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Feasibility Evaluation of the Arkansas Valley Pipeline <br />Water Works! Committee <br />July 2003 <br />Federal Funding Sources <br />A number of established funding sources at the federal level were evaluated, and three of them <br />appear to be directly applicable to the proposed Arkansas Valley Pipeline. The USDA Rural <br />Development Program appears to offer the largest dollar amount, having given recent grants <br />and/or loans in the amount of up to $19 million. In addition, the Rural Community Assistance <br />Corporation (RCAC) has awarded loans of as much as $6 million at a time in recent years. <br />Small grants are also available from the Economic Development Administration. <br />What are not included in the established federal funding sources are the legislated grant or loans <br />programs beyond these more traditional outlets. Under this alternative, specific legislation <br />would be drafted, probably by the Colorado senate and house delegations, which could provide <br />funding support, probably through a combination of grants and loans, for this project. An <br />example of this alternative would be the Gamson Diversion Project in North Dakota. Under the <br />Dakota Water Resources Act of 2000, a total of $200 million has been authorized for the <br />construction and operation of this extensive pipeline and impoundment system. Appropriations <br />from the federal government have amounted to $78 million thus far, supplemented with $50 <br />million from state coffers. The expressed federal intent is to fully fund construction and <br />operation costs of the pipeline system. The Bureau of Reclamation (BOR) is the lead agency in <br />administering this program through the Garrison Diversion Conservancy District. <br />Preliminary Evaluations <br />As anticipated, the financial funding for this project is going to be an extraordinary challenge. <br />Whereas, up to $50 million in loan monies might optimistically be available from the various <br />State of Colorado agencies, the Valley's local government interest and ability to borrow that <br />amount of money is questionable unless customer tap fees and user charges can support the debt <br />in the form of revenue bonds. Even so, considerable monies must be forthcoming from other <br />funding sources, and they must be primarily in the form of grants. Established water system <br />funding programs at the federal level might amount to $20 million or more, but these monies, <br />supplemented by the state funds and identified local borrowings, will not be sufficient to move <br />this project forward, at least in the present full development configuration. <br />This leaves few remaining options to fill the funding shortfall. First, specific legislation passed <br />and signed into law at the federal level could get the project built, but the commitment to obtain <br />such funding must be formidable. Secondly, at least one, large, unidentified customer might be <br />found that needs high quality water supply in sufficient volume to become a major project <br />contributor. A power plant would be an example. Finally, new public jurisdictions could be <br />brought in as partners, and they would need to be relatively large and well financed. Further <br />GEI Consultants, Inc. ~ ~ 01284 03-07-21 feasibilty report executive summary <br />