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, , COLORADO WATER RESOURCES & POWER DEVELOPMENT AUTHORITY Logan Tower Bldg, - Suite 620, 1580 Logan Street, Denver, Colorado 80203 303/830-1550 FAX 303/832-8205 November 2, 1993 /)'~ , C'~ /YOj/ <..'lV,s " (; , oJ '0'1 /JJp~ VI,. .....~ This letter is a "fo11o~i-up" to our telephone conversa'hJ;ll1, of last week concerning Fort Morgan's (City) request for funding from the CWCB for a portion of its share in the Southern Water Supply Project. As you are aware, the statute requires that the Authority must first determine that funding cannot be provided under its programs before an entity can receive funding from the CWCB. Mr. Daries "Chuck" Lile Colorado Water Conservation Board 1313 Sherman Street, Room 720 . Denver, Colorado 80203 ~. Dear Mr.-HTe: ,.".. As of this date, the City has not submitted an application to the Authority. Therefore, a determination for Authority funding cannot be made with one hundred percent certainty. However, on November 1st, I spoke with the City's investment banker about the City's funding needs for 1994. It is estimated that the City needs about $2.5 mi 11 i on for next year. As a Category 2 borrower under the Authority's Small Water Program, the City would be eligible for $2.55 million. It is highly probable that the City would qualify as a Category 1 borrower and therefore, be eligible for a much higher loan amount. It is my understanding that the City will be submitting a loan application to the Authority by the end of this week. In order to overcome many of the scheduling problems with prospective borrowers that have projects ready to go. the Authority is considering the establishment of a line of credit (LaC) or direct loan program. The LaC or direct loan approach would permit the Authority to meet the project funding needs of its borrowers while allowing us to put together larger, more cost effective bond financings. Prior to. the Authority's consideration of the City's project financing and LaC or direct loan at the December 8, 1993 meeting, several requirements must be met. The two most critical are: 1. Approval by the bond insurer and 2. Creation of an enterprise fund to satisfy TABOR requirements. Upon receipt of the City's appl ication, we will be working with the City to proceed as quickly as possible to meet these requirements. Over the next five weeks, the Board of Directors will be kept apprised of the progress in meeting these requi rements, Thi s, however, does not guarantee that the Board wi 11 approve the project on December 8th. APPENDIX P