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<br />Otero Ditch Co. <br />Marcl1 20-21. 2000 <br /> <br />Agenda Item 9a. <br />(Updated' 'en 22. 2000) <br /> <br />Table 1. Financial Summary <br /> <br />Project Cost $616,409 <br />Loan Amount (75% of Project Cost) $155,000 <br />CWCS Loan Payment Amount, including 10% loan reserve $9,860 <br />Number of Shareholders 66 <br />Number of Shares of Stock . 4975 <br />Current Assessment per Share $16 <br />Future Assessment per Share $18 <br />Annual Project Cost per acre-foot $0.48 <br />(Average annual diversions: 20,687 acre-feet) <br /> <br />Table 2. Financial Ratios <br /> <br />Financial Ratio Without the project With the project <br />Operating Ratio (revenue/expense) 108% (averaae) 121% (averaae) <br />Debit Service Coverage Ratio No debt (strong) 164% (strong) <br />(revenues-expenses)/debt service <br />Cash Reserves to Current Expense 13% (weak) 26% (weak) <br />Annual Cost per Acre-Foot $ 3.84 (strona) $4.33 (strona) <br /> <br />Recommendation <br />Staff recommends that the CWCS find that the Otero Ditch Company is eligible for a loan from <br />the Emergency Infrastructure Repair Account because their diversion structure washed out <br />during a tiood in 1999. (The project is necessary to avoid unreasonable risk of injury or damage <br />to human health or well being or to property or crops, and the emergency condition is not the <br />result of negligence in the operation or maintenance of the infrastructure.) <br /> <br />Staff recommends an Emergency Loan not to exceed $155,000 to the Otero Ditch Company for <br />. up to 25% of the costs to rebuild the Company's diversion structure on the Arkansas River, The <br />recommended term of the loan is 30 years and the recommended lending rate is 4% (CWCS <br />rate for Agricultural borrowers in 2000.) Security for the loan will be a pledge of assessment <br />revenues backed by assessment covenant, one payment in a certificate of deposit account to <br />be held by the State, and the project itself. <br /> <br />Staff further recommends that final approval of the loan be conditioned upon acceptance of the <br />project and the associated financial obligations by a vote of the shareholders of the Com.pany, <br />completion of the feasibility study by April 30, 2000, and all standard contracting provisiOl1s of <br />the CWCS. <br /> <br />Action taken bv the CWCS March 20. 2000 <br />The CWCS approved the Staff Recommendation. <br /> <br />cc: Robert Valdez, President Otero Ditch Co.. P.O. Box 358, La Junta CO 81050 <br />Linda Bassi, AGO <br /> <br />Attachment <br />C:\ WP51 IProj-NewlOteroDitchDiversion300memo <br />L:\boardmem\mar1l0\9a-Mar1l0 <br /> <br />3 <br />