C150374 Approval Letter

• Contract/PO #: C150374
• Contractor Name: Boulder and Larimer County Irrigation and Manufacturing Ditch Company
• Contract Type: Loan
• Water District: 4
• County: Boulder
• County: Larimer
• Loan Projects - Doc Type: Approval Letter

Boulder and Larimer County Irrigating and Manufacturing Company Agenda Item 8f
October 18, 2013 (Updated October 21, 2013)
Page 4 of 5
Schedule: Construction of the Project is expected to occur between October of 2013 and March of
2014.
Financial Analysis
Table 3 provides a summary of the Project's financial aspects. The first three years of the loan will
be assessed a 0% interest rate. The remaining term of the loan will be assessed a blended interest
rate of 1.90% with the principal amortized over 27 -years (Ownership: 81 % Agriculture, and 19%
Middle- Income Municipal). While the preliminary Project cost estimate is $305,000, the Company
shareholders approved a maximum loan amount of $200,000. The additional Project funds will
come from a combination of special assessment and/or grants.
Staff is recommending an exemption to Financial Policy 411 to allow for 100% funding of eligible
Project costs.
TABLE 3: FINANCIAL SUMMARY
Company's Portion of the Total Project Cost
$305,000
CWCB Loan Amount (invoices will be paid at 100% up to this amount)
$200,000
CWCB Loan Amount (Including 1% Service Fee)
$202,000
CWCB Annual Loan Payment
$9,633
CWCB Loan Obligation (Including 10% Reserve)
$10,596
Number of Shares
1,000
Annual Cost Per Share for Loan (with Reserve Account)
$10.60
Current Assessment per Share
$14
Future Assessment per Share
$114*
*Note: The future assessment is in excess of the Project cost per share. This increase is to help fund
the difference in the total Project cost versus the CWCB loan amount.
Creditworthiness: The Company has no existing debt.
TABLE 4: FINANCIAL RATIOS
Collateral: As security for the loan, the Company will pledge its assessment revenues backed by a
rate covenant and the Project itself (Boulder and Larimer Diversion Structure). This is in
compliance with the CWCB Financial Policy #5 (Collateral).
Future
Financial Ratio
Past 2 Years
w/ Project
Operating Ratio (revenues /expenses)
160%
117%
(Strong)
(Average)
weak: <100% vera e: 100=1201/o - strop : >1200 /
$48K/$30K
$48K/$41K
Debt Service Coverage Ratio
164%
(revenues- expenses) /debt service
N/A
(Strong)
(No ex. Debt)
$48K -$30K
weak: <100% vera e: 100 % - 120% strop : >120%
$11K
Cash Reserves to Current Expenses
167%
122%
(Strong)
(Strong)
weak: <50% vera e: 50% - 100% trop : >100%
$50K/$30K
$50K/$41K
Annual Operating Cost per Acre -Foot (4,500 AF)
$6.67
$9.11
eak: >$20 vera e: $10 - $20 strop : <$10
(Strong)
(Strong)
$41K/4.5K AF
$30K/4.5K AF
Collateral: As security for the loan, the Company will pledge its assessment revenues backed by a
rate covenant and the Project itself (Boulder and Larimer Diversion Structure). This is in
compliance with the CWCB Financial Policy #5 (Collateral).