Animas -La Plata Water Marketing Supply and Demand Study
<br />Section 2
<br />other alternatives than those listed below, but the study resources limited the number of alternatives
<br />that could be explored within this study.
<br />Alternatives for payment for the annual Fixed OM &R costs include:
<br />Fixed OM &R Alternative I State assumes full responsibility for payment of fixed OM &R costs:
<br />There are two variations for the State assuming full responsibility of Fixed OM &R costs which
<br />include the State seeking an annual appropriation to pay the Fixed OM &R costs less amounts that
<br />would be billed to entities using a portion of the State's allocation, either sold or leased to them.
<br />Table 2.5 illustrates potential OM &R costs based on amount of water purchased.
<br />Table 2.5. State of Colorado Purchase,
<br />Amount Purchased
<br />Annual Fixed OM&R and Variable Costs
<br />Annual Fixed OM &R Cost
<br />Variable Cost
<br />AF
<br />Capital Cost
<br />($ 3475 /AF)
<br />For Amount Purchased
<br />(%of Total Projecy
<br />At Start Up
<br />$610,000.
<br />(%•$610,000)
<br />Full Operation
<br />$680,000.
<br />( %'$680,000)
<br />Pump Amount Purchased
<br />($18 /AF)
<br />1,560 (IGA Minimum)
<br />$5,421,547
<br />1.6%
<br />$9,760
<br />$10,880
<br />$28,080
<br />2,000
<br />$6,950,701
<br />2.0%
<br />$12,247
<br />$13,652
<br />$36,000
<br />3,120
<br />$10,843,093
<br />3.1%
<br />$19,105
<br />$21,297
<br />$56,160
<br />3,180
<br />$11,051,614
<br />3.2%
<br />$19,472
<br />$21,707
<br />$57,240
<br />3,400
<br />$11,816,191
<br />3.4%
<br />$20,819
<br />$23,208
<br />$61,200
<br />3,453
<br />$12,000,385
<br />3.5%
<br />$21,144
<br />$23,570
<br />$62,154
<br />10,460
<br />$36,352,165
<br />10.5%
<br />$64,050
<br />$71,400
<br />$188,280
<br />The second variation to this alternative is to have the State establish a permanent escrow account
<br />sufficient to generate the required revenues on an annual basis to pay the Fixed OM &R costs less
<br />amounts billed to entities using a portion of the State's allocation. The size of the corpus in the
<br />escrow account will depend on the rate of return obtainable. Table 2.6 illustrates how much
<br />income will be accrued at various interest rates. Note that Fixed and Variable OM &R Costs should
<br />be considered separately as pumping may not be required every year and the Variable OM &R Fund
<br />may cover any Variable OM &R costs.
<br />Table 2.6. Potential Accrual Incomes of
<br />Annual Interest Rate Starting Fund Amount
<br />N ($)
<br />an OM&R Escrow Fund
<br />Annual Income
<br />($)
<br />2.0
<br />$2,400,000
<br />$48,000
<br />$1,200,600
<br />$24,000
<br />$1,150,000
<br />$23,000
<br />3.01
<br />$3,000,000
<br />$90,000
<br />$2,400,000
<br />$72,000
<br />$1,200,000
<br />$36,000
<br />$1,150,000
<br />$34,500
<br />$1,000,000
<br />$30,000
<br />$800,000
<br />$24,000
<br />2 -13
<br />FINAL ALP Report_1_13_11_LL.Docx
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