1. Before any securities are actually issued payable from any net pledged revenues, except for any securities issued solely for the purpose of funding or refunding or both funding and refunding outstanding securities, any such revenues for the next preceding 12 months, for the next preceding calendar year, or for the next preceding fiscal year, as defined and otherwise determined by the Board, shall be sufficient to pay an amount representing 110 percent of the combined maximum annual principal and interest requirements to be paid during such 12 months, calendar year, fiscal year or bond year, as defined and otherwise determined by the Board, of any outstanding securities payable from and constituting a lien upon such net pledged revenues and the securities proposed to be issued (excluding any reserves therefor), except as otherwise expressly provided in this section.

2. In any determination of whether or not any proposed securities meet the earnings test limiting their issuance as provided in subsection 1 of this section:

(a) There shall be deducted from or added to any gross pledged revenues any estimated decrease or increase in such revenues resulting from any decreased or increased or additional fees, rates or charges fixed by the Board, whether or not appertaining to any additional facilities for which the proposed securities are authorized to be issued; and

(b) There shall be deducted from or added to any operation and maintenance expenses any estimated decrease or increase in such expenses, whether or not resulting from any additional facilities for which the proposed securities are authorized to be issued.

3. The respective annual principal and interest requirements (including as an interest requirement the amount of any prior redemption premiums due on any prior redemption date as of which any outstanding securities have been called or have been ordered by the Board to be called for prior redemption) shall be reduced to the extent such requirements are scheduled to be paid with any moneys held in trust or escrow for that purpose in any trust bank or trust banks within or without or both within and without the State, including without limitation the known minimum yield from any investment or reinvestment of any such moneys in federal securities.

4. The estimates and adjustments provided in subsections 2 and 3 of this section and the calculations required by subsection 1 of this section shall be made by the Treasurer of the University; and his or her estimates, adjustments and determination of whether the earnings test provided in subsection 1 of this section has been met shall be conclusively presumed to be accurate. Nothing contained in this section shall be construed to prohibit the issuance of securities merely because there were no pledged revenues nor operation and maintenance expenses, in the absence of such adjustments, in the next preceding 12 months, calendar year, or fiscal year, as the case may be.

5. There must be excluded from the calculations required by subsections 1 to 4, inclusive, the proceeds of any general fund fee or fees to be pledged to the payment of the securities (other than any securities issued solely for the purpose of funding or refunding or both funding and refunding outstanding securities). The proceeds of a general fund fee or fees must not be pledged to the payment of any such securities (other than any such funding or refunding or both funding and refunding securities) unless the remaining pledged revenues do not contravene the limitations imposed by those subsections.

6. Nothing herein contained prevents the Board from providing an earnings test in any resolution authorizing the issuance of securities or in any other proceedings appertaining thereto which test limits the issuance of any additional securities.

(Added to NRS by 1967, 7; A 1979, 360)