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<br />. <br /> <br />. <br /> <br />. <br /> <br />. <br /> <br />. <br /> <br />Table 2 is a summary of the City's long-term financial plan which would include <br />borrowing from the CWCB and the Water & Power Authority as well as a loan and grant <br />from USDA Rural Development. The City would now like to obtain approval for $8.0 <br />million in the 1998 Construction Fund bill to include $4.0 million from the Construction <br />Fund and $4.0 million from the Perpetual Base Account of the Severance Tax Trust <br />Fund. <br /> <br />Table 2. Proposed Long-Term Funding Scenario <br /> <br />Year Source and Type Amount <br /> $ Million <br />1997 Rural Development - Grant $3.2 <br />1997 Rural Development -Loan $4.8(40 yrs, 4.5%) <br />1997 CWRPDA - Loan $15.0 (20 yrs, 4.5%) <br />1998 CWCB -Loan $8.0 (30 yrs) <br /> <br />The proposed funding from the CWCB would be used to repay the costs of the raw water <br />pipeline and the raw water reservoir. Disbursements by the Board would actually be used <br />to retire $8.0 million in variable rate bonds. <br /> <br />Financial Analvsis <br />The total cost of raw water facilities (existing and proposed) for the entire project is <br />estimated at $23 million. With the $5.5 million existing loan and a potential $8.0 million <br />in new financing from the CWCB, the Board's investment in the project would amount to <br />$13.5 million or approximately 58 percent of the total cost of the project raw water <br />facilities. <br /> <br />This month, the City staff submitted an updated 40-year projection of expenditures and <br />revenue requirements for implementation of the financial plan outlined in Table 2. <br />CWCB staffhas reviewed the projections and finds that combined revenues from <br />residential and commercial water users would appear to be adequate to cover operating <br />expenses and all debt service to be incurred as a result of the project. Debt service <br />coverage ratios are 1.10 or greater for the entire period of CWCB debt retirement <br /> <br />The revenue/expenditure projection indicates that the average monthly water bill may <br />increase to a maximum level of about $56 per month over the next several years (from the <br />current level of about $22 per month). On November 18th of this year, the Fort Morgan <br />City Council is expected to adopt a schedule of water rate increases for 1998 and a <br />resolution to implement further rate increases in 1999 and 2000 in order to provide the <br />required revenues. <br /> <br />3 <br />