Texas Administrative Code › Title 31 - NATURAL RESOURCES AND CONSERVATION › Part 10 - TEXAS WATER DEVELOPMENT BOARD › Chapter 365 - RURAL WATER ASSISTANCE FUND › Subchapter C - CLOSING AND RELEASE OF FUNDS › Section 365.41 - Loan Closing

Current through Reg. 49, No. 28; July 12, 2024
(a) Instruments
				  needed for closing. The documents which shall be required at the time of
				  closing shall include the following:
(1) if
				  not closing under the pre-design funding option, evidence that requirements and
				  regulations of all identified local, state and federal agencies having
				  jurisdiction have been met, including but not limited to permits and
				  authorizations;
(2) a certified
				  copy of the bond ordinance, order or resolution adopted by the governing body
				  authorizing the issuance of debt to be sold to the board, or an executed
				  promissory note and loan agreement, that is acceptable to the executive
				  administrator and which shall have sections providing as follows:
(A) if loan proceeds are to be deposited into
				  an escrow account, at the closing on all or a portion of the loan or grant,
				  then an escrow account shall be created that shall be separate from all other
				  accounts and funds, as follows:
(i) the
				  account shall be maintained by an escrow agent as defined in §
													363.2 of
				  this title (relating to Definitions of Terms);
(ii) funds shall not be released from the
				  escrow account without written approval by the executive
				  administrator;
(iii) upon request
				  of the executive administrator, the escrow account statements shall be provided
				  to the executive administrator;
(iv) the investment of any loan or grant
				  proceeds deposited into an escrow account shall be handled in a manner that
				  complies with the Public Funds Investment Act, Texas Government Code, Chapter
				  2256; and
(v) the escrow account
				  shall be adequately collateralized in a manner sufficient to protect the
				  board's interest in the project and that complies with the Public Funds
				  Collateral Act, Texas Government Code, Chapter 2257;
(B) that a construction account shall be
				  created which shall be separate from all other accounts and funds of the
				  applicant;
(C) that a final
				  accounting be made to the board of the total sources and authorized use of
				  project funds within 60 days of the completion of the project and that any
				  surplus loan funds be used in a manner as approved by the executive
				  administrator;
(D) that an annual
				  audit of the rural political subdivision, prepared in accordance with generally
				  accepted auditing standards by a certified public accountant or licensed public
				  accountant be provided annually to the executive administrator;
(E) that the rural political subdivision
				  shall fix and maintain rates and collect charges to provide adequate operation,
				  maintenance and insurance coverage on the project in an amount sufficient to
				  protect the board's interest;
(F)
				  that the rural political subdivision shall document the adoption and
				  implementation of an approved water conservation program for the duration of
				  the loan;
(G) that the rural
				  political subdivision shall maintain current, accurate and complete records and
				  accounts in accordance with generally accepted accounting principles necessary
				  to demonstrate compliance with financial assistance related legal and
				  contractual provisions;
(H) that
				  the rural political subdivision covenants to abide by the board's rules and
				  relevant statutes, including the Texas Water Code, Chapters 15 and
				  17;
(I) that the rural political
				  subdivision or an obligated person for whom financial or operating data is
				  presented, will undertake, either individually or in combination with other
				  issuers of the rural political subdivision's obligations or obligated persons,
				  in a written agreement or contract to comply with requirements for continuing
				  disclosure on an ongoing basis substantially in the manner required by
				  Securities and Exchange Commission (SEC) rule 15c2-12 and determined as if the
				  board were a Participating Underwriter within the meaning of such rule, such
				  continuing disclosure undertaking being for the benefit of the board and the
				  beneficial owner of the rural political subdivision's obligations, if the board
				  sells or otherwise transfers such obligations, and the beneficial owners of the
				  board's obligations if the rural political subdivision is an obligated person
				  with respect to such obligations under rule 15c2-12;
(J) that all payments shall be made to the
				  board via wire transfer or in a manner acceptable to the Executive
				  Administrator at no cost to the board;
(K) that the partial redemption of bonds or
				  other authorized securities be made in inverse order of maturity;
(L) that insurance coverage be obtained and
				  maintained in an amount sufficient to protect the board's interest in the
				  project;
(M) that the rural
				  political subdivision shall establish a dedicated source of revenue for
				  repayment; and
(N) any other
				  recitals mandated by the executive administrator;
(3) evidence that the rural political
				  subdivision has adopted a water conservation program in accordance with §
											363.15
				  of this title (relating to Required Water Conservation Plan);
(4) an unqualified approving opinions of the
				  attorney general of Texas and a certification from the comptroller of public
				  accounts that such debt has been registered in that office;
(5) if obligations are issued, an unqualified
				  approving opinion by a recognized bond attorney acceptable to the executive
				  administrator, or if a promissory note and loan agreement is used, an opinion
				  from the corporation's attorney which is acceptable to the executive
				  administrator;
(6) executed escrow
				  agreement entered into by the entity and an escrow agent satisfactory to the
				  executive administrator, in the event that funds are escrowed, or a certificate
				  of trust as defined in §
											363.2 of
				  this title, if applicable; and
(7)
				  other or additional data and information, if deemed necessary by the executive
				  administrator.