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THE TUNNEL WATER COMPANY , P.O. BOX 1584 Ft. Collins, Colorado 80522 RECEIVED JAN 1 'I 2002 Cotorado Wa fer Conservation B ^ OI,.~Ir: January 15,2002 Mr. Rod Kuharich Colorado Water Conservation Board 1313 Sherman St. Room 721 Denver, Colorado 80203 Dear Sir: I am writing to request time on the agenda of the Board of Directors meeting this January 23rd or 24th. I want to ask the board to consider resetting the interest rate of our two loans at the agricultural rate only until the water does indeed change from an agricultural use to a municipal or industrial use. Let me start with some basic information about our company, the reason for our loans, and the status of our loans today. The Tunnel Water Company is owned and operated by two major irrigation companies that divert water from the Cache LaPoudre River and deliver it to irrigated farms (approximately 100,000 acres) in both Larimer and Weld Counties. The Tunnel Water Company (TWC) diverts water from the Laramie River and transports it through a tunnel and releases it into the Cache LaPoudre River. The water flows down the river and then diverted into our respective canals for delivery to the farmers. In May of 2000, our tunnel collapsed in one section and blocked the flow of water completely, We obtained two loans from the CWCB for the rehabilitation of the tunnel. We are just about done with the project and are about to convert the loans from construction status to an amortization schedule. Having read more closely the loan documents and particularly paragraph 13 of the loan contract, I think. the blending of interest rates should happen when the water use is physically changed, not because of ownership on the day of the loan procurement. If the intent of the clause in the note document requiring notification of change of use of the water implies blending of interest rates, then I would suggest that is the proper time to blend, not prior to the use change. Currently, all of the TWC water is used to irrigate farms. The annual installments paid by TWC will be collected from assessments paid either directly or indirectly by the farmers using the water. This is why I feel that the agricultural rate is appropriate now. These are fragile economical times for us farmers and a reduction in our operating expenses will certainly help not only us, but will help ensure a more dependable and cheaper food supply for all the people in the long run. Thank you for your consideration of this matter. ~~~ Tunnel Water Company President 970-481-9481