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<br />Riverside Irrigation District
<br />May 16-17. 2006
<br />
<br />Agenda Item 11b
<br />
<br />Alternative 3, Purchase RRLC water at GASP auction - This alternative would give RID control
<br />of the GASP water through direct ownership, The 46 private rights of Riverside Reservoir were
<br />purchased at the GASP liquidation auction (a significant share of the historically used 62 GASP
<br />owned rights,) There would be no third party uncertainty with this alternative,
<br />
<br />Selected Alternative 3, Purchase RRLC water at GASP auction. RID plans to pursue
<br />Alternative #3, Only by purchasing the 46 private rights can RID ensure the control they are looking
<br />for. Alternative #3 prevents third party uncertainty and gives RID perpetual control of the water,
<br />
<br />The Total Project cost is estimated to be:
<br />
<br />1,
<br />2,
<br />3,
<br />
<br />Planning and Engineering
<br />"Bridge" Financing Cost
<br />Water Purchase
<br />TOTAL
<br />
<br />$ 500
<br />5.000
<br />1.632.500
<br />$1,638,000
<br />
<br />Schedule - Following the GASP auction on February 9, 2006, RID closed on the 46 Private Rights
<br />on February 23, 2006, using an interim loan from Bank of Colorado in Brush, This loan will be paid
<br />off using proceeds of the eWCB loan, as soon as the State contract process is complete,
<br />
<br />Appraisal- In accordance with CWCB Loan Policy #8 (Purchase of Water Rights), a written
<br />appraisal or opinion of value from a qualified water rights appraiser supporting the purchase price,
<br />must be submitted prior to disbursal of CWCB loan funds, In view of the fact that the water rights
<br />were purchased at a widely advertised public auction, and RID purchase prices were substantiated
<br />by prices paid by other bidders, no additional appraisal or opinion of value has been required,
<br />
<br />Financial Analvsis
<br />
<br />I
<br />
<br />The total estimated cost of the project is $1,638,000 and RID water usage is 100% agricultural,
<br />Staff is recommending a maximum loan amount of $1 ,450,000 (90% of the estimated project cost)
<br />for 30 years at an interest rate of 2,50%, RID will pay the additional 10% ($188,000) of the project
<br />cost from reserves,
<br />
<br />Table 1 is a summary of the financial aspects of the project A eWCB Loan of $1 ,450,000 would
<br />have an annual payment of $76,205 (including the 10% reserve requirement) at the loan terms of
<br />2,50% for 30 years, The CWCB loan will be repaid from increases in the assessment levy from $10
<br />per acre to a minimum of $13.40 per acre. The annual loan cost for the project will be $103,54 per
<br />acre-foot based on an annual delivery of the additional 736 acre-feet to RID irrigated lands,
<br />
<br />Table 1. Financial Summary
<br />
<br />
<br />$1,638,000
<br />147
<br />22,494
<br />$1,450,000
<br />$76,205
<br />$10
<br />$13.40
<br />$103.54
<br />
<br />I
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<br />Page 4 of 5
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