BOARD01011

• Board Meeting Date: 9/24/2001
• Description: CF Section - Consolidated Home Supply Ditch and Reservoir Company
• Board Meetings - Doc Type: Memo

Consolidated Home Supply Ditch and Reservoir Co,
September 24-25, 2001

Agenda Item 16a.

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Selected Alternative 2 consists of construction of a toe drain, a toe berm, outlet modifications,
foundation grouting, and other ancillary items. Outlet works improvements will include lining of
the existing masonry arch tunnel with a circular conduit and grouting of the annular space
between the new conduit and the old arch tunnel. The outlet pipe will be extended downstream
approximately 30 feet to allow room for toe berm construction. A toe drain and berm will be
constructed along the toe of the existing dam to provide protection from deep-seated slope
instabilities. The downstream slope of the dam will be flattened to a 2.5: 1 slope. The
construction budget also includes a cost to re-establish wetlands and a cost to relocate two
electric transmission line structures.

TheirnplementaUon schedule calls for completion of financing arrangements and final
engineering design in fall 2001. Construction will be completed in fall-winter 2001.

Financial Analysis
The total estimated cost of the project is $1,048,000, and the water is used primarily for
agricultural purposes. Staff is recommending a 30-year Emergency loan in maximum amount of
$943K (approximately 90% of estimated project cost.)

1800 of the CHSDRC shares are owned and used for agricultural purposes, with this use
expected to continue for the foreseeable future. The remaining 201 shares are currently, or will
soon be, used for municipal or domestic purposes. Table 2 shows the calculation of the interest
rate for this project:

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Table 2: CHSDRC Share Ownership and Interest Rate

Shareholder

Rate Category

Year 2001 Rate

# Shares
CHSDRC
1800
201

Rate x Shares

Aaricultural
Municipal
(Johnstown)
Totals

Aarlcultural
Municipal
Low Income

3.5%
4.5%

63
9

2001

72
3.59 %

30-year blended rate for the
CHSDRC

Blended Rate = 72/2001 shares

Round to
3.5%

Alternative financing sources: The Company actively sought alternative financing but was not
able find such. They requested a loan from their local bank (Union Colony Bank of Johnstown)
but were turned down because the bank does not provide long-term fixed rate financing for
agricultural projects.

Table 3 is a summary of the financial aspects of the project. A CWCB Emergency Loan of
$943K would have an annual payment of $56,399 (including the 10% reserve requirement) at
the loan terms of 3.5% for 30 years. This represents $7.50 per acre-foot, based on mean
. annual reservoir storage of 7,522 acre-feet.

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