Bulletin No. 1 INSTRUCTIONS TO STATE ENGINEERS (P.W.A.) FOR PREP. ARATION OF REPORTS ON APPLICATIONS FOR LOANS AND OUTLINE OF REPORTS The following instructions and the attached outline indicate in a general way the procedure and form to be followed by the State engineer (P.W.A.), hereinafter called the engineer, in the study and analysis of various projects presented for consideration and report. Reports are to be prepared by the engineer with such engineering, legal, and financial assistance as may be found necessary. The report will present briefly but completely the examiner's analysis. of the application, with particular reference to— (a) Necessity and social desirability of the project and relation to coordinated planning. (b) Economic desirability of the project. (c) Technical soundness of the project. (d) Legal authority of the applicant to construct and operate the project, incur the proposed obligation, and issue the necessary evidences of indebtedness therefor. (e) Assurance that the proposed loan is reasonably secured either by pledge of the taxing power of the applicant, by pledge of the net revenues reasonably to be anticipated from the operation of the project, or by such other obligations of the applicant as will be satisfactory to the administration. NOTE. For projects which are to be supported wholly or in part from the revenues received from the operation of the project it is essential that the engineer satisfy himself and clearly indicate in the report that the anticipated gross revenue, operating expenses, and net income as estimated by the applicant are reasonable, and that the net income will be adequate by a reasonable margin to provide for interest and amortization of the loan and discharge of other obligations which now or may hereafter constitute a charge against such revenues. The engineer will examine and check the estimated cost of the project as presented by the applicant and assure himself and so certify that the project can be completed within the amounts estimated. In cases where in the opinion of the engineer the estimates of cost are either materially too high or too low on the basis of conditions that will probably obtain under the provisions of the National Industrial Recovery Act, the estimates of cost and all estimates of debt service should be revised in accordance therewith. (1) The report should present in brief the statements of the applicant relative to the various data requested in Circular No. 2 or 3, with a discussion indicating the disagreement with or concurrence in the applicant's assumptions and an indication of the opinion of the engineer thereon, with supporting reasons. The attached outline of the form of report is intended to indicate, in a general way only, the form and method of preparation of reports and the data reasonably to be included therein. This form is indicative only and will not in any way restrict the engineer in the preparation of a report in setting forth the essential features of the project in such a manner as to give the administrator a clear picture of the project. In cases where engineer, financial, and legal examiners are employed, the report will be prepared jointly by such examiners, each being responsible for that portion of the report within his technical jurisdiction. In general, it will be found advisable that the engineer examiner first prepare in draft form that portion of the report included in sections 1 to 7, inclusive. Much of these data will be of use to the legal and financial examiners to whom the draft is then submitted for completion. Upon completion of the draft, the recommendations, conclusions and conditions as proposed by the three examiners will be reconciled by conference in order that no disagreement in view may be indicated by the report as finally prepared. In general, the imposition of unimportant conditions precedent to the loan should be avoided. However, where any one of the examiners is strongly of the opinion that certain conditions are desirable or essential, and such conditions are not included as a recommendation, nevertheless for the information of the administrator, the report will call attention to the suggested conditions. Upon completion of the report, it should be signed by the engineer and by the chairman of the State advisory board, if the board concurs, duplicated on heavy paper and four copies transmitted to Washington, accompanied by three copies of the application, complete with all exhibits and additional data submitted by the applicant. In cases where the board disagrees with the engineer the record will so state and will then be forwarded as above. FORM OF REPORT ON LOAN APPLICATION [Form of report to be prepared by State engineer (P.W.A.) for all loan applications. Reports will vary in detail to meet conditions of each application, but will conform in general to the following outline where applicable.] Correspondent-Name, title, and address of official with whom correspondence and negotiations are to be conducted. Applicant's attorney-Name and address. Applicant's engineer and/or architect-Name and address. Population of municipality or community where located for 1910, 1920, and 1930. II. Loan Requested ($, secured by (general obligation bonds, revenue bonds, first-mortgage bonds, etc.) payable in increasing) annual installments, 19-19). equal (or III. Loan Recommended (If no loan is recommended, so state, with reasons.) Amount (Including grant.) (3) Grant (If no grant is recommended, so state.) (Of percent of cost of labor and materials. State that grant is to be utilized either (a) To reduce the amount of the loan or (b) To meet debt service for the first life of the bond issue.) years of the (The administrator will approve, or disapprove, the grant. To provide for disapproval, recommend (should grant not be allowed) either— (a) Loan of entire amount, or (b) No loan be made, with reasons therefor.) Type of obligation General obligation bonds, revenue bonds, first-mortgage bonds, etc. Schedule of maturities State maturities in tabular form: IV. Project (a) With grant as recommended. (b) Without grant, if recommended. Type-Waterworks; bridge; hospital, etc. Location Omit, if indicated by applicant's address. Estimated cost-Total, $ ; material, $ $ Work schedule-Construction can begin in ; and labor, and be com pleted in Employment months. months. Brief statement of important information relative to the applicant and the area served by the project. For private corporations, give date of incorporation, description of business, franchise, and any other essential data. Reasons for abnormal changes in population served should be stated, if available. Present works Brief description of any existing facilities of the same character as the proposed project. Description of project In sufficient detail to enable the reader to visualize the project and its relation to any existing works. Cost of project Brief discussion of applicant's estimate. Important revisions thereof should be stated with reasons therefor. A detailed estimate of cost of the project in sufficient detail to permit checking. Tabular arrangement of estimate showing subtotals for (a) preliminary expenses, (b) land, rights of way and easements, (c) construction, (d) engineering, (e) legal, administrative, and other overhead, (f) interest during construction, (g) any other items. Give separately approximate total cost of labor and materials. Schedule of funds required Show, in tabular form, estimate of funds required each ་ Objections T Objections or possible litigation, as reported by applicant or presented by others, should be stated, including names of objectors. Status of project State present status of surveys, drawings, specifications, and contracts. If completely described under work schedule, omit this paragraph. Technical soundness Statement that the general design of the project has been checked, that necessary revisions have been made by the applicant, and whether the project is satisfactory and adequate for the purpose intended. Financial soundness of the project Present the applicant's statements as to rates and operating results, and analysis thereof, with adjustments if necessary. For revenue-supported projects, show in tabular form the relation between net revenue and debt service, including all debt charges to be paid from revenue, for the probable period of the loan, if grant is made. Show similar table for loan of entire amount. For a project supported, wholly or in part, by taxation, present arguments or tabulations, to show the economic justification for its construction. VI. Planning Considerations NOTE. The engineer will obtain independently such information, in addition to that furnished by the applicant, as is necessary to prepare report under this section. Conformity with comprehensive city, regional, or State plan Indicate whether plan is city, regional, or State plan, whether official or unofficial, and give status of plan, date of plan, consultant, recommendation of planning board, if any, present membership and consultant to board and date of recommendation. Metropolitan or regional significance Consider relation of project to similar or affected proposals in same metropolitan or regional district. 5486-33-2 |