§ 165.00 Deposit and use of proceeds from sale of bonds, bond\nanticipation notes, capital notes, urban renewal notes or budget notes.\na. The proceeds, inclusive of premiums, from the sale of bonds, bond\nanticipation notes, capital notes, urban renewal notes or budget notes\nshall be deposited and secured in a special account in the manner\nprovided by section ten of the general municipal law, shall not be\ncommingled with other funds of the issuer, and shall be expended only\nfor the object or purpose for which such obligations were issued. In the\nevent that any portion of the proceeds, inclusive of premiums, from the\nsale of bonds, bond anticipation notes, capital notes, urban renewal\nnotes or budget notes is not expended for the object or purpose for\nwhich such obligations were issued, such portion shall be applied only\nto the payment of the principal of and interest on such obligations,\nrespectively. Notwithstanding the foregoing provisions of this\nparagraph, the finance board of any municipality, school district or\ndistrict corporation may adopt any or all of the following resolutions\nto provide that:\n 1. The proceeds, inclusive of premiums, of capital notes issued in\namounts of one hundred thousand dollars or less, and of budget notes,\nneed not be deposited in a special account but may be deposited and\ncommingled with other funds of the issuer in any account of the issuer\nin a bank or trust company located and authorized to do business in this\nstate, but such power shall not be construed as authorizing the use of\nsuch proceeds for an object or purpose other than that for which the\nobligations were issued.\n 2. The proceeds, inclusive of premiums, from the sale of any two or\nmore issues of bonds, bond anticipation notes, capital notes, urban\nrenewal notes or budget notes need not be deposited in separate special\naccounts but may be deposited in a single special account of the issuer\nin a bank or trust company located and authorized to do business in this\nstate, but shall not be commingled with other funds of the issuer. The\nchief fiscal officer shall then maintain a separate accounting record of\neach issue to insure that the proceeds shall be used only for the object\nor purpose for which the obligation was issued.\n 3. Moneys appropriated for a purpose for which bonds, bond\nanticipation notes, capital notes or urban renewal notes have been\nauthorized may be deposited in the same bank account with the proceeds\nfrom the sale of such obligations. Such power shall not be construed as\nauthorizing the use of the proceeds of such obligations for an object or\npurpose other than that for which they were issued. Provided, however,\nthat any moneys remaining in such bank account after the object or\npurpose has been completed or abandoned shall be applied to the payment\nof the principal of and interest on such obligations; any excess\nremaining thereafter may be used for any lawful purpose.\n b. Notwithstanding the provisions of paragraph a of this section, the\nproceeds, inclusive of premiums, from the sale of bonds, bond\nanticipation notes, capital notes and urban renewal notes may be\ninvested in the manner provided by section eleven of the general\nmunicipal law.\n Such investment shall be made by the finance board or the chief fiscal\nofficer, if the finance board shall delegate such duty to that person.\nThe separate identity of the proceeds from the sale of bonds, bond\nanticipation notes, capital notes, urban renewal notes and budget notes\nshall be maintained at all times, whether such proceeds consist of cash\nor investments or both. Any interest earned or capital gain realized on\nany investment shall be applied to either the payment of the principal\nof and interest on the bonds, bond anticipation notes, capital notes,\nurban renewal notes or budget notes, as the case may be, the proceeds\nfrom the sale of which were used in making such investment or for any\nother purpose or purpos
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