Texas Administrative Code › Title 31 - NATURAL RESOURCES AND CONSERVATION › Part 10 - TEXAS WATER DEVELOPMENT BOARD › Chapter 363 - FINANCIAL ASSISTANCE PROGRAMS › Subchapter A - GENERAL PROVISIONS › Division 4 - PREREQUISITES TO RELEASE OF STATE FUNDS › Section 363.42 - 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, 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 proceeds
					 deposited into an approved 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 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 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, if applicable, the political subdivision shall document the adoption and
					 implementation of an approved water conservation program for the duration of
					 the loan, in accordance with §
													363.15
					 of this title;
(G) that the
					 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 political subdivision covenants to abide by the board's rules and relevant
					 statutes, including the Texas Water Code, Chapters 15, 16, and 17;
(I) that the 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
					 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 political subdivision's obligations, if the board sells or
					 otherwise transfers such obligations, and the beneficial owners of the board's
					 bonds if the political subdivision is an obligated person with respect to such
					 bonds under rule 15c2-12;
(J) that
					 all payments shall be made to the board via wire transfer 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 political subdivision shall
					 establish a dedicated source of revenue for repayment; and
(N) any other recitals mandated by the
					 executive administrator;
(3) if applicable, evidence that the
					 political subdivision has adopted a water conservation program in accordance
					 with §
												363.15
					 of this title (relating to Required Water Conservation Plan);
(4) unqualified approving opinions of the
					 attorney general of Texas and if bonds are issued, a certification from the
					 comptroller of public accounts that such debt has been registered in that
					 office;
(5) if bonds 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.