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<br />e <br /> <br />e <br /> <br />e <br /> <br />DRAFT REVISIONS <br /> <br />POLICY NUMBER: 8 <br /> <br />SUBJECT: <br /> <br />RATE OF RETURN ESTIMATE FOR LOANS FROM THE <br />CONSTRUCTION FUND AND THE SEVERANCE TAX <br />TRUST FUND PERPETUAL BASE ACCOUNT <br /> <br />EFFECTIVE DATE: October 1, 2000 <br /> <br />POLICY: The Colorado Water Conservation Board (CWCB) will attempt to <br />maintain a rate of return on loans from the Construction Fund and <br />from the Severance Tax Trust Fund Perpetual Base Account <br />(STTFPBA) adequate to offset the long-term impacts of inflation <br />in construction costs. <br /> <br />PURPOSE: To maintain the financial integrity of the Construction Fund and of <br />the STTFPBA. <br /> <br />APPLICABILITY: This policy and procedure apply to all loans from the Construction <br />Fund and the STTFPBA. <br /> <br />PROCEDURE: <br /> <br />The CWCB staff will present to the Board, at the second Board <br />meeting of each calendar year, the estimated internal rate of return <br />on all of the Board's funding recommendations included in the <br />CWCB water projects funding legislation for the year as well as <br />loans approved by the Board from the Small Project Loan Account <br />and the Emergency Infrastructure Repair Loan Account in the <br />previous calendar year. This will include both new loan <br />authorizations as well as increases to prior loan authorizations. <br />Staff will also present a comparison of the estimated rate of return <br />for the year with appropriate construction cost indices and with the <br />Board's desired rate of growth in the total combined equity for <br />both funds. <br />