Overflow serves as a project's runway since future funding cycles can tap into it within the bounds of the preconfigured distribution limits. Overflow can also serve as a refund or rebate mechanism, where everyone's net contribution price is pushed towards zero as volume outpaces what the project needs.
By default, overflow also serves a means for allowing community members to exit with a portion of the treasury's funds in hand. Any funds in overflow are reclaimable by the project's community by redeeming community tokens along a bonding curve defined by the project's current redemption rate. Projects can override or extend this functionality using a custom data source.
Projects can manage how much money is in overflow (and therefore how much each member can exit with) either by adjusting its distribution limits or by using a custom redemption extension.