PROJ00283

• Contract/PO #: FS0009X
• Contractor Name: Swink, Town of
• Contract Type: Loan
• Water District: 0
• County: Otero
• Loan Projects - Doc Type: Feasibility Study

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The project proposes the Stage I 'U977-l978) construction of a 70,000 ;':,..,
gpd reverse osmosis water treatment plant, a new elevated storage tank with a
capacity of 100,000 gallons, and approximately 26,500 feet of 8",6" and 4"
distribution- mains with valves and hydrants. Total project cost for the Stage
I Construction is estimated at $834,000.

Additional Stage II construction is scheduled for approximately 1995 and will
consist of expanding the water treatment facilities and a new elevated storage
tank with a capacity of 100,000 gallons. Stage II construction costs are escalated
at t~e rate of 6% per year through 1981 and 4% per year to 1995 compounded
annually to a total estimated project cost of $937,000. Stage II construction
costs do not include the distribution mains needed to ser~e the developing area
since these costs should be borne by the developer or property owner. That
portion of the Stage II improvements relating to water treatment facilities
should be reviewed again prior to 1995. Existance at that time of the currently
proposed Arkansas Valley Conduit may avoid the need for additional treatment
facilities.

The Stage I construction project meets the current eligibility requirements for
Federal grant assistance under the Consolidated Farm and Rural Development Act,
Section 306: Public Law 92-419 administered by the Farmers Home Administration,
Department of Agriculture. The project also meets the current eligibility
requirements for Federal grant assistance under Title V, Section 509 of Public
Works and Economic Development Act of 1965 administered by the Four Corners
Regional Commission. Depending on the current unemployment rate in the?area,
the project may be eligible for funding under the Public Works _",-3 ,," ,,', ,,[
Employment Act of 1976 as administered by the Economic Development Administration.

If full Federal grant assistance can be obtained in conjunction with a low interest
rate loan from Federal or State sources, the project is financially feasible
at a moderately high user charge.

If grant funds cannot be obtained, the project will need to be substantially
reduced in scope. Requ{red fire flows will not be available to all areas of the
Town. Financing of the reduced project would depend on obtaining a very low
interest rate State loan for 50% of the project cost and a low interest rate
Federal loan for the balance of the project. The resultinghlgh user charge is
considered excessive and the project is only marginally feasible.