BOARD01036

• Board Meeting Date: 11/22/1999
• Description: CF Section - New Loans - Town of Ridgeway
• Board Meetings - Doc Type: Memo

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Town of Ridgway
November 22-23,1999, Agenda Item 13a.

The Town's water enterprise has existing loans with the CWCB and with GMAC Commercial
Mortgage Corporation. The CWCB loan was initiated in 1980 in amount of $175,000, All
payments have been made as agreed, and the loan is current. The GMAC loan was also
initiated in 1980, in an amount of $245,000. Payments on that loan have also been made as
agreed, and the loan is current. It will be necessary for the CWCB to obtain parity with the
GMAC debt as a condition of a new CWCB loan for the raw water pipeline.

Table 2. Financial Ratios

Financial Ratio Without the project With the project
Operating Ratio (revenue/expense) 116% (average) 116% (average)
Debit Service Coverage Ratio 188% (strong) 148% (strong)
(revenues-expenses)/debt service
Debt per Tap $850 (strong) $1071 (strong)
Cash Reserves to Current Expense 242% (strong) 242% (strong)
Monthly Residential Water Bill $22 (strong) $22 (strong)

As security for the loan the Town will pledge revenues from the Town's Water Enterprise,
backed by rate covenant and annual financial reporting.

Recommendation
Staff recommends a loan not to exceed $77,000 to the Town of Ridgway, not to exceed 75% of
the costs to construct a raw water pipeline for outside irrigation, The recommended term of the
loan is 20 years and the lending rate would be that rate approved by the Board for municipal
standard income borrowers in 2000, As security for the loan, the Town will pledge revenues
from the Town's Water Enterprise, backed by rate covenant and annual financial reporting,

Staff further recommends that approval of the loan be contingent upon standard contracting
provisions of the CWCB.

cc: Don Batchelder, Ridgway Town Manager
Joanne Fagan, P.E.
Linda Bassi, AGO

Attachment

C:IWP51IProj-NewIRidgwayPipeline1199memo
L:lboardmemlnov99113a-Nov99

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