BOARD01922

• Board Meeting Date: 1/24/2001
• Description: CF Section - Tunnel Water Company - Additional Loan
• Board Meetings - Doc Type: Memo

195

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Tunnel Water Co.
Janual}' 24-25, 2001.

Agenda Item lOb.

tI

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Credit worthiness: TWC has no debt, other than the two CWCB loans, Table 5 shows the
Financial Ratios and indicates average ability to repay with the project in place.

59%
$3.19

54%
$19.47

As security for the loan the TWC will pledge assessment revenues backed by assessment
covenant and Company property at least equal in value to the loan amount.

Recommendation

Staff recommends a loan not to exceed $2,080,000 to the Tunnel Water Company for
continued rehabilitation work on the laramle-Poudre Tunnel. The recommended term of the
loan is 30 years and the recommended blended interest rate is 4.3%. (The Company would
also be allowed to borrow at 3.8% for 20-years or at 3.3% for 10-years, at its option.) Security
for the loan will be a pledge of assessment revenues backed by assessment covenant and
Company property at least equal in value to the loan amount. This loan would be funded from
the Construction Fund.

. (Note: This loan is In addition to the $1.6 million Emergency loan already approved by the
CWCS at terms of 4,5% for 30 years,)

Staff recommends that the Company be allowed to use this loan to refinance project costs
already completed and paid for with short term bridge financing,

Staff further recommends that final approval of the loan be conditioned upon acceptance of the
project and the associated financial obligations by a vote of the shareholders of the Company,
and all standard contracting provisions of the CWCS.

cc: Fred Walker. President, Tunnel Water Co.
Don Deere, P.E., RMC
Linda Bassi, AGO

Attachment

C:\W P51\Proj-New\ TunnelW aterCo1 01 memo
L:\boardmem~an01\ lOb Tunnel Water Co

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