Fearing the effects of a potential federal government shutdown on funding for an underground science facility in Lead, the facility's oversight board on Thursday approved setting up a $5 million line of credit with a bank.
Board members of the South Dakota Science and Technology Authority voted 6-0 during a teleconference meeting to approve a request from their executive director, Mike Headley, to establish the line of credit.
The authority manages the Sanford Underground Research Facility in the former Homestake gold mine, where several major science experiments are planned, under construction or in progress.
According to the authority’s audit report for the fiscal year that ended in June, the authority recently began a five-year, $121 million cooperative agreement with the DOE to fund the authority’s operation of the underground research facility.
“We have been encouraged by DOE to have a financial backstop to be able to cash-flow our operations in case of a delay in payment due to a government shutdown or a continuing resolution,” Headley said during Thursday’s meeting.
You have free articles remaining.
Funding for numerous aspects of the federal government is scheduled to expire Nov. 21. The government could shut down if Congress and the president do not enact temporary funding extensions or spending bills before then.
The authority’s line of credit will be provided by First Interstate Bank, which is the bank for the authority’s day-to-day operations, Headley said.
The interest rate for the line of credit is variable and will be 1.25 percentage points below the prime rate published in the Money Rates section of the Wall Street Journal. On Oct. 25, the day a promissory note was prepared for presentation to the board, the Wall Street Journal rate was 5 percent, which made the authority’s rate 3.75 percent.
The authority’s chief financial officer, Nancy Geary, said the authority would first seek to use unrestricted funds from state government before tapping into the line of credit if a need for the assistance ever arises.