Reasonably Required Reserve or Replacement Fund

A fund maintained to provide Security to bondholders that does not exceed the least of (i) 10% of the stated Principal amount of the Bond Issue (Issue Price if more than a de minimis amount of Original Issue Discount or Premium), (ii) the maximum annual Principal and Interest requirements of the Bonds, or (iii) 125% of the average annual Debt Service requirements of the Bonds.

See Also

Debt Service Reserve Fund

The fund established as a reserve for payment of debt service on revenue bonds in the event there is insufficient money to make a debt service payment.

Debt Service

The amount of principal and interest required to be paid on an issue of bonds.

Hudson Yards Rail Yards

Start with the Bond Basics

Guaranteed Investment Contract (GIC)

An investment agreement offered by financial institutions (e.g., banks or insurance companies) which pays a stated rate of return on invested bond proceeds for a stated term.