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Southeastern Colorado Water Conservancy District Agenda Item 13a <br /> July 20-21, 2016 Board Meeting(Updated July 22, 2016) <br /> Page 5 of 6 <br /> Creditworthiness: The District's water activity enterprise has no existing debt. <br /> TABLE 3: FINANCIAL RATIOS <br /> Financial Ratio Past 2 Years Future <br /> w/ Project <br /> Operating Ratio (revenues/expenses) 100% 100% <br /> weak: <100% - average: 100% - 120% - strong: >120% (Average) (Average) <br /> $2.17M/$2.17M $3.63M/$3.62M <br /> Debt Service Coverage Ratio 101% <br /> (revenues-expenses)/debt service NA (Average) <br /> weak: <100% - average: 100% - 120%I- strong: >1201 ($3.63M $2.77M) <br /> $0.85M <br /> Cash Reserves to Current Expenses 29% 17% <br /> weak: <50%I- average: 50% - 100% - strong: >100% (Weak) (Weak) <br /> $0.63M/$2.17M $0.63M/$3.62M <br /> Collateral: As Security for this loan, the District, acting by and through its water activity enterprise, <br /> will pledge power revenues and will provide annual financial reporting. A rate covenant is not <br /> applicable as the PPA controls the purchase price of the power and it has been set at a price sufficient <br /> to cover expenses and debt service. However, because of the lack of a rate covenant, this will be a <br /> variance from the CWCB Financial Policy#5 (Collateral). <br /> Original AVC Loan Conditions <br /> In addition to the standard contracting provisions of the CWCB, the 2006 CWCB Loan approval <br /> contained 9 additional conditions. Table 4 provides a summary of these conditions and a status report <br /> specific to the hydropower development phase. <br /> TABLE 4: LOAN CONDITIONS STATUS REPORT <br /> Summary of Additional Loan Conditions Status <br /> 1. Final Feasibility Study: A feasibility study is The June 1, 2016 "Pueblo Dam Hydroelectric <br /> required to be approved prior to the execution of Project Loan Feasibility Study" satisfies this <br /> a State loan contract. condition for the hydropower development phase. <br /> 2. Participant Funding Agreements: Alt proposed This condition is not applicable to this phase of <br /> Participant Funding Agreements shall be executed the AVC as there are no other participants <br /> prior to the execution of a State loan contract. providing funding for the hydropower <br /> development phase. <br /> 3. Conservation Plans: A CWCB approved Water This plan was approved by the CWCB in February <br /> Conservation Plan is required for all "covered 2013. <br /> entities" prior to the execution of a State loan <br /> contract <br /> 4. Federal Authorization: No State loan contract In 2009, the 111`h Congress approved a 65% <br /> shall be executed until Federal legislation to federal/35% local cost share in Public Law 111-11 <br /> authorize the federal/local cost-share for the AVC section 9115. <br /> has been approved. <br />