PROJ01934 ‎(2)‎

• Contract/PO #: C153471
• Contractor Name: Frederick, Town of
• Contract Type: Loan
• Water District: 0
• County: Weld
• Loan Projects - Doc Type: Feasibility Study

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6.0 PROJECT ALTERNATIVES

The Town board approved the project and selected Alternative 2b (Full Perimeter Slope Liner) as described in
/ the Feasibility Study (RMC, September, 2002). The design proposes to extend a low permeability compacted
clay liner from the existing upstream clay liner to the underlying natural clay. The clay liner would tie into the
upstream face by constructing a clay cap. Approximately 5,700 linear feet of liner with an average vertical
depth of twenty feet would be constructed 25 feet inside the reservoir from the upstream toe of the dam (for
construction and stability purposes). Refer to the Feasibility Study (RMC, September, 2002).
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7.0 ECONOMIC FEASIBILITY + ~
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The proposed project will result in the reservoir capacity being increased by approximately 275 acre-feet from
an existing capacity of approximately 775 acre-feet to post-project capacity off,059>acre-feet. The typically
recognized value for "lined storage" in the area of Mil avec Lake is $2,500 per acre-foot. Therefore, the value
of the additional 275 acre-feet of usable lined storage volume would be approximately $687,500. This does
not consider the increase in value for changing the existing 775 acre-feet of storage volume to "lined" storage.

Raw water irrigation will replace the current use of Central Weld water for irrigating some of the Town's
public areas and parks (refer water demand section). Currently, the Town pays $0.63 per thousand gallons for
Central Weld to treat and deliver the Town's CBT raw water. The estimated cost of pumping raw water from
Milavec Lake for irrigation is approximately $0.20 per thousand gallons including power, system operation
and maintenance and the cost of the water as paid by the Town. Therefore, the cost savings to the Town
would be at least $42,000 per year per 100 acres of Town property irrigated with raw water.

The raw water irrigation system may also serve entities or customers other than the Town. These entities may
include St. Vrain School District, other neighboring municipalities and various residential developments.
Representatives of the St. Vrain School District have previously expressed interest in purchasing raw water for
irrigating school grounds at Frederick High School and the neighboring elementary. The Town has
preliminarily indicated that the cost of the raw water would be set at approximately one-half the cost of
potable water ($1.10 per thousand gallons) or approximately $0.55 per thousand. The sale of the raw water
would net approximately $0.35 per thousand gallons or approximately $34,000 per year per 300 acre-feet of
irrigation water (100 irrigated acres) sold to outside users. The currently projected annual demand of 450
acre-feet is less than half of the total reservoir storage volume and is also less than the 60 percent of the 768
acre-feet total adjudicated storage decree.

7.1 Financial Plan for Repavment

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j The Town's water department and Water Fund is operated as an enterprise fund. The legal opinion of the
Town's attorney is that the Tabor amendment does not impact the funding or loan repayment for this project.
Refer to Exhibit C. Project financing (loan repayment) will be made through revenue obtained from the sale
of water to customers, existing Water Fund revenues, an additional raw water impact fee on new construction
permits or any combination of the above. The Combined Balance Sheet from the Town's 2000 and 2001
calendar year financial audits have been included as Exhibit D. The full audit reports for these years were
submitted previously to CWCB.

CWCB Feasibility Study for the
Milavec Lake Rehabilitation Project

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December 2002

I:\0092_055.blh\03-Milavec Lake Liner Design\cwcb-rptLdoc

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