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Business and Financial Policies and Procedures

14.1 Apply for an Internal Loan

Policy Statement

Major capital projects are usually funded from sources outside the University of Illinois System. However, for smaller projects the System may make internal loans to any of its units. The application for an internal loan must be completed and approved and the loan agreement fully executed before the internal loan Banner fund is established.

Procedure

To apply for an internal loan:

  1. Contact Treasury Operations - Capital Financing. They will help you determine the best way to finance your project and work with you through the process of obtaining an internal loan.
  2. Work with your university OBFS chief business officer to develop your business plan and complete the Internal Loan Application form. Obtain the required approval signatures for the application and submit to Capital Financing.
  3. Capital Financing prepares supporting documentation with their recommendation and forwards the complete package to the Associate Vice President for Treasury Operations (AVPTO), Senior Associate Vice President for Business and Finance (SAVPBF), and the Vice President, Chief Financial Officer and Comptroller (VP/CFO Comptroller).
  4. The AVPTO, the SAVPBF and the VP/CFO Comptroller review, and then approve or deny the internal loan application. If the application is approved, Capital Financing prepares a formal loan agreement, detailing the terms and conditions of the loan transaction.
  5. The borrowing unit obtains signatures on the loan agreement from the unit head and the university provost and/or chancellor (as required by the policy of the Urbana-Champagin, Chicago, or Springfield). Capital Financing then obtains the signatures of the VP/CFO Comptroller.
  6. Capital Financing forwards the fully-executed loan agreement to the unit, Capital Programs, Facilities and Services, University Accounting and Financial Reporting (UAFR), and the university OBFS chief business officer.
  7. The project manager or unit submits a Banner Fund, Program, and Index Code Request form to UAFR to establish an internal loan Banner fund.
  8. UAFR sets up the requested Banner accounting structures and processes the principal and interest payments as established by the loan agreement.

Exceptions

The VP/CFO Comptroller, upon recommendation by the AVPTO and the SAVPBF, may approve exceptions to this policy.

Forms Used in this Procedure

University of Illinois at Urbana-Champagin

Internal Loan Application
Loan Agreement Form (Less than Three Years)
Loan Agreement Form (More than Three Years)

University of Illinois at Chicago

Internal Loan Application
Loan Agreement Form (Less than Three Years)
Loan Agreement Form (More than Three Years)

University of Illinois at Springfield

Internal Loan Application
Loan Agreement Form (Less than Three Years)
Loan Agreement Form (More than Three Years)

Last Updated: March 6, 2017 | Approved: Senior Assistant Vice President for Treasury Operations and Senior Associate Vice President for Business and Finance | Effective: November 2010

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