BOARD01620

• Board Meeting Date: 5/16/2006
• Description: CF Section- Financial Matters - New Loan Lending Rate Structure for FY 2007
• Board Meetings - Doc Type: Memo

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STATE OF COLORADO

Colorado Water Conservation Board

Department of Natural Resources
1313 Sherman Street, Room 721
Denver, Colorado 80203
Phone: (303) 866.,3441
FAX: [phone]
www.cwcb.state.co.us

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Bill Owens
Governor

Russell George
Executive Director

MEMORANDUM

Rod Kuharich
CWCB Director

TO:

Colorado Water Conservation Board Members

Mike Serlet, P.E., chief'-lll f
Water Supply Planning and~ce Section

Dan McAuliffe
Deputy Director

FROM:

DATE:

May 5, 2006

SUBJECT:

Agenda Item #10 - May 16-17, 2006 Board Meeting
Water Supply Planning and Finance Section - Financial Matters
New Loan Lending Rate Structure for FY 2007

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 3D-year "A" rated municipal bond for the period
November 6, 2005 to April 30, 2006.1 As the graph indicates, the average yield for the municipal
bond was 4,71 percent for the past six-month period.

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 suscep1ible to the adverse effects of changes in circumstances and economic
conditions than debt in higher rated categories."

Flood Protection. Water Supply Planning and Finance. Stream and Lake Protection
Water Supply Protection. Conservation and Drought Planning