PROJC00465 ‎(2)‎

• Contract/PO #: C150083
• Contractor Name: John Peroulis and Sons Partnership
• Contract Type: Loan
• Water District: 44
• County: Moffat
• Loan Projects - Doc Type: Approval Letter

John Peroulis & Sons Partnership
May 20-21, 2002

Agenda Item 12c

Financial Analvsis
The total estimated cost of the project is $335,000, and the water is used primarily for
agricultural purposes, The initial $100K CWCS loan was at the terms of 3,5% for 30 years and
staff is recommending this $150K follow-up Small Project loan at the terms of 2,75% for 30
years, The weighted average interest rate (both loans, totaling $250K) is 3%, The new total
loan amount of $250K represents approximately 75% of estimated total project cost of $335K,

Alternative financing sources: The Partnership actively sought alternative financing but was
not able find competitive funding elsewhere, They requested a loan from their local bank but
were turned down because the bank does not provide long-term fixed rate financing for
agricultural projects,

Table 1 is a summary of the financial aspects of the project. A CWCS Small Project Loan in
total amount of $250K at 3% would have an annual payment of $14,030 (including the 10%
reserve requirement) at the loan terms of 3% for 30 years. This represents $42,51 per acre-
foot, based on a revised reservoir storage capacity of 330 acre-feet.

Proiect Cost $335,000
Number of Shareholders 1
Number of Shares of Stock N/A
CWCS Loan Amount $250,000
CWCS Loan Pavment (includes 10% reserve) $14,030
Annual Loan Cost oer acre-foot (Reservoir volume: 330 ac-ft.) $42.51

Table 1, Financial Summary

Credit worthiness: The JPSP has two existing loans with Lend Lease Agri-Susiness of
Englewood Colorado, The outstanding balance for these loans is $3,95 million and an
acceptable credit report has been obtained from this lender. Table 2 shows the Financial Ratios
for the JPSP and indicates two in the strong category and two in the weak category with the
$250K CWCS loan in place, Partnership income varies from year to year depending on the
agricultural market and one-time land purchase and sale events,

Financial Ratio Without With
The oroiect The oroiect
Operating Ratio (revenue/expense) 129% 125%
weak: less than 100% (strong) (strong)
average: 100% - 120%
stron';: nreater than 120%
Debit Service Coverage Ratio 137% 132%
(revenues-expenses)/debt service (strong) (strong)
weak: less than 100%
average: 100% - 125%
stron';: nreater than 125%
Cash Reserves to Current Expense 36% 35%
weak: less than 50% (weak) (weak)
average: 50% - 100%
stron';: nreater than 100%
Annual Cost per Acre-Foot (330 ac-ft) $4.00 $44,00
weak: greater than $20 (strong) (weak)
average: $10 - $20
strona: less than $10

Table 2. Financial Ratios

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