BOARD00026 ‎(2)‎

• Board Meeting Date: 9/19/2006
• Description: CF Section - Revisions to Existing Loans - Logan Irrigation District - Prewitt Reservoir Emergency Spillway Project
• Board Meetings - Doc Type: Memo

Based on the additional costs as presented above, the District is requesting an additional $194,081 in
loan funds.

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DISCUSSION
Due to additional work not programmed in the original cost estimate and unforeseen variations in
cost for specific items during construction, the overall cost of the project has increased, resulting in
a requested loan increase of approximately 65% or $194,081. Staffhas reviewed the bids received
by the District and finds the construction costs to be reasonable, given increase material costs, site
location, and contractor availability.

The amended loan amount for the District will be $505,000 ($500,000 for project costs and $5,000
for the 1 % Loan Service Fee), at the present blended interest rate of 2.35 % for 20-years. The new
annual payment will be $34,172, which includes the 10% reserve requirement. The Company's.
current approved loan of $306,419 has an annual payment of $21,316, which includes the 10%
reserve requirement.

Table 1 illustrates the combined Financial Ratios for the Logan Irrigation District and indicates
an average to strong ability to repay the $505,000 CWCB loan.

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Financial Ratio With Amended
the project Droject
Operating Ratio (revenue/expense) 123% 133%
weak: less than 100% (strong) (average)
average: 100% - 120%
strong: greater than 120%
Debt Service Coverage Ratio 120% 112%
(revenues-expenses )/debt service (average) (average)
weak: less than 100%
average: 100% - 125%
strong: greater than 125%
Cash Reserves to Current Expense 39% 63%
weak: less than 50% (weak) (average)
average: 50% - 100%
strong: greater than 100%
Annual Cost per Ac-Ft diverted (9,614 ac-ft) $8.40 $9.12
weak: greater than $20 (strong) (strong)
average: $10 - $20
strong: less than $10

Table 1. Financial Ratios

The amended project values above are based on the District increasing its levy per acre from
$2.60 to $4.13, and that the District receives annual income of $8,816 from Ulif Irrigation
District and $6,630 from the Morgan Prewitt Reservoir Company. The annual income received
by the District is based on the Illiff Irrigation District raising its levy per acre from $1.50 to
$2.31, and Morgan Prewitt Reservoir Company raising its annual share cost from $50 to $75.40.

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Collateral: As security for this loan the District will pledge their annual assessment levy
revenues. This security is in compliance with CWCB Financial Policy #5 (Collateral).

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