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<br />authorized to loan Seven Hundred Thousand Dollars ($700,000) for <br />construction of the project, including the cost of the <br />feasibility report; and <br /> <br />WHEREAS, the Contractor requested that construction of this <br />project be authorized to proceed before this contract could be <br />executed as this would be the only way that the Contractor could <br />store the 1991 decreed amount of water in Douglas Reservoir, <br />which is essential for operation of its irrigation system; and <br /> <br />WHEREAS, because of the emergency nature of this project; <br />the State did authorize the Contractor to proceed with the <br />construction, using short-term funds from a commercial bank with <br />the proviso that eVery facet of the construction work would meet <br />with the approval of the state; and <br /> <br />WHEREAS, during construction of the project, the <br />Contractor's engineer determined that the concrete cutoff wall <br />for the dam spillway needed to be deeper and longer than the <br />original design called for in order to provide a suitable <br />contact with the underlying bedrock; and <br /> <br />WHEREAS, during construction, the State Engineer's office <br />determined that an earthfill stability berm would be necessary <br />on the downstream toe of the dam, and that this item was not <br />shown on the original design; and <br /> <br />WHEREAS, the two unforeseen construction items described <br />above increased the total cost of this project to Seven Hundred <br />sixty-One Thousand Dollars ($761,000), which is sixty-One <br />Thousand Dollars ($61,000) over the current appropriation; and <br /> <br />WHEREAS, the state has the authority to increase the <br />construction loan amount for this project under section 1, <br />subsection (2) of HB 91-1006, which states: "Said loans shall <br />be in the amounts listed in subsection (1) of this section plus <br />or minus such amounts, if any, as may be justified by ordinary <br />fluctuations . . . . or as may be justified by reason of changes <br />in the plans for a project if those changes are required by <br />final engineering drawings and specifications or by federal, <br />state, or local governmental requirements"; and <br /> <br />WHEREAS, the Contractor or Borrower understands that this <br />Contract is also a promissory note for the repayment of funds <br />loaned to the Borrower according to the terms set forth herein. <br /> <br />NOW THEREFORE, in consideration of the mutual and dependent <br />covenants herein contained, it is agreed by the parties hereto <br />as follows: <br /> <br />A. The state and the contractor have previously entered into a <br />termination contract, attached hereto as Exhibit A, and a <br />feasibility report contract, attached hereto as Exhibit B. <br />Exhibits A and B are incorporated by reference herein. The <br />Contractor's Articles of Incorporation and By-Laws are also <br />incorporated by reference herein. <br /> <br />B. The Contractor agrees that it shall: <br /> <br />1. Employ an engineering firm (hereinafter referred to as <br />the Consultant) to prepare project plans and specifications for <br />the project. Both the Consultant and the project plans and <br />specifications must be approved in writing by the state before <br />construction on the project can commence. For purposes of this <br />paragraph, "construction" includes any real estate and water <br />rights acquisitions. <br /> <br />2. contract fOr the construction of said project to a <br />responsible and capable firm or firms (hereinafter referred to <br /> <br />Page 2 of Ll Pages <br />