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<br />,; .""." <br /> <br />Headgate 396 Lateral Corporation <br />November 6, 2006 (Revised November 14, 2006) <br />Page 4 of 4 <br /> <br />Agenda Item 1 Of '<. <br /> <br />Table 3. Financial Ratios <br /> <br />Financial Ratio Without Project With Project <br />Previous Years* Future Years <br />Operating Ratio (revenue/expense) 440%(Average) <br />I weak: <100% 1- I average: 100% - 120% ~ - I strong: >120%1 N/A <br /> $1100/2500 <br />Debt Service Coverage Ratio 133%(Strong) <br />(revenues-expenses )/debt service N/A <br />I weak: <100% 1- I averaQe: 100% - 120% 1- I stronQ: >120%1 $8500/6400 <br />Cash, Reserves to Current Expense 145%(Strong) <br />I weak: <50% I-I average: 50% - 100% 1- I strong: >100%' N/A After 3 years <br /> $12800/8900 <br />Annual Operating Cost per Acre-Ft. (1900 AF) $4.68(Strong) <br />I weak: >$20~ -I average: $10 - $2~ -I strong: <$101 N/A After 3 years <br /> $8900/1900AF <br /> <br />* Values are not applicable (N/A) since the Corporation is new and financial records do not exist. <br /> <br />Staff further recommends that final approval of the loan be conditioned upon the following: <br /> <br />1 , Executed USDA Conservation Program Contract. <br />2. Corporation's Funding Agreement shall include a "step-up" provision. <br />3. AlIstandard contracting provisions of the CWCS Loan Program including a revised Debt <br />Service Reserve Fund Provision that requires two annual loan payments (one payment set <br />aside at the time of first draw of funds and one third of an annual payment set aside at the <br />time of each. of the first three annual loan payments). <br /> <br />Email copy: <br /> <br />Dave McDonald, President, Headgate 396 Lateral Corporation <br />Max Schmidt, Water Solutions of Colorado <br />NRCS Office c/o Lloyd Reed & Louis Hautbauer <br />Amy Stengel, AGO <br /> <br />Attachment: Project Data Sheet <br />