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Water Development Loan Program
Purpose
The Water Development Loan Fund program serves a broad range of eligible borrowers in all regions of the state. The goal is to provide low-cost, long-term, fixed-rate financing incentives that promote projects that achieve the state´s long-term water management goals.

The Department may grant loans to individuals, cities and local governments, farming partnerships, limited partnerships, corporations and cooperatives, irrigation and water control districts, and others meeting the lending criteria under the program. Eligible projects include: drainage, irrigation, community water supply (communities less than 30,000 population), fish protection, watershed enhancement, and multipurpose projects.

All costs to operate the loan fund are paid by borrowers. Funds to finance a project are obtained through the issuance and sale of self-liquidating bonds. The bonds are repaid by participants in the program at no cost to the state or taxpayers. The amount and type of loan security required depends on the borrower and the type of project. A first lien on real estate is required security for all loans. Other security may also be required.


Program Implementation
Eligible Applicants
Applicants eligible to apply for a loan from the Water Development Loan Program are:
  1. Individual residents of Oregon
  2. Entities with principal income from farming including  profit-making partnerships, profit-making corporations, nonprofit corporations, and cooperatives
  3. Water-related districts including irrigation districts, water improvement districts, irrigation or drainage corporations, drainage districts, corporations, cooperatives, companies or other associations formed prior to 1917 for the purpose of distributing water for irrigation purposes, and port districts
  4. Cities or counties
  5. Organizations formed for the purpose of distributing water for community water supply or
  6. Local soil and water conservation districts

Eligible Projects
To be eligible for a loan from the Water Development Loan Fund, projects must meet one of the following definitions:
  1. Drainage project: facilities installed to provide for the removal of excess water to increase soil versatility and productivity.
  2. Irrigation project: facilities designed to provide water to land for the purpose of irrigation.
  3. Community water supply project: an undertaking, in whole or in part, in Oregon for the purpose of providing water for municipal use. A community is an incorporated or unincorporated town or locality with more than three service connections and a population of less than 30,000.
  4. Fish protection project: an undertaking, in whole or in part, in Oregon for the purpose of protecting fish or fish habitat.
  5. Watershed enhancement project: an undertaking, in whole or in part, in Oregon for the purpose of watershed enhancement.
  6. Multipurpose project: a water development project in Oregon which provides more than one use. The primary use of the project must be one of the uses listed in a-e above. Secondary uses may include other water uses which are compatible with the primary use.

Program Costs
Funds to finance a water development project are obtained through the issuance and sale of self-liquidating bonds. The bonds are repaid by participants in the program and at no cost to the state or the Oregon taxpayer.


Application Procedures
One of the goals of the WDLF is to provide its customers with a flexible, easy to use program. To that end, a WDLF loan officer meets with an applicant several times to assist in guiding the applicant through the loan process.

Application
First, the loan officer conducts a pre-application conference with applicants to review the program and answer any of the applicant´s questions. The loan officer and applicant meet again to review the completed application forms and ensure they are prepared adequately for submission.

Application and loan processing fees
All costs to operate the Water Development Loan Fund (WDLF) are paid by borrowers. Tax dollars are not used. Consequently, borrowers pay an application fee and a loan processing fee. The application fee is $100 and is non-refundable. The loan processing fee is $1,000 or one percent (1%) of the loan request, whichever is greater, up to $10,000. Additionally, borrowers pay closing costs and bond issuance costs.

Review and recommendations
The loan officer then begins the underwriting process by reviewing the submitted information. An engineering analyst conducts a technical review and prepares a report. The loan officer prepares a written loan recommendation and findings for management review. The Loan Advisory Board reviews the loan officer´s presentation and makes a recommendation to the Director to approve, modify, deny or refer the loan request to the Water Resources Commission. The Director or the Commission issues the final decision on the loan request. If the loan is approved, the loan officer mails the applicant a commitment letter.

Follow-up
The applicant notifies the loan officer when all commitment conditions have been met. The loan officer arranges for any needed inspections, verifies all commitment conditions are met, prepares closing documents, and requests funds needed for disbursement at closing. If the loan has been scheduled for construction disbursements, the borrower notifies the loan officer as each stage of completion is reached. Finally, the borrower begins making the agreed loan payments.

Collateral and security
The amount and type of loan security required depends on the borrower and the type of project financed. A first lien on real estate is required security for all loans. Other security may include a first lien on assessments or other revenue pledged for repayment and personal property financed by the loan.

More information
For more information and copies of the Water Development Loan Program application forms, contact Salem Opeifa.


Links and Resources
The Safe Drinking Water Revolving Loan Fund provides another alternative for that is available for drinking water system improvements needed to maintain compliance with the Safe Drinking Water Act. Additional information on the loan fund is available from the state Economic and Community Development Department and the Drinking Water Program of the Department of Human Services.


Authority
ORS 541.700 to 541.855
OAR Chapter 690, Division 90