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Memorandum Agenda Item 10c 01/27,28, 1999
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Memorandum Agenda Item 10c 01/27,28, 1999
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Board Meetings
Board Meeting Date
1/27/1999
Description
Board Meeting Water Project Construction Loan Program - Revisions to the Guidelines for Interest Rate Setting
Board Meetings - Doc Type
Memo
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• The High Income Rate would be for areas where the median household income is more <br /> than 110 percent of the Colorado median household income. [Jan 95] The 30-year <br /> municipal bond yield(rounded to the nearest one-quarter of one percent) will be used <br /> directly as the Municipal High Income lending rate and all other rates will be <br /> structured from that rate. [Nov 97] <br /> • The Standard Lending Rate and terms are ten percent less than the High Income <br /> Rate for a repayment period of 30 years. <br /> • To qualify for the Low Income Rate, the median household income in the project <br /> sponsor's service area must be less than 80 percent of the statewide median household <br /> income in Colorado. [Jan 95] The Low Income Rate is 20 percent less than the <br /> Standard Lending Rate. <br /> h. In recommending to the Board a lending rate for individual municipal loans, the staff will <br /> take into consideration the financial strength of the borrow e orrower's ability to <br /> issue bonds (where that can be determined) in addition to the median household income <br /> of the community. [Nov 97] <br /> t Agricultural lending rates will be set equivalent to the Municipal Low Income Rate. [Jan <br /> �� 95] <br /> • <br /> category of loans will be set at a rate 20 <br /> �,\ �. Lending rates for the Commercial/Industrial c g ry <br /> � � percent higher than the Standard Rate. [Nov 97] <br /> k. For projects which include more than one project purpose, a weighted average lending <br /> �e� rate will be recommended based on the percent of water supplied or on the percent <br /> \ ownership for each preceding purpose in a particular project. [Jan 95] <br /> 1. A slightly lower interest rate may be available for a shorter repayment period. [Aug 94] <br /> The 30-year lending rate may be reduced for each category of loans by one-quarter <br /> - of one percent for all loans with maturities of 20 years or less but more thanl0 years <br /> and by one-half of one percent for all loans with maturities of 10 years or less. <br /> m. For Agricultural and Low-Income Municipal borrowers, the percentage of the total <br /> allowable costs for the planning, engineering design, and construction of a project which <br /> 4 �g may be financed by the Board will be up to 90 percent. For all other classes of borrowers, <br /> f\ in particular for those borrowers with greater financial strength and/or the capacity to <br /> issue bonds, the staff may recommend that the Board fund less than 75 percent of <br /> planning, design, and construction costs depending upon the particular circumstances of <br /> the borrower..[Nov 97] <br /> n. Preference for funding will be given to those projects which are most cost effective, which • <br /> demonstrate the greatest need for assistance in financing, and which best relate to the Board's <br /> 4 <br />
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