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<br />POLICY NUMBER: 7 <br /> <br />SUBJECT: <br /> <br />ANNUAL CONSTRUCTION FUND AND SEVERANCE TAX <br />TRUST FUND PERPETUAL BASE ACCOUNT LENDING RATE <br />DETERMINATION <br /> <br />EFFECTNE DATE: January 25, 1995 <br /> <br />REVlSEDDATES: November 24, 1997 <br />January 27, 1999 <br />November 20, 2001 <br />May 20, 2002 <br /> <br />POLICY: The Colorado Water Conservation Board (CWCB) shall annually establish <br />lending rates for loans to be made from the Construction Fund and <br />Severance Tax Trust Fund Perpetual Base Account. Thirty-year lending <br />rates will be established for agricultural, commercial, and municipal <br />categories ofJoans using the procedure outlined below: <br /> <br />1. A Baseline Rate will be established equal to the average yield of the <br />30-year "A" rated* municipal bond for the six months preceding the <br />May Board, meeting, of each year, and will be used to set all of the <br />other lending category interest rates. <br /> <br />It <br /> <br />2. The Commercial Rate will be calculated as 110 percent of the Baseline <br />Rate, rounded to the nearest one-quarter of one percent. <br /> <br />3. Municipal Rates will be based on the project sponsor's service area <br />median household income, as established by the Colorado Department <br />of Local Affairs, and will be structured as follows: <br />a. The Municipal High Income Rate will be calculated as 90 <br />percent of the Baseline Rate rounded to the nearest one- <br />quarter of one percent. The High Income Rate will apply <br />where the median household income in the project <br />sponsor's service area is greater than 11 0 percent of the <br />state-wide median household income <br />b. The Municipal Middle Income Rate will be calculated as 80 <br />percent of the Baseline Rate rounded to the nearest one- <br />quarter of one percent. The Middle Income Rate will apply <br />where the median household income in the project <br />sponsor's service area is equal to 80 percent to 11 0 percent <br />of the statewide median household income. <br />c. The Municipal Low Income Rate will be calculated as 70 <br />percent of the Baseline Rate rounded to the nearest one- <br />, quarter of one percent. The Low Income Rate will apply <br />where the median household income in the project <br />sponsor's service area is less than 80 percent of the <br />statewide median household income. ' <br />