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<br />10 percent. A loan from the federal Government, such as Farmers Home
<br />Administration, may be as low as 5 percent. Use of money from the Colorado
<br />Water Conservation Board Construction fund would essentially have an effec-
<br />
<br />TAllLE-15
<br />AVERAGE ANNUAL CAPITALIZATION COSTS
<br />Reach 4
<br />
<br />tive rate of 2 ~_rcent.
<br />
<br />Uaeful Life, Years
<br />
<br />The best deal from a local perspective is obviously a grant from a
<br />Federal agency such as from Housing and Urban Development, the Soil Conser-
<br />vation Service, or the Army Corps of Engineers. However, competition for
<br />thcse grants, if available at all, is time consuming, requires considerable
<br />local effort, and probably a restudy.
<br />
<br />Interest
<br />Rate, , , <0 " 30 " ;0
<br />10 $288,808 $178,179 $128,595 $116,1)6 $111,954 $110,421
<br />8 $274,203 $163,158 $111,505 $ 97,251 , 91,810 $89,489
<br />", $270,601 $159,501 $107,389 , 91,492 $ 86,927 $ 84,376
<br />, $252,865 $141,776 $87,847 , 71,217 $ 63,805 $ 59,973
<br />2 $232,272 $121,884 $ 66,958 , 48,882 $ 40,026 $ 34,831
<br />
<br />The total ptoject cost of the recommended alternative for Reach 2 is
<br />$627,060, and for Reach 4 it i, $1,094,800. The average annual construction
<br />costs of the recommended plans are sUmMari~ed below for several interest
<br />~ates and useful lives. Operation and maintenance eosts are estimated at an
<br />additional $2,000 per year for each reach.
<br />
<br />NOTE' Add $2,000 for O&M costs for all above values,
<br />
<br />D. Benefit!Coat(B!C)Ratios
<br />
<br />Reach 2
<br />
<br />By co~paring average annual benefits with aver8Ke annual project costs,
<br />including operation and maintenance, for various interest rates snd useful
<br />lives, it is possible to obtain a wide rsnge of B/C ratios. Using the present
<br />U.S. Treasury Department intereat rate of 7% percent and the Colorado Water
<br />Conservation Board flood control interest rate of 2 percent for a project life
<br />of 30 years, the following B!C ratios are obrained for reaches 2 and 4,
<br />respectively'
<br />
<br />TABLE 14
<br />AVERAGE ANNUAL CAPltALIZATtON COSTS
<br />
<br />Interest Uaeful Life, Years
<br />Rate, %
<br /> , 10 20 JO " 50
<br />10 $165,418 $102,054 $73,654 $66,519 $64,123 $63,245
<br />8 $154,053 $93,451 $63,866 $55,702 $52,585 $51,256
<br />'" $154,990 , 91,356 $61,508 $52,403 $49,769 $48,328
<br />, $144,832 $ 81,204 $50.315 $40,790 $36,545 $34.350
<br />2 $133,037 $ 69,811 $38,351 $27,998 $22,925 $19,953
<br />NOTE: '" $2,000 for 0," costs to all above values.
<br />
<br />.L
<br />
<br />,
<br />
<br />TABLE-16
<br />BENEFIT!COST RATIOS
<br />
<br />-I
<br />
<br />,
<br />.\ \..~
<br />
<br />I
<br />
<br />'.
<br />
<br />So"rce of Jok>ney
<br />
<br />Interest Rate
<br />
<br />B/C_Ratios
<br />
<br />Reach 2
<br />
<br />Rcach4
<br />
<br />federal
<br />
<br />,\
<br />2
<br />
<br />'.2
<br />14.8
<br />
<br />0.15
<br />0.65
<br />
<br />State
<br />
<br />-92-
<br />
<br />-93-
<br />
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