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<br />Below is a brief summary of the major project elements and their estimated cost as presented in the
<br />original cost estimate:
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<br />Pipeline No.1 - The installation of8,318 ft. of15" plastic pipeline, 2-15" valves, 7-12" valves, 10
<br />meters, power supply line, I recharge well, I augmentation wen, 2 ditch pumps, and wen pennits.
<br />Estimated total cost = $170,218.
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<br />Pipeline No.2 - The installation of 3,600 ft. of 12" plastic pipeline, 4-12" valves, 4 meters, power
<br />supply line, I recharge well, and well permit. Estimated total cost = $57,567.
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<br />Pipeline No.3 - The installation of 7,000 ft. of 15" plastic pipeline, 2-15" valves, 3 meters, power
<br />supply line, I recharge well, and well pennit. Estimated total cost = $147,262.
<br />
<br />Rechal'fle Sites - The construction of various recharge sites. Estimated total cost = $7,110.
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<br />Enfdneerinf! - Preparation of the feasibility study and plan development. Est. total cost = $10,600
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<br />The estimated total cost of the project at the time of construction was $392,758, as summarized
<br />above. During construction of the project, however, various line items experienced cost overruns
<br />and cost savings. Additionally, pipeline hookup expenses were not included in the original cost
<br />estimate. The hookup expense involved the cost to connect the pipeline to the well/pump and all
<br />the appurtenances needed to make that connection.
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<br />The project has been completed and is currently operational. The total cost of the completed
<br />project is $421,621, which is $28,863 more then the original cost estimate. Based on the additional
<br />costs as presented above, Mildred Rothe is requesting 90% of additional project cost incurred, for an
<br />increased loan amount of$25,977.
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<br />DISCUSSION
<br />Due to additional work not programmed in the original cost estimate and unforeseen variations in
<br />cost for specific items during construction, the overall cost of the project has increased by
<br />approximately 7% or $28,863. Staff has inspected the improvements in the field and has reviewed
<br />the detailed cost summary provided by the owner and finds the additional expenses to be justifiable
<br />and within the normal parameters for this type of construction.
<br />
<br />FINANCIAL/COLLATERAL
<br />The amended loan amount for Mildred Rothe will be $379,459, at the present interest rate of 2.5 %
<br />for 30-years. The new annual payment will be $19,942.62, which includes the 10% reserve
<br />requirement. The Rothe's current loan of $353,482 has an annual payment of $18,577.39, which
<br />includes the 10% reserve requirement.
<br />
<br />CREDIT WORTHINESS
<br />Mildred Rothe has 4 existing long-term loans with a total outstanding balance of$I,742,000, as
<br />shown on Table 1.
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