C150109 Approval letter - Laserfiche WebLink

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Lanmer and Weld Irrigation Co. Ju!y23-24.2oo2 Agenda Ilem 19a The LWIC operating policy is to maintain a cash reserve of about 540,000, approximately equal to 10% of its normal 0 & M expenses. While this places the ratio of Cash Reserves to Current Expense in the weak category, it is fairly typical practice for ditch companies not to carry large cash reserves from year to year. As security for the loan the LWIC will pledge assessment revenues backed by an assessment covenant and the project itself. This is in compliance with CWCB Loan Policy #5 (Collateral). Recommendation Staff recommends a CWCB Small Project Loan not to exceed $1,000,000 to the Larimer and Weld Irrigation Company from the Construction Fund to rehabilitate and replace 10 check structures and install one new check structure in the Larimer & Weld Ditch (Eaton Ditch). The recommended term of the loan is 30 years and the recommended lending rate is 2.75%. Security for the loan will be a pledge of assessment revenues backed by assessment covenant and the project itself. Staff further recommends that final approval of the loan be conditioned upon all other standard contracting provisions of the CWCB, and prior to entering into a contract L WIC will obtain other financing necessary to complete the project as described in this memorandum. Action Taken bv the CWCS on Julv 24. 2002 The CWCB approved the Staff Recommendation with the following revisions: 1. The Board noted that the loan is being used to refinance the cost of three check structures already constructed. 2. The Board imposed a condition that if the collateral for the short-term line of credit loan is the same as or overlaps with the collateral for this loan, the CWCB must be able to obtain a parity lien on that collateral with the lender of the short-term loan. cc: Barry Anderson, President, Larimer and Weld Irrigation Company. Duane Smith, Smith Geotechnical Engineering Consultants Linda Bassi, AGO Attachment Page 5 ot6