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<br />Lake Meredith Reservoir Co. <br />March 24-26, 2003 <br /> <br />Agenda Item 24c. <br />(Updated March 27, 2003) <br /> <br />Financial Analvsis <br />Three entities will provide financing for the project by either grants or loans, with an estimated <br />cost of $1,524,860. The estimated amounts from each source are provided in Table 1. <br /> <br />TABLE 1 - SOURCES OF FUNDING <br /> <br />Entity Grant Loan Assessment Percent <br />Participation <br />Lake Meredith Shareholders $9.860 .7% <br />Engineering Feasibility <br />First National Bank of Ordway -- $500,000 -- 32.8% <br />CWCB Feasibility Grant $5,000 -- 0.3% <br />CWCB Construction Loan and $1,000,000 $10,000 66.2% <br />Loan Origination -- <br />Total $5,000 $1,500,000 $19,860 100% <br /> <br />The Company will cover any costs that exceed the estimated project cost by special <br />assessments of the Shareholders, although no such assessments are expected. <br /> <br />The total estimated cost of the project is $1,524,860, and the water is used primarily for <br />municipal purposes, with some agricultural use. Staff is recommending a 30.year loan in <br />maximum amount of $1,000,000 (approximately 66% of the estimated total project cost.) <br />Table 2 shows the calculation of the blended interest rate for this project: <br /> <br />Table 2: LMRC Share Ownership and Interest Rate <br /> <br />Shareholder Rate Category Year 2001 Rate # Shares Rate x Shares <br /> LMRC <br />Agricultural Agricultural 2.75% 4620 127 <br />Municipal Municipal 4.75% 230 11 <br />(Woodland Park) High Income <br />Municipal (Aurora, Municipal 4.25% 35,048 1490 <br />Colo. Springs, Fountain, Middle Income <br />Pueblo) <br />Municipal Municipal 3.75% 724.094 27 <br />(Crowley Co., Olney Low Income <br />Springs, Ordway) <br />Totals 40,621 1,655 <br /> I Blended Rate = 1655/40,621 shares 4.073 % <br />3D-year blended rate for LMRC (Round to 4.00%) <br /> <br />The CWCB loan payment (including the 10% reserve requirement) would be $63,613 per year <br />at the loan terms of 4% for 30 years. To this cost would be added the loan payment to the First <br />National Bank of Ordway for a $500,000 loan. The annual payment for that loan is expected to <br />be about $67,934. The total of annual payments for the two loans will be $131,547. The <br />Company has applied for a $5,000 grant from the CWCB for the Feasibility Study. Any other <br />ancillary expenses will be paid from contingency accounts of the Company's operating budget. <br />The Following Table 3 shows a summary of the project financing. <br /> <br />3 <br />