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<br />"' <br /> <br />.,.. <br /> <br />Stan Bernstein and Associates, Inc. <br /> <br />Financial Planners and Consultants <br />For Local Governments, Municipal Bond Underwriters, and Real Estate Developers <br /> <br />November 19, 1996 <br /> <br />Mr. Dennis Gelvin <br />Manager <br />Eagle River Water and Sanitation District <br />Upper Eagle Regional Water Authority <br />846 Forest Road <br />Vail, Colorado 81657 <br /> <br />RE: FINANCIAL FEASIBILITY - PHASE I EAGLE PARK RESERVOIR COMPANY <br /> <br />Dear Dennis: <br /> <br />This report and the enclosed SCHEDULE 1 (PRELIMINARY ALLOCATION OF <br />COSTS TO SHAREHOLDERS); EXHIBIT t- (EAGLE PARK RESERVOIR COMPANY - <br />CASH FLOW PROJECTION); EXHIBIT II (EAGLE COUNTY - SALES TAX <br />CAPITAL IMPROVEMENT FUND CASH FLOW PROJECTION); EXHIBIT III (EAGLE <br />RIVER WATER AND SANITATION DISTRICT - WATER OPERATIONS COMPONENT <br />ONLY - CASH FLOW PROJECTION); and EXHIBIT IV (UPPER EAGLE REGIONAL <br />WATER AUTHORITY - CASH FLOW PROJECTION) were prepared to provide <br />financial information demonstrating how Eagle County, Upper Eagle <br />Regional Water Authority, and Eagle River Water and Sanitation <br />District could be able to pay for their respective costs associated <br />with the proposed Eagle Park Reservoir Company's assumed <br />acquisition of 1,500 acre feet of firm water yield at an assumed <br />cost of $8,500,000. <br /> <br />It is assumed that the proposed Eagle Park Reservoir Company <br />("Eagle Park") will borrow approximately $8,500,000 from the <br />Colorado Water Conservation Board on, or about, January 1, 1998 at <br />an assumed interest rate of 5.75% and that such debt will be repaid <br />by Eagle Park over a thirty year period. It is assumed that Eagle <br />Park will annually assess four entities (i.e., Vail Associates, <br />Inc., Eagle County, Upper Eagle Regional Water Authority, and Eagle <br />River Water and Sanitation District) for their proportionate shares <br />of (i) the annual debt service costs associated with Eagle Park's <br />Phase I firm water yield acquisition, and (ii) the annual costs of <br />administering Eagle Park. <br /> <br />This report is intended to provide financial information that has <br />been requested by the Colorado Water Conservation Board ("CWCB") <br />with respect to Eagle Park's requested $8,500,000 loan from the <br />CWCB. It should be emphasized that the $8,500,000 loan requested <br />from CWCB represents approximately 74% of the total amount of the <br />Phase I firm water yield acquisition costs because Vail Associates, <br />Inc. has previously acquired 500 acre feet of firm water yield for <br />a cash pclyment of $3,000,000. <br /> <br />707 Seventeenth Street, Suite 2900 Denver, Colorado 80202 (303) 291-0495 Telecopier; (303) 291-0625 <br />2606 Davos Trail Vail, Colorado 81657 <br />