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\ -1:'7 2 EXHIBIT C ORDINANCE NO. 2438 AN ORDINANCE OF THE CITY or GRAND JUNCTION, COLORADO, AUTHORIZING THR CITY TO ENTRR INTO A CONTRACT FOR BORROWING A PRINCIPAL SUM NOT TO EXCEED $250.000 FROM THE COLORADO WATER CONSRRVATION BOARD; ASSURING UTILITY RATBS TO PRODUCR REVENUES surrlCIBNT TO PAY TUB CONTRACT LOAN; SBTTING ASIDB or RBVBNU~S IN THE WATER fUND FOR TIIR RSPAYHENT or TilE DRBT; AND PROVIDING A SRCURITY INTEREST IN fAYOR or THE STATR TO SECURE THE REPAYMENT. WHEREAS, tile City of Grand Junction, Colorado, wisJles to construct the North Fork Diversion Pipeline, a water conveyance structure from the North Fork of Kennah Creek to the Purdy Meso and Juniata Reser- voirs; and WHEREAS, the project costs are scheduled to be paid from from the Colorado Water COnservation Board, a grant from the Department of Local Affairs, and City water fund revenues; and a lonn Colorado WHEREAS, the loan from the Colorado Water Conservation Board will not exceed 50% of the project costs up to an amount not to exceed $250,000 j and WHEREAS, in order to acquire the said loan from the Colorado Water Conservation Board, the City of Grand Junction is required to sign a contract and promissory note with the Colorado Water Conservation Board and pass an ordinance implementing the provisions of the contract and promissory note. NOW, THERBFORE, BE IT ORDAINED BY THE CITY COUNCIL or TUB CITY or GUAND JUNCTION: Section 1. Authorization. The City of Grand Junction through its elected representatives and appointed officers are authorized to enter into a Contract and Promissory Note with the Colorado Water Conserva- tion Board to contract for a principal sum of money not to exceed $250,000 for construction of the North Fork Diversion Pipeline and to repay to the State said principal sum with interest at the rate of five percent (5%> per annum, said repayment to be made in constant annual installments for twenty-five (25) years. Said Contract and Promissory Note to be the complete integration of all understandings between the parties. The City Manager of the City of Grand Junction is authorized to sign the Contract and Note when loan calculations and contract terms are finalized with the State of Colorado. Section 2. Security. As security for the loan to be made by the State, the City of Grand Junction, Colorado, will execute a warranty deed within thirty (30) days of the first advance of funda from the State which will convey to the State an undivided fifty percent (50%) interest in 5866 feet of 24 inch diameter Plastic Irrigation Pipe, 100PSI, SOR 41, inclusive of all intake structures, incidentals, and appurtenances, the pipe to be laid between the North Fork of Kannoh Creek existing diversion structure and Purdy Mesa and Juniata Reservoirs. Section 3. Assurance, The Cily will provide revenues in the City water fund to insure that the North Fork Diversion Pipeline is main- tained and operated in good working order,: as security to the State and the City for their interests in the pipeline until, at least, the total loan obligation from the Colorado Water Conservation Board is dis- charged. Section 4. Utility Rates. The City of Grand Junction periodically sets rates for the operation and expansion of its water utility op- eration. The City agrees that it will maintain rales sufficient to pay the annual indebtedness on the loan and to maintoin the pipeline in good working order as outlined in Section 3, These revenues are estab- lished and set aside in the Water Fund and are separate and apart from City General Fund revenues. The portion of the Fund balance of the Wa- ter Fund, not to exceed the annual principal ond interest payment of this note, will be restricted for the sole purpose of discharging the City's loan obligation and the State of Colorado will have conveyed to it a security interest in these restricted revenues to secure repayment of the debt. EXHIBIT C