PURPOSE: This rule sets forth the requirements for implementation of a direct loan program to be financed through the state revolving fund program contained in 10 CSR 20-4.040.

1. (1) General. The department may make direct loans by purchasing the general obligation bonds, revenue bonds, short-term notes or other acceptable obligation of any qualified applicant for the planning, design and construction of an eligible project. These loans shall not exceed the total eligible project costs as described in 10 CSR 20-4.040(23) less any amounts financed by any means other than through the direct loan program.

2. (2) State Revolving Fund (SRF). The provisions and requirements of the State Revolving Fund General Assistance Regulation, 10 CSR 20-4.040, apply to loans awarded under this regulation.

   (10/31/96)* Rebecca McDowell Cook

3. (3) Letter of Intent. The department will issue a letter of intent to make a direct loan when the application documents are approved and the commission approves the project for receipt of loan funds. The letter of intent shall state the amount of funds reserved for the project, the requirements to qualify for receipt of loan funds and the schedule for the applicant to meet all requirements. The department may terminate this letter of intent for failure to meet the schedule requirements or conditions of the letter of intent. The amount of assistance stated in the letter of intent may be adjusted to reflect actual costs, subject to commission approval and the availability of funds.

4. (4) Construction Loans. The department may award construction loans to qualified applicants in order to provide interim financing during construction of their project. Construction loans may contain clauses and provisions determined by the department to be necessary to protect the interests of the state.

   1. (A) The interest rate charged by the department on construction loans shall be equal to the target interest rate calculated under section (4) of 10 CSR 20-4.040. Interest on the unpaid balance will begin accruing on the last day of the month in which a construction advance is made and will be compounded at the end of each month after that until such time as the construction loan along with all interest accrued is paid in full.
   2. (B) With exception of substate revolving funds, the construction loan will remain in force throughout the construction period. However, it must be paid in full no later than six (6) months following the initiation of operation of the facility constructed by the project or the closing deadline provided in the construction loan agreement, whichever is earlier.
   3. (C) If the department is to provide longterm financing under this rule, then the construction loan must contain an agreement by the department and the recipient that the department will purchase the recipient’s general obligation, revenue bonds or other acceptable debt obligation after construction is completed. If a construction loan is awarded, the bond purchase will be limited in amount to the sum of the payments drawn from the construction loan for eligible project costs plus interest accrued on the construction loan plus the reasonable costs of issuance which can be financed under Missouri statutes.

   4. (D) The recipient may request construction loan payments no more often than monthly. The maximum construction advance shall be the sum of all eligible costs incurred to date. Each payment request shall include the information listed in the following paragraphs (4)(D)1.–3. and other information deemed necessary by the department to insure proper project management and expenditure of public funds:

      1. 1. Completed reimbursement request

form;

1. 2. Construction pay estimates signed by

the construction contractor, the recipient and the resident inspector, if applicable; and

1. 3. Invoices for other eligible services,

equipment and supplies for the project.

1. (E) If the department is satisfied that the payment request accurately reflects the eligible cost incurred to date on the project, the department will request that a state payment check be issued to the recipient.

2. (F) The department may contract with a trustee to provide all or part of the services listed in the following paragraphs (4)(F)1.–4. of this rule. The department may require recipients of less than thirty thousand (30,000) service area population to use the services of the trustee, to—

   1. 1. Make joint assistance payments to the

recipients and their contractors;

1. 2. Ensure that payments are only

released to those recipient’s whose contractors have a project contract approved by the department;

1. 3. Ensure that none of the recipient’s

contractors receive more in assistance payments than approved by the department; and

1. 4. Maintain financial records of credits

and debits for the construction project.

1. (G) If a SRF direct loan is matched with a grant awarded under 10 CSR 20-4.023, the maximum loan amount will be calculated as follows: grant amount divided by four-tenths (.4) less the grant amount plus approved costs of issuance and capitalized interest, as appropriate.

1. (5) Purchase of Obligations. The department shall purchase revenue bonds, general obligation bonds or other acceptable debt obligations from the recipient no later than six (6) months following initiation of operation of the facilities constructed by the project or by the closing deadline contained in the construction loan agreement, whichever is earlier. In addition to the requirements of this rule, the department may require the recipient to include those assurances and clauses in the loan agreements and bond resolutions as deemed necessary to protect the interest of the state.

