Laserfiche WebLink
<br />Delta Canal Company <br />May 20-21, 2002 <br /> <br />Agenda Item 12a. <br />(Updated May 23, 2002) <br /> <br />Water is used for agricultural purposes and the Staff is recommending a Small Project loan in <br />maximum amount of $75K during construction, reducing to about $40,000 once construction is <br />complete. The recommended loan terms are 30 years at 2.75%. <br /> <br />Alternative financing sources: The Company actively sought alternative financing. They <br />were able to get an in-kind grant from the NRCS to cover project planning and design (value <br />about $11,600), as well as an NRCS cost share grant in amount of $92,800 for construction. <br /> <br />Table 2 is a summary of the financial aspects of the project, assuming a $75K CWCS Loan. <br />The annual payment would be $3,704 (including the 10% reserve requirement) at the loan <br />terms of 2.75% for 30 years. This represents $2.30 per acre-foot, based on average annual <br />diversions of 1620 acre-feet. <br /> <br />a e mancla ummary <br />Proiect Cost $144,200 <br />Number of Shareholders 15 <br />Number of Shares of Stock 202 <br />CWCS Loan Amount $75,000 <br />CWCS Loan Payment (inCludes 10% reserve) $3,704 <br />Current equivalent assessment per share ($1500 divided by 202 shares) $7.43 <br />New equivalent assessments Der share ($5574 divided by 202 shares) $27.60 <br />Annual Loan Cost Der acre-foot (Averaae diversions 1620 ac-ft.) $2.30 <br /> <br />T bl 2 F' . I 5 <br /> <br />Credit worthiness: The DCC has no existing debt. Table 3 shows the Financial Ratios for the <br />DCC and indicates, with the exception of cash reserves, average to strong ability to repay a <br />$75K CWCS loan with the project in place. <br /> <br />Table 3, Financial Ratios <br /> <br />Financial Ratio Without With <br /> the Droiect The Droiect <br />Operating Ratio (revenue/expense) 100% 100% <br />weak: less than 100% (average) (average) <br />average: 100% -120% <br />strano: areater than 120% <br />Debit Service Coverage Ratio No Debt 110% <br />(revenues-expenses)/debt service (strong) (average) <br />weak: less than 100% <br />average: 100% - 125% <br />strang: greater than 125% <br />Cash Reserves to Current Expense ~4'J'lci 9:0/& <br />weak: less than 50% ~}l~hV.')-- :~~ tii,L~'!.<l <br />average: 50% - 100% <.We,aEi) "l{v:eel5l <br />strano: oreater than 100% <br />Annual Cost per Ac-Ft (1620 ac-ft diverted) $ 2.16 $3.44 <br />weak: greater than $20 (strong) (strong) <br />average: $10 - $20 <br />strang: less than $10 <br /> <br />As security for the loan the DCC will pledge assessment revenues backed by assessment <br />covenant and the project itself. This security is in compliance with cwes Loan Policy #5 <br />(Collateral). <br /> <br />3 <br />