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<br />AGENCY NAME: Waler Conservation Board
<br />AGENCY NUMBER: PDA
<br />ROUTING NUMBER: 97 PDA 0 I06;z
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<br />$2,300,000
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<br />LOAN CONTRACT
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<br />THIS CONTRACT, made this j.,ff-+1. day of .dfI~ 1997, by and
<br />between the State of Colorado for the use and benefit of the Dep ent of Natural Resources,
<br />Colorado Water Conservation Board (CWCB), hereinafter referred to as the STATE, and the Lower
<br />Arkansas Water Management Association (LAWMA) P.O. Box 1161, Lamar, CO 81052, hereinafter
<br />referred to as the BORROWER and/or CONTRACTOR.
<br />
<br />FACTUAL RECITALS
<br />
<br />1. Authority exists in the law, and funds have peen budgeted, appropriated and otherwise made
<br />available and a sufficient unencumbered balance thereof remains available for payment in Fund
<br />Number 424, Organization YYYY, Appropriation ARA, GBL L768, Program WTRC, Object Code
<br />5120, Reporting Category: 3768, Contract Encumbrance Number C153768.
<br />
<br />2. Required approval, clearance, and coordination have been accomplished from and with appropriate
<br />agencies.
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<br />3. Pursuant to. the provisions of 937-60-130, C.R.S., as amended by Senate Bill 97-8, Section 17, the
<br />STATE is authorized to expend up to $3,500,000 from the Arkansas River Augmentation Loan
<br />Account for the purpose of making loans to orgllnizations for the purchase of augmentation water to
<br />replace out-of-priority depletions to surface water rights and to prevent material depletions of usable
<br />stateline flows in violation of the Arkansas Rive( Compact, provided that the borrower meets certain
<br />criteria set forth at 937-60-130(3), C.R.S, (Supp. 1996).
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<br />4. The BORROWER is a duly constituted Colorado non-profit corporation formed under 9 31-24-1 et
<br />sea., C.R.S. (1967 Supp.) for the primary purpose of providing replacement water to its members.
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<br />5. The BORROWER has applied to the STATE for a loan to be used for the purchase of approximately
<br />3,569 shares of the Highland Irrigation Company ("Highland Shares") and approximately 354
<br />shares of the Fort Bent Ditch Company ("Fort Bent Shares"), hereinafter referred to as SHARES
<br />and/or PROJECT, to be used as part of the BORROWER'S augmentation plan to offset depletions by
<br />its members' wells to Colorado surface water rights and to usable state line flows in the Arkansas
<br />River Basin.
<br />
<br />6. The STATE has reviewed a feasibility report provided by Helton and Williamsen, P.C., dated March
<br />11, 1997, and a report by William A. PaddocK and Bill Milenski, dated March 28, 1997, entitled
<br />"Report On The Estimated Fair Market Value Of 3,569 Shares Of Stock In The Highland Irrigation
<br />Company, Bent County, Colorado," and, based upon these reports, the STATE determined the
<br />PROJECT to be technically and financially feasible. .
<br />
<br />7.. The BORROWER has entered into Water Rights Option Contracts and Purchase Agreements, which
<br />are incorporated herein by reference, for the purchases of the Highland Shares and anticipates
<br />purchasing the Fort Bent Shares in 1998.
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<br />8. At its May 12, 1997 meeting, the CWCB approved a loan to the BORROWER in an amount not to
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<br />Lower Arkansas Water Management Association
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<br />Loan Contract
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