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Town of Hillrose <br />July 11-12, 2007 <br />Agenda Item 15d <br />the estimated project cost) for 30 years at an interest rate of 3.00%. The Town wili pay the <br />additional $5,500 of the project cost from Town reserves. <br />Table 1 is a summary of the financial aspects of the project. A CWCB loan of $49,500 would <br />have an annual payment of $2,778 (including the 10% reserve requirement) at the loan terms of <br />3.00% for 30 years. The annual loan cost far the project will be $ 287 per acre foot of dry-year <br />pumping allocation produced from the purchased shares. The Town will add an new surcharge <br />of $1.75 to pay the proposed CWCB loan. <br />Table 1. Financial Summary <br />Pro'ect Cost $55,000 <br />Number of Residents 270 <br />Number of Water Ta s 132 <br />CWCB Loan Amount 30 ears) $49,500 <br />CWCB Loan Pa ment includes 10% reserve - Be in 2008 $2,778 <br />Current Monthl Water Rate Avera e incl. DWRF loan $55.40 <br />Future Monthl Water Rate $57.15 <br />Monthl Per Ta Cost of CWCB Loan $1.75 <br />Annual Loan Cost er Acre-Foot min. of 9.675 AF um allocation $287 <br />Credifworthiness: In July 2004, the Town, through its Water Enterprise Fund, obtained a <br />CWCB loan for $69,311 to purchase surface water rights to use for well augmentation, with an <br />annual payment of $3,768.53 through 2035. Also, the Town recently closed on a$995,097 <br />loan (0% interest) with the Colorado Water Resources and Development Authority, with an <br />annual payment of $33,170 through 2037. In addition, the Town will be taking out a$44,000 <br />loan with USDA Rural Development (4.375% for 40 years) with an annual payment of $2,503. <br />CWCB will require parity with the CWRPDA and USDA-RD loans. The Town has obtained <br />temporary financing for $48,000 for the proposed water rights purchase from the Bank of <br />Colorado, which will be paid off with the CWCB loan. <br />Table 2 shows the financial ratios for the Town, and indicates average ability overall to repay <br />the $49,500 CWCB loan, with the proposed $1.75 increase in monthly water rate for the new <br />loan. <br />Current and proposed monthly water rates are: <br />Base User Rate $30.00 <br />Existing CWCB Loan 2.55 <br />DWRF Loan 22.85 <br />Proposed CWCB Loan 1.75 <br />TOTAL $57.15 <br />Table 2. Financial Ratios <br />Financial Ratio Without With projecf <br /> the project Future Year <br /> Aver. 2005-06 2008+ <br />Operating Ratio (revenue/expense) <br />weak: less than 100% 169% 183% <br />average: 100% - 120% (St~Ong) (St~Of1g) <br />strong: greater than 120% <br /> 56K/33K 94W51.5K <br />4of6 <br />