PROJ01960 ‎(2)‎

• Contract/PO #: C150249
• Contractor Name: Black Dike Pipeline Company
• Contract Type: Loan
• Water District: 0
• County: Montezuma
• Loan Projects - Doc Type: Feasibility Study

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The Company is requesting a 30-year loan from the CWCB. The standard agriculturall:ending
rate would be 2.85%, resulting in annual payments of $10,357.25. The Company will fund a
payment reserve account at the outset of the Project in the amount of $10,357.25 and increase
the reserve account to $20,714.50 over 3 years..

Table 3 is a summary ofthe financial aspects ofthe Project.

Table 3. Financial Summary

Proiect Cost
Loan Amount (25% of Project Cost)
CWCB Loan Annual Payment Amount
CFS of water to be carried on behalf of the Members
Annual Commitment for repayment per cfs of water to be carried
Annual Project Cost per acre-foot (based upon 1,000 acre-ft)

$598,146
$207,000
$10,357.:25
7.75
$1,336.42
$10.36

Since all other funding for the Project is in the form of grants, the Company would havE~ no other
debt service on this Project.

The Company was incorporated in March of 2007 for the purpose of undertaking the Project.
Therefore, the Company has no financial history. The Company has no existing debt. The
owners of the Ditch have spent an average of $1,000 per year per c.f.s. on maintenance costs
in the recent past. Maintenance costs are expected to be much less with the new pipeline, and
can be accommodated by Company assessments to Members pursuant to the Bylaws. The
Company checking account at the Vectra Bank presently has a balance of $3000 as a reserve
for maintenance expenses.

Credit worthiness: The Company has no existing debt. The Company's ability to repay the
loan is supported by the Funding Agreement and the payment reserve account.

Loan Application: The Loan application to CWCB for the Project financing is contained in
Appendix E.

Alternative financing considerations: The Company has obtained approximately $3,91,140 in
cost share (grant) from the NRCS to cover ~of the construction costs plus an in-kind grant
from the NRCS for engineering design and construction inspection. Long-term financing for the
Company's portion of the construction costs ($207,000) could not be attained elsewhe~re, and
the cost could not be financed internally with a one-time assessment.

Collateral: As security for the CWCB loan, the Company can pledge the Funding Agn3ement,
the project structures, and a payment reserve account of two annual payments.

Economic Analysis

The economic benefit of the project is considerable. The additional water to be delivered to the
Members after completion of the Project is estimated by the NRCS to be greater than with the
open Ditch. Regulation and measurement of water deliveries will be significantly improved. The

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