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Home > Frequently Asked Questions > Collateral Requirement for a Water Project Loan  

Frequently Asked Questions: Collateral Requirement for a Water Project Loan


Collateral Requirement for a Water Project Loan 

Program Area

Loans & Grants 

Specific Program

Water Project Loan Program 

CWCB Section



The CWCB requires collateral to secure repayment of a loan. What type of collateral will the CWCB require?


State law requires the CWCB to obtain sufficient collateral from the borrower to assure repayment of the loan. The specific collateral the CWCB requires to secure a loan varies by project. Types of collateral include, but are not limited to, the following: (1) a pledge of assessment revenues backed by a rate covenant that guarantees that your organization’s assessment rates will be adequate to cover all of your debt obligations; (2) a pledge of your facilities, water rights, or other real property; and (3) other assets held by your organization. Finally, collateral requirements will be related to your creditworthiness and repayment capacity. The Board will determine the adequacy of collateral for each individual funding request. Please see CWCB Financial Policy No. 5 for more information regarding collateral.
Created at 6/30/2010 3:16 PM  by System Account 
Last modified at 1/7/2013 3:03 PM  by System Account