C153718 Contract - Laserfiche WebLink

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-" . ,'. . . . ," ~. .... . . REVENUE ANALYSIS: Water and Sewer User Charges: The district charges a flat rate of $17.00, which entitles customers to use up to 5,000 gallons per month. Above that, the district charges $.75 per 1,000 gallons. The 1993 water sales revenue of $514,531 translates into a monthly payment of $22.77 when spread among 1993's 1883 EQRs. The district currently has 2015 EQRs, 352 of which are representative of non-residential customers. Large commercial and industrial customers are billed according the terms of contracts with the district, and in some cases have their consumption limited by those contracts. . Leprino Foods was added as a customer of 'the District in 1993. This customer represents 132 EQRs based upon the plant's 4" water tap. . Excel Corporat~on uses a 2" tap to get water from the district, which represents 25 EQRs. Property Tax: The district currently receives a substantial portion of its annual revenue from property tax, and its cash flow projections indicate that it will be relying upon this source in the future. It is estimated that property tax revenues will increase ,at an annual rate of 1.75% over the next thirty-five years. Reliance on more than 10 percent of total annual revenues from property tax will disqualify the district from enterprise status under the TABOR amendment. Contributed Capital: This consists of tap fees and system development fees collected from customers. The revenue is reserved for capital projects. Contributed capital in 1992 totalled $67,250, . Contributed capital in 1993 totalled $256,000, reflecting the addition of Leprino Foods to the system. FINANCIAL ANALYSIS: The district has eight current indicators in the "strong" category, and five in the "average" category. Debt: The district's current indicators for existing debt are all in the "strong" category. The requested loan amount of $4,260,000 forces the indicators of debt per capita and debt per EQR into the "average" category. The debt to assessed value ratio is very strong showing considerable additional debt capacity, assuming significant reliance upon property tax to service this debt. However, additional revenue debt must be reviewed in light of the MHI indicators. . The ability to pay is shown in the ratios using median household income (MHI). Again, the indicators are in the "strong" category when calculated using current debt, but tall into the "average" category when using the requested loan amount. The MHI used for the district, see footnote 2, is lower than the state average median income ($22,185 compared to $30,140). Annual debt service on the requested loan amount is estimated at $246,350. . The district has indicated it is seeking to refinance its outstanding revenue bonds. If this is successful, annual debt service may be reduced. . The coverage ratio displays the same weakening effect, although not from the new loan. Current debt CO~erage is "strong;" calculating the ratio with the new loan debt service using 1993 revenues and operating expenses pushes the ratio into the "average" rating. Total revenues were increased in 1993 by a signifi~antly larger amount of contributed capital ($256,000), than in the pre~ious year ($67,250), and therefore, the coverage ratio is stronger than 'can be expected in other years, without equally large capital contrtbutions occurring. Monthly User Charges: Loan repayment is expected to be made with user fees. . Annual debt service will be $246.350, or $10,62 per EQR per