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<br />FINANCIAL CONSIDERATIONS <br /> <br />Finance information included in this supplement is intended only as a <br />guide to give the Board of Trustees an insight to the individual costs and <br />financial arrangements. A cost analysis for each of the two recommended <br />projects has been made for the purpose of comparing the projects and to <br />support recommendations made in this supplemental report. The Town of <br />Hotchkiss will incur an indebtedness in constructing these projects. Con- <br />struction funds from the State of Colorado, through the Colorado Water <br />Conservation Board Construction Fund, have been obligated. The funds are <br />obligated for a 30 year term at 4% interest. <br /> <br />Income and Budget <br /> <br />The 1981 budget for the Town of Hotchkiss lists revenue from six sources; <br />these six sources and the estimated income are as follows: <br /> <br />Source <br /> <br />Income <br /> <br />General fund; $2,145,940.00 assessed <br />evaluation at 7 mills <br /> <br />$ 15,022. 00 <br /> <br />Revenue from water sales <br /> <br />96,000.00 <br /> <br />Revenue from the sale of water taps <br /> <br />8,000.00 <br /> <br />Garbage Collection <br /> <br />13,500.00 <br /> <br />. <br /> <br />Sales Tax Revenues <br />Town Sales Tax <br /> <br />40,000.00 <br /> <br />County Sales Tax <br /> <br />30,000.00 <br /> <br />Miscellaneous Income <br /> <br />5,460.00 <br /> <br />TOTAL ESTIMATED INCOME <br /> <br />$207,982. 00 <br /> <br />Of the $207,982.00 estimated income for the Town of Hotchkiss $135,242.00 <br />is attributed directly to the sale of water, water taps, or miscellaneous in- <br />come. The 1981 budget for the Hotchkiss Water Fund estimates an expenditure <br />of $74,242.00 for salaries and expenses, $36,000.00 for debt repayment and <br />interest expense, and building a reserve of $25,000.00. The $36,000.00 debt <br />retirement and interest expense is the annual payment required to repay a loan <br />from the Farmers Home Administration which is for a 40 year period at a 5% <br />interest rate. The Farmers Home Administration require that a reServe fund <br />equaling one annual payment be maintained by the town, the reserve fund may <br />be accrued over a ten year period. <br /> <br />Existing Water Rates <br /> <br />The existing water rates for the Town of Hotchkiss provide adequate re- <br />venue to help repay the existing bonded indebtedness as well as proposed bonded <br />indebtedness for the recommended improvements. The water rates provide for a <br />minimum of $9.50 per month for the first 7,000 gallons for residential users, <br /> <br />4 <br />