BOARD00763

• Board Meeting Date: 5/19/2003
• Description: CF Section - New Loans - Willow Heights Irrigation Company - Dual Water Rehabilitation
• Board Meetings - Doc Type: Memo

Willow Heights Irrigation Company, Inc.
May 19-20, 2003

Agenda Item 18<1

Table 1. FinanclaliSummary

$115,000
98
104
$103,500
$6,386
$65
$110
$24.85

: 257 ac-ft.

Creditworthiness: The WHIC has no existing long-te~m debt.

The CWCB loan will be repaid from increases in the base assessment rate from $65 to $110 per
share. This assessment was approved at the WHIC annual meeting, with authorization given to
raise assessments to $120 if necessary to implement the project.

Table 2 shows the Financial Ratios for the WHIC and indicates, strong to average ability to repay
the $103,500 loan, with the new assessment levels.

Table 2. FinancIal Ratios

Financial Ratio Without With project
the project Future Years
( Aver. 2001-021 2004+
Operating Ratio (revenue/expense)
weak: less than 100% 154% 260%
average: 1 00% - 120% (strong) (strong)
strano: oreater than 120% , ,
Debt Service Coverage Ratio ,
(revenues-expenses)/debt service i N/A 110%
weak: less than 100% (aver.)
average: 100% - 125%
strano: oreater than 125%
Cash Reserves to Current Expense :
weak: less than 50% 54% 103%
average: 50% - 100% (aver.) (strong)
strano: oreater than 100% ,
Annual Operating Cost per Acre-Ft. (257 AF)
weak: greater than $20 $17 $42
average: $10 - $20 ( aver.) (weak)
strano': less than $10 :

As security for the loan the WHIC will pledge assessment revenues backed by an assessment rate
covenant and the project itself, including water rights' and property owned. This security is in
compliance with CWCB Loan Policy #5 (Collateral). ;

Recommendation

Staff recommends a CWCB Small Project Loan, riot to exceed $103,500, to the Willow Heights
Irrigation Company, Inc., from the Construction :Fund, for rehabilitation of their existing dual
(secondary) irrigation water system. The recomn1ended term of the loan is 30 years and the

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