Laserfiche WebLink
<br />. <br /> <br />. <br /> <br />project). <br /> <br />Emergency Operating Fund <br /> <br />Since 1892, when the Stevens Land and Cattle Company first conceived and started <br />construction on the system that is noW under the ownership of the Paradox Valley <br />Canal and Reservoir Company, no acts of God or other climatological factors have <br />presented any disasters, except for iofrequent periods of drought, that cannot <br />be corrected with a normal assessment to the shareholders. Therefore a reserve <br />fund is not necessary in the budget. Since droughts could be a problem, and <br />there may be years in which the Paradox Valley Canal and Reservoir Company could <br />not make full payment on the proposed loan of $100,000.00 over a 40 year period <br />at a 3% interest rate it is advisable that an emergency operating fund amounting <br />to one year's full payment be developed OVer a period of ten years. The emer- <br />gency operating fund will be utilized to repay the Colorado Water Conservation <br />Board or to finance extraordinary costS beyond the Scope of normal operation, <br />maintenance, and replacement costs, such as those of repairing damage to project <br />facilities resulting from abnormal conditions which may be experienced. An <br />additional $432.60 per year for a ten year period (totaling $4,326.00 - one year's <br />full payment to the Colorado l,ater Conservation Board) will be added to the annual <br />budget of the Company. This figure, $432.68, will appear in the next paragraph <br />and identified as emergency operating fund. <br /> <br />Operation, Maintenance, and Replacement Costs <br /> <br />The Paradox Valley Canal and Reservoir Company has now, and will continue to have <br />operation, maintenance, and replacement costs (OM&R). In addition to OM&R costs <br />the Company will be required to establish an emergency operating fund as described <br />in the proceeding paragraph. The emergency operating fund is required to finance <br />extraordinary costs beyond the scope of normal OM&R costs. An emergency operating <br />fund of 10% of the annual payment to the Colorado Water Conservation Board has <br />been established. <br /> <br />The Paradox Valley Canal and Reservoir Company has established an assessment of <br />$0.70 per share for OM&R costs for 1981. With 8,600 shares of reservoir water <br />at a payment of $0.70 per share the Company will generate $6,020.00 in reVenue <br />from assessments for 1981. With an annual repayment of $4,326.00 ($100,000.00 <br />amortized over 40 years at a 3% interest rate) to the Colorado Water Conservation <br />Board, build up of the emergency operating fund at $432.60 (10% of the annual <br />payment to the Colorado Water Conservation Board), and $6,020.00 for OM&R costs, <br />the Company will be required to generate $10,778.60 per year in assessments. In <br />an attempt to generate $10,778.60 per year an estimated assessment of $1.30 per <br />year (rounded off to the nearest nickel) will generate $11,180.00 per year when <br />collected from all 8,600 shares. No projected increases in OM&R costs for the re- <br />payment of 40 years will be assigned. Although such cost escalations will very <br />likely occur, OM&R estimates used in the pay estimate study remain on current price <br />levels as very likely crop values and returns will increase at the same rate as <br />OM&R costs. <br /> <br />VT-J <br />