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<br />/ <br /> <br />. <br /> <br />. <br /> <br />'-" <br />\.--.. <br /> <br />. They have letter of credit and plan tei sell the interim (variable rate) bonds Dec. 4 for total <br />of $31m to be taken out by long-term financing by the three agencies. Current rate for <br />VRDs would be about 3.6 % with 0.7 % for letter of credit. Conversion to long-term <br />financing (if necessary) would be about 5.75% - 6.00% at current market conditions. City <br />has purchased interest rate cap of 4.5% for VRDs. <br /> <br />MCQWD will participate in the entire PL to the City WTP. Fort Morgan could provide <br />treated water in an emergency. MCQWD participation will result in some cost savings for <br />the City. <br /> <br />We are concerned about the collateral issue. They will pledge revenues and PL capacity. <br />Other agencies are also taking a flyer here and worst case scenario is probably a <br />restructuring of debt in event of a default. Use of C-BT shares would require an election <br />next November. <br /> <br />Public Service is again showing interest in SWSP water and may lease some water from <br />City and MCQWD. PSCO could use as much as 6,000 ac-ft per year. This may be a basis <br />for value of the City's capacity in the PL. <br /> <br />2 <br />