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<br />Springdale Ditch Company <br />May 19-20, 2003 <br /> <br />Agenda Item 18b <br />(Updated May 27,2003) <br /> <br />Table 2. Financial Ratios <br /> <br />Financial Ratio Without With <br /> the Droiect The Droiect <br />Operating Ratio (revenue/expense) 107% 107% <br />weak: less than 100% (average) (average) <br />average: 100% - 120% <br />strano: oreater than 120% <br />Debt Service Coverage Ratio No Debt 143% <br />(revenues-expenses)/debt service (strong) (strong) <br />weak: less than 100% <br />average: 100% - 125% <br />strono: oreater than 125% <br />Cash Reserves to Current Expense 3% 8% <br />weak: less than 50% (weak) (weak) <br />average: 50% - 100% <br />strono: oreaterthan 100% <br />Annual Cost per Ac-Ft (10,647/11.147 ac-ft diverted) $3.07 $3.53 <br />weak: greater than $20 (strong) (strong) <br />average: $10 - $20 <br />strono: less than $10 <br /> <br />As security for the loan the SDC will pledge assessment revenues backed by assessment <br />covenant and the project itself. The "project" consists of an agreement with private landowners <br />to use their property for recharge or augmentation, as well as the improvements constructed as <br />a part of this project. This security is in compliance with CWCB Loan Policy #5 (Collateral). <br /> <br />Recommendation <br />Staff recommends a CWcB Small Project Loan in maximum amount of $121,500 to the <br />Springdale Ditch Company (for up to 90% of the cost) to construct a well augmentation and <br />groundwater recharge project for its shareholders. The recommended loan terms are 30 years <br />at 2.75% (2.828% Annual Percentage Rate) or 20 years at 2.5% (2.61 % Annual Percentage <br />Rate) at the borrower's option. As security for the loan the Company will pledge assessment <br />revenues backed by assessment covenant and the project itself, in compliance with CWcB <br />Loan Policy #5 (Collateral). <br /> <br />Staff further recommends that final approval of the loan be conditioned upon all standard <br />contracting provisions of the cWCB, including the 1 % loan origination fee charged in <br />accordance with CWCB Policy #16. The maximum loan amount may be increased to $122,715 <br />if the borrower elects to finance the 1 % loan service charge <br /> <br />Action taken by the CWCB May 27.2003 <br />The CWCB approved the staff recommendation with the revision noted above. <br /> <br />cc: Ken Fritzler, Springdale Ditch Co. <br />Brent Nation, P.E. <br />Linda Bassi, AGO <br /> <br />Attachment <br /> <br />C:Proj-NewISpringdale 0503 memo; <br /> <br />L:\boardmemlMay031 18b - Springdale Ditch <br /> <br />4 <br />