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<br />Agenda Item 6(a)1 <br />October 20, 1992 <br /> <br />These items would constitute the first phase of a three phase program to up-grade the <br />water system and the estimated cost of phase I is $700,000. <br /> <br />Proposed Financing <br /> <br />The Town is requesting a $320,000 twenty year loan from Colorado Water <br />Conservation Board (CWCB) at zero percent (0%) interest as partial funding for the <br />new raw water pipeline and it has applied for a $300,000 grant from the Department <br />of Local Affairs and will provide $80,000 of its own funds in order to construct phase <br />I of this project. The justification offered for a 0% loan is as follows: <br /> <br />1. In July, 1991 the Town raised the average montWy water bill from $15 to $35. <br />2. The per capita income in Norwood is 41 percent below the State average. <br />3. Even with a 0% loan the average water bill will increase by $3 per/month. <br />4. The Town still has to spend another $700,000 to complete this project. <br /> <br />Based on the above information the staff feels a 0% loan is justified and if <br />granted the Town would have to pay the CWCB $16,000 per year for 20 years for a <br />total repayment of $320,000. <br /> <br />Recommendation <br /> <br />It is recommended that this project be authorized by the General Assembly in <br />the amount of $320,000, subject to the proposed terms of financing set forth above and <br />subject to the Town demonstrating to the Board's satisfaction that it can meet its <br />repayment obligation. <br /> <br />FMA/bj <br /> <br />bj807.6al <br /> <br />2 <br />