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Mancos Valley Beaver Ditch Loan Application 1/4/2006 3:19 PM orw <br />Mancos Valley Beaver Ditch Company <br />Pipeline Project <br />Need for Revision in the Project Scope <br />Completion of the detailed engineering design of the pipeline on December 2, 2005, gives the <br />basis for accurate calculation of the NRCS project cost allowance of $904,750 compared to the <br />original allowance of $431,456 given in the Feasibility Study dated June 2, 2004. Lack of a <br />detailed pipeline design at that time resulted in the underestimate of the project cost. The <br />Company has entered into a supplemental NRCS 2006 EQIP contract to secure the balance <br />needed to complete the project. The Company requires an initial line of credit for $904,750 for <br />the construction phase and a long term loan of $226,178 after the pipeline is completed. NRCS <br />engineers estimate that the final cost may be $700,000 with uncertainty in the cost of PVC pipe <br />needed in the project. The Mancos Valley Beaver Ditch Company recognizes the size of the <br />cost increase and sees its obligation to reduce actual construction cost to below the engineers <br />estimate. <br />The new design changed to a single 21 inch pipe from the Mancos River diversion structure to <br />the first delivery point on the Jankowski Ranch. Our first design called for dual 12 inch pipelines <br />with one devoted to carrying the Jankowski water alone. Use of the single pipe simplifies the <br />diversion and reduces the cost of the head gate and screen structure. <br />Introduction <br />The Mancos Valley Beaver Ditch Company (Company) manages the Mancos Valley Beaver Ditch <br />(the Ditch) for the benefit of the Members as an association of owners', of water rights and lands <br />served by the Ditch. Irrigation water is diverted from the Mancos River, southwest of the Town of <br />Mancos in Montezuma County Colorado, and carried in the Ditch to the 700 -acre Member service <br />area. The Ditch is approximately 21,000 feet in length, serves 5 Members and carries a maximum <br />flow of approximately 12.5 cubic feet per second. The Company proposes to upgrade the Ditch by <br />installing a pipeline in the Ditch easement for a distance of approximately 21,000 feet. <br />Project Sponsor <br />The Company is a non - profit corporation registered in the State of Colorado. There are four <br />Members in the Company. The Company has the power to assess the Members for operations, <br />maintenance and administrative costs. The Members have entered into a Funding Agreement <br />with the Company for repayment of the loan that will be used to finance Project costs. All of the <br />Members' irrigation water will be carried in the pipeline, and the loan repayment will be shared <br />by the Members according to the project cost share distributed in proportion to the maximum <br />adjudicated water flow in cubic feet per second(cfs) carried on behalf of each Member sharing <br />their common pipeline. The Total of the Member's water flow rate is 1''2.5 cfs. The Company <br />Articles of Incorporation, By -laws and Funding Agreement are included in Appendix A. <br />Project Service Area and Facilities <br />Page 6 of 16 pages <br />