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" . . Senate Agriculture, Natural Resources & Energy Committee! Capital Development Committee April 23, 1986 Page two 20 year schedule for major project development. The St. Vrain study has been completed, and we expect to have additional information developed, at least in preliminary form, during the forthcoming summe~ Therefore, in response to the questions of your committees, I am enclos- ing Attachment "B", our current cash flow projections. The figures contained t~erein represent trends in requests and priorities with which the Authority has been confronted in recent years. It is useful primarily to analyze the impact on the cash flow needs of the Authority due to the cost-sharing propos- al for Animas-La Plata. In addition, I have included a brief summary of considerations relevant to bond-based financing and have concluded with a list of the most pertinent policy questions relating to the state's role in water resource development. The Authority will also respond directly to your request for tax need estimates for water resources development over the next ten years. But we are convinced that we can best serve you by taki ng the time necessary to ensure that our analysis is well-considered and as accurate as future projections can be. We intend to make an estimate of future costs available to your commit- tees by September 1, 1986. We will thereafter update the estimate in the autumn of each yea~ Authority's Cash Flow Projections The Authority's cash flow projections are contained in Attachment "B". It is important to notice that, although the Authority has maintained positive cash flow throughout its history by utilizing earnings from its initial appro- priation, the needs are now beginning to exceed earnings. Unless additional cash flow is provided, the Authority will be required to set tighter priori- ties, advancing funds only for the most economically attractive water projects which will largely be for large cities and high-capital industry. It is also clear from the projections that the acceptance by the federal government of Colorado's proposal regarding cost-shari ng for the Ani mas-La Plata project will immediately commit all of the $30 million originally appro- priated to the Authority and will necessitate additional state appropriations to continue even the current rate of activity. As we have previously discussed with you, the Authority is engaged in several pre-feasibility basin-wide water resources investigations which lead to the setting of priorities for development. The basin-wide, pre-feasibility and feasibility investigations are in the process of yielding specific proj- ects that can be financed to meet future water needs in the St. Vrain and Cache la Poudre Basins. The Joint-Use Reservoir and Green Mountain Exchange Projects are currently being investigated by the Authority and represent a similar effort on the Colorado River System. We are also launching a major