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<br />/ <br /> <br />Project Description and Alternatives <br /> <br />The purpose of this project is to provide a means for the TWC to continue providing irrigation <br />water to shareholders while minimizing the occurrence of future failures of the tunnel. Five <br />alternatives were considered: <br /> <br />1, The no-action alternative, <br />2, Rebuild only the collapsed portion of the tunnel ($1 million,) <br />3, Rebuild the collapsed portion of the tunnel, and other sections of the tunnel that are lound to <br />be in need of immediate reconstruction, ($1,77 million,) <br />4, Bore a new tunnel ($22 million,) <br />5. Completely rehabilitate the eastern Y2 and parts 01 the western Y2 01 the tunnel ($4,1 million, <br />revised up from the initial estimate of $2,33 million,) <br /> <br />Alternative No, 1 was considered unacceptable since it means the TWC could not deliver water <br />to its shareholders, <br /> <br />Alternative No, 2, rebuild only the collapsed portion of the tunnel, was ruled out because it is <br />not a reliable approach, There are several other areas in the tunnel that are in imminent danger <br />of collapse, These areas must be repaired to ensure the tunnel operates satisfactorily for the <br />long term, <br /> <br />Alternative NO.3 rebuild the collapsed portion of the tunnel, and other sections of the tunnel <br />that are found to be in need of immediate reconstruction, was the preferred alternative when the <br />Company applied for a CWCB Emergency loan in August 2000, However, this alternative has <br />since been ruled out because of the high cost of rernobilization to complete the project. <br /> <br />Alternative No.4 was ruled out due to cost. <br /> <br />Alternative No.5, rehabilitate the eastern % and parts of the western % of the tunnel, is now <br />the preferred alternative of the TWC, This saves mobilization costs, and shortens the time to <br />complete the overall project. The Company is using the existing $1.6 million emergency loan <br />now, as work progresses on Phase 1 oi the project. Funds from this additional loan (if approved) <br />will become available around July 1, 2001, These funds will be used to complete the project by <br />early summer 2001, (Funds from the $1,6 million Emergency loan will be expended by about <br />May 1, 2001, The Company understands that it will need to arrange for short-term bank <br />financing to cover the periOd May 1 through July 1, The Company also understands that if this <br />additional CWCB loan is not approved, it will need to obtain alternative long-term financing to <br />complete Phase 2 of the project.) <br /> <br />Selected Alternative 5 involves construction of access roads and construction staging areas at <br />both ends of the tunnel. For downstream access, a new road must be built up a steep <br />mountainside, across USFS property, The cost of access will be a major part of the total project <br />cost. The eastern 5,500 feet of the tunnel will be cleaned and stabilized, a temporary rail <br />installed to facilitate construction and portions of the tunnel will be re-mined to establish <br />sufficient width for construction equipment. <br /> <br />Tunnel Water Company <br />Laramie-Poudre Tunnel Feasibility Study <br />September 2000 (Updated December 2000) <br /> <br />Page 9 of 15 <br />