Bonds: Safety as to repayment of principal and interest; Fund for the Retirement of Bonds; investment of money in Fund

1. The bonds issued pursuant to NRS 349.900 to 349.929, inclusive, must be structured to provide a significant degree of safety as to repayment of principal and interest upon their maturity. 2. A portion of the proceeds of the bonds must be placed in a Fund for the Retirement of Bonds. The money in this Fund must be invested in: (a) Direct obligations of, or obligations the payment of the principal of and the interest of which are unconditionally guaranteed by the United States; (b) Obligations issued or guaranteed as to principal and interest by any agency or instrumentality of the United States; or (c) Money market mutual funds that: (1) Are registered with the Securities and Exchange Commission; (2) Are rated by a nationally recognized rating service as “AAA” or its equivalent; and (3) Invest only in securities issued or guaranteed as to payment of principal and interest by the Federal Government, or its agencies or instrumentalities, or in repurchase agreements that are fully collateralized by such securities. 3. The amount of the deposit in the Fund for the Retirement of Bonds must be determined on the basis of the yields available from the securities in which that money may be invested on the date of the deposit and calculated so as to produce, without reinvestment, a balance in the Fund sufficient to pay the principal amount due on the bonds at maturity.