24f

• Board Meeting Date: 3/24/2003
• Description: CF Section - Town of Coal Creek
• Board Meetings - Doc Type: Memo

Town of Coal Creek Agenda Item 24f.
March 24-2625, 2001
I Project Cost
I CWCB Loan Amount
CWCB Loan Payment (includes 100/0 reserve.)
Number of Taps
I Annual Loan Cost per acre-foot (34 acre-feet consumptive use)

$75,000 I
$67,500 I
$4,165
165
$123 I

Credit worthiness: The Town has no debt. Table 2 shows the Financial Ratios and indicates, with
the exception of Cash Reserves, average to strong ability to repay with the CWCB loan in place.

Financial Ratio

Table 3. Financial Ratios
I Without the project

With the project

Operating Ratio (revenue/expense) 1120/0 (average) 1060/0 (average)
weak: less than 1000/0
average: 1000/0 - 1200/0
strong: greater than 1200/0
Debit Service Coverage Ratio No Debt (strong) 1990/0 (strong)
(revenues-expenses)/debt service
weak: less than 1000/0
average: 1000/0 - 1250/0
strong: greater than 1250/0
Cash Reserves to Current Expense 440/0 (weak) 300/0 (weak)
weak: less than 500/0
average: 500/0 - 1000/0
strong: greater than 1000/0
Monthly Residential Water Bill $25.00 (strong) $25.00 (strong)
weak: greater than $60
average: $30 - $60
strong: less than $30

As security for the loan the Town will pledge revenues backed by rate covenant. (This security is in
compliance with CWCB Loan Policy #5 (Collateral).

Recommendation
Staff recommends a Small Project loan from the Construction Fund in amount of $67,500 to the Town
of Coal Creek to pay for up to 900/0 of the cost to purchase water rights. The recommended loan
terms are 30 years at 3.750/0 (3.8320/0 Annual Percentage Rate.) As security for the loan the Town
will pledge revenues backed by rate covenant in compliance with CWCB Loan Policy #5 (Collateral).

Staff further recommends that final approval of the loan be conditioned upon all standard contracting
provisions of the CWCB, including the 1 % loan origination fee charged in accordance with CWCB
Policy #16. The maximum loan amount may be increased to $68, 175 if the borrower elects to finance
the 1 % loan service charge. An appraisal or written opinion of value of the water shares must also be
provided by the Borrower as a condition of obtaining the CWCB loan.

cc: Charles Hastings, Mayor, Town of Coal Creek, P.O. Box 36, Coal Creek, CO 81221
Linda Bassi, AGO

Attachment

C:\CoaICreek 303memo
L:\boardmem\mar03\24f - Town of Coal Creek

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