9.2.3 Debt Service Reserve Fund

9.2.3 Debt Service Reserve Fund

A debt service reserve fund (DSRF) is designed to meet unexpected difficulties that might keep a public agency from paying debt service for a short period of time. They are common to all forms of debt with the exception of general obligation bonds and variable rate obligations secured by a direct pay credit facility. DSRFs commonly contain an amount equal to the maximum annual debt service on the bonds. See Section 2.4.4, Debt Service Reserve Fund. While investors derive substantial comfort from the existence of a DSRF, issuers are unlikely ever to access them.