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<br /> <br />. <br /> <br />. <br /> <br />. <br /> <br />Upper Platte and Seaver Canal Company <br />May 19-20. 2003 <br /> <br />Agenda Item 18e <br /> <br />Credit worthiness: The UPBCC has an existing loan with the CWCB in original amount of <br />$83,000, for rehabilitation of the Company's diversion structure. That loan was approved in <br />2002, and all payments have been made as agreed. Table 2 shows the Financial Ratios for the <br />UPBCC and indicates, with the exception of cash reserves, strong ability to repay the new <br />$67,500 CWCB loan with the project in place. <br /> <br />Table 2. Financial Ratios <br /> <br />Financial Ratio Without With <br /> the project the pr~ct <br />Operating Ratio (revenue/expense) 129% 126% <br />weak: less than 100% (strong) (strong) <br />average: 100% . 120% <br />stronQ: Qreater than 120% <br />Debt Service Coverage Ratio 263% 145% <br />(revenues-expenses)/debt service (strong) (strong) <br />weak: less than 100% <br />average: 100% . 125% <br />strol'lg,: oreater than 125% <br />Cash Reserves to Current Expense 28% 18% <br />weak: less than 50% (weak) (weak) <br />average: 50% - 100% <br />strong: greater than 100% <br />Annual Cost per Acre-Foot (32,500 AF) $ 3.75 $4.01 <br />weak: greater thlln $20 (strong) (strong) <br />average: $10 - $20 <br />strol1g: less than $10 <br /> <br />As security for the loan the UPBCC will pledge assessment revenues backed by assessment <br />covenant and the project itself. This security is in compliance with CWCB Loan Policy No.5 <br />(Collateral). <br /> <br />Recommendation <br />Staff recommends a Small Project Loan from the Construction Fund to the Upper Platte and <br />Beaver Canal Company to construct a well augmentation project on Badger Creek. The <br />maximum loan amount is $67,500 for up to 90% of the project cost, and the recommended loan <br />terms are 10 years at 2.25%. (2.325% Annual Percentage Rate.) Security for the loan will be a <br />pledge of assessment revenues backed by assessment covenant and the project itself. <br /> <br />Staff further recommends that final approval of the loan be conditioned upon all standard <br />contracting provisions of the CWCB, including the 1 % loan origination fee charged in <br />accordance with CWCB Policy #16. The maximum loan amount may be increased to $68,175 if <br />the borrower elects to finance the 1 % loan service charge. <br /> <br />cc: Philip Mortensen, President, Upper Platte and Beaver Canal Company <br />Brent Nation, P.E. <br />Linda Bassi, AGO <br /> <br />Attachment <br /> <br />C:IProj-NewIUPBCC 503 memo: <br /> <br />L:lboardmemlMay031 18e - Upper Platte and Beaver <br /> <br />3 <br />