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Gypsum Loan Feasibility Outline CWCB Water Project Loan Program Page 32 of 33 connection, when a development is annexed to Gypsum, dedicating a water right is required or an in-lieu dedication fee is required to be paid on a per EQR basis. To the extent a development seeking annexation does not own water rights that can be stored or that aze adequate for Gypsum's use to serve such development, then in lieu fees for costs of storage are part of the annexation process. Given the current economy, while tap fees and water dedication fees collected in 2008 totaled $1,415,216, the enclosed estima.te for those fees is very conservative ($300,000 per year), reflecting the slowdown in real estate development. e. Financial Impacts. Gypsum generally raises monthly service fees on a 3-5 year cycle. The estimate provides for a 3% increase annually, which takes into account both the population growth and increased fees. In addition, tap fees and water right dedication fees are incrementally increased on a 3-5 year basis. Finally, additional revenues ma.y occur with short or long-term leases for agricultural use or other uses in order to pay for the project until a time when Gypsum may need all of the available water. Storage water prices in the Eagle River valley upstream of the confluence of the Eagle River and the Colorado River are currently estimated at $15,000/acre-foot for long term leases. f. TABOR (Taxpaver's Bill of Ri~ts, Issues. Gypsum has a properly established enterprise for all water projects, as allowed by the TABOR law. Please see the attached opinion letter from the Town's general legal counsel at Appendix 11. g. Collateral. Gypsum will pledge revenues/assessments on an annual basis for the life of the loan and project facilities/water rights. An appraisal was done for the previous owner of the LEDE water rights and is attached as Appendix 3. h. Sponsor Creditworthiness. i) Current schedule of rates or assessments. Please see Appendix 12 for a copy of Gypsum's Municipal Code, Article 13, which specifies monthly service rates, tap fees, and water right dedication fees. ii) Existing CWCB Obli a~ tion. Gypsum has an outstanding loan with CWCB, which will be paid in full by 2014. All payments have been made timely to CWCB, and the Financial Schedule Ana.lysis includes these debt payments in its calculations. iii) Bonds Payable - CWRPDA. In 1994, the Town issued $715,000 of bonds through the Colorado Water Resources and Power Development Authority (CWRPDA). The note payable to CWRPDA has interest rates ranging from 4.85% to 5.875% and calls for monthly payments in varying amounts through 2014. Prepayments on the loan may be made, at the option of the Authority, upon