Wyo. Code R. 060-0003-38
Loan and Investment Board
Chapter 38: Capital Construction Loans
Effective Date: 11/13/2018 to 10/11/2021
Rule Type: Superceded Rules & Regulations
Reference Number: 060.0003.38.11132018
Capital Construction Loans
(a) This Chapter is adopted pursuant to Wyoming Statute (W.S.) 16-1-111.
In addition to the definitions in Chapter 1, as used in this Chapter:
(a) “Capital construction” means new construction, expansion, renovation, or replacement of an existing facility or facilities. (b) “City” means any incorporated municipality having a population of four thousand (4,000) or more which has been declared a city or which has taken the necessary steps to be and has been proclaimed a city. (c) “DDA” means demand deposit account. (d) “Infrastructure project” means a capital construction project which may lawfully be undertaken within the powers of the political subdivision. (e) “Political subdivision” means Wyoming cities, towns, counties, school districts, and community college districts. (f) “Street and road projects” means the construction, maintenance or improvement of a public street, road or alley within a city, town, or county. (g) “Town” means any incorporated municipality, not a city.
(a) Loans shall be made in such a manner and to such parties as shall, in the judgment of the Board, represent a prudent investment of state funds. (b) The capital construction loan program is not intended to benefit investors or developers.
(a) Political subdivisions are eligible for loans for infrastructure projects. In order to qualify for a loan, the political subdivision must be able to demonstrate the following: (i) A commitment to adequately maintain the project for the duration of the loan; and, (ii) All project costs will be funded at the time of receipt of the loan.
(b) Wyoming cities, towns, and counties are eligible for loans for street and road projects. In order to qualify for a loan, the city, town, or county must be able to demonstrate the following:
(i) A commitment to adequately maintain the project for the duration of the loan;
(ii) All project costs will be funded at the time of receipt of the loan;
(iii) All related infrastructure, including water and sewer is or will be in place at the time of receipt of the loan; and,
(iv) No outstanding loans exist under this Chapter for a street and road project.
(c) All projects must be owned by the entity applying for the loan.
(d) Applicants must be compliant with all applicable reporting requirements of the Wyoming Department of Audit and Wyoming Department of Revenue prior to the application being considered by the Board.
(a) Loans may be made for infrastructure projects and street and road projects and may include costs associated with the following purposes:
(i) Purchase of land, buildings, and improvements associated with capital construction;
(ii) Renovation or upgrade of existing infrastructure; and/or
(iii) Planning and construction.
(a) Applications.
(i) Each applicant shall submit a written loan application on the form furnished by the Office. At a minimum, the application shall include:
(A) A signed resolution stating the amount of the loan being requested, name of project and repayment source(s), and agreeing to maintain the project for the life of the loan;
(B) A detailed project summary which includes a breakdown of total project costs, a project timeline and proposed repayment source(s);
(C) Commitment letters from all funding sources, if applicable;
(D) Engineer’s Feasibility Statement;
(E) A formal maintenance plan documenting how the borrower will adequately maintain the project for the life of the loan.
(ii) Incomplete applications shall not be submitted to the Board for consideration.
(iii) Any false or misleading statements made by the applicant in an application shall be grounds for summary rejection of the application.
(iv) Timing. Loan applications must be received by the Office at least ninety (90) calendar days prior to any regularly scheduled meeting of the Board. Applicants must cure any defects in their application no later than forty-five (45) calendar days before any regularly scheduled meeting of the Board.
(b) Consideration.
(i) The Office shall conduct a preliminary review of all applications received. If the Office identifies issues with the application which would result in a negative recommendation to the Board, the Office shall notify the applicant within 30 days of receiving the application of the issue and the applicant shall have the opportunity to correct the application or withdraw the application. Applicants must cure any defects in their application no later than forty-five (45) calendar days before any regularly scheduled meeting of the Board.
(ii) All applications shall be reviewed by the Attorney General to certify the legality of the transaction and to determine if an election is required by law.
(iii) The following will be considered when reviewing applications:
(A) The project’s contribution to health, safety and welfare of the citizens in the political subdivision as demonstrated by:
(I) The extent the project will protect the citizens from exposure to hazards that may result in adverse consequences;
(II) Achieving compliance with state and federal mandates; or
(III) Any other relevant information demonstrating the project’s contribution to the health, safety and welfare of the citizens.
(B) The applicant's need for the project and financial need of the applicant in relation to the project; and,
(C) The applicant's ability to repay the loan.
(a) Interest rate. The interest rate for loans under this Chapter shall be pursuant to Chapter 14 of the rules established by the Board and a one-half of one percent (0.5%) origination fee shall be collected on the approved loan amount.
(b) Length. The term for each loan shall be set by the Board with due regard given to repayment ability and the security offered, but in no event shall the term be less than five (5) years or exceed twenty-five (25) years.
(c) Repayment. Loans shall be payable in equal installments. Payments shall begin within one (1) year from the date of loan funds being deposited in the required DDA.
(a) Every loan shall be evidenced by a promissory note for the principal sum of the loan.
(b) Loans shall be adequately secured to the Board's satisfaction. Loans may be secured with:
(c) If an appraisal is required, the applicant shall be responsible for ensuring one is completed prior to submitting a loan application.
(i) Office staff shall review and approve the methodology used for valuation and the overall market value prior to loan closing.
(a) Upon closing, the loan proceeds shall be deposited in a DDA to be disbursed solely for the approved loan purpose. The borrower shall pay all costs associated with the DDA. Interest earned shall be credited to the borrower.
(b) Borrower shall submit all requests for payment from the DDA on a form provided by the Office, with supporting documentation, as required by the Director.
(i) The Office shall inspect and verify any reports and records required by the Board and submitted by the borrower before proceeds shall be released from the DDA for payment.
(a) Costs for preparation or presentation of loan application;
(b) Costs incurred prior to loan award, except costs incurred for architectural and engineering design, surveying and environmental review, if required;
(c) Engineering fees, including design, inspection and contract administration costs, in excess of fifteen percent (15%) of project cost;
(d) Markups by engineers/architects of sub-contractor and other outside charges;
(e) Costs for transportation, meals, lodging and incidentals incurred offsite from the project or that exceed the current federal per diem reimbursement rate;
(f) Costs associated with the borrower’s own employees and equipment;
(g) Costs for real property in excess of current fair market value and/or costs for an amount of real property in excess of that needed for project purposes;
(h) Costs related to issuance of bonds;
(i) Costs for furnishings;
(j) Legal fees;
(k) Costs for sidewalks that are owned or maintained by a private property owner; and,
(l) Costs for contingency or extra work allowance in excess of 10% of estimated construction costs.
(a) At least annually, more often if deemed necessary by the Office, the borrower shall provide the Office an account statement for the DDA used for holding the loan proceeds.
(a) On an annual basis, records of the borrower shall be, at a minimum, compiled by an independent accounting firm. The borrower shall provide the Office a Compilation, Review or Audited Financial Statement.
(b) The Board may, at its expense, conduct an independent audit of the borrower’s records and inspect the construction and operation of the project.