PROJ00150

• Contract/PO #: C150116
• Contractor Name: B.F. & M.E. Porter, LLLP
• Contract Type: Loan
• Water District: 45
• County: Garfield
• Bill Number: SPL
• Loan Projects - Doc Type: Feasibility Study

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Tahle 6. Three Precipitation Scennios

Climate Existing Rescnoir Expanded Incrc3:o.e of Income
Income Resenoir lm.'ome
Drv $91.250 53~3,250 5252,000
Average 5200,500 S31O,500 $110.000
Wet $235.750 $326,000 590,250

If the assumption is made that. during any ten year period. 2 wet .years, 2 dry years and 6 average
years of precipitation will occur, the total increase in income can be estimated over the next
20 years. which is the term of the n:quested loan. Using this scenario. and using an annual
inflation rate of 4 percent, the total annual increase in income over the next 20 years is estimated
to be $3.95 million. The present value of the additional income. using the 2.5% discount rate of
the loan, is 53.00 million as shown in Table 7. The present value of the loan is, by definition.
$1.00 million. Therefore, the Porter Res~r\'oir expansion project has a benditlcost ratio of 3.0.
This confinns that the economic benefit of this project is considerable.

Table 7. Economic Analysis for Porter H.esen.oir ImproH'ments

Additional Income-t% C\\'cn Loan Annual
Year Additional Income 2002 Dollars Inflation Payments
I 5252,000 $252.000 $6~,OOO
2 5110,000 5114,400 564.000
3 $110,000 5118.976 564,000
4 $90,250 S101,519 56~,OOO
5 SIIO,OOO 5128,68~ 56~.000
6 $110,000 $133.832 S6~.000
7 5252,000 $318.860 56~.000
8 5110,000 $1~~,752 $6~.000
9 590.250 $123.513 56~,000
10 5110.000 5156.564 $6~.000
II $252,000 $373,022 56~,000
12 5110.000 5169.3~O $6~,OOO
13 $110.000 5176,11~ 56~.000
14 590,250 5150.273 56~.000
15 5110.000 5190,48~ 56~.000
16 5110.000 5198.10~ 56~.00O
17 S252,000 5~71,991 564.000
18 SIIO.OOO 5214.269 S6~.000
19 590.250 5182.830 56~,OOO
20 $110,000 5231.753 564.000
Totals 52.689.000 53.951.282 51.280,000
Present Value (with 2.5% discount rate) 53.007.253 51.000.000

Benetiu'Cost Ratio of 3

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