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<br />Alternative financing considerations: The Glenwood Irrigation Company has investigated <br />alternative financing sources. They were able to obtain a grant of $15,000 from the Colorado <br />River Water Conservation Board for construction. The Glenwood Irrigation Company have <br />obtained engineering design and construction inspection from the Natural Resources <br />Conservation Service, However, long term financing could not be attained elsewhere. USDA <br />Rural Development no longer makes loans to irrigation companies. The bank letter of denial (US <br />Bank, Glenwood Springs) is included in Appendix H. <br /> <br />Collateral: The structure itself will be offered as collateral. <br /> <br />Economic Analysis <br /> <br />If the project is not completed the annual production of lands in the 750-acre service area would <br />be reduced. The average net yield per acre with water is estimated at $60, compared to a net <br />yield of $25 as dry land. This results in an annual loss of $35/acre x 750 acres = $26,250. This <br />loss will continue each year until the diversion is repaired or replaced (an additional cost of <br />$109,000.) A major benefit of the project is avoiding the annual economic loss associated with <br />the lack of irrigation water within the service area, <br /> <br />Social and Physical Impacts <br /> <br />The project will have no significant social impacts, since it will assure the continued operation of <br />an existing irrigation system. The project will have minor physical impacts, once construction is <br />complete. <br /> <br />Conclusions <br /> <br />1. The Glenwood Irrigation Company is an incorporated entity. The Company must be <br />registered in the State of Colorado in order to enter into a contract with the CWCB for the <br />purpose of obtaining a Construction Fund loan. <br /> <br />2. Rights-of-Way easements will be obtained in time for the construction of this project. <br /> <br />3. The project would provide for the continued delivery of irrigation water to share holders. <br /> <br />4. The total estimated cost of the project is $109,000 and will be financed by a grant from the <br />NRCS for engineering services, by a $15,000 CRWCB grant, and by a $85,000 CWCB loan <br />for construction. <br /> <br />5, The Glenwood Irrigation Company is eligible for a CWCB Small Project Loan because the <br />loan amount is less than $100,000, and because the project is necessary to avoid undue <br />hardship on the borrower. Requiring the Glenwood Irrigation Company to apply through the <br />standard CWCB loan process would delay the project one-year, and jeopardize the <br />Company's ability to deliver water to its shareholders. <br /> <br />Opinion of Feasibility <br /> <br />The project appears to be technically and financially feasible. <br /> <br />Glenwood Irrigation Company <br />Diversion Feasibility Study <br />June 2001 <br /> <br />Page 11 of 11 <br />