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<br />~ <br /> <br />., <br /> <br />., <br /> <br />e <br /> <br />e <br /> <br />e <br /> <br />Proposed Proiect <br /> <br />The Fortune Reservoir site is located about Y2 mile northwest of the intersection of Highway 72 <br />and Indiana Street in the City of Arvada. The site encompasses about 250 acres with no existing <br />structures. The proposed dam is a lOS-foot high, earth embankment structure with a crest length <br />of 5,000 feet impounding a reservoir with a capacity of about 9,000 acre-feet. The total cost of <br />the project is estimated at $21,748,000 as summarized by major project elements in Table 2. The <br />cost per acre-foot of reservoir capacity is about $2,400 which is quite favorable. <br /> <br />Table 2. Fortune Reservoir Cost Summary <br /> <br />Item Estimated Cost <br />Land at reservoir site $3,285,000 <br />Project management 100,000 <br />Engineering 300,000 <br />Pipeline 3,000,000 <br />Reservoir and spillway costs 15.062.852 <br />Total $21,747,852 <br /> <br />Impacts from the project are expected to be minimal; there are no existing structures and no road <br />relocations are needed. Environmental studies were conducted with the involvement of the <br />Colorado Department of Public Health and Environment (CDPHE) and the Corps of Engineers. <br />The Corps issued a letter in November 1996 stating that no federal permits will be required for <br />the proj ect. <br /> <br />Financial Summarv <br /> <br />The company's financial condition appears strong at the present time. Table 3 summarizes some <br />key financial indicators based on information in the Company's annual reports for the years 1996 <br />to 1998. All of the indicators in Table 3 are strong per the Board's adopted creditworthiness <br />policy with the exception of Cash Reserves to Current Expense. Cash reserves are expected to <br />vary in the next few years but do not appear to be a problem during the period of debt retirement. <br />Tap fees amount to only a very minor part of total revenues. Total current long-term debt is $4.1 <br />million. <br /> <br />Table 3. Financial Indicators <br /> <br />Item 1998 1997 1996 <br />Operating Ratio (1) 1.28 1.25 1.29 <br />Debt Service Coverage (2) 1.61 2.44 3.14 <br />Debt per Tap $210 $176 $226 <br />Cash Reserves to Current Expense 0.26 0.33 0.24 <br /> <br />(1) Operating revenue/( operating expense - depreciation) <br />(2) (Operating revenue-depreciation)/debt service <br /> <br />3 <br />