LPPD000237

• Contract/PO #: C150174
• Contractor Name: Guenzi Farms, Inc.
• Contract Type: Loan
• Water District: 64
• County: Logan
• Loan Projects - Doc Type: Approval Letter

Brent Nation, P.E., of Nation Engineering Services, completed the feasibility study for the project in
April of 2004.

Below is a brief summary of the major project elements and their estimated cost as presented in the
original cost estimate:

1. Drill Recharge Well
2. Refurbish Existing Recharge Well
3. 4,500-ft. 2 I-inch PVC Pipeline
4. 2,200-ft. 12-inch PVC Pipeline
5. Pipeline Appurtenance
6. Recharge Ponds Construction
7. Land Purchase (105 acres)
8. Electrical
9. Planning, Surveying, and Design
10. Contingency

$46,000
$10,000
$75,600
$15,400
$30,000
$15,000
$119,500
$9,000
$6,750
$41.000

Total:

$368,250

The estimated total cost of the project at the time of construction was $368,250, as summarized
above. During construction of the project, however, various line items experienced cost overruns
and cost savings. These various cost overruns and savings are summarized in detail on the attached
spreadsheet prepared by Guenzi Fanns.

The project has been completed and is currently operational. The total cost of the completed
project is $429,648, which is $61,398 more then the original cost estimate, or approximately a 17%
more then the originally scoped project.

The two main reasons for the cost overruns was the well drilling and the electrical work. The final
cost of completing the new well and refurbishing the old was $90,702, which was $34,702 more
then the engineer's estimate. The added cost was due to a low initial engineer's estimate and
having to drill an added 240- ft. to achieve the desired well capacity. The final cost of providing
power to the two wells was $23,887, which was $14,887 more then the engineer's estimate. These
two items, combined with an additional cost of $11,809 for miscellaneous fittings and concrete
work, accounted for the total project cost overrun of$61,398.

Based on the additional costs as presented above, the Guenzi's are requesting a loan increase of
$17,261, which meets their available collateral for the project, as discussed in more detail below.
The remaining additional construction cost to complete the project is being covered by the Guenzis.

DISCUSSION
Due to additional work not programmed in the original cost estimate and unforeseen variations in
cost for specific items during construction, the overall cost of the project has increased by
approximately 17% or $61,398. Staffhas inspected the improvements in the field and has reviewed
the detailed cost summary provided by the owner and finds the additional expenses to be justifiable
and within the normal parameters for this type of construction.

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