2. (6) Amortization Schedules. The department shall use the guidelines contained in the following subsections (6)(A)—(D) to establish amortization schedules for bonds purchased under this rule:

   1. (A) The bonds, notes or other debt obligations shall be fully amortized in no more than twenty (20) years after initiation of operation;
   2. (B) The payment frequency on any debt obligations shall be no less than annual with the first payment no later than one (1) year after the initiation of operation;
   3. (C) The amortization schedule may either be straightline or declining schedules for the term of the debt obligation; and 10 CSR 20-4
   4. (D) Repayment of principal shall begin not later than one (1) year after initiation of operation.
3. (7) Loan Fees. The department may charge annual loan fees not to exceed one-half percent (.5%) of the outstanding loan balance of each loan provided from the WWLF or WWRLF. Those fees are intended to reimburse the department for the cost of loan origination, loan servicing and administration of the program.
4. (8) Additional Administrative Fees Allowed. Additional administrative fees may be assessed by the department at the time the administration fee is calculated for failure by a recipient to submit approved documents to the department (for example, operation and maintenance manuals, plan of operation, enacted user charge and sewer-use ordinances and executed contract documents) in accordance with the time frames provided under the program agreement entered into by the recipient. The additional fee will be an additional one-tenth percent (.1%) per month that the document remains delinquent. The additional fee will be collected only during the year in which the document is not submitted.
5. (9) Variations of Structure Permitted. This rule sets out the general format for the direct loan program. The commission and the department shall have the authority to make specific refinements, variations or additional requirements as may be necessary or desirable in connection with the efficient operation of the direct loan program.

AUTHORITY: sections 644.026, RSMo (Supp. 1995) and 644.122, RSMo (1994).* Original rule filed Sept. 13, 1988, effective Feb. 14, 1989. Amended: Filed April 2, 1990, effective Sept. 28, 1990. Emergency amendment filed July 17, 1990, effective July 30, 1990, expired Nov. 26, 1990. Amended: Filed March 4, 1993, effective Sept. 9, 1993. Amended: Filed April 14, 1994, effective Nov. 30, 1994. Amended: Filed March 1, 1996, effective Nov. 30, 1996. *Original authority; 644.026, RSMo (1972), amended 1973, 1987, 1993, 1995 and 644.122, RSMo (1987), amended 1991, 1993. Water Pollution Control Program, FTS Construction Fund Reimbursement And Grant Request Form State Revolving Loan Program/State Match Grant 7. Eligible Project Costs Incurred (Excluding Retainage) Recipient Project Number and Name Show construction, engineering, administrative costs, etc. A. B. C. D. E. F. W. Total from construction sheet X. Eligible costs incurred to date O F F I C E 8. Certification DNR-WPCP-FTS, SRF-01 (11-90) Missouri Department Of Natural Resources, Cumulative Current Period (this loan/grant only) Office Use Only Y. Total Approved Eligible Costs To Date: Z. Match Grant (15% Of Line 7.Y.) or______________________ %: U AA. Less Grant Amount Previously Paid: S E BB. State Match Grant Payment Due: CC. Eligible Costs (Line 7.Y.), Less Match Grant (Line 7.Z.): O DD. Less Amount Previously Approved For Payment by Trustee N EE. Amount Payable To City By Trustee (Actual Reimbursement Amount): L FF. Wastewater Loan Fund Ratio: ________________ % of Line 7.CC.: Y GG. Less Wastewater Loan Fund Payments Authorized to Date: HH. Payment Due From State (83.33% Federal/16.67% State): Signature of Authorized Certifying Official: Recipient: Missouri Department Of Natural Resources, Water Pollution Control Program, FTS Construction Fund Reimbursement And Grant Request Form State Revolving Loan Program/State Match Grant INSTRUCTIONS 1. If this is the final request, check the “final” line; if not, check “partial.” 2. Enter your construction loan number. 3. Enter the number of this request. If this is the only page you will use for this request, enter page 1 of 1. If you are attaching a continuation page for this form, enter page 1 of 2. 4. Enter the period covered by this report. 5. Enter the name and address of the municipality, political subdivision, or sewer district. 6. Enter the name and address of the Trustee Bank for this loan. 7. A–F. Enter the costs incurred in the construction of this project. Use a separate line for each major construction contract, each major segment of engineering services, and any additional costs (administration, land purchase and the attendant costs, and testing services). Remember that all costs shown for the first time in any category must have documentation concerning the cost and service rendered. 7. G–V. These Lines Are on the Continuation Page! If more lines are necessary than are provided on the first page of the form, attach a continuation page. Carry the total of the continuation pages to line W. 7. X Add lines 7.A. through 7.F. and line W. 7. Y–HH Do not use these lines. 8. Authorized representative must sign and date the form. Missouri Department of Natural Resources, Water Pollution Control Program, FTS Construction Fund Reimbursement and Grant Request Form State Revolving Loan Program/State Match Grant Continuation Page 1. Loan/Grant Number: ________________________ Bond Issue Identifier ________________________ 3. Recipient Organization: (Grant Payee) Name: Address: 7. Eligible Project Costs Incurred (Excluding Retainage) Recipient Project Number and Name N. O. P. Q. R. S. T. U. V. Total from this continuation sheet Carry this amount to Line W on the first page DNR-WPCP-FTS, SRF-01 (11-90) Continuation page Page ________of ___________ 2. Period Covered By This Report: from: ____________to: ___________ 4. Loan Trustee: (Loan Payee) Name: Address: Cumulative