The CSDA Interim Finance Program is intended to provide water and wastewater agencies a means of interim financing capital improvement projects pending the receipt of a state or federal grant or loan. The criteria and features of the CSDA Interim Finance Program are as follows:

1. Interim financing only applies to capital improvement projects of a water or wastewater system.

2. The agency shall secure the interim financing through a pledge of the net revenues of the water or wastewater system.

3. The agency must be able to "bank qualify" the financing by issuing no more than $10 million of tax-exempt obligations in the aggregate during the calendar year in which the financing closes.

4. The interim financing will be structured with quarterly interest-only payments with the principal due at the end of a two to five year period.

5. The interest rate will adjust quarterly based upon a formula equal to 200 basis points over the 90 day London Interbank Offer Rate (LIBOR), the sum multiplied by the factor 0.65.

6. A ½-1% financing fee applies, depending on the size of the transaction.

7. The financing may be prepaid on any business day commencing six months after the closing date. No prepayment penalty shall apply.

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