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Orchard Mesa Irrigation District March 13, 2006 (Revised March 24, 2006) Page 3 of 4 Agenda Item 17a private property. This siphon is located on the Power Canal which is the only source of River flows to the power plant and the main source of water to the irrigators. The siphon has required numerous repair efforts in the recent years and several areas are currently showing significant spalling and exposed rebar. The District has evaluated four alternatives and determined that the risk of a siphon failure is too high and repair is needed. The District evaluated two primary options: repair or replace the Siphon. Replacement was selected since repair would only prolong the need for replacement. Two construction techniques were evaluated: Cast-in-place and Precast placement of the new 12ft x 12ft concrete box sections. The precast option has been determined to be the most cost effective. Alternatives evaluated are listed below: 1. Repair the Siphon 2. Replace the Siphon with cast-in-place concrete box sections 3. Replace the Siphon with precast concrete box sections 4. No Action The District chose Alternative NO.3 with a total Project cost estimate of $600,000 Construction Planning/Engineering Contingency (30%) Total $385,000 75,000 140.000 $600,000 FinanciarAnalvsis Table 1 shows a summary of the financial aspects of the Project for the loan request. A cwes Loan of $540,000 will have an annual debt service obligation of $28,380 ($25,800 for annual loan payment and $2,580 for the 10% reserve funding) for the loan terms of 2.5% for 30-years. The interest rate is based on the standard agricultural interest rate. The District will use cash available for the remaining 10% of the Project costs that are not financed by CWCS. The total debt service obligation for this Project represents an annual cost of $0.50Iac-ft of water delivered to District lands. Table 1. Financial Summary of Project Total Proiect Cost $600,000 CWCS Loan (90% of Total Project Cost) $540,000 CWCS Annual Loan Payment $25,800 CWCS Loan Obligation (including 10% debt reserve funding) $28,380 Annual Assessment for Project Only (based on 9,206 acres) $3.10Iacre Annual Project Cost per Acre-Foot delivered (based on 58,300 AF) $0.50/ac-ft Creditworthiness: The District currently has a 1997 CWCS loan (C153723) for the Mutual Mesa Ditch Lateral Rehabilitation Project. Current balance is $392,627 with annual payments of $27,169 plus the 10% reserve funding. The District is current in the repayment and has been prompt with all payments. The District raised assessments in 2004 in anticipation of the capital improvements needed on the water supply delivery system. As of December 2004, the District had $1.9 million in cash reserves to begin a series of system improvements. Repayment of the loan will be accomplished utilizing the current assessments.