S.B. 90 Enrolled

DRINKING WATER BOARD LOAN AND GRANT
AMENDMENTS
2002 GENERAL SESSION
STATE OF UTAH
Sponsor: Bill Wright
This act modifies the Water and Irrigation Code to allow the Drinking Water Board to make
loans or grants to political subdivisions for planning for drinking water projects.
This act affects sections of Utah Code Annotated 1953 as follows:
AMENDS:
73-10c-4, as last amended by Chapters 12 and 175, Laws of Utah 2001
Be it enacted by the Legislature of the state of Utah:
Section 1. Section 73-10c-4 is amended to read:
73-10c-4. Credit enhancement and interest buy-down agreements -- Loans --
Hardship grants.
(1) On behalf of the state, the Water Quality Board and the Drinking Water Board may
each enter into credit enhancement agreements with political subdivisions containing terms and
provisions the acting board determines will reasonably improve the security for or marketability
of drinking water and wastewater project obligations, including any of the following:
(a) a term providing security for drinking water and wastewater project obligations, as
provided in Subsection 73-10c-6 (2)(b), by agreeing to purchase the drinking water or wastewater
project obligations of, or to make loans to, political subdivisions from a subaccount of the security
fund for the purpose of preventing defaults in the payment of principal and interest on drinking
water and wastewater project obligations;
(b) a term making loans to political subdivisions to pay the cost of obtaining:
(i) letters of credit from banks, savings and loan institutions, insurance companies, or other
financial institutions;
(ii) municipal bond insurance; or
(iii) other forms of insurance or security to provide security for drinking water and
wastewater project obligations; and

(c) a term providing other methods and assistance to political subdivisions which are
reasonable and proper to enhance the marketability of or security for drinking water and wastewater
project obligations.
(2) (a) The Drinking Water Board and the Water Quality Board may each make loans from
a security fund subaccount to political subdivisions to finance all or part of drinking water and
wastewater project costs by following the procedures and requirements of Sections 73-10c-4.1 and
73-10c-4.2 .
(b) These loans may only be made after credit enhancement agreements, interest buy-down
agreements, and all other financing alternatives have been evaluated by the acting board and the
board determines those options are unavailable or unreasonably expensive for the subdivision
requesting assistance.
(c) Loans may be made from the security fund subaccount at interest rates determined by the
board.
(d) Loans may not be made from the $5,000,000 appropriated to the security fund
subaccount by the Legislature for fiscal year 1983-84.
(3) (a) The Drinking Water Board and the Water Quality Board may each make loans or
grants from the security fund to political subdivisions for interest buy-down agreements for drinking
water or wastewater project obligations.
(b) The Drinking Water Board may make loans or grants from the security account to
political subdivisions for planning for drinking water projects.
(4) (a) Of the total amount of money annually available to the Drinking Water Board and
Water Quality Board for financial assistance to political subdivisions, at least 10% shall be allocated
by each board for credit enhancement and interest buy-down agreements.
(b) The requirement specified in Subsection (4)(a) shall apply only so long as sales and use
tax is transferred to the Utah Wastewater Loan Program Subaccount and Drinking Water Loan
Program Subaccount as provided in Section 59-12-103 .
(5) To the extent money is available in the hardship grant subaccounts of the security fund,
the Drinking Water Board and the Water Quality Board may each make grants to political

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subdivisions that meet the drinking water or wastewater project loan considerations respectively, but
whose projects are determined by the granting board to not be economically feasible unless grant
assistance is provided.
(6) The Drinking Water and Water Quality Boards may at any time transfer money out of
their respective hardship grant subaccounts of the security fund to their respective loan program
subaccounts.

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