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rJ . . . With regard to Vail Resorts, Inc., the financial statements indicate net income of$3.3 million and $4.7 million in 1995 and 1996, respectively. Income was higher in 1994, a year in which Vail Resorts sold off assets of Gillett Holdings, Inc. While the information provided is quite limited it does tend to indicate that, at the very least, both Vail Associates and Vail Resorts are solvent as of the dates of the information provided and would probably not be unduly burdened by the amount of debt they would incur from participation in the project. This information does not, however, reflect the financial impact of the acquisition of the Breckenridge and Copper Mountain ski areas. (3) Alternative Sources of Financing Glenn Porzak, the attorney for the applicants, has indicated to both the staff and the Board that the applicants do not believe that other sources of financing are viable because of the public/private sector mix of the reservoir company membership. We do not know if the applicants have actually attempted to obtain financing from other sources only that they are probably not eligible for funding from most public agencies. (4) Analysis of Collateral The Helton & Williamsen feasibility study provided a detailed analysis of both the firm yield of the reservoir as well as a market-based analysis of the value of water rights in the project area, The study concludes that the firm (dry-year) yield of the reservoir would be about 2,000 acre-feet and that the average value of the water rights would be about $2,000 per acre-foot. Staff concurs in these estimates based on the information provided. Helton & Williamsen further estimated the total value of the project by adding the cost of the reservoir to the estimated value of the water rights. Multiplying this amount by 75 percent, the equity in the project to be pledged by the applicants; results in an estimated value of the collateral (reservoir plus-waternghts) of about $11.6 inillion as outlined in Table 2. This indicates that the value of the collateral (to be offered in the form of shares of stock) exceeds the amount of the loan by more than $3.0 million. Table 2. Estimated Values for Eagle Park Reservoir Project Water Rights Total Value Value of CWCB Residual Reservoir ' ('l!>. $2,000 oer Ac-Ft Entire Project 75 % of Proiect Loan Value $11,500,000 $4,000,000 $15,500,000 $11,625,000 $8;500,000 $3,125,000 The $11.5 million purchase price for the 3,000 acre-foot reservoir implies a cost of about $3,800 per acre-foot of storage capacity. Staffhas reviewed the cost versus capacity relationships for several other constructed or planned reservoir projects in Colorado and has found that the $3,800 per acre-foot is quite high for a rehabilitation project but relates well to the cost curve for new projects, 3