WSP08827

• File Number: 8220.122.J
• Description: Paonia Project
• State: CO
• Basin: Gunnison
• Water Division: 4
• Date: 12/1/1971
• Title: Review of Condition of Project Facilities & Economy: Paonia Project CO
• Water Supply Pro - Doc Type: Report/Study

Construction Costs and Repayment

As discussed in previous paragraphs, a period of several years,
1949 through 1961, was required by the Bureau to construct the.Paonia
Project facilities with money provided by appropriations from Congress.
The total reimbursable cost of all the work accomplished by the Bureau
was $8,033,160. The repayment contract between the North Fork Water
Conservancy District and the United States requires the District to
pay $2,320,000, without interest. This leaves $5,713,160 to. be repayed
from Colorado River Storage Project power revenues. Under this arrange-
ment, the District (the water users) is required to repay only 29% 'of
the total cost of the project. Repayment by the District is to be made
in equal amounts of $34,118 for a period of 68 years. Payment of the
first instal1ment by the District is due December 31, 1972.

Project O&M Costs

Project facilities owned Py the United States along with privately
owned facilities are being operated by the water users. Fire Mountain
Canal Company personnel are operating the Paonia Dam and the Fire .
Mountain Canal and Leroux Creek Water Users Association personnel are
operating the several dams owned by the Association and their canals .
which divert from Leroux Creek. .

Annual Audit Reports or Financial Statements for Lerous Creek
Water Users Association, Fire Mountain Canal Company and North Fork
Water Conservancy District show the costs which are chargeable to
. Operation and Maintenance of all facilities in the project area
including Bureau of Reclamation constructed facilities and privately
constructed facilities. The following table presents these costs
for the three year period of 1958, 69 and 70.
1968
$ 2,024
25,608
2,383

North Fork Conservancy District
Fire Mountain Canal Company
Leroux Creek Water Users Association

1969
$ 1,789
22,214
4,170

1970
$ 2,509
23,439.
5,893

Total
Total average annual project O&M

$30,015
$30,000

$28,173
(rounded)

$31,841

Project PaYment Capacity

The payment capacity for the Paonia Project was estimated and
presented,in the Definite PIan Report of the Paonia Project dated May
1957. Theagricultural study made to develop this payment capacity.,
was based on 10ng term project prices with an index of 247 for prices
received and 295 .for prices paid (1910-14 = 100).

Concern has been expressed by the North Fork Water Conservancy
District; the contracting entity for the Paonia Project, as to whether
they can make thar payments to the United States scheduled to begin
.in December '1972. For this reason, a reanalysis of their ability to
pay construction costs has been made and is preSented herein.

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