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LA WMA's attorney, Amelia Whiting of Moses, Wittemeyer, Harrison and Woodruff, has submitted a letter of application for funds to acquire additional water rights as outlined in the discussion below. Helton & Williamsen have submitted a Letter Report describing the water rights to be acquired, the need for additional water supplies, replacement strategies, and a financial analysis of the. water rights acquisition. A complete feasibility study, which the Board agreed to fund in January 1997 (January Agenda Item B.a.), is expected by the end of April of this year. An appraisal report for the water rights is expected from William Paddock on March 19 of this year. DISCUSSION The water rights proposed for purchase by LA WMA are 3,569 shares (94 percent of outstanding shares) of the Highland Irrigation Company and 354 sp.ares (3 percent of outstanding shares) in the Fort Bent Ditch Company in which LA WMA already~ an interest. The total cost of the acquisition is $3,330,500. The amounts required for th~ two purchases are shown in Table 1. Table 1. Costs of Proposed LAWMA Acquisitions Highland Irrigation Co. $3,153,550 Fort Bent Ditch Co. $177,000 Total Cost $3,330,550 The purchases would be staged over a period of two years. For the Highland Irrigation Company, 2,702 shares would be purchased in 1997 and the remaining 867 shares would be purchased in 1998. All of the Fort Bent Ditch Company shares would be purchased in 1998. LA WMA is requesting the release of the approximately $1.1 million in the escrow account as well as approximately $2.23 million in new lending. Table 2 is an outline for a suggested arrangement in which all of the funds in the escrow account would be released in 1997 and about $1.5 million in new lending would also take place this year. Table 2. 1997 Funding Request ':"; Cost of Water Rights Plus "Earnest Mane " Subtotal Less Mane from Escrow Net New Lendin 2,416,600 $162,129 $2,578,729 $1,099,556 $1,479,173 2