BOARD00810

• Board Meeting Date: 5/11/1998
• Description: CF Section - Policy for Charges on Late Payments
• Board Meetings - Doc Type: Memo

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Colorado Water Conservation Board
Department of Natural Resources
721 Centennial Building
, 313 Sherman Street
Denver, Colorado 80203
Phone: [phone]
FAX: [phone],4474

STATE OF COLORI\DO

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Roy Romer
Governor

MEMORANDUM

James s. Lochhead
Executive Director, ONR
Daries C. life, P.E.
Director, eWeB
Peter H. Evans
Acting Director, ewes

TO: Colorado Water Conservation Board Members

DATE: May 4, 1998

FROM: Bill Stanton, Section Chie
Jan lilian, Contract Administrato
Construction Fund SectiOn

SUBJECT: Agenda Item 21, May 11-12, 1998 Board Meeting
Water Project Construction Loan Program
Policy for Charges on Late Payments

INTRODUCTION. Staff has added language to the promissory note to provide for a late
charge in the amount of 5% of the loan payment on loan payments not received within 15
days of the due date,

BACKGROUND.

DISCUSSION. Staff recently added the late charge language' to the promissory note,
Actual enforcement of the terms will subject to the Board's approval of this proposed late
charge policy.

Attached is a copy of the proposed procedures for administering the later charge policy.

It is standard lending practice to include a provision for a late charge when payments are
not made on time. The purpose of the late charge is to motivate the borrowers to make
their payments in a timely manner, It also provides the CWCB staff with the option of
encouraging a Borrower to make its payment(s) rather than the last resort threat of
enforcing the acceleration of the loan and foreclosure clauses.

STAFF RECOMMENDATION.

The staff recommends that the Board authorize the staff to impose a late charge in the
amount of 5% of the payment on annual loan payments not received within 15 days of the
due date.