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<br />Platte Valley Irrigation Company <br />November 13-15, 2006 <br /> <br />Agenda Item 10e <br /> <br />Table 2 shows the Financial Ratios and indicates overall average ability to repay the $2,365,000 <br />CWCS loan, with the increased assessments. For the purpose of the financial ratios, future <br />assessments were assumed to be $545. This also assumes that the full CD interest is included <br />in the analysis. If no CD interest were included, assessments would need to be increased by <br />about $300. <br /> <br />Table 2. Financial Ratios <br /> <br />Financial Ratio Without With project <br /> the project Future Year <br /> (Aver.2004-05J 2009+ <br />Operating Ratio (revenue/expense) <br />weak: less than 100% 104% 115% <br />average: 100% - 120% (aver.) (aver.) <br />strong: greater than 120% <br /> (335K/323K) (385K/335K) <br />Debt Service Coverage Ratio <br />(revenues-expenses)/debt service N/A* 105% <br />weak: less than 100% (aver.) <br />average: 100% - 125% <br />strong: greater than 125% (490K-335K/148K) <br />Cash Reserves to Current Expense <br />weak: less than 50% 26% ** 14% *** <br />average: 50% - 100% (weak) (weak) <br />strong: greater than 100% <br /> (83K/323KJ (65K/483K) <br />Annual Operating Cost per Acre-Ft. (52,401 AF) <br />weak: greater than $20 $6.16 $9.22 <br />average: $10 - $20 (strong) (strong) <br />strong: less than $10 <br /> (323K/52K) (483K/52KJ <br /> <br />* Value is not applicable (N/A) since PVIC has no existing debt. <br />** Does not include CD: $2,105,751 in 2005 and $1,612,500 in 2004. <br />*** Does not include CD: $2,105,751 <br /> <br />The assessments for the years 1997 to 2006 are summarized as follows. <br /> <br />Year <br />2006 <br />2005 <br />2004 <br />2003 <br /> <br />Assessment <br />$400 <br />$400 <br />$400 <br />$400 <br /> <br />Year <br />2002 <br />2001 <br />2000 <br /> <br />Assessment <br />$450 <br />$600 <br />$300 <br /> <br />Collateral- As security for the loan, the PVIC will pledge its annual assessment revenue <br />backed by a rate covenant, and the project itself, including the land and physical assets at <br />the reservoir site. This is in compliance with CWCS Loan Policy #5 (Collateral). <br /> <br />6 of? <br />