(a) The proceeds of refunding bonds shall be applied, together with any other moneys legally available, to the payment of the expenses authorized by this article and to the payment of the principal of, premium, if any, and interest due and to become due on any outstanding bonds to be refunded. The expenses authorized by this article shall include, in addition to other expenses authorized by this article, all expenses that the board of directors may deem necessary or advantageous in connection with the sale and issuance of refunding bonds, including, without limitation, the expenses of selling and issuing such refunding bonds, including any discount reflected in the purchase price paid to the corporation, fees and disbursements of attorneys, accountants, fiscal agents, financial advisors, and other consultants, fees and disbursements of trustees, escrow agents, registrars, paying agents, transfer agents, depositories for safekeeping, authenticating agents, agents for the delivery and payment of bonds, fees and commissions of bond insurers and credit enhancers, printing costs, and other customary bond issuance expenses.

(b) To the extent not required for the immediate payment of outstanding bonds or for deposit into an interest account or a reserve account, proceeds of refunding bonds together with any other moneys legally available, shall be deposited in trust, with one or more trustees or escrow agents, which trustees or escrow agents shall be trust companies or national or state banks, located either within or without the state, having powers of a trust company. Any proceeds or moneys deposited in trust with one or more trustees or escrow agents shall be applied solely to the payment when due of the principal of, premium, if any, and interest due and to become due on the outstanding bonds on or prior to the redemption date or maturity date, as the case may be. Any proceeds or moneys so deposited with one or more trustees or escrow agents, may be invested in government securities; provided, such government securities shall not be subject to redemption prior to their maturity other than at the option of the holder thereof.

(c) Except as provided in subsection (d), neither the government securities nor moneys so deposited with one or more trustees or escrow agents shall be withdrawn or used for any purpose other than, and shall be held in trust for, the payment of the principal of, redemption premium, if any, and interest on such outstanding bonds to be refunded; provided that any cash received from such principal or interest payments on the government securities deposited with one or more trustees or escrow agents to the extent such cash will not be required at any time for such purpose, shall be paid over to the corporation, and to the extent such cash will be required for such purpose at a later date, shall, to the extent practicable and legally permissible, be reinvested in government securities maturing at times and in amounts sufficient to pay when due the principal of, premium, if any, and interest on the outstanding bonds on and prior to the redemption date or maturity date, as the case may be, and interest earned from such reinvestments to the extent not required for the payment of such outstanding bonds shall be paid over to the corporation.

(d) Moneys on deposit in any reserve fund created pursuant to this article shall be invested by the corporation in permitted investments which mature at such time or times as the corporation shall direct. Interest income earned from such investments shall be deposited as received in an account of the corporation.