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<br />'\ <br /> <br />J <br /> <br />e <br /> <br />e <br /> <br />. <br /> <br />Kern Reservoir and Ditch Company <br />September 11-12, 2002 <br /> <br />Agenda Item 12a. <br /> <br />Windsor is a municipality with median household income of more than 110% of the statewide <br />median, qualifying it for the CWCB high-income municipal rate of 4.75% (30 year term.) The <br />blended rate for a loan to the KRDC is calculated as follows: <br /> <br />Table 1: KRDC Share Ownership and Blended Interest Rate <br /> <br />Shareholder Rate Cate 0 Year 2002 Rate # Shares Rate x Shares <br />Town of Municipal 4.75% 70 332.5 <br />Windsor Hi h Income <br />Hall-Irwin Commercial 6,0% 30 180 <br />Cor oration <br />Totals 100 512.5 <br />Blended rate for KRDC Blended Rate = 512.5 /100 5.1% <br /> shares (rounded down to <br /> nearest .1 % <br /> <br />The blended interest rate for the KRDC would be 5.1 % for a 30-year loan, (By similar <br />calculation, the 20-year loan rate would be 4.8%.) The Company is requesting an initial small <br />project loan of $1 million, and plans to submit an application for a standard loan of up to $2.75 <br />million. The initial loan represents approximately 20% of the total project cost. <br /> <br />Table 2 is a summary of the financial aspects of the project. A CWCB Small Project Loan of $1 <br />million would have an annual payment of $72,375 (including the 10% reserve requirement) at <br />the loan terms of 5.1 % for 30 years. The total amortized cost of this project will be <br />approximately $130 per acre-foot, based on the new total reservoir storage capacity of 2,600 <br />acre-feet. <br /> <br />Table 2. Financial Summary <br /> <br /> <br />$5,100,000 <br />2 <br />100 <br />$1,000,000 <br />$72,375 <br />$100 <br />$824 <br />$28 <br /> <br />Credit worthiness: The KRDC has no debt. Table 3 shows the Financial Ratios for the KRDC <br />and indicates 3 ratios in the average category and 2 in the weak category with the $1,000,000 <br />CWCB loan in place. However, the Annual Cost oer Acre-Foot is a ratio relating to purely <br />agricultural projects. Municipal and multiple use projects can typically support a much higher <br />annual cost. The Monthlv Residential Water Bill was included because the major stockholder in <br />the KRDC is the Town of Windsor. (Note: Gravel obtained during the dredging process will be <br />processed for sale. It is estimated that income from this source could offset project costs by as <br />much as $1.2 million,) <br /> <br />3 <br />