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<br />, <br /> <br />- <br /> <br />e <br /> <br />e <br /> <br />. . <br /> <br />We estimate an additional $1.00 per share, for ten years, for every $10,000 over <br />the budget may need to be assessed each shareholder, We suggest that you refer 'to the <br />Beaver Reservoir Rehabilitation Feasibility Study prepared by Golder Associates, Inc. for <br />information regarding annual assessments, reserve accounts, loan payments and other <br />financial planning parameters associated with this project <br /> <br />By the time the project is complete, and the final costs determined, it will be too <br />late to include this request in the 1997 Construction Fund Bill. <br /> <br />A loan increase based on the CWCB authority to increase the original loan based <br />on a change in field conditions does not apply in this case because the problem is a labor <br />dispute rather than a change in field conditions. <br /> <br />Also, the current CWCB policy is to finance projects at a 75% level with the <br />remllining 25% cost being the responsibility of the project sponsor. Since the existing <br />loan is a 100% loan, the CWCB, when contemplating additional funning requests from <br />BRC, will be looking for a local cost share as well as credits to a "reserve account" as <br />prescnDed in the August 1995 Beaver Reservoir Rehabilitation Feasibility Study prepared <br />by Golder Associates, Inc., The original loan also did not provide for the costs associated <br />with the emergency 1995 sinkhole repairs which were eventually removed as part of the <br />1996 construction project <br /> <br />The CWCB may not look favorably on increasing the loan amount or deferment <br />of payments unless the BRC has already increased ass....sments. <br /> <br />Recommendation <br /> <br />Based on the above discussion of the options it is our recommendation the BRC, at its <br />earliest convenience: <br /> <br />· Impose the share 8$S('Ssments for the authorized loan as outlined in the above <br />referenced feasibility study. <br />· Inform the shareholders of the possibilities of future higher assessments. <br />· Establish a "reserve account" in order to accommodate future project cost <br />contingencies. <br />· Continue to work closely with the State Engineer's Office in monitoring spring <br />runoff. <br />· Investigate securing additional funds to cover all cost contingencies associated with <br />project completion, over the CWCB loan amount, through conventional bank <br />financing as soon as possible. <br />