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<br />r' <br /> <br />. <br />., <br /> <br />- <br /> <br />. <br /> <br />STATE OF COLORADO <br /> <br />Colorado Water Conservation Board <br /> <br />Department of Natural Resources <br />1313 Sherman Street Room 721 <br />Denver, Colorado 80203 <br />Phone:~03)866-3441 <br />FAX: (303) 8664474 <br />www.cwcb.state.co.us <br /> <br />.~~'CONS@~", <br />0' '& <br />~. ~ <br />~'" '.' ,~ <br />""". .i <br />',<.,. ',.,t" <br />"'j1'93;:1.," <br /> <br />MEMORANDUM <br /> <br />Bill Owens <br />Governor <br /> <br />TO: <br /> <br />Russell George <br />Executive Director <br /> <br />Colorado Water Conservation Board Members <br /> <br />Mike Serlet, P.E., Chief '--aij <br />Water Supply Planning an;~;;;ce Section <br /> <br />FROM: <br /> <br />Rod Kuharich <br />CWCB Director <br /> <br />Dan McAuliffe <br />Deputy Director <br /> <br />DATE: <br /> <br />May 13, 2005 <br /> <br />SUBJECT: <br /> <br />Agenda Item 13 - May 24-25, 2005, Board Meeting <br />Water Supply Planning and Finance Section - Policy Review <br />Policy#ll-Allowable Loan Amounts as a Percent of the Total Project Cost <br /> <br />IntroductionlBacke:round <br /> <br />The Board approved Financial Policy #11 at their November 24, 1997 Board meeting. The <br />policy limits loan amounts to 90% and 75% of the total project cost for loans made to <br />AgriculturallMunicipal Low-Income borrowers and all other borrowers respectively. Since that <br />time, some potential borrowers have turned away from our loan program because of these funding <br />limitations. Also, the Natural Resources Conservation Service (NRCS) provides funding support <br />(typically 50% to 75% of project costs) in the form of grants from several of their salinity control <br />and on-farm programs to agricultural borrowers also interested in our loan program. The NRCS <br />program's grant disbursement criteria provide that funds are not available until project completion. <br />This requirement creates cash-flow problems for our borrowers during the course of project <br />construction since we can only disburse 90% of any contractor's pay request as part of our loan <br />distribution. <br /> <br />In an attempt to make the CWCB loan programs attractive to more borrowers, and solve the <br />project cash-flow problems encountered with NRCS matching funds, staff is presenting the proposed <br />revisions to Financial Policy #11 (attached). <br /> <br />Discussion <br /> <br />The proposed policy revision changes the loan amount limits to 90% for all borrower <br />categories. The statement, "The CWCB may lend up to 90%..." gives the Board the flexibility to <br />authorize a lesser loan amount in the event the Board feels the loan applicant has the financial <br />strength to provide more than 10% of project matching funds. It also provides staff with a more <br />Flood Protection. Water Supply Plamting and Finance. Stream and Lake Protection <br />Water Supply Protection. Conservation and Drought Planning <br />