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<br />The intent of the project, as approved by the Board in November of2004, was to place additional
<br />fill material along the lower section of the existing liner, to eliminate any future erosion in this
<br />area, and to replace the outlet works.
<br />
<br />Golder Associates, Lakewood, Colorado, completed the cost estimate for the project in July of
<br />2004. The estimated total cost of the project at the time of construction was $142,800. During
<br />construction ofthe project, however, various line items experienced cost overruns and cost savings,
<br />as well as some additional items were added to the project. The actual total cost ofthe completed
<br />project is $172,800. A comparison of the total cost ofthe project with that originally estimated is
<br />summarized below:
<br />
<br />Items
<br />
<br />On!. Est.
<br />
<br />1. Site and Foundation Preparation
<br />2. Fill Construction
<br />3. Outlet Works
<br />4. Mobilization
<br />5. Construction Testing/Inspection
<br />6. Engineering
<br />7. Contingency
<br />
<br />$2,655
<br />$8,000
<br />$57,725
<br />$4,700
<br />$13,720
<br />$40,000
<br />$16,000
<br />
<br />Total:
<br />
<br />$142,800
<br />
<br />Actual
<br />
<br />$14,155
<br />$17,000
<br />$79,225
<br />$8,700
<br />$13,720
<br />$40,000
<br />$0
<br />
<br />$172,800
<br />
<br />The main cost overruns associated with the project were additional fill work to stabilize the existing
<br />liner, site grading work, temporary repair of the outlet works, and weather delays. The outlet
<br />works were repaired in the fall of2005, prior to the project being shutdown for winter, to allow the
<br />reservoir to be operational in 2006. The only remaining construction item to be completed is the
<br />replacement of the outlet works. The 24-inch gate and stem have been ordered and delivered to the
<br />Company. Construction of the outlet works is scheduled to occur in the fall of2006.
<br />
<br />DISCUSSION
<br />
<br />Due to additional work not prograntmed in the original cost estimate and unforeseen variations in
<br />cost for specific items during construction, the overall cost of the project has increased by
<br />approximately 21% or $30,000. At this time the Company is only requesting an increase of
<br />$25,250 to their existing loan. The remaining $5,000 in added construction costs are being covered
<br />by the Company. Therefore, the requested increase of $25,250 is only a 19.5% increase to their
<br />current loan amount of $129,785. Staff has inspected the improvements in the field and has
<br />reviewed the detailed cost SUlllffiary provided by the owner and finds the additional expenses to be
<br />justifiable, based on the additional work added to the project.
<br />
<br />The Beaver Reservoir Company is requesting an increase of $25,250 ($25,000 for project costs and
<br />$250 for a 1 % origination fee), to their existing loan amount of $129,785. The total amended loan
<br />amount for Beaver Reservoir Company would be $155,035 (153,500 for project costs and $1,535
<br />for a 1% origination fee), at their present interest rate of 2.5 % for 30-years. The new annual
<br />payment will be $8,148, which includes the 10% reserve requirement. The Beaver Reservoir
<br />Company's current loan of $129,785 has an annual payment of $6,820, which includes the 10%
<br />reserve requirement.
<br />
<br />The Company's financial ratios will remain in the strong category, for operating and debt service
<br />coverage ratios, and in the weak category for cash reserves, and annual operating costs per acre-
<br />foot.
<br />
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