C150154 Approval Letter

• Contract/PO #: C150154
• Contractor Name: Pine River - Bayfield Ditch Company
• Contract Type: Loan
• Water District: 31
• County: La Plata
• Loan Projects - Doc Type: Approval Letter

" .

Pine River - Bayfield Ditch Company
May 19-20 2003

Agenda Item 18c

,

increases in the base assessment rate from $7.25 to $ 12.80 per share. At the annual meeting in
February 2003, shareholders voted unanimously to increase assessments to repay the loan.

Table 1. Financial Summary

: 8,866 ac-ft.

$267,000
51
1952
$200,000
$10,865
$7.25
$12.80
$1.22

Creditworthiness: The PRBDC has no outstanding loans.

Table 2 shows the Financial Ratios for the PRBDC and indicates average to strong ability to repay
the $200,000 CWCB loan.

Table 2. Financial Ratios

Financial Ratio Without With project
the project Future Year
(Aver.2001-02) 2004+
Operating Ratio (revenue/expense)
weak: less than 100% 120% 196%
average: 100% -120% (aver.) (strong)
strano: areater than 120%
Debt Service Coverage Ratio
(revenues-expenses )/debt service N/A 114%
weak: less than 100% (aver.)
average: 100% - 125%
strano: areater than 125%
Cash Reserves to Current Expense
weak: less than 50% 209% 49%
average: 50% - 100% (strong) ( weak)
strano: areater than 100%
Annual Operating Cost per Acre-Ft. (8866 AF)
weak: greater than $20 $1.45 $2.67
average: $10 - $20 (strong) (strong)
strona: less than $10

As security for the loan the PRBDC will pledge assessment revenues backed by an assessment
covenant and the project itself. This is in compliance with CWCB Loan Policy #5 (Collateral).

Recommendation

Staff recommends a CWCB Small Project Loan not to exceed $200,000 to the Pine River - Bayfield
Ditch Company from the Construction Fund to replace 2300 feet of their Beaver Creek Siphon. The
recommended term of the loan is 30. years and the recommended lending rate is 2.75% per annum.
Security for the loan will be a pledge of assessment revenues backed by assessment covenant and
the project itself.

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