PROJC00092

• Contract/PO #: C153507
• Contractor Name: Greeley, City of
• Contract Type: Loan
• Water District: 3
• County: Larimer
• Bill Number: SB 87-15
• Loan Projects - Doc Type: Contract Documents

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MEMO R.AN Du:r-1:

FROM:

Chuck Lile. Peter Evans. and Bill Stanton

Debra, 01 i ver. Accountinq gfl

write-off of Feasibilitv Studies in Fund 424

TO:

SUBJECT :

DATE:

Julv 22. 1996

As stated in my memo dated January 31, 1996, a number of loan
balances in Fund 424 showed no collection or payout activity in the
last two years. ,Accounting's concern was that these "loans" were
not valid. The loans were for feasibility studies.

Shamaine Krauser has completed her review, with Bill stanton, of
the contracts resulting in these loans and the applicable statute.'
Based on this review, Accounting recommends that $846,615.80 be
written off for the following reason:

Per the terms of the contracts, the amounts would be repaid
only if the feasibility study resulted in a project within a
specified time (10 years) from the date of the feasibility
contract. If no project resulted from the feasibility study
within the time period, there would be no repayment.

since no "right to repayment" exists unless a future event
occurs, the state does not have an asset until that event
occurs.

In order to track each, feasibility study'being written off until it
either becomes a loan or until the time period expires and/or the
CWCB determines that no project has resulted, we propose using the
COFRS grant module.

Attached is a summary, by loan, of the results of the contract
review and the proposed action to be taken. If you disagree with
the treatment of any of the above "loans" or have suggestions
relating to the proposed recommendation, please contact Sue
Griswold (866-2009) or Bob Goodnough (866-2857) by 7/25/96.

xc: Sue Gris~old
Bob Goodnough
v5hamaine Krauser
Jan Il1ian

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