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~-/~ • CITI~' OF LAS ANIMAS WATER SYSTEM IMPROVEMENTS WATER SUPPLY RESERVE ACCOUNT GRANT APPLICATION All funding sources presented within the application have been committed a. $800,000 - DOLA C.DBG (grant) -committed on August 20, 2007 b. $10,000 - CDPHE Advance Planning Grant -committed on March 1, 2007 c. $400,000 -local commitment - committed in March 2007 i. $250,000 from the retained Earnings in the water reserve account ii. $150,000 from the Infrastructure and Improvement Fund d. $812,000 - CWR&PDA DRWF loan -committed on September 18, 2007 2. Overall, the City of Las Animas will be paying for 49% of the project if CWCB contributes the total amount requested. If CWCE3 does not contribute, the City will be paying for 60% of the total project cost. 3. As presented within CWCB's discussion section, one of the questions presented is directed to how the correctional facility is coni:ributing fiscally to the project. As a direct result of the project, the correctional facility's user rates have been increased from $3.75 per 1,000 gallons above 800,001 and above of monthly consumption to $4.00 per 1,000 gallons. This will effectively generate an additional $255 per month or $3,060 annually based on the correctional facility's current usage. Furthermore, as a result of the expansion of the • correctional facility, all additional water will be billed at this new rate. The anticipated increase in demand is approximately 2.2 million gallons per month, which equates to an additional $8,800 per month or an additional $105,600 annually. However, there is a cost to generate this additional water, ~~vhich is estimated to be $1.41 per 1,000 gallons. Therefore, the projection is that the City will net an additional $68,000 annually from the correctional facility. The new DWRF loan plus the 110% coverage ratio will require an annual allocation of approximately ;30,000, which provides the city with approximately $38,000 annually of additional funds„ Therefore, the correctional facility is paying for their share of the project byr covering the full cost of the new debt and providing additional retained earnings for future repairs identified within the city's Water System Evaluation Preliminary Engineering Report. 4. Note that the City's Preliminary Enginneering Report for Water System Evaluation identified $5,018,283 of repairs needed within the water system. The City is currently undertaking a slightly under half of those identified repairs as a result of realistic fiscal limitations. 5. The project is currently under design and is projected to be under construction beginning in the summer months of 2008. Given the time frame the city is facing for the added water system demands, any postponement of the request will have significant implications on construction activities and related costs as well as the city's ability to meet the increased demands. Given these time frames, .action on the request is needed during the March 19tH, 2008 session. 6. The City of Las Animas monitors its grater usage closely from month to month in an effort to reduce their water losses. This provides the City the needed knowledge as to when a leak becomes present that requires attention or if abnormal water usage is occurring from a customer. C:1D000ments antl Settings\ro3lLOCaI Settings\Temporary Internet Files\OLK92Vltltl Info CWCB.doc 1