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<br />Morgan County Quality Water District - Purchase of the Hay Gulch Well Field <br /> <br />In HB 95-1155, the General Assembly authorized a Construction Fund loan of $4.26 million for the <br />Morgan County Quality Water District to participate in the Southern Water Supply Project. <br />However, final approval of the loan was contingent upon satisfactory completion of the draft <br />feasibility study with a detailed analysis of at least one viable alternative to the Southern Water <br />Supply Project (SWSP). <br /> <br />In January 1995, the District entered into negotiations, for a second time, with the Northern Trust <br />Company of Chicago for the purchase of the Hay Gulch Wells. The Hay Gulch Wells are the <br />District's main existing source of supply. The District and the Northern Trust Company reached a <br />mutually acceptable price of$3,132,500. The purchase includes a section of land in the Hay Gulch <br />basin, three wells currently leased by the District, and a perpetual right to water from a fourth well <br />for a total yield of 1,380 acre-feet per year. <br /> <br />The District completed the revisions to the feasibility study in September 1995. A total of five <br />alternatives were evaluated in the feasibility study. With a better offer for the well system, at least <br />two alternatives were found to be less expensive than participation in the SWSP. The least-cost <br />alternative was based on continued leasing of the wells with a total 30-year present worth cost of <br />$6,409,000, The second least expensive alternative was the purchase of the Hay Gulch Wells with <br />a 30-year present worth cost of$7,147,000. While the purchase of the wells is not the least-cost <br />alternative, it would allow the District to have a much greater degree of certainty and control with <br />regard to this source as opposed to the current leasing arrangement. <br /> <br />The acquisition of the Hay Gulch Wells will be one part of an overall program of improvements to <br />and expansions of the system estimated to cost about $6.5 million over the next 30 years. The <br />District is now requesting a 30-year loan for $3.0 million, or $1.26 million less than the previous <br />authorization. <br /> <br />I <br />I <br />I <br />I <br />I <br />I <br />I <br />I <br />I <br />I <br />I <br />I <br />I <br />I <br />I <br />I <br />I <br />I <br />I <br />