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<br />Agenda Item 16c. <br />July 13-/4, /998 <br />Leroux Creek Water Users Association <br /> <br />It may still be possible to operate the system in 1998 and 1999 so that most of the water <br />can be delivered to the shareholders to some degree before and during construction. This <br />would mitigate an expected loss of revenue to the association, <br /> <br />. <br /> <br />The CWCB has several options to financially assist the LCWUA at this time. <br /> <br />· The CWCB may have the authority to revise the purpose, terms, and conditions of the <br />existing Construction Fund loan for $150,000 to rehabilitate and/or enlarge four <br />reservoirs provided it does not conflict with the language ofHB 95-1155. However, <br />the funds originally intended for another project, will be insufficient to evaluate <br />feasibility and cover all construction costs to rehabilitate the dam. <br /> <br />· The CWCB has the authority to make a direct construction loan from the Emergency <br />Infrastructure Repair Account in the Construction Fund. The amount of the loan is <br />limited to the available funds in the account. The Board must find that a delay would <br />cause undue financial hardship. <br /> <br />· The CWCB has the authority to make a direct construction loan for up to $100,000 <br />from the Small Project Account in the Construction Fund. However, this amount will <br />also be insufficient to evaluate feasibility and cover all construction costs to <br />rehabilitate the dam. <br /> <br />· The CWCB has the statutory authority to make loans for feasibility studies with out <br />going through the legislative process. The Guidelines currently provide that the <br />Board may participate in up to half the cost ofa feasibility study. <br /> <br />. <br /> <br />· The CWCB could make a small (say $5,000) grant for up to half the cost of preparing <br />the feasibility study from funds approved for "local water planning" from the <br />Operational Account of the Severance Tax Trust Fund for FY 1999. These grants are <br />intended to promote CWCB involvement in the smaller size feasibility studies which <br />cost up to about $10,000. <br /> <br />Each of the above options will involve various amounts oftime and effort on the part of <br />the borrower and the staff. <br /> <br />At the November 4, 1997 CWCB meeting, the Board adopted revised lending policies <br />and procedures (agenda item 15.a.) Item 4.ofthat memo states "For agricultural and <br />Low-Income Municipal borrowers, it is recommended that the percentage of the <br />allowable total costs for the planning, engineering design, and construction of a project <br />which may be financed by the Board be increasedfrom 75 percent to 90 percent." This <br />policy would apply to a loan to the LCWUA, allowing the CWCB to loan up to 90% of <br />eligible project costs. <br /> <br />. <br /> <br />4 <br /> <br />.-" <br />