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(a) Separate Accounts Established. There shall be and are hereby established separate accounts in the Water Revenue Fund to be known as the Operation and Maintenance Account, the Depreciation Account and the Capital Account, to which there shall be credited on or before the first day of each month by the financial officer of the Village, without any further official action or direction, in the order in which said accounts are hereinafter mentioned, all moneys held in the Water Revenue Fund, in accordance with the following provisions:
(1) Operation and Maintenance Account. There shall be credited to the Operation and Maintenance Account an amount sufficient, when added to the amount then on deposit in said Account, to establish a balance to an amount not less than the amount necessary to pay operation and maintenance costs for the then current month.
(2) Depreciation Account. Money in the Water Revenue Fund shall next be allocated to a separate and special account to maintain a renewal, replacement and depreciation reserve for the system known as the Depreciation Account. On or prior to the first day of each month there shall be credited to the Depreciation Account the sum of one thousand dollars ($1,000), provided that no deposit to the Depreciation Account shall be required if the amount then held in said Account equals or exceeds one hundred fifty thousand dollars ($150,000) or such higher amount as may be recommended by an independent consulting engineer. Money in the Depreciation Account shall be used solely for the purpose of paying the renewals and replacements not included in the annual budget for current operation and maintenance costs. The amount required to be maintained in the Depreciation Account is hereby determined to be an adequate and reasonable depreciation reserve.
(3) Capital Account. All moneys remaining in the Water Revenue Fund, after crediting the required amounts to the respective accounts hereinabove provided for, and after making up any deficiency in the accounts described in paragraphs (a)(1) and (2) hereof, shall be credited each month to the Capital Account. Funds in this surplus account shall first be used to make up any subsequent deficiencies in any of the accounts hereinabove named and then, at the discretion of the Corporate Authorities, shall be used for one or more of the following purposes without any priority among them:
A. For the payment of principal and interest on any other obligations or indebtedness that by their terms are payable from the revenues of the system, but are subordinate to any system revenue bonds and have been issued for the purpose of renewals, replacements, extensions or improvements to the system;
B. For the purpose of constructing, installing or acquiring repairs, replacements or improvements to the system; or
C. For any other lawful system purpose.
(b) Investment of Moneys in Accounts. Moneys to the credit of the Depreciation Account and the Capital Account may be invested from time to time by the Treasurer in the following:
(1) Interest-bearing bonds, notes or other direct full faith and credit obligations of the United States of America;
(2) Obligations unconditionally guaranteed as to both principal and interest by the United States of America; or
(3) Certificates of deposit or time deposits of any bank, as defined by the Illinois Banking Act, provided such bank is insured by the Federal Deposit Insurance Corporation or a successor corporation to the Federal Deposit Insurance Corporation, and provided, further, that the principal of such deposits in excess of the insured amount is secured by a pledge of obligation as described in paragraphs (d)(1) and (d)(2) hereof in the full principal amount of such excess.
Such investments may be sold from time to time by the Treasurer as funds may be needed for the purpose for which said respective accounts have been established. To the extent that moneys in said Accounts as described in this subsection are held uninvested and on deposit in demand accounts, such amounts shall be added to the amount invested pursuant to paragraph (b)(3) hereof and the sum so derived, subject to the limitations as set forth therein.
Investments in the Accounts shall mature or be subject for redemption at the option of the holder thereof prior to the time when needed, and, in any event, within the time as follows:
Operation and Maintenance
All interest on any funds so invested shall be credited to the Water Revenue Fund and is hereby deemed and allocated as expended with the next expenditure(s) of money from the Water Revenue Fund.
(c) Excess Over Requirements. Any amounts to the credit of the Accounts in excess of the then current requirement therefor may be transferred by the Corporate Authorities to such other Account or Accounts of the Water Revenue Fund as they may, in their sole discretion, designate.
(Ord. 1996-06. Passed 4-22-96.)