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40 40 11 as applicable regulations implementing said Sections, and the County further covenants to comply with all other requirements of the Code if and to the extent applicable to maintain continuously the Federal income tax exemption of interest on the Bonds. G, FUNDS AND ACCOUNTS, The designation and establishment of the various funds and accounts created herein does not require the establishment of any completely independent, self balancing funds as such term is commonly defined and used in governmental accounting, but rather is intended solely to constitute an earmarking of certain revenues and assets as provided herein. H. POWER TO LEVY TAX, ISSUE BONDS, ETC. The County is duly authorized under all applicable laws to levy and collect the ad valorem taxes pledged hereunder, to create and issue the Bonds and to adopt this Resolution and to pledge the full faith, credit and taxing power of the County in the manner and to the extent provided herein, The Bonds and the provisions of this Resolution are and will be valid and legally enforceable obligations of the County in accordance with their terms and the terms of this Resolution. I. TAR COVENANTS. The County covenants that it will not take any action or fail to take any action with respect to the proceeds of the Bonds that would result in loss of the exclusion from gross income for federal income tax purposes pursuant to Section 103(x) of the Code of interest paid on the Bonds which, when initially issued and sold, were the subject of an opinion of counsel to the effect that interest thereon was so excludable. SECTION 15. APPLICATION OF THE BOND PROCEEDS, All moneys received from the sale of the Bonds shall be deposited and applied by the County as follows; A. All accrued interest on the Bonds, plus, at the option of the County, an amount specified by subsequent resolution of the County adopted at or prior to delivery of the Bonds which equals the amount of interest on the Bonds for a reasonable period of time from the date of issuance thereof, shall be deposited into the Sinking Fund and applied exclusively for the payment of interest first becoming due on the Bonds. B, Next, the amount necessary to pay all engineering fees, costs and expenses of financial reports, studies and projections, legal fees, fees of financial advisors, costs of the issuance of the Bonds, premiums and expenses related to insuring or rating the Bonds and all other similar costs incurred in connection with the issuance of the Bonds shall be paid or provided for. C. A fund is hereby created and established to be known as the "General Obligation Bonds, Series 1989 Construction Fund" (herein the "Construction Fund"). There shall be deposited into the Construction Fund the balance of the moneys remaining after making all the deposits and payments provided for above. The moneys on deposit in the Construction Fund shall be withdrawn, used and applied by the County, as and when necessary, solely for the payment of the Project Cost, If for any reason any moneys in the Construction Fund are not 14