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<br />. .-' . <br /> <br />1 <br /> <br />Swnmary <br /> <br />. <br /> <br />The contractor has reviewed and critiqued the economic analysis <br />of Foothills alterm.tives prepared by the Corps of Engin8er3. Only <br />the mouth of canyon alternative is considered herein, but the same <br />assumptions and factors can be applied to the other alternatives to <br />the Strontia Springs proposal. <br />The finding is that while the overall structure and numerical <br />application of the Corps analysis appears sound, two major factors <br />were inappropriate: (1) the amortization of the capital costs over <br />75 years, (2) assessing the alternatives to Strontio. Springs an excessive <br />amoW1t to improve the intalce works and intertie capability for the City <br />of Aurora. The contractor also challenges the Corps 1978 electric cost <br />and the projected rate of increase of this cost. Recalculation with <br />the contractor's assumptions sholls the mouth of canyon alternative to <br />be less costly than the Strontia Springs proposal. Each factor in <br />contention is separately priced in this review to show is sensitivity. <br />Finally, these cost differences are compared to the 1977 Denver \'Iater <br />Department costs. Overall, on a percentage basis, all of the cost <br />differences considered are sholm to be quite small. <br /> <br />Introduction <br /> <br />The contractor conducted the review of the Corps analysis in the <br />following order. <br />1. Obtained a detailed W1derstanding of what the Corps had done. <br />2. Isolated factors which could possibly change the Corps outcome. <br />3. Investigated these factors for their accuracy, appropriateness, <br />and sensitivity. <br />4. Recomputed a comparison between the Strontia Springs and mouth of <br />canyon alternatives. <br />5. Related the costs of the Foothills addition to the 1977 financial <br />statement of the Denver \'ater lIepartr.Ient. <br />Due to the shortne3S of time allotGl[ for this review, the <br />contractor recommGnded that the folloving estimates and assumptions <br />of the Corps be accepted as pre3entcd for the purpose of this review. <br /> <br />... <br /> <br />00696 : <br />