BOARD01171

• Board Meeting Date: 11/19/2001
• Description: CF Section - New Loans - Larimer County - Dry Creek Flood Mitigation Project
• Board Meetings - Doc Type: Memo

has committed to being responsible for 47 percent and the City 53 percent of the costs facing the
two entities. The third entity involved in financing this project is the Irrigation Company that
will be responsible for one-half of the pipeline construction cost. An agreement between the
County and Irrigation Company has yet to be finalized; however, authorization of the CWCB
loan will be contingent on its execution.

The County proposes to form a Pry Creek Stormwater Utility Enterprise to fund the
County's portion of the project costs. The monthly fees for the stormwater services will be
similar to the City's citywide fee structure for its existing stormwater utility. The use of a
stormwater utility enterprise by the County provides for equitable funding between the City and
the County since the two funding source fee structures are equivalent. Division of funding
responsibilities is simply based on geographic area within the respective jurisdictions. The use of
a stormwater utility also provides flexibility in terms of future annexations by the City of Fort
Collins in that areas that are amlexed simply will begin paying the fees to the City instead of the
County. Correspondingly, debt payments would be taken over by the City upon amlexation.

Based on a median household income of $16, I 81 for the service area of the stormwater
utility, the enterprise would qualify for the Board's 2002 Municipal Low-Income lending rate for
a 30-year loan. Staff is recommending a loan in the maximum amount of $l 1,000,000, or
approximately 87% of the estimated project cost. CWCB Financial Policy #1 1 - Allowable Loan
Amounts as a Percent of the Total Proiect Cost allows for loans up to 90% of the total project
cost to Municipal Low-Income borrowers.

Alternative financing sources: Sources of financing for a stormwater utility include the ...
private municipal bond market, the Larimer County General Fund, or a loan from another ..
govemmental entity. Because of its small size, and the fact that the Larimer County Dry Creek
Stormwater Utility will not have a history of operations and collections, selling municipal bonds
on the private municipal bond market would be very difficult, if not impossible. The Larimer
County General Fund does not have sufficient resources to make a loan of the size needed for the
proposed project. A CWCB loan is the only practical method the County has to finance its
portion ofthe project costs.

Table I is a summary of selected characteristics of the proposed Dry Creek Stormwater
Utility. A CWCB Loan of $1 1 million would have an annual payment of $678,660 (including
the 10% reserve requirement) at the loan terms of 3.75% for 30 years.

Table 1
Selected Characteristics of the Dry Creek Stormwater Utility

Pro' ect Cost
Avera e Number of Residential Accounts
Avera e Number of Commercial Accounts
CWCB Loan Amount
CWCB Loan Pa ent includes 10% reserve
Avera e Residential Assessment
Avera e Commercial Assessment
Avera e Investment Fee er new Residential or Commercial ta

$12,600,000
1049
446
$11,000,000
$678,660
$11
$45
$450

.t

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