9.3 Investment Authority and Controlling Documents

The authority to invest the proceeds of debt differ from those imposed on investments of public agency surplus funds. California law and bond documents, providing for the holding of bond funds pending disbursement, generally limit the investment of such funds to particular types of securities and investments of limited duration. See Section 2.4.7, Investments. An issuer’s investment policies may also impose additional authorities on proceeds. The proceeds of tax exempt obligations are subject to federal tax law restricting yields on particular funds and requiring the rebate of arbitrage earnings. These may also affect a public agency’s investment strategy.