C150240 Approval Letter - Laserfiche WebLink

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Bull Creek Reservoir, Canal & Power Company January 23-24, 2007 (REVI>ED January 29, 2007) Page 3 of 5 Reservoir Storage Water Rights Summary Agenda Item 9b R�eservoir Capacity Storage Right Potential Loss ac-ft ac-ft ac-ft * Bull Creek No. 1 80 154 74 Bull Creek No. 2 75 120 45 Bull C;reek No. 3 59 59 0 Bull Creek No. 4 203 313 110 Bull Creek No. 5 247 2p4 p Total 664 850 22g * Potential lo�s figures are taken from the Stipulation and Agreement dated 10/31/03 The Company has applied for a 2006 storage right crf 115 ac-ft for Reservoir No. 4 and may also apply to have a portion of the senior rights from Res�ervoir No. 1& 2 moved to Reservoir No. 4. Proiect Description Three alternatives were analyzed in the feasibility study: 1) No action alternative 2) Rehabilitate and enlarge Bull Creek Reservoir No. 4($1.3 million) 3) Enlarge Bull Creek Reservoir Nos. 1& 2 and rehabilitate Reservoir No. 4($600,000) The Company originally determined that Alternative 3 provided the best value to the shareholders. As the project continued to develop, the cost and difficulties associated with enlarging Reservoirs 1 & 2 became insurmountable. The Company has decided to pursue Alternative 2 which will provide a better benefit cost ratio. The rehabilitation and enlargement of Reservoir 4 will retain the Company's valuable senior water rights by repairing the dam and will replace the abandoned water rights from Reservoir 1& 2, with the enlargement. Access to the reservoir is difficult and the timing of construction will be cr►tical to maintain the use of the water during the irrigation season. PROJEGT COST ESTIMATE Planning,/Engineering $157,000 Construction $984,000 Contingency $137,000 Construction Services/Management 55 000 Total $1,333,000 Construction is expected to begin during the summer of 2007 and be completed by October 2007. This is a very aggressive schedule and will require final design plan approval by the SEO, Forest Service permitting, anci other reservoir project hurdles prior to starting the project. As a result, the Cornpany has decided to pre-qualify bidders and thoroughly evaluate each bidder's approach and assumptions prior to awarding a contract. If the contractor fails to complete the project during the summer construction s,eason of 2007, significant cost to the project and impact to the water users will result. Financial Analvsis Table 1 shows a sumrriary of the financial aspects of the loan request. The Company qualifies for an Agricultural interest rat�e of 2.5% for 30-years. Ute Water Conservancy District owns 7% of the Company stock. This low percentage of municipally owned stock does not materially impact the stated interest rate. Th� Company will finance 90% of the total Project cost with a CWCB loan. The