C150329 Approval Letter

• Contract/PO #: C150329
• Contractor Name: La Veta, Town of
• Contract Type: Loan
• Water District: 2
• County: Huerfano
• Loan Projects - Doc Type: Approval Letter

STATE OF COLORADO
Colorado Water Conservation Board
Department of Natural Resources
1313 Sherman Street, Room 721
Denver, Colorado 80203
Phone: [phone]
Fax: [phone]
www.cwcb.state.co.us
DATE: January 13, 2012 (Updated January 31, 2012)
SUBJECT: Agenda Item 26a, January 23 -24, 2012 Board Meeting
Finance Section — Construction Fund - New Loan
Town of La Veta — North Lake Dam Rehabilitation Project
Introduction
The Town of La Veta (Town) is applying for a loan for the North Lake Dam Rehabilitation Project
(Project). The purpose of the Project is to rehabilitate the Town's North Lake Reservoir (North
Lake), to remove the 2.5 -foot restriction imposed by the State Engineer's Office (SEO). The loan
request is for 90% of the estimated $410,000 total cost of the Project. See attached Project Data
Sheet for a location map and project summary.
Staff Recommendation (Board approved staff recommendation on January 24, 2012)
Staff recommends the Board approve a loan, from the Construction Fund, not to exceed $372,690
($369,000 for project costs and $3,690 for the 1% Loan Service Fee) to the Town of La Veta, acting
by and through its Water Enterprise, for the North Lake Dam Rehabilitation Project. The loan
terms shall be 30 years at the low - income municipal restricted reservoir interest rate of 3.00% per
annum. Security for the loan shall be in compliance with CWCB Financial Policy #5.
Background
The Town is located in Huerfano County, along the Cucharas River (River) and the foothills of the
Sangre De Cristo mountain range in southeastern Colorado. Raw water diverted from the River is
the primary source for the Town's municipal water supply. North Lake is one of two reservoirs the
Town utilizes for raw water storage. The Town is dependent on storage to supplement river flows
during drought conditions and periods of low flow in the River.
On March 4, 2011, growing concerns over the safety of the North Lake dam resulted in the SEO
issuing the Town a restriction order to lower the North Lake water level 2.5 -feet below its normal
storage elevation. The primary concerns were outlet pipe deterioration, seepage on the downstream
Interstate & Federal • Watershed & Flood Protection • Stream & Lake Protection • Finance
Water Information • Water Conservation & Drought Planning • Water Supply Planning
John W. Hickenlooper
Governor
TO: Colorado Water Conservation Board Members
Mike King
DNR Executive Director
FROM: Ryan Edwards, P.E., Project Manager/_M&
Kirk Russell P.E. Chief
> > f
Jennifer L. Gimbel
CWCB Director
Finance Section
DATE: January 13, 2012 (Updated January 31, 2012)
SUBJECT: Agenda Item 26a, January 23 -24, 2012 Board Meeting
Finance Section — Construction Fund - New Loan
Town of La Veta — North Lake Dam Rehabilitation Project
Introduction
The Town of La Veta (Town) is applying for a loan for the North Lake Dam Rehabilitation Project
(Project). The purpose of the Project is to rehabilitate the Town's North Lake Reservoir (North
Lake), to remove the 2.5 -foot restriction imposed by the State Engineer's Office (SEO). The loan
request is for 90% of the estimated $410,000 total cost of the Project. See attached Project Data
Sheet for a location map and project summary.
Staff Recommendation (Board approved staff recommendation on January 24, 2012)
Staff recommends the Board approve a loan, from the Construction Fund, not to exceed $372,690
($369,000 for project costs and $3,690 for the 1% Loan Service Fee) to the Town of La Veta, acting
by and through its Water Enterprise, for the North Lake Dam Rehabilitation Project. The loan
terms shall be 30 years at the low - income municipal restricted reservoir interest rate of 3.00% per
annum. Security for the loan shall be in compliance with CWCB Financial Policy #5.
Background
The Town is located in Huerfano County, along the Cucharas River (River) and the foothills of the
Sangre De Cristo mountain range in southeastern Colorado. Raw water diverted from the River is
the primary source for the Town's municipal water supply. North Lake is one of two reservoirs the
Town utilizes for raw water storage. The Town is dependent on storage to supplement river flows
during drought conditions and periods of low flow in the River.
On March 4, 2011, growing concerns over the safety of the North Lake dam resulted in the SEO
issuing the Town a restriction order to lower the North Lake water level 2.5 -feet below its normal
storage elevation. The primary concerns were outlet pipe deterioration, seepage on the downstream
Interstate & Federal • Watershed & Flood Protection • Stream & Lake Protection • Finance
Water Information • Water Conservation & Drought Planning • Water Supply Planning