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<br />Republican River Water Conselvation District
<br />January14,2008
<br />Page 5 of6
<br />
<br />Agenda Item lId
<br />
<br />4. This alternative would not place a new water demand on the Ogallala Aquifer, and wells in this area are
<br />located in one of the deepest parts of the aquifer in Colorado, thereby assuring a long-term water supply
<br />for Compact compliance and not requiring future actions to offset new withdrawals from the aquifer.
<br />
<br />The pipeline will be sized to allow gravity delivery of water to meet the 15,000 AF /yr requirement during
<br />nine month period, with the capability to expand the delivery rate by adding a pumping facility.
<br />
<br />Project Cost Estimate
<br />Water and Property Purchase
<br />Engineering
<br />Pipeline Construction
<br />
<br />Total
<br />
<br />$50,000,000
<br />2,500,000
<br />$18,500,000
<br />$71,000,000
<br />
<br />Financial Analysis
<br />
<br />Table 1 shows a summary of the financial aspects of the loan request. The District's revenue source is
<br />predominantly agriculture (99%) with a small portion coming from municipal/commercial (1 %). Therefore,
<br />the District qualifies for an Agricultural interest rate of 2.00% for a 20-year term (reduced by 0.25% per
<br />Policy #7 from a standard 30-year Agricultural loan rate of 2.25%).
<br />
<br />Table 1. Financial Summary
<br />
<br />PROJECT /LOAN
<br />Total Project Cost $71,000,000
<br />CWCB Loan $60,000,000
<br />CWCB Loan (Including 1 % Service Fee) $60,600,000
<br />CWCB Annual Loan Payment $3,700,000
<br />CWCB Loan Obligation (including 10% debt reserve funding) $4,080,000
<br />Annual Cost Per Assessed Acre for Project (500,000 acres) $8. 16/acre
<br />Ground Water Rights Purchase per Acre-Foot (based on 15,000 AF annual delivery) $3,333/ AF
<br />Total Project Cost per Acre-Foot (based on 15,000 AF annual delivery) $4,733/ AF
<br />Assessments Before After*
<br />Assessments per irrigated acre (500,000 acres) $5.50/acre $14.50/acre
<br />
<br />* Approved intent to increase at the January 10, 2008 District meeting in Burlington, Colorado
<br />
<br />Creditworthiness: The District operates as a water activity enterprise. Increases in revenues received from
<br />fees assessed on irrigated acres and water used by municipal and commercial users will be increased to
<br />$14.50 to cover the increases in operating expenses and debt service.
<br />
<br />The District's Enterprise has one outstanding debt of approximately $5 million with Farm Credit Services of
<br />Colorado which was used as a down payment for the recent water right purchase. The District anticipates
<br />using available Certificates of Deposit as the CD's become due to pay this debt in full in 2009.
<br />
<br />Expense Total
<br />
<br />Before
<br />$2,750,000
<br />
<br />$600,000
<br />$2,000,000
<br />$0
<br />$2,600,000
<br />
<br />After
<br />$7,250,000
<br />
<br />$1,100,000
<br />$1,000,000
<br />$4,080,000
<br />$6,180,000
<br />
<br />Annual Revenues/Expenditures
<br />Revenues
<br />
<br />Operating Expenses
<br />Programs (CREP & EQIP)
<br />Debt Service
<br />
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