BOARD00693

• Board Meeting Date: 5/19/2003
• Description: CF Section - Financial Matters Lending Rate Structure for FY 2004
• Board Meetings - Doc Type: Memo

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STATE OF COLORADO

Colorado Water Conservation Board

Department of Natural Resources
1313 Sherman Saeer, Room 721
Denver, Colorado 80203
Phone: [phone]
FAX: [phone]
www.cwcb.state.co.us

Bill Owens
Governor

GregE. Walcher
Executive Director

MEMORANDUM

Rod Kuharich
CWCB Pirectot

TO:

Colorado Water Conservation Board Members

Pan McAuliffe
Peputy Pirectur

FROM:

Mike Serlet, P.E., Chief
Water Supply Planning and Finance Section

DATE:

May 9, 2003

SUBJECT: Agenda Item 21 - May 19-20, 2003 Board Meeting
Water Supply Planning and Finance Section - Financial Matters
Lending Rate Structure for FY 2004

Introduction

This memorandum provides a summary of interest rates for the last six months and the staff
recommendation for a lending rate structure for CWCB lending programs for the next twelve months.
The recommendation is in accordance with the Board's Financial Policy #7 - Annual Construction
Fund and Severance Tax Trust Fund Perpetual Base Account Lending Rate Determination.

Discussion

Attached is a graph of weekly yields for the 30-year "A" rated municipal bond for the period
November 4, 2002 to April 28, 2003.1 As the graph indicates, the average yield for the municipal
bond was 5.08 percent for the past six-month period.

The rates shown in Table I below are calculated based on Financial Policy #7.

I Standard & Poor's definition of an 'A' bond rating is: "A debt rated 'A' has a strong capacity to pay interest and repay
principal although it is somewhat more susceptible to the adverse effects of changes in circumstances and economic
conditions than debt in higher rated categories."

Ftood Ptorection . Water Supply Planning and Finance . Stream and Lake Prorection
Water Supply Protection. Conservation and Drought Planning