments due to the authority from the city as described in subsection (a). The authority shall establish a payment schedule for the deposit of amounts sufficient to accumulate the interest and principal becoming due on such bonds in each fiscal year of the authority, and the first moneys received from such tax or other pledged revenues shall be deposited in the bond payment account until the payment requirement established for the bonds has been met. Any proceeds of such tax or other pledged revenues in excess of the scheduled deposit shall be transferred first to the debt service reserve fund or funds of the authority established under section 313 to cure any deficiency in such fund. Any remaining proceeds shall be paid to the authority in the amount permitted for authority operating expenses pursuant to section 206 and subsection (a), and the excess shall be transferred to the city account. If at any time proceeds of the tax are insufficient to meet the scheduled deposit requirement, all proceeds of the tax shall be paid into the bond payment account until all deficiencies have been restored. Income on investments of moneys on deposit in the bond payment account shall be retained in such account and applied when earned to reduce future deposit requirements.
(c) Status of city account.--The city account shall be a trust fund held for the exclusive benefit of an assisted city. Any proceeds of the taxes or other revenues pledged to secure the bonds or to secure payments due from the city to the authority in excess of the payment requirements for the bond payment account and in excess of any amount required to cure a deficiency in the debt service reserve fund or funds established pursuant to section 313 and in excess of any amount permitted to be paid to the authority for authority operating expenses pursuant to section 206 and subsection (a) shall be deposited in the city account. Amounts in the city account shall be invested at the direction of an assisted city in investments permitted by this act. Subject to any suspension of disbursements pursuant to section 210(e), amounts in the city account shall be disbursed to an assisted city not less often than monthly for credit to such city's general fund for application to the general expenses of government or for deposit in an operating reserve of such city if such operating reserve is created pursuant to an intergovernmental cooperation agreement.