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DNR COLORADO 1313 Sherman Street John Hickenlooper, Governor <br /> Denver, CO 80203 <br /> CO / Colorado Water Robert Randall, DNR Executive Director <br /> Conservation Board p (303) 866-3441 <br /> Department of Natural Resources F(303) 866-4474 James Eklund, CWCB Director <br /> TO: Colorado Water Conservation Board Members <br /> FROM: Jonathan Hernandez, P.E., Project Manager <br /> Kirk Russell, P.E., Finance Section Chief \4Gt� <br /> DATE: July 20-21, 2016 Board Meeting (Updated July 22, 2016) <br /> AGENDA ITEM: 13a. Water Project Loans <br /> Southeastern Colorado Water Conservancy District - Arkansas Valley Conduit <br /> Phase One, Pueblo Dam Hydroelectric Project <br /> Introduction <br /> The Southeastern Colorado Water Conservancy District (District), acting by and through its water <br /> activity enterprise, is applying for a loan for the Arkansas Valley Conduit Phase One, Pueblo Dam <br /> Hydroelectric Project (Project). The Arkansas Valley Conduit (AVC) is a planned pipeline extending <br /> from Pueblo Reservoir to the City of Lamar. The purpose of the AVC is to help the Lower Arkansas River <br /> Basin communities provide a safe and reliable water supply to replace their dependence on <br /> contaminated groundwater. Phase One of the AVC project is the development of hydropower on Pueblo <br /> Dam and is the focus of this loan request. The Project will provide a needed revenue source to help <br /> offset AVC cost through the construction of a 7.5 megawatt facility located on the Pueblo Dam River <br /> Outlet. The facility will provide an average of 28,000,000 kWh of clean renewable energy (enough to <br /> power approximately 3,300 homes). The total Project cost is estimated to be $19,060,000. The District <br /> is requesting a loan from CWCB for approximately 90% of the Project Cost. See attached Project Data <br /> Sheet for a location map and Project summary. <br /> The District was approved for a $60,600,000 loan for the AVC project at the November 2006 CWCB <br /> Board Meeting. That loan was authorized in the 2007 Projects Bill (SB07-122) and its authorization was <br /> extended to July 1, 2021 in the 2009 Projects Bill (SB09-125). As Phase One of the AVC project, this <br /> Project will use those loan funds reserved for the AVC project, leaving $43,207,800 reserved for the <br /> remaining phases of AVC. <br /> Staff Recommendation (Board approved staff recommendation on July 20, 2016) <br /> Staff recommends the Board approve a loan not to exceed $17,392,200 ($17,220,000 for Project costs <br /> and $172,200 for the 1% service fee) to the Southeastern Colorado Water Conservancy District, acting <br /> by and through its water activity enterprise, for costs related to the Arkansas Valley Conduit Phase <br /> One, Pueblo Dam Hydroelectric Project from the Severance Tax Perpetual Base Fund. The loan terms <br /> shall be 30 years at the hydroelectric interest rate of 2.0% per annum. Security for the loan shall be a <br /> pledge of power revenues. <br /> Staff further recommends that no funds be disbursed until the following contract conditions have been <br /> satisfied: <br /> 1) Execution of the Lease of Power Privilege <br /> 2) Execution of the Power Purchase Agreement <br /> Interstate Compact Compliance •Watershed Protection • Flood Planning Et Mitigation • Stream Er Lake Protection <br /> Water Project Loans a Grants•Water Modeling • Conservation 8 Drought Planning •Water Supply Planning <br /> '' /876.4' <br />