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Louden Irrigating Canal and Reservoir Company Agenda Item 35b May 9,2014(Updated May 23,2014) Page 2 of 5 Background The Company serves approximately 2,180 irrigated acres in Larimer County near Loveland. Its diversion structure is located on the Big Thompson River just east of the canyon mouth and west of Loveland. In addition to agricultural users,the Cities of Loveland, Fort Collins, Windsor, and Greeley own Company shares. In total, there are 180 shareholders who irrigate farms, ranches, public parks, and golf courses. The Company's diversion structure consists of a concrete dam across the river connected to a concrete headgate structure with a sand gate and three headgates that regulate flow diverted into its ditch. During the unprecedented flood of September 2013 in the tributaries to the South Platte River, a significant number of diversion structures and dams along the river corridor were damaged, including the Company's river diversion. The ditch was diverting water as the September storm started. As the flood progressed, the headgates could not be safely reached for operations. Water overtopped the headgate structure by at least 4 feet resulting in damage to the headgate and ditch system. The first 3,000 feet of the ditch were totally filled with silt and debris. The ditch breached back to the river in two places, and undercutting caused slides that threatened the ditch. Upon post- flood inspection,the concrete headgate structure and dam remained structurally sound though debris removal and backfilling of undercut areas are required. While the concrete headgate structure remains usable,the steel headgates were damaged but are salvageable to allow the Company to use them for the 2014 irrigation season. Loan Feasibility Study Dale Leach, President of the Louden Irrigating Canal & Reservoir Company, with assistance from Walter Niccoli, P.E. with Telesto Solutions Inc., prepared the Loan Feasibility Study,titled "Emergency Loan Application and Feasibility Study," dated March 31, 2014. Telesto's As- Constructed Report titled"Louden Irrigation Canal 2013 Flood Repair"was included as an attachment to the feasibility study. The study was prepared in accordance with the CWCB guidelines. Borrower—Louden Irrigating Canal and Reservoir Company The Company is a mutual ditch and reservoir company and was incorporated in 1878. The Company's office is located in Fort Collins. It operates as a nonprofit corporation and is in good standing with the Colorado Secretary of State. The Company has issued 600 shares of stock. The Company's revenues are primarily derived from assessments charged on shares of stock owned by the stockholders. The Company's by-laws (2003)provide the Board of Directors with the authority to exercise the corporate powers of the company, and the general supervision over the company affairs. Assessments are set annually and are levied through a shareholder majority vote. The Board has the authority to sell stock upon which any assessment remains due and unpaid for a period of one year. At the February 2014 Annual Shareholders Meeting, the Company was authorized through a shareholder resolution to enter into a loan contract with CWCB for this Project, and to levy and collect assessments in an amount sufficient to pay the associated debt service.