Board Meeting 03/03/1983

• Board Meeting Date: 3/3/1983
• Description: Minutes, Agenda, Memorandums March 3, 1983
• Board Meetings - Doc Type: Meeting

District $ 500,000
CWCB 6,000,000
Development Authority 5, 500,000
(or other source)
Total $12,000,000
The District is further proposing that the $5,500,000 from the
Colorado Water Resources and Power Development Authority
(Development Authority) or other source (as yet unidentified) be
a 10 year loan at 5 percent interest, with interest only being
payable until the tenth and final year of the loan. The
District's rationale is that a market for the presently unspoken
for yield of the reservoir ( i.e. , at least 15,000 acre-feet) will
materialize within 10 years, thereby enabling the District to
refinance the proposed loan from the Development Authority.
Were the above proposed financing to be made available at
the assumed interest rate of 5 percent (both for CWCB and
Development Authority funds) , the annual repayments required of
the District during the first 9 years of the projects's operation
would be as follows :
CWCB $349,680
Development Authority 275,000
(or other source)
Total $624,680
This compares to revenues from the sale of water to Colorado-Ute
of only $350,000 per year and perhaps another $50,000 per year
from the proposed sale of 1 ,000 acre-feet for municipal use and
4 ,000 acre-feet for irrigation (the latter water will probably
not sell for more than $5-$10 per acre-foot) .
In short, revenues from the sale of water will not be
sufficient to cover annual payments. Thus, the District's ad
valorem tax revenues will have to be pledged for repayment to
make-up the difference.
With respect to the District 's proposal that the Development
Authority loan $5,500,000 to the District, the Water Conservation
Board wishes to emphasize that it has no position on this
matter. Participation in the financing of projects is a matter
which is entirely at the sole discretion of the Development
Authority pursuant to 37-95-107, CRS 1973, as amended.
Furthermore, the General Assembly must authorize the Development
Authority to proceed with the consideration of a project before
it can act .
Discussion
The proposed Stagecoach Reservoir project presents a number
of difficult issues. First, it exemplifies the problem of a
-3-