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<br />Town of Ridgway Agenda Item 13a. <br />November 22-23.1999 Updated December 1. 1999 <br /> <br />The Town's water enterprise has existing loans with the CWCS and with GMAC Commercial <br />Mortgage Corporation. The CWCS/oan was initiated in 1980 in amount of $175,000. All <br />payments have been made as agreed, and the loan is current. The GMAC loan was also <br />initiated in 1980, in an amount of $245,000. Payments on that loan have also been made as <br />agreed, and the loan is current. It will be necessary for the CWCS to obtain parity with the <br />GMAC debt as a condition of a new ewcs loan for the raw water pipeline. <br /> <br />Table 2. Financial Ratios <br /> <br />Financial Ratio Without the project With the project <br />Operating Ratio (revenue/expense) 116% (average) 116% (average) <br />Debit Service Coverage Ratio 188% (strong) 148% (strong) <br />(revenues-expenses)/debt service <br />Debt per Tap $850 (strong) $1071 (strong) <br />Cash Reserves to Current Expense 242% (strong) 242% (strong) <br />Monthly Residential Water Sill $22 (strong) $22 (strong) <br /> <br />As security for the loan the Town will pledge revenues from the Town's Water Enterprise, <br />backed by rate covenant and annual financial reporting. <br /> <br />Recommendation <br />Staff recommends a loan not to exceed $77,000 to the Town of Ridgway, not to exceed 75% of <br />the costs to construct a raw water pipeline for outside irrigation. The recommended term of the <br />loan is 20 years and the lending rate would be that rate approved by the Soard for municipal <br />standard income borrowers in 2000. As security for the loan, the Town will pledge revenues <br />from the Town's Water Enterprise, backed by rate covenant and annual financial reporting. <br /> <br />Staff further recommends that approval of the loan be contingent upon standard contracting <br />provisions of the CWCS; <br /> <br />Action taken bv the CWCS November 23. 1999 <br />The CWCS approved the staff recommendation, with the revision that the borrower will be "the <br />Town of Ridgway and/or the Town of Ridgway Water Utility Enterprise." The loan rate will be <br />4.75%. <br /> <br />cc: Don Batchelder, Ridgway Town Manager, PO Box 10, Ridgway CO 81432 <br />Joanne Fagan, P.E., PO Box 738, Delta, CO 81416 <br />Linda Bassi, AGO <br /> <br />Attachment <br /> <br />C:\WP51 \Proj-New\RidgwayPipeline1199memo <br />L:\boardmem\nov99\ 13a-Nov99 <br /> <br />3 <br />