CT2016-1987 Approval Letter

• Contract/PO #: CT2016-1987
• Contractor Name: Fort Lyon Canal Company
• Contract Type: Grant/Loan Combo
• Loan Projects - Doc Type: Approval Letter

Fort Lyon Canal Company Agenda Item 23a
September 15-17, 2015 Board Meeting(Updated September 18, 2015)
Page 7 of 7
CWCB Loan Program
Financial Analysis
Company shares are held by 99% or more agricultural use owners and less than 1% of commercial and
municipal owners. Blending this mix of users under the current interest rates, the Company qualifies
for a 1.75% interest rate for a 30-year term.
TABLE 4: FINANCIAL SUMMARY
Total Project Cost $2,188,000
Borrowers Contribution (3% of Project Cost) $75,000
WSRA Statewide Grant (21% of Project Cost) $450,000
WSRA Arkansas Basin Grant (2% of Project Cost) $50,000
CWCB Loan Amount $1,613,000
CWCB Loan Amount (Including 1% Service Fee) $1,629,130
CWCB Annual Loan Payment $ 70,264
CWCB Annual Loan Obligation (including reserve account) $ 77,290
Annual Loan Obligation per share (93,989 Shares) $0.82
Current Assessment per share $22.50
Project cost per acre-foot (221,000 AF) $9.90/AF
Creditworthiness: The Company's current assessments are not expected to be increased significantly
in the 2016 water year. The Company carries no existing debt.
TABLE 5: FINANCIAL RATIOS
Future
Financial Ratio Past Years w/ Project
Operating Ratio (revenues/expenses) 126% 119%
weak: <100% - average: 100% - 120% - strong: >120%1 (strong) (average)
I $1.65M / $1.31M $1.65M / $1.39M
Debt Service Coverage Ratio 438%
(revenues-expenses)/debt service NA (strong)
weak: <100% - average: 100% - 120% - strong: >1201 ($1.65M
$1.31M) / $77K
Cash Reserves to Current Expenses 53% 64%
weak: <50%I - average: 50% - 100%1 - strong: >100%1 (average) (average)
$695K / $1.31M $881K / $1.39M
Annual Operating Cost per Acre-Foot Diversions (221,000 AF) $5.93 $6.28
(weak: >$20 - average: $10 - $20 - strong: <$1 (strong) (strong)
$1.31M / 221K $1.39M / 221K
Collateral: As security for the loan, the Company will pledge its assessment revenues backed by an
assessment covenant and the project itself (Horse Creek Flume and all appurtenances). This is in
compliance with the CWCB Financial Policy#5 (Collateral).
cc: Amy Van Horn, Fort Lyon Canal Company
Susan Schneider/Jennifer Mete, Colorado's Attorney General Office
Attachment: Water Project Loan Program - Project Data Sheet