Notwithstanding any other provision in this part, for the purposes of (1) assuring that the bonds to be issued will not become arbitrage bonds as defined in the Internal Revenue Code of 1954 (Title 26 of the United States Code) and regulations promulgated thereunder by the Department of Treasury, and (2) providing for reduction of the amount of money in the special reserve fund during the term of the bonds, the legislative body may, by resolution adopted prior to the issuance of bonds under this division, provide that money in the special reserve fund, including investment income, shall be used, in the amounts and at the times as the legislative body may determine, for either or both of the following:
(a) Credit upon the assessment in the manner provided in Section 10427.1.
(b) Transfer to the redemption fund for advance retirement of the bonds pursuant to this division.
The resolution may specify the terms and conditions, as the legislative body may determine to be reasonable, with respect to its authorization of either or both of the uses.
(Added by Stats. 1981, Ch. 378, Sec. 5. Effective September 9, 1981.)