234.933 Wisconsin drinking water reserve fund.

(1) Definition. In this section, “drinking water loan guarantee program" means the program under s. 234.86.

(2) Establishment of fund. There is established under the jurisdiction and control of the authority, for the purpose of providing funds for guaranteeing loans under s. 234.86, a Wisconsin drinking water reserve fund, consisting of all of the following:

(a) Moneys transferred to the authority from the appropriation accounts under s. 20.320 (2) (s) and (x) or received by the authority for the Wisconsin drinking water reserve fund from any other source.

(b) Any income from investment of money in the Wisconsin drinking water reserve fund by the authority under s. 234.03 (18).

(3) Program administration.

(a) The authority shall enter into a guarantee agreement with any bank, production credit association, credit union, savings bank, savings and loan association or other person who wishes to participate in the drinking water loan guarantee program. The authority may determine all of the following, consistent with the terms of the loan guarantee program:

1. The form of the agreement.

2. Any conditions upon which the authority may refuse to enter into such an agreement.

3. Any procedures required to carry out the agreement, including default procedures and procedures for determining the guaranteed percentage of each loan.

(b) The authority may not use any moneys other than those in the Wisconsin drinking water reserve fund for the drinking water loan guarantee program, and may not use moneys in the Wisconsin drinking water reserve fund for any programs other than the drinking water loan guarantee program.

(c) The authority may establish an eligibility criteria review panel, consisting of experts in finance and in the subject area of the drinking water loan guarantee program, to provide advice about lending requirements and issues related to the drinking water loan guarantee program.

(d) The authority shall ensure that the cash balance in the Wisconsin drinking water reserve fund is sufficient to fund guarantees under the drinking water loan guarantee program at a ratio of $1 of reserve funding to $4.50 of total outstanding guaranteed principal that the authority may guarantee under the program and to pay all outstanding claims under the program. The authority shall regularly monitor the cash balance in the Wisconsin drinking water reserve fund to ensure that the cash balance is sufficient for the purposes specified in this paragraph.

(4) Increases or decreases in loan guarantees. The authority may request the joint committee on finance to take action under s. 13.10 to permit the authority to increase or decrease the total outstanding guaranteed principal amount of loans that it may guarantee under the drinking water loan guarantee program. Included with its request, the authority shall provide a projection, for the next June 30, that compares the amounts required on that date to pay outstanding claims and to fund guarantees under the drinking water loan guarantee program, and the balance remaining in the Wisconsin drinking water reserve fund on that date after deducting such amounts, if the increase or decrease is approved, with such amounts and the balance remaining, if the increase or decrease is not approved.

(5) Annual report. Annually, the authority shall report on the number and total dollar amount of guaranteed loans under the drinking water loan guarantee program, the default rate on the loans and any other information on the program that the authority determines is significant.

(6) Moral obligation. Recognizing its moral obligation, the legislature expresses its expectation that, if called upon to do so, it shall make an appropriation to meet all demands for funds guaranteed by the Wisconsin drinking water reserve fund.

History: 1997 a. 27.