16-1-109. State loan and investment board loans; amount; interest; security; conditions.

(a) The state loan and investment board may negotiate and make loans to one (1) or more agencies, the University of Wyoming, or joint powers boards presently existing, permitted or created pursuant to the statutes, from the permanent mineral trust funds and other permanent funds of Wyoming not otherwise obligated, not to exceed sixty million dollars ($60,000,000.00) including all loans previously made and outstanding, and not to exceed a term of forty (40) years for repayment. The board shall set rates of interest on all such loans according to the current rates of interest for similar securities on the commercial market upon a basis which will not be less than the average rate of return realized on all permanent mineral trust fund investments as determined by the state treasurer for the five (5) calendar years immediately preceding the year in which the loan is made. For all loans under this section approved after July 1, 1996, a loan origination fee of one percent (1%) of the loan shall be paid to the state loan and investment board by the borrowing agency, university or joint powers board. The revenue produced by this fee shall be credited to the loss reserve account as provided by W.S. 16-1-110.

(b) In making loans pursuant to this act, the state loan and investment board shall establish requirements and standards which it determines to be necessary and advisable.

(c) Upon approval of a loan, an agency, the university, participating agencies, or a joint powers board shall transfer title or its interest to the property upon which facilities are to be constructed, including later improvements, to the state loan and investment board, or the state loan and investment board may require the security it deems necessary. The recipient of the loan shall make reasonable annual rental charges or loan payments as specified by the state loan and investment board. Upon repayment of the loan, title to or interest in the property and improvements shall be reconveyed to the appropriate agency, university, participating agencies or joint powers board. Where the transfer of title or interest in the property would preclude the obtaining of federal grants or where transfer of title or interest is prohibited by or would be in violation of existing grant-in-aid agreements, the state loan and investment board may waive the requirements of transfer of title or transfer of any interest in the property, and substitute other security of sufficient value as it deems necessary.

(d) Loans under this section shall be made only under the following conditions:

(i) Loans shall be made only for facilities generating user fees only to the extent that the user fees will repay the loan such that the loan can be considered a reasonable and prudent investment of state permanent funds. Any portion of the revenue generating facility unable to be financed by user fees may be financed by a grant under W.S. 9-4-604(g) and (h) to agencies and joint powers boards otherwise authorized to receive grants under those provisions;

(ii) No security other than a lien on the facilities used to generate user fees to repay the loan and pledges of user fees shall be taken to secure the loan except that the entity or joint powers board receiving the loan may also be required to issue revenue bonds to the state to evidence the loan if statutory authority exists for the entity to issue revenue bonds for the facility. No property shall be taken as security unless the property is owned by the entity to which the loan will be made. Upon repayment of the loan, liens against the property and revenue shall be released by the state loan and investment board;

(iii) Loans shall be made to the governmental entity or entities whose inhabitants receive a direct service or benefit from the revenue generating facility;

(iv) The state loan and investment board shall receive annual financial statements from entities receiving loans under this subsection;

(v) No loan shall be made without the written opinion of the attorney general certifying the legality of the transaction and all documents connected therewith;

(vi) The board shall request a review and recommendation from the aeronautics commission on all applications for loans for the construction, development and improvement of airport facilities generating user fees and shall make any loan recommended by the aeronautics commission unless, based upon the credit worthiness of the project, the board determines the loan would not be a prudent investment.

(e) The board, whenever it deems necessary for the better protection of permanent funds of the state invested in loans under this section, may refinance any delinquent loan and reamortize the loan over not more than thirty (30) years from the date of refinancing. All costs of refinancing the loan shall be paid by the borrowing entity and no loan shall be refinanced where it appears refinancing will jeopardize the collection of the loan. An additional fee of one percent (1%) of the amount of the reamortized loan shall be paid by the borrowing entity to the board to be credited to the loss reserve account created by W.S. 16-1-110 as provided by subsection (a) of this section.