Colo. Rev. Stat. § 30-35-705
Such refunding bonds may be exchanged dollar for dollar for the bonds to be refunded, or they may be sold at, above, or below their par value at a price or prices such that the net effective interest rate of the issue of refunding bonds does not exceed the maximum net effective interest rate authorized. Such refunding bonds shall be in a principal amount not exceeding the principal amount of the bonds to be refunded, as directed by the governing body, and the proceeds thereof shall be applied only to the purpose for which such refunding bonds were issued. The principal amount of said refunding bonds may be the same as or less than the principal amount of the bonds to be refunded, if due, adequate, and sufficient provision has been made for the payment, or redemption, and retirement of said bonds to be refunded and the payment of the interest accruing and having accrued thereon in accordance with this article.
C.R.S. § 30-35-705