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I I I I I I I I I I I I I I I I I I I 2. A second coal mining company within the area that can be served has indicated an interest in leasing 100 acre-feet/yr of augmentation water. No specific negotiations have been entered into with this company. The repayment analysis included below is based on the assumption that the rate for this lease would also be $125/acre-foot/yr for 15 years. 3. The local water commissioner has indicated there are domestic and commercial water users in the area that would be interested in a combined total of at least 100 ac-ft of augmentation water in small increments. The current marlcet value of water for such purposes is $200/acre- foot/yr. An analysis of the effect that these three leases would have on repayment ability is included in Appendix G. This analysis shows that these prospective water leases have the potential to reduce the annual payment associated with this project from $79,805/yr ($7.98/share or $4.69/total delivered ac- ft) to $2, 157/yr ($0.22/share or $0. 13/total delivered ac-ft) COLLATERAL: As security for the CWCB loan, the ODFtC can pledge assessment income, and the fompanX physical f~ciliti~<;, The project value, as collateral, has been estimated using the following two methods: Least Cost Alternative: The North Forlc Water Conservancy District has investigated a number of potential projects for additional storage (both enlargement and new facilities) in the Leroux Creelc and Muddy Creelc areas over the last few years (see Alternative No.2. under the "Project Description And Alternatives" parafPraph of this report). These studies have indicated that the lowest cost to provide a similar amount of storage as the Overland project (about l,OOO ac-ft) would be approximately $5,500/acre- foot. The initial estimated cost for the proposed project is $1,254,550, which will result in increased storage of 971 ac-ft. For a new CWCB loan in the amount of $1,130,000, the unit loan amount will be about $1,164 /ac-ft for the proposed project. ODFtC currently has two outstanding CWCB loans with a total principal balance of$1,003,600. The current storage amount is 6,200 ac-ft which will increase to 7,171 ac-ft after completion of the proposed project and will result in a unit loan amount (CWCB loans only) for the entire modified reservoir facility of$298/ac-ft. Consequently, on the basis of the least cost alternative, the loan to value ratio (CWCB loans only) is 0.21 for the proposed project and will be .05 for the entire facility after completion ofthe proposed work Potential Water Sales: Based on recent sales, the marlcet value ofODFtC shares ranges from $1,200 to $1,500. The ODFtC manager estimates that each share represents approximately 1.8 acre-foot during an average year resulting in a unit marlcet value between $670/ac-ft and $830/ac-ft. This indicates total marlcet values of $650,570 to $805,930 (loan to value ratios of 1.74 to 1.40 respectively) for the additional 971 ac-ft 11