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<br /> <br />Agenda Item 19b <br /> <br /> <br />Town of Frederick - Milavec Lake Rehabilitation <br />January 22-23, 2003 <br /> <br />Financial Ratio Without With project <br /> the project Future Years <br /> (Aver. 2000-01) 2004+ <br />Operating Ratio (revenue/expense) <br />weak: less than 100% 235% 223% <br />average: 100% - 120% (strong) (strong) <br />strana: areater than 120% <br />Debt Service Coverage Ratio <br />(revenues-expenses )/debt service 177% 163% <br />weak: less than 100% (strong) (strong) <br />average: 100% - 125% <br />strona: areater than 125% <br />Cash Reserves to Current Expense <br />weak: less than 50% 11 00% 795% <br />average: 50% - 100% (strong) (strong) <br />stronQ: Qreater than 100% <br />Debt per Tap <br />weak: greater than $5000 $760 $1307 <br />average: $2500 - $5000 (strong) ( strong) <br />strona: less than $2500 <br />Monthly Water Sill <br />average: $30 $30 $30 <br />weak: greater than $60 (aver.) (aver.) <br /> <br />Table 2. Financiall Ratios <br /> <br />As security for the loan the Town of Frederick will pledge water revenues backed by a rate <br />covenant and annual financial reporting. This is in compliance with CWCS Loan Policy #5 <br />(Collateral). <br /> <br />Recommendation <br /> <br />Staff recommends a CWCS Small Project Loan from the Construction Fund, not to exceed <br />$1,000,000, to the Town of Frederick, acting by and through its Water Fund (enterprise fund), to <br />rehabilitate Milavec Lake to reduce seepage loss and increase storage capacity. The recommended <br />term of the loan is 20 years and the recommended lending rate is 4.5% per annum. Security for the <br />loan will be a pledge of water rate revenues backed by a rate covenant and annual financial reporting. <br /> <br />Staff further recommends that final approval of the loan be conditioned upon all other standard <br />contracting provisions of the CWCS. <br /> <br />cc: Charles Klarich, Town Administrator, Town of Frlederick <br />Brad Hagen, P .E., Rocky Mountain Consultants, Inc. <br />Linda Bassi, AGO <br /> <br />Attachment <br /> <br />Action Taken by the CWCS on January 23. 200~~ <br /> <br /> <br />The CWCS approved the Staff Recommendation. <br /> <br />Page !5 of 6 <br />