Sheet: 726

Sheet: Instructions

DISTRIBUTION LOAN APPLICATION CHECKLIST AND INDEX

BORROWER & LOAN DESIGNATION

(ALL ITEMS CHECKED "YES" NEED TO BE INCLUDED IN THE LOAN

APPLICATION, UNLESS THE FOOTNOTE APPLIES TO THE ITEM IN QUESTION)

YES

NO

NA

1.

2.

Transmittal Letter to Supplemental Lender

3.

Board Resolution requesting Loan and release of information

4.

RUS Form 740c - Cost Estimate & Loan budget 

a.

Reimbursement schedule (if applicable)

b.

Attachment for 740C - statement certifying that at least 90% of the loan funds are for facilities with a useful life of

33 years or longer or attached schedule showing the costs and useful life of those facilities with a useful life

c.

Location of Consumers, if applicable (if density exceeds 17 - ref. 7 CFR 1710.401,3,iv)

5.

RUS Form 740g - Application for Headquarters Facilities and two copies of the Preliminary Drawings (if needed).

6.

RUS Form 602 - Analysis of Prior Loan Funds:  Dated

7.

RUS Form 7  -  Financial & Statistical Report:    Dated

(not more than 60 days old)

8.

9.

Current Power Requirements Study: Dated

(Attach Board Resolution adopting if not previously submitted)

10.

Long Range Financial Forecast including Board Resolution adopting the forecast and statement of assumptions.

11.

Sensitivity Analysis - if required - (see 7 CFR 1710, subpart G)

12.

Copy of all Retail Rates (only if amended since last loan)

13.

Include a narrative statement concerning recent and/or planned changes in retail rates

14.

Attorney Opinion concerning property owned, corporate status, authorized place of business, borrower's legal name,

debt limit, State regulatory approvals and subsidiary (7 CFR 1710.401), standard form provided by GFR.

a.

b.

Debt Limit established at $

Date established:

c.

15.

Attorney's Report on Pending Litigation.

16.

Special Resolution as required: (use of contractors, corrective action plans, etc..)

List:

17.

Articles of Incorporation (only if amended since last loan)

18.

Bylaws (only if amended since last loan)

19.

CWP, Board Resolution approving the CWP, and BER (if not previously submitted)

20.

21.

Certification Regarding Debarment, Suspension & Other (Form AD 1047)

22.

Lobbying Certification

23.

Uniform Relocation Assistance & Real Property Acquisition Assurance Statement (if not previously provided)

24.

Debt Delinquency Certification

25.

DSM or IRP Study (required for a loan for DSM or IRP facilities or equipment)

26.

Copy of Standard Form 100 (if in excess of 100 employees)

27.

28.

Performance Measures

29.

Other (list): 

THE FOLLOWING ITEMS ARE COMPLETED BY THE GENERAL FIELD REPRESENTATIVE

30.

Form 324 - Financial Forecast Review and Evaluation Form (Not needed if the information is contained in the FAR).

31.

Form 138 Checklist 

32.

Trendbux Analysis 

33.

RELRA Worksheet 

Rate Disparity and Consumer Data (if needed, density greater than 5.5)

must also be provided as attachment to Form 740c (see item 4, c. above).

34.

Civil Rights Field Activity Review Report (Form 9 - if not previously submitted)

A total of 5 loan packets for concurrent loan applications. RUS receives the original loan documents and one copy. The Supplemental lender receives one

copy. The GFR one copy. One copy for the Cooperative's files. The RUS loan packets and the GFR loan packet are sent to the GFR for final review.

The Supplemental loan packet is sent directly to the Supplemental lender.

Remarks:

FORM 726

Rev 9/97, version 6

INSTRUCTIONS

TRANSMITTAL LETTER

1.0

Items to be included in the transmittal letter as listed in 7 CFR 1710.401:

a. 

Transmittal letter must be signed by the cooperative Manager.

b.

Include the corporate name of the borrower.

c.

Include the street address of the corporate headquarters.

d.

Include the Taxpayer ID of the cooperative.

e.

The need for flood hazard insurance must be addressed.

f.

Provide a breakdown of the funds by State.

g.

List of Counties served.

h.

Listing of threatened actions by third parties that could adversely effect the 

cooperative's financial condition including annexations or other actions 

affecting service territory, loads, or rates (example: potential loss of a large 

power consumer or large load concentration). 

i.

Listing of pending regulatory proceedings.

2.0

A statement that there has been no change in area coverage or line extension policies. 

(Note:  If there has been a change then a copy of the new area coverage and/or line  

extension policy(s), as applicable, must be submitted to RUS - see Form 726 item #8)

726 LINE ITEMS

The following items are provided to further explain items included on the RUS Form 726.

1.0

certifying that at least 90% of the loan funds requested are for facilities with a useful

life of 33 years or longer.  If facilities are included in the loan that have a useful life of 

less than 33 years, and represent more than 10% of the loan, attach a schedule

showing the costs and useful life of those facilities (reference 1710.115).  

(Statement included with the Excel version of the 740c - see tab following page 4 

of the Excel version of the 740c form)

2.0

RUS form 605 or if there are carryover projects included in the loan application.

3.0

Muni's only) - The Comparison should be based upon the average residential usage.  

This comparison should also include an explanation of any recent or planned changes in

retail rates.

4.0

Submit an opinion of counsel (sample form provided by GFR) which provides and 

opines to the accuracy of information relating to:

(a)

Counties where the borrower has personal or real property (existing facilities and 

new facilities).

(b)

The completeness and accuracy of the property schedule (Property Scheduled 

(c)

The suitability of the property descriptions for inclusion in a mortgage.

(d)

The borrower's corporate status.

(e)

The borrower's authorized places of business.

(f)

The borrower's true and correct legal name.

(g)

The borrower's corporate debt limit.

NOTE:  A new Board Resolution will be required (attach) whenever the debt limit is 

different than that contained in the last mortgage or whenever the debt limit is 

inadequate to cover all debt (past plus current application).

(h)

State Regulatory Approvals (loan documents would or would not require)

(i)

Whether the borrower has one or more subsidiaries

5.0

indicating that, based upon available information, there is no reason to anticipate that 

any of the facilities included in the loan application will be excluded from the borrower's

rate base by State regulatory authorities.  This statement may be based upon the

provisions of State law, rules and policies of State regulatory authorities, prior

experience, and the recent experience of other utilities in the State.

NOTE:  If provided by Management, the statement may be included in the 

transmittal letter.

Please be as specific as possible with your responses to the above items.  If you need any 

assistance with addressing any item, please contact your GFR.