Definition of Surplus Fund

Surplus fund is an account set up for funds generated by a project financed by a municipal revenue bond to pay a variety of expenses.

Applying "Surplus Fund" to Securities Exams:

Revenue bonds issued to to finance bridges and tunnels must use those revenues to for operations and maintenance and for debt service. If the project sets up a surplus fund it will take a portion of the revenue received and place it into a surplus fund to hold in reserve to pay for future expenses.

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