C150360 Feasibilty Study - Laserfiche WebLink

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Credit worthiness: East Mesa Water Company has no existing debt. Table 4 shows the Financial Ratios for the East Mesa Water Company and indicates average to strong ability to repay with the project in place. The East Mesa Water Company operates on assessments of the water users. For many years the Ditch Company has kept the assessments as low as possible as many of the users are just getting by. A major project like this could cause the failure of the ditch company and leave the water unused if loans and grants are not obtained. Table 4. Financial Ratios Financial Ratio Without the project With the project Operating Ratio (revenue/expense) Debit Service Coverage Ratio revenues -ex enses /debt service Cash Reserves to Current Expense Annual Cost per acre -foot 15,000 acre -feet diverted. Annual income at $15.00 per (1003 Shares) $15,045.00. Expenses run an average of $15,000.00per year. Alternative financing considerations: The East Mesa Water Company has investigated alternative financing sources. They have obtained an in -kind grant from the NRCS for engineering design and construction inspection. The Ditch Company has requested and are tentatively approved for a grants from Natural Resources Conservation Service, USDA, EQIP (Environmental Quality Incentive Program) Collateral: As security for the CWCB loan the East Mesa Water Company can pledge assessment income, water rights and the structure and pipeline itself. Economic Analysis The economic benefit of the project is considerable. The Mount Sopris Conservation District estimates the value of property affected to be $7.8 million (780 ac.X $10,000.00), within the 780 - acre service area. The short -term damage in the event of ditch failure to this area is loss of hay and pasture production and physical and environmental effects. Hay production loss alone would be almost $500,000 ( 780 ac. At 3 ton per acre times $200 per ton = $468,000.00 per year) the loss in land value and water value is unknown and may be incalculable. Social and Physical Impacts This project lies in the Crystal River Valley in the northern portion of Pitkin County and in the southern portion of Garfield County, Colorado. The Ditch is approximately 8 miles long, starting at diversion out of the Crystal River about 9 Miles south of Carbondale Colorado. The area is known locally as East Mesa and is located south of Carbondale, Colorado. Increased population, recreation and tourism are causing increased demands on water resources in the valley for both domestic uses and recreation uses. The water resources are having additional demands and uses put on them because of this growth.