Laserfiche WebLink
<br />Colorado Water Conservation Board <br />Department of Natural Resources <br />1313 Sherman Street, Room 721 <br />Denver, Colorado 80203 <br />Phone: (303) 86&-3441 <br />FAX, 13031 866-4474 <br />wW\v.cwcb.state.co.u5 <br /> <br />STATE OF COLORl\DO <br /> <br />Q <br /> <br />Bill Owens <br />Governor <br /> <br />June 5, 2001 <br /> <br />Greg E. W<lJcher <br />Executive Director <br /> <br />Rod Kuharich <br />(We8 Director <br />Dan McAulifie <br />Deputy Director <br /> <br />Mr. Lee D. Merkel <br />City Administrator, City of Ouray <br />PO Box 468 <br />Ouray, CO 81427 <br /> <br />RE: <br /> <br />Skyrocket Creek Feasibility Study <br />Review Comments <br /> <br />Dear Mr. Merkel, <br /> <br />This letter is a follow-up to our conversation of May 1, 2001. Based on that conversation, and <br />review of the Draft Feasibility Study (Skyrocket Creek Diversion Wall Replacement) dated <br />December 2000, I am providing written comments for the completion of the Study. <br /> <br />The Study covers the technical issues and establishes a reasonable cost estimate for the project. <br />The cost estimate is important, since it is the basis for the CWCB loan. <br /> <br />The Financial Analysis portion of the Study needs to address the ability of the City (through its <br />Parks Enterprise Fund or PEF) to borrow from the CWCB. The following issues need to be <br />addressed: <br /> <br />. The PFE has 5 exiting loans. Do any of these lenders prohibit or set limits on additional <br />borrowing by the PEF? If so, these prohibitions and/or limitations need to be explained in the <br />Study. <br /> <br />. The CWCB normally requires parity with all existing debt (that is, the right to share revenue <br />income equally with existing lenders.) Are the existing lenders willing to grant parity to the <br />CWCB, even though the CWCB loan would be junior to theirs? <br /> <br />. If the existing lenders are not willing to provide parity, an alternative may be for the PEF to <br />provide other collateral. That collateral would need to be a first interest in real estate, water <br />rights, or other notes or securities of a relatively permanent nature. (Personal property such as <br />vehicles is not acceptable, since they depreciate before the loan is repaid.) The Study should <br />indicate whether the PEF has acceptable alternative collateral. <br /> <br />. The Study indicates that the loan will be repaid by revenues from the PEF, and that the annual <br />loan payment will be about $6,000. The table on page 12 does not show sufficient income to <br />make that payment. The Study should include a proforma estimate of future PEF revenues <br />and expenses showing ability to repay the CWCB loan. Please submit two years of financial <br />statements for the PEF (or for the City, if statements are in a combined report) as the basis for <br />the proforma estimate. <br /> <br />Flood Protection. Water Project Planning and Financing. Stream and Lake Protection <br />Water Supply Protection. Conservation Planning <br />