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Fort Morgan Reservoir and Irrigation Company <br />September 9, 2009 (UPDATED September 16, 2009) <br />Page 6 of 6 <br />TABLE 4 <br />FINANCIAL RATIOS <br />Agenda Item 7a <br /> Future <br />Financial Ratio Past 2 Years ~,/ project <br />Operating Rario (revenues/expenses) 114% 100% <br /> (Average) (Average) <br />weak: <100% - avera e: 100% - 120% - stron : >120°/ $599K/$526K $632K/$632K <br />Debt Service Coverage Ratio 355% 100% <br />(revenues-expenses)/debt service (Strong) (Average) <br /> $599K~96K/ $632K-496K/ <br />weak: <100% - avera e: 100% - 120% - stron : >120°/ $29K $136K <br />Cash Reserves to Current Expenses 41 % 34% <br /> (Weak) (Weak) <br />weak: <50% - avera e: 50% - 100% - stron : >100°/ $216K/526K $216K/632K <br />Annual Operating Cost per Acre-Foot (37,058 AF) $14 $17 <br />`,eak: >$20 - avera e: $10 - $20 - stron : <$1 <br />~ (Average) <br />26K/37K AF <br />$ (Average) <br />$632/37K AF <br /> 5 <br />Collateral: As security for the loan, the Company will pledge its assessment revenues backed <br />by a rate covenant and annual financial reporting. This is in compliance with the CWCB <br />Financial Policy #5 (Collateral). <br />Staff Recommendation (Board approved staff recommendation on September 15, 2009) <br />Staff recommends the Board approve a loan not to exceed , , , , <br />,.~~., .,.,a Q i ~ nnn c.. +~,o , o~ T„ r ear,;,.o ~oo~ to the Fort Morgan Reservoir and Irrigation <br />, <br />Company to construct the Pipeline Project from the Construction Fund. The loan terms shall be <br />30 years at a blended rate of 2.9% per annum. Security for the loan shall be in compliance with <br />CWCB Financial Policy #5. Loan approval amount is $1,494,800 ($1,480,000 for project <br />costs and $14,800 for the 1% Loan Service Fee). Loan amount was reduced (per the <br />condition noted in following paragraph) because the Company was awarded $420,000 for <br />project costs from the Water Supply Reserve Account statewide funds. <br />Staff further recommends that if the Fort Morgan Reservoir and Irrigation Company is awarded a <br />grarit from the Water Supply Reserve Account statewide funds, this CWCB loan approval shall be <br />reduced by such amount. <br />Staff also recommends that the following documents be submitted to the CWCB prior to <br />disbursement of funds: 1) an executed copy of the operating agreement between Ft. Morgan <br />Reservoir and Irrigation Company and Groves Farms; 2) documentation that all necessary <br />easements from neighboring landowners along the pipeline route have been obtained. <br />cc: Cynthia Vassios, Office Manager, Fort Morgan Reservoir and Irrigation Company <br />Susan Schneider, AGO <br />Attachment: Project Data Sheet <br />