SECTION 785:50-7-2. Approval criteria

(a)   General approval standards and criteria. In the review and consideration of applications for financial assistance under the water and sewer program, the Board shall give consideration to the following general and non-exclusive criteria for application approval:

(1)   Compliance with laws. The application and proposed project must be found to be in compliance with all applicable and relevant federal, state and local laws and regulations, and applicant must possess all necessary and incidental legal rights and privileges necessary to project commencement and operation.

(2)   Eligibility. The applicant and proposed project must be determined to be eligible for the assistance sought.

(3)   Local need, support and priority. The project must be found to be needed in the area to be served and must be found to be sufficient, as proposed, to serve such needs. The Board shall additionally consider the project's relative benefit and priority in relation to the needs of other proposed projects and applicants.

(4)   Availability of other assistance. The Board shall consider the feasibility and availability of alternative sources of revenue which could be obtained and utilized by applicant for project financing.

(5)   Economic feasibility. The Board shall consider the overall apparent economic viability and feasibility of the project as a whole including proposed revenues from the project and the adequacy and reliability of estimated revenues necessary for loan repayment when indicated.

(6)   Project feasibility. The Board shall consider from the engineering data submitted and otherwise available whether the proposed project appears to be feasible, and must determine as a prerequisite for approval and funding that it is cost effective.

(7)   Statewide needs and public interest. The Board shall give consideration to the relationship between the proposed project and the overall water resource development needs within the State of Oklahoma as well as to whether the proposed project, if constructed, will serve the public interest and welfare.

(8)   Availability of funds. The Board shall take into consideration the current and anticipated availability of assistance funds needed to provide the financial assistance requested.

(b)   Criteria applicability.

(1)   The general criteria set forth in (a) and (c) of this Section are intended to constitute and shall constitute general guidelines and standards for application review and consideration by the Board.

(2)   Such criteria shall not be deemed appropriate for strict application and interpretation nor shall such criteria be deemed exclusive.

(3)   In all instances, each individual application and project must be reviewed and considered on its own individual merits.

(4)   The criteria and standards set forth in (a) and (c) of this Section shall accordingly be interpreted and applied so as to allow sufficient flexibility in the ultimate exercise of Board's judgment and discretion.

(c)   Criteria for denying an application. The Board may deny an application for a State Loan Program Revenue Bond Loan for any of the following reasons:

(1)   The applicant or the entity which stands to receive the benefit of the financial assistance is not an eligible entity.

(2)   The applicant has had improper or unsound management in the past.

(3)   The applicant's financial condition is not sound enough to assure the Board that the loan would be satisfactorily repaid (including but not limited to circumstances such as inability to meet debt service, inability to meet any applicable rate covenant or additional indebtedness requirements, a substantial increase in operator and maintenance costs due to the proposed project, substantial revenue collection problems, substantial negative financial trends, a default or record of late payment(s) on previous indebtedness, etc.)

(4)   The economic conditions pertinent for the applicant show negative trends (including but not limited to conditions such as substantial declines in sales tax revenues, population, per capita income, building permits, or water and/or sewer connections; a substantial increase in unemployment; or detrimental changes in the bases of ten largest customers or ten largest taxpayers).

(5)   The project is not cost effective.

(6)   Any other reason based upon applicable law, applicable requirements of the pertinent bond resolution governing use of the bond proceeds, or the Board's judgment and discretion.

[Source: Amended at 14 Ok Reg 2788, eff 7-1-97; Amended at 15 Ok Reg 2881, eff 7-1-98; Amended at 35 Ok Reg 2243, eff 9-14-18; Amended at 36 Ok Reg 1332, eff 8-11-19]