C150252 Feasibility Study - Laserfiche WebLink

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CREDIT WORTHINESS T'he HID currently has four outstanding loans as previously deseribed. One loan will mature and be paid off in 2008 and a second in 2009. The Company has significant capital assets and have liquid assets of over $1,800,000. As shown in Table 9, the~IID does not have to significantly raise the assessments and could tap into their cash reserves to make the yearly payment without significantly affecting their financial position. ALTERNATIVE FINANCING CONSIDERATIONS The HID has investigated alternative financing with the Colorado East Bank located in Keenesburg, Colorado. The bank has indicated they would consider a loan for the HID after review of their financial status. They would consider a loan with a 30 year term, fixed rate for 5 years, at 7.25% interest rate. Using the 7.5% interest rate for 30 years, the yearly loan payment would increase from $103,329 to $178,706. Included in Appendix D is a letter from the bank stating their position. OPINION OF FEASIBILITY There do not appear to be significant roadblocks which would keep the Henrylyn Irrigation District from successfully completing this project. The project does not significantly raise the level assessments from the current level of $18 per acre. Following is a cost to benefit analysis of the project. Total Proj~ect Cost including interest $103,329 x 30 years + $261,927 = $ 3,361,797 Total Cost per Acre of land served $ 3,361,797 = 32,750 acres = $103 From 1968 to 2005, the average water delivery out of Horsecreek Reservoir was 11,197 acre-feet and out of Prospect reservoir was 3,849 acre-feet for a total of 15,046 acre-feet. Based on the average deliveries: Cost Per Acre-foot Of Water For An Average Year $ 3,361,797 = (15,046 x 30 yrs) _ $7.45 The current value of the water is expected to be in the range of $6,000 to $8,000 per acre foot. This Horsecreek & Prospect Reservoirs - 06.014 Henrylyn Irrigation District Page 20