PUB00059

• Year: 1995
• Title: Construction Fund Annual Report 1995
• CWCB Section: Finance
• Author: CWCB
• Description: Construction Fund Annual Report 1995
• Publications - Doc Type: CF Annual Report

I

I

TABLE 2, Audit Recommendations

I

I

Rec.
No, Recommendation Summary Progress as of December I, 1995
1 Develop a formal, systematic program or process which Completed. The Board agreed to implement this
provides a loog- and short-term framework for the use of recommendation by 12/93, The Board identified 5 long-
the Construction Fund. This process should include term goals at its January 1993 meeting. The Board attended
developing broad policy statements, establishing goals a retreat in October 1993 to develop a draft Long Range
and implementation plans and developing performance Plan, The Board's Long Range Plan was formally adopted
measures. on September 14, 1994.
2 Develop and implement an effective process for 100g- Completed, The Board agreed to implemeDt this
term financial planning of Construction Fund monies. recommendation by 12/93. The Board staff worked with
This process should include establishing long-term DNR accounting to set up a better method of systematically
funding needs, assessing current sources of funds, and reporting revenues. All accounts have been reconciled. A
projecting future funding requirements that may be water user needs survey was completed in July 1993. A
needed to meet long-term goals. Long-Term Financial Projection for the Construction Fund
was completed in December 1993,
3 Establish guidelines which include setting loan interest Completed, The Board agreed to partially implement tlljS
rates to reflect market interest rateS. The Guidelines recommendation by 7/93, The Board approved new
should be reflected in the projects that will be authorized "standard" interest rate guidelines at 2 basis points below
during the upcoming legislative session. the then 30-year Treasury Bond rare for 30 years at its May
6-7, 1993 meeting. A project evaluation matrix is being
used on new projects.
4 Charge interest on cash disbursements made to project Completed. The Board agreed to implement this
sponsors during the construction phase of projects. recommeDdation by 12/93. The Board adopted this new
Interest charges could be added to the principal amount policy at its May meeting. The Construction Fund
of the loan and financed over the term of the loan. Guidelines have been revised to reflect the new policy.
Contracts for future construction projects will require
interest during construction.
5 Improve Board monitoring of projects by contacting Ongoing. The Board agreed to implement this
project sponsors at least annually to determine if project recommendation by 12/93, Letters are sent in March to the
sponsors plan to go ahead with the projects. Responses sponsors for all authorized but not yet constructed CWCB
should be documented and reported to the General projects. The staff evaluates the status of the project and
Assembly on an annual basis. determines if it should be deauthorized.
6 Develop and implement procedures which would recover Completed, The Board agreed to implement this
the Board's share of feasibility study costs for projects recommendation by 10/93. The Board adopted a new
that are not constructed. Alternatives should be policy at its May meeting that stated the Board's
evaluated, induding payback over a period of time. participation in feasibility study costs must generally be
repaid whether the project is constructed or not. The
Guidelines have been revised to reflect this policy.
7 Develop methods to demonstrate Board compliance with Completed, The Board agreed to implement this
procedures it has established, including documentation of recommendation by 7/93. A project checklist was prepared
all Board reviews and approvals. by staff in July 1993.

I

I

I

I

I

I

I

I

I

I

I

I

I

I

I

CWCB Annual Report, page 11