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POLICY NUMBER: 13 SUBJECT: TARGET GROWTH RATES FOR THE EQUITY OF THE CONSTRUCTION FUND AND SEVERANCE TAX TRUST FUND PERPETUAL BASE ACCOUNT EFFECTIVE DATE: October 1, 2000 REVISED DATES: January 27, 2004 September 14, 2004 POLICY: The Colorado Water Conservation Board (CWCB) will attempt to maintain an overall growth rate for the equity of the Construction Fund and Severance Tax Trust Fund Perpetual Base Account (STTFPBA) of no less than the long-term rate of inflation, as established by appropriate construction cost indices, plus 0.5%. This will be the "target growth rate" for each fund. PURPOSE: To offset the impacts of cost inflation, to maintain the financial integrity of the CWCB Construction Fund and STTFPBA and to provide a process for estimating the financial resources available for non-reimbursable investments from the Construction Fund in any given year. APPLICABILITY: This policy and procedure apply to the CWCB Construction Fund and STTFPBA. PROCEDURE: The overall growth for the fund equity of the Construction Fund and STTFPBA will be presented as part of the Comprehensive Annual Financial Report by CWCB staff at the September Board meeting each year. Staff will present an annual estimate of funds available for non-reimbursable investments relative to the target growth rate. The estimate of funds available for non-reimbursable investments will be the current fund equity (as of the end of the most recent fiscal year), less the previous year's fund equity increased by the target growth rate. At the same Board meeting each year, staff will present a summary of long-term construction cost indices with any recommendations for revisions to the target growth rate in fund equity. Approved by the CWCB September 14, 2004 Finance Sub-Committee Meeting