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2. Construction labor supply will be adequate to provide skilled and unskilled tradesmen necessasry to construct the facilities. There will be no strikes or significant shortages or delays in receipt of mate- rials or equipment. 3. All necessary permits, licenses and approvals will be obtained on a timely basis. Advances would be required based upon a schedule of estimated expenditures. Reclamation will seek budget contract authority which essentially permits an agency to write its own appropriation within limits set in the legislation, for normal appropri ated funds as well as revolving funds. Project financing participants would be guaranteed that the Federal Government is committed to funding its portion of the project on a timely basis. In turn, project participants must be bound to maintain their level of funding as advances come due or payment for sunk joint costs come due. Financing Alternatives Financing Diamond Fork costs may be accomplished individually by partici- pants or by an agency or multiple agencies set up for that purpose dependent upon the participant mix. For illustration purp~ses. we have structured a representative tax-exempt bond financing program._' Methodo logy This analysis is based upon the estimated costs for generation and trans- mission facil ities. These costs would be expended through 1993 and the final un;'; is anticipated to be on line on October 1, 1993. This non- Federal funding is assumed to be on a tax-exempt basis, with 50 percent ot construction costs funded initially with long-term bonds and 50 percent with tax-exempt commercial paper (T.E.C.P.) with the T.E.C.P. being refi- nanced with long-term bonds shortly after the project is on 1 ine. The joint costs which have already been incurred are assumed to be repaid to the Government over 40 years at an interest rate of 3.222 percent through a repayment contract arrangement. :1 Assumptions General The inn ation rate is assumed to be 5 percent annually over the construc- tion period. Long-term bonds and commercial paper are issued 1 year ahead of scheduled construction expenditures as shown in Table 5. 1/ The non-Federal financing adjunct committee of investment bankers and bond counsel which is composed of Mr. Dick