Laserfiche WebLink
<br />able 3. manclal ummary <br />Project Cost $135,382 <br />Loan Amount (77.5% of Project Cost) $105,000 <br />CWCS Loan Payment Amount $6,421 <br />Number of Shareholders 48 <br />Number of Shares of Stock 150 <br />Current Assessment per Share $75 <br />Future Assessment per Share $125 <br /> <br />T <br /> <br />f" <br /> <br />. S <br /> <br />Since there is cash on-hand to cover all other associated costs, the Company would <br />have no other debt service on this project. Operation and maintenance costs are <br />expected to continue as is, and can be accommodated by the Company's existing <br />budget. <br /> <br />Credit worthiness: LL&D Company has no existing debt. Table 4 shows the Financial <br />Ratios for the ll&D Company and indicates average to strong ability to repay with the <br />project in place. <br /> <br />Financial Ratio Without the project With the project <br />Operating Ratio (revenue/expense) 99% (average) 101% (strong) <br />Debit Service Coverage Ratio No debt (strong) 115% (average) <br />(revenues-expenses )/debt service <br />Cash Reserves to Current Expense 447% (strong) 219% (strong) <br /> <br />Table 4. Financial Ratios <br /> <br />Alternative financing considerations: In addition to CWCS, the LL&D Company has <br />contacted about 5 or 6 local banks and CoBank. Among them, the best terms we could <br />find was $50,000.00 for 10 years at 7.5% with a 1.0% origination fee. Such a small <br />amount, however, would have forced LL&D Company to exhaust its emergency cash <br />reserves. <br /> <br />Collateral: For collateral we intend to offer our three water rights, and we pledge up to <br />$50.00 per share special assessment each year until the loan is paid. <br /> <br />Economic Analysis <br /> <br />The economic benefit of the project is measured in terms of being able to provide a <br />higher quality of service to shareholders than what is allowed today. This is because <br />today the LL&D Company, with its restrictive inlet capacity, struggles to fill its reservoir in <br />order to issue a comfortable amount of water per share each year. <br /> <br />LL&D Company shareholders use the company's water to irrigate hay and corn fields, <br />and landscaping on private property and subdivision common areas. In recent years, <br />due to the drought and the company's inability to fill the lake when in priority, <br />shareholders have been forced to either purchase water from other sources, at prices of <br />up to $30/acre-foot with a 20% "shrink" charge. In many cases, fields have been left dry <br />forcing the owners to purchase hay elsewhere at prices that are, in some cases 3 times <br />the amount that would have been paid had the field been able to yield. In other cases, <br /> <br />Loveland Lake and Ditch Company <br />Inlet Structure Upgrade Feasibility Study <br />February 1,2008 <br /> <br />13 of 47 <br />