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<br />.~ " <br /> <br />4. Each of the revenue and expenditure projections in Tables 1 through 4 show a <br />substantial shortfall in revenues for the first eight to ten years of the repayment period with <br />cumulative amounts ranging from about $646,000 to about $829,000. The report <br />indicates that revenue shortfalls may be covered by the use of cash reserves. We would <br />have a genuine concern about a continuing operating deficit for that period of time and for <br />those amounts and would suggest that other means (other than a continuing use of cash <br />reserves) should be considered to eliminate those shortfalls. <br /> <br />5. If a rate increase is necessary, the report should estimate the amount of the increase, <br />compare future rates with the existing rates, and demonstrate the impact on a typical <br />residential water user along with a discussion of the subject (as opposed to inserting an <br />additional table in the report). <br /> <br />6. As we discussed at our meeting on July 5th, the Town's current Construction Fund <br />authorization is for the pipeline and pump station project only. CWCB authorization for <br />the reservoir rehabilitation project would require a feasibility study for the reservoir <br />project, a recommendation by the Board, and approval by the legislature. The information <br />provided on page 23 of the compendium does not meet the requirements for a feasibility <br />study of the proposed reservoir rehabilitation. <br /> <br />7. By statute, the CWCB is not authorized to fund water treatment or distribution <br />systems. The treated water project (retrofitting of an existing clarifier with a dissolved air <br />flotation unit) listed on page 23 is not eligible for CWCB funding. <br /> <br />8. We have prepared a brief financial analysis, copy attached, which outlines in some <br />detail our concerns with respect to the revenue and expenditure projections. <br /> <br />Please let me know if you have any questions or if we can be of any assistance to you and <br />PRC in completing this work. We look forward to meeting with you on September 17th. <br /> <br />Sincerely, <br /> <br />'73"d~ <br /> <br />William E. Green, P.E. <br />Manager of Planning <br />Project Planning and Construction Section <br /> <br />Enclosure <br /> <br />cc: <br /> <br />Section B Staff <br />Linda Bassi, GAG <br />Mike Brod, Water & Power <br />Skip Dinges, PRC <br /> <br />bg/l:wctrans/secblhilll.doc <br />