BOARD02595

• Board Meeting Date: 11/19/2003
• Description: CF Section - New Loans - New Cache La Poudre Irrigation Company - New Reservoir Construction
• Board Meetings - Doc Type: Memo

New Cache La Poudre Irrigating Company
November 19-21 2003

Agenda Item Bb

Financial Analvsis

The total estimated cost of the project is $9,542,000, and NCLPIC water is used almost exclusively
for agricultural purposes. Staff is recommending a maximum loan amount of $7,200,000 (75% of
the estimated project cost) for 30 years at an interest rate of 2.50%. NCLPIC will fund its $932,351
share of the project through cash reserves and an increase in its assessments. In addition,
NCLPIC has a $1,409,649 private loan with Cornish Plains Livestock, LLLP for property
acquisition, discussed further below.

Table 1 is a summary of the financial aspects of the project. A CWCS Construction Fund Loan of
$7,200,000 would have an annual payment of $378,399 (including the 10% reserve requirement) at
the loan terms of 2.50% for 30 years. The CWCS loan will be repaid from increases in the base
assessment rate from $110 to $259 per share. Including both loans, the annual loan cost for the
project will be $111.39 per acre-foot, based on an average annual delivery of 4500 acre-feet.

Table 1. Financial Summary

Project Cost $9,542,000
Number of Shareholders 300
Number of Shares of Stock 2500
Cornish Plains Livestock, LLLP Propertv Loan Amount $1,409,649
Cornish Plains Livestock, LLLP Propertv Loan Pavment (thru 2013) $122,843
CWCS Loan Amount (30 years) $7,200,000
CWCS Loan Pavment (Includes 10% reserve) $378,399
Current Assessment per share (2003) $110
New Assessments per share $259
Annual Cost of Loans per acre-foot (aver. annual deliverv: 4500 ac-ft.) $111.39

Note: A recent history of annual assessments and proposed assessments is as follows:

Past Assessments Past and Proposed Assessments
1999 $ 56 2002 $ 65
2000 $ 56 2003 $110
2001 $ 60 Future $259

Creditworthiness: The NCLPIC has one outstanding CWCS loan for its diversion structure. The
original amount (1993) was for $450,000, with a remaining amount of $335,649 and an annual
payment of $28,805 through 2019. In addition, NCLPIC has two loans for property acquisition for
this project. One loan has an outstanding amount of $702,596 with the Colorado Community Sank
of Greeley (term ending 2006) that will be paid off with the CWCS loan, if approved. The second
loan is for $1 ,409,649 with the Cornish Plains Livestock, LLLP, with a 20-year amortization and an
annual payment of $122,843, and a 10-year balloon payment of approximately $900,000 due in
2013. The NCLPIC intends to refinance the remainder at that time. The project land,
approximately 1300 acres, is pledged as collateral for this loan.

Table 2 shows the Financial Ratios for the NCLPIC, and indicates average ability to repay the
$7,200,000 CWCS loan with the increased assessments.

Table 2. Financial Ratios

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