C153824 Contract

• Contract/PO #: C153824
• Contractor Name: Preisser, Rodney J.
• Contract Type: Loan
• Water District: 17
• County: Lincoln
• Bill Number: SPL
• Loan Projects - Doc Type: Contract Documents

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Agenda Item 15a.
July 21, 1997

LENDING RATE AND TERMS

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Selection of terms for this loan will involved some discussion. Mr. Preisser has requested a loan
term of 40 years, and an interest rate be 3%. However, CWCB standard 30 year lending rates
for 1996-1997 are as follows:

Agricultural:
Municipal:
Commercial:

3.75% for 30 years
4.75% for 30 years
5.25% for 30 years

The following issues suggest a LOWER interest rate or a LONGER term for this loan:

The loan will settle the remaining case in the Horse Creek basin.
The loan is for only 41 % of the cost of the water rights, in contrast to the HCWUA loan,
which was for the entire amount.
The loan to the HCWUA was 3% for 40 years.
The loan collateral will be better than the HCWUA loan.
Mr. Preisser will be personally liable for repayment, in contrast to the HCWUA loan.
The hog farm is a form of agricultural use.

The following issues suggest a IDGHER interest rate and/or a SHORTER term for this loan:

Mr. Preisser has a strong fInancial statement.
The loan is for a relatively small amount ($90K).
Sale of a portion of the property is involved.
The retained portion of the property may be developed for housing.

Staff is suggesting a 30 year loan, at an overall interest rate of 4.75 %. This is equivalent to the
CWCB standard Municipal loan rate for a 30 year loan, with median household income in the
range of 80% to 100% of the Statewide average.

COLLATERAL

Mr. Preisser owns land and other personal property which can be used as collateral for the
CWCB loan. OI'V.- i1u- HbM.Q 0.&L

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STAFF RECOMMENDATION The staff recommend' dJ

I. That a construction fund loan in an amount of $90,000, be ~ for
Rodney Preisser, to purchase water rights, and