15a

• Board Meeting Date: 7/11/2007
• Description: CF Section- New Project Loans - Henrylyn Irrigation District - Horse Creek Reservoir and Prospect Reservoir Rehabilitation
• Board Meetings - Doc Type: Memo

Henrylyn Irrigation District
July 11-12, 2007

Agenda Item 15a

Current Levy per acre (H I D) - 2007 $18.00
Required New Levy per acre (HID) - with CWCB loan $21 .00
Annual Cost of Loan per AF delivered (H I D) - 13,850 ac-ft. $7.21

Creditworthiness: HID current has a total outstanding long-term debt of $624,863, The HID has
two existing loans with CWCB. The first is a 1980 loan for $653,000 for the repair of flood damage
to the Prospect and Lord Reservoirs, with a remaining principal amount of $337,240 and annual
payments of $28,249 through 2021 (40-year loan). Collateral for this loan is a conveyance of an
individual 1/10 interest in Prospect Reservoir. The second is a 1981 loan for $260,000 for the
purpose of repair of damages to the Horse Creek Reservoir Dam, with a remaining principal amount
of $164,220 and an annual payment of $15,153 through 2022 (40-year loan). Collateral for this
loan is a conveyance of an undivided ~ interest in the Horse Creek Reservoir. HID is current on its
CWCB loan obligations. Also, HID also has an interest-free $1,000,000 loan with the U.S. Bureau
of Reclamation for the purpose of concrete lining its ditch laterals and canals, with a remaining
principal amount of $79,288 and an annual payment of $32,800 through 2008. In addition, HID has
a $75,861 loan with CN H Capital for purchase of an excavator, with a remaining principal amount of
$44,115 and an annual payment of $20,513 through 2009. Collateral for this loan is the excavator
itself. The last two loans will be retired prior to the start of CWCB loan repayment (2010).

Table 2 shows the Financial Ratios for HID and indicates overall average to strong ability to repay
the $2,162,700 CWCB loan, with annual HID assessment levy raised from $18 to $21 per acre.

Table 2. Financial Ratios

Financial Ratio Without With project
the project Future Year
(Aver. 2005-06) 2010+
Operating Ratio (revenue/expense)
weak: less than 100% 100% 118%
average: 100% - 120% (average) (average)
strong: greater than 120%
(808K/808K) (1,037K/881K)
Debt Service Coverage Ratio
(revenues-expenses)/debt service 441% 109%
weak: less than 100% (strong) (average)
average: 100% - 125%
strong: greater than 125% (1, 224K-808K/94K ) (1,037K-881K/143K)
Cash Reserves to Current Expense
weak: less than 50% 162% 124%
average: 50% - 100% (strong) (strong)
strong: greater than 100%
(1,462K/903K) (1, 268K/1, 024K)
Annual Operating Cost per Acre-Ft. (19,175 AF)
weak: greater than $20 $47 $53
average: $10 - $20 (weak) (weak)
strong: less than $10
(903K/19K) (1,024K/19K)

Collateral: As security for the loan, the HID will pledge its annual assessment levy revenues,
backed by an assessment covenant. Also, the HID will pledge additional collateral in the form of

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