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<br />~. <br /> <br />Agenda Item 16a. <br />May 12, 1998 <br /> <br />Page 2 <br /> <br />e <br /> <br />DISCUSSION <br /> <br />The primary purpose of the project loan is to rehabilitate the Company's check dam that forms <br />part of the diversion structure for the ditch. The project also involves a plan to keep the river <br />from cutting a new channel around the diversion structure by providing bank protection and spurs <br />to stabilize the historic river channe!. <br /> <br />The Company needs to complete this work in the summer of 1998, when the South Platte River is <br />usually low. The Company wanted to have the work done by now, but the river was toO high this <br />winter and spring and the project had to be delayed. The work needs to be completed as soon as <br />possible to ensure that the structure does not fail completely during high water. Delaying the <br />project until 1999 would result in an undue hardship on the borrower. <br /> <br />The Western Mutual Ditch Company provides water for irrigation. A loan to the Company <br />should thus be at the "Agricultural" rate. The Company has requested a 20-year loan at 3.75%. <br />(This is the "Agricultural" rate for a loan duration of 20 years, as set by the CWCB November <br />24, 1997.) <br /> <br />COLLATERAL <br /> <br />e <br /> <br />The Company receives assessments from its stockholders. The CWCB will take a security <br />interest in this stream of revenue. The Company can provide one payment in the form of a <br />certificate of deposit. <br /> <br />STAFF RECOMMENDATION <br /> <br />The staff recommends: <br /> <br />1. That the Board fmds that a delay in the rehabilitation of the check dam and the <br />construction of bank protection would cause undue hardship for the water users, <br />qualifying the Western Mutual Ditch Company for a loan from the Small Project Loan <br />Account, and <br /> <br />2. That a loan from the Small Project Account of the Construction Fund, in a maximum <br />amount of $100,000, be approved for the Western Mutual Ditch Company to rehabilitate <br />their check dam and construct bank protection in the vicinity of the Company's <br />diversion dam and headgate on the South Platte River, and <br /> <br />3. That the financing terms for this loan shall be at an annual percentage rate of 3.75% for <br />a duration of 20 years, and e <br />