BOARD02057

• Board Meeting Date: 1/22/2003
• Description: CF Section - G.M.S. Land and Cattle Company
• Board Meetings - Doc Type: Memo

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G,M,S, Land and Cattle Company
January 22-23, 2003

Agenda Item 1 gg

Credit worthiness: The GMSLCC has an existing loan in amount of $300,000 with Community
First Bank, for which all payments have been made as agreed, Table 2 shows the Financial
Ratios for the GMSLCC and indicates 2 ratios in the strong category and 2 in the weak category
with the $200,000 CWCB loan in place.

T bl 2 F'

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a e , mane.a alas anc ng opera Ion
Financial Ratio Without With
the Droiect The Droiect
Operating Ratio (revenue/expense) 209% 194%
weak: less than 100% (strong) (strong)
average: 100% - 120%
strong: greater than 120%
Debit Service Coverage Ratio 306% 271%
(revenues-expenses)/debt service (strong) (strong)
weak: less than 100%
average: 100% . 125%
strong: greater than 125%
Cash Reserves to Current Expense 35% 33%
weak: less than 50% (weak) (weak)
average: 50% . 100%
strong: areater than 100%
Annual Cost per Ac-Ft (150/279 ac-ft total) $33 $57
weak: greater than $20 (weak) (weak)
average: $10 - $20
strong: less than $10

As security for the loan the GMSLCC will pledge the west Y. of Section 18, T10N, R66W
containing approximately 320 acres of farm/ranch land, This property has an approximate dry-
land value of $975 per acre, based on a recent comparable sale (total value $312,000,) A
Certified General Appraiser will confirm the land value, This collateral is in compliance with
CWCB Loan Policy #5 (Collateral),

Recommendation
Staff recommends a eWCB Small Project Loan in maximum amount of $200,000 to the G.M.S,
Land and Cattle Company, LLC, to rehabilitate the Giffin #1 and #2 reservoirs, The
recommended loan terms are 30 years at 2,75%, or 20 years at 3,5% at the borrower's option,
Security for the loan will be the west Y. of Section 18, T10N, R66W containing approximately
320 acres of farmland, with value confirmed by a Certified General Appraiser.

Staff further recommends that final approval of the loan be conditioned upon all other standard
contracting provisions of the CWCB, including loan Policy #16 (Loan Service Charges),

cc: Larry Seitz, G,M,S, Land and Cattle Company
Duane Smith, P,E,
Linda Bassi, AGO

Attachment

C:Proj-New\GMS 0103 memo;

L:\boardmemlJanuary03\Agenda Item 199 Jan03\ GMS Land and Cattle Co

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