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<br />. <br /> <br />Table 1. Ryan Gulch Reservoir Co. <br />Estimated Revenues and Expenditures for 1995 - 1997 <br /> <br />1995 <br /> <br />1996 <br /> <br />1997 <br /> <br />Operating Revenues <br />Assessments <br />Other Income <br />Total Operating Revenues <br /> <br />$5,089 <br />8,200 <br />$13,289 <br /> <br />$4,925 <br />8,275 <br />$13,200 <br /> <br />$4,989 <br />8.200 <br />$13,189 <br /> <br />Operating Expense <br /> <br />$5,855 <br /> <br />$3,389 <br /> <br />$10,413 <br /> <br />Net Operating Income <br /> <br />$7,434 <br /> <br />$9,811 <br /> <br />$2,776 <br /> <br />The Company is requesting a 30-year loan for $317,500 which represents 75 percent of <br />the project cost less a $5,000 feasibility study grant which the Board provided to the <br />Company in 1998. The Company will finance the remaining 25 percent of project costs, <br />about $112,000, by the use of existing cash reserves and a one-time special assessment. <br /> <br />Nine of the ten Company shareholders are agricultural and one is commercial. <br />A weighted lending rate of 4.25% was calculated based on 25 shares at the commercial <br />rate of 5,75% and 75 shares at the agricultural rate of 3.75%. <br /> <br />. <br /> <br />Company assessments are currently about $50 per share, As a result of the project, it is <br />expected that the annual assessment will increase to approximately $185 per share over <br />the period of debt retirement. The corresponding cost per acre-foot of yield, using 800 <br />acre-feet per year, is about $23. <br /> <br />The only alternative source of funding for this project would likely be a commercial bank <br />loan involving a lending rate of about eight percent and a loan term of much less than 30 <br />years. <br /> <br />As security for the loan, the Company will offer a pledge of revenues from assessments <br />and the Ryan Gulch Reservoir. Using an assumed value of storage at $1,000 per acre- <br />foot, staff estimates the value of the collateral at about $900,000, <br /> <br />Conclusion <br /> <br />Staff finds the proposed project to be economically, financially and technically feasible. <br /> <br />Recommendation <br /> <br />. <br /> <br />Staff recommends that the Board recommend to the General Assembly a Construction <br />Fund loan of $317,500 to the Ryan Gulch Reservoir Company of Loveland for the <br />construction of a new spillway on the Ryan Gulch Dam, The recommended lending rate <br />is 4,25 percent for a term of 30 years, Staff further recommends that the Board require, <br /> <br />3 <br />