CT2016-2794 Approval Letter - Laserfiche WebLink

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Lake McIntosh Reservoir Company Agenda Item 18b January 25-26, 2016 Board Meeting (Updated January 27, 2016) Page 4 of 5 obtained without also replacing 2,310 LF of the existing 48" RCP pipe. The majority of construction will occur through an open cut trench with the exception of portion that is located under Harvard Street and the Platte River Power Authority (PRPA) substation. The presence of the substation will require that approximately 150 LF be hand tunneled so the PRPA's conduits can remain in place. The cost associated with this alternative is $1,900,000 as shown in Table 2. TABLE 2: PROJECT COST Task COST Design Engineering $200,000 Permitting $100,000 Construction $1,200,000 Construction Management $100,000 Contingency $300,000 TOTAL $1,900,000 Permitting: The Company is in discussion with the US Army Corps of Engineers to determine if the project will be permitted through a Nationwide 3 Permit, of if it will qualify under the Agricultural Exemption. Additionally, City of Longmont permits will be required for impacts to Harvard Street as well as to bike paths, trails, and any underground utility lines. Schedule: Construction is planned to begin in summer 2016 and be completed by winter, prior to the 2017 irrigation season. Financial Analysis The Company qualifies for a blended interest rate of 2.70% for a 30-year term (Ownership: 28% Agricultural, 61% Mid Municipal, 9% High Municipal, 2% Commercial). Table 3 provides a summary of the Project's financial aspects. The Company's 10% contribution will come from design engineering expenses that have already been incurred and cash on hand. TABLE 3: FINANCIAL SUMMARY Total Project Cost $1,900,000 Borrowers Contribution (10%) $190,000 CWCB Loan Amount (90%) $1,710,000 CWCB Loan Amount (Including 1% Service Fee) $1,727,100 CWCB Annual Loan Payment $84,733 CWCB Annual Loan Obligation (1st Ten Years) $93,206 Number of Shares 2816 Annual Loan Obligation per Share $33/share Current Assessment per Share $0/share Future Assessment per Share $25/share Project Cost per Storage Capacity Preserved (2,476AF) $767/AF Creditworthiness: The Company has no existing debt. Income from the recreation lease has been sufficient to cover annual expenses and thus shareholders do not currently pay annual assessments. Prior to 2001, annual assessments were collected for this water through the Highland Ditch Company. Although not required by its By-Laws, the Company will obtain a shareholders resolution authorizing this loan in consideration of the need for new shareholder assessments.