BOARD02507

• Board Meeting Date: 7/24/2000
• Description: CF Section - Rate of Return Estimates for 2000 Loans and Grants
• Board Meetings - Doc Type: Memo

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STATE OF COLORADO

Colorado Water Conservation Board

Department of Natural Resources
1313 Sherman Street, Room 721
Denver, Colorado 80203
Phone: [phone]
FAX: [phone]

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MEMORANDUM

Bill Owens
Governor

TO:

Colorado Water Conservation Board Members /' /' Greg E Walcher
'=:1" Executive DlJ'ector

Bill Green, P.E., Water Supply Planning and Finance Sectio~ Peter H. Evans
Mike Serlet, P.E., Chief, Water Supply Plarming and Finance sJttf. cwcs Director

Dan McAuliffe
July 14, 2000 Deputy Director

FROM:

DATE:

SUBJECT:

Agenda Item 16, July24-25, 2000 Board Meeting - Water Supply
Planning and Finance - Rate of Return Estimates for 2000 Loans and
Grants

Introduction

This memo describes the staff analysis for the estimated rate of return for the year 2000 on:
Construction Fund loans,
Construction Fund loans plus non-reimbursable items, and
Severance Tax Trust Fund loans.

Backl!round

In November 1997 the Board adopted the following policy:

"The Board and the staff of the CWCB will attempt to maintain an overall, long-term rate of
return of no less than 4.0 percent on the aggregate amount of all loans and grants made
through the Construction Fund in order to offiet the long-run impacts of price inflation and
to maintain the integrity of the Fund. "

Construction Fund Loans and Non-Reimbursllble Items

Table 1 summarizes all Construction Fund loans recommended by the Board for authorization by
the legislature in 2000. The table gives the amount, term and lending rate for each loan as well as
total amount of loans, total amount of non-reimbursables recommended and the total of all loans
and non-reimbursables.

Staff estimated the rate of return for the Construction Fund loans and for Construction Fund
loans plus non-reimbursables. The procedure utilizes certain simplifYing assumptions (such as