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<br /> <br />I <br />I <br />I <br />I <br />I <br />I <br />I <br />I <br />I <br />I <br />I <br />I <br />! I <br />I <br />I <br />I <br />I <br />I <br /> <br />$155,000 for 20 years at 10.08% would be $18,305 (approximately twice the CWCB <br />annual loan payment.) If the loan were called at year 5, the Company would still owe <br />$138,601 and would again be seeking permanent financing. The letter from the First <br />National Bank, and the ODC letter requesting EWP Program funding, are included in <br />Appendix F. <br /> <br />Collateral: Security for the loan will be a pledge of assessment revenues backed by <br />assessment covenant, one payment in a certificate of deposit account to be held by the <br />State, and the project itself. <br /> <br />Institutional Considerations <br /> <br />The ODC needs approval to borrow $155,000 from the CWCB Construction Fund. The <br />loan, if approved, will be contingent upon the successful negotiation of a contract <br />between the CWCB and the ODC. <br /> <br />The ODC must gain access across private land for construction of the project, and must <br />coordinate with landowners to complete reclamation of private lands after the project is <br />complete. <br /> <br />Conclusions <br /> <br />1. The ODC is an incorporated entity in Colorado with the ability to enter into a contract <br />with the CWCB for the purpose of obtaining a Construction Fund loan. <br />2. Rights-of-way easements are adequate for the construction of this project. <br />3. The project will assure continued delivery of irrigation water to shareholders, <br />4. The total estimated cost of the project is $658,009 and this will be financed by a <br />grant from the NRCS for engineering services and for construction, and by at <br />$155,000 Emergency Loan from the CWCB Construction Fund. <br />5. The ODC is eligible for a CWCB Emergency Loan because their diversion structure <br />washed out during a flood in 1999. The project is also considered u.. .necessary to <br />avoid unreasonable risk of injury or damage to human health or well being or to <br />properly or crops, and the emergency condition is not the result of negligence in the <br />operation or maintenance of the infrastructure." <br /> <br />Opinion of Feasibility <br /> <br />The selected alternative appears to be technically and financially feasible. There are no <br />known problems that would keep the ODC from successfully completing this project. <br /> <br />Otero Ditch Company <br />Diversion Structure Feasibility Study <br />February 2000 <br /> <br />Page 13 of 20 <br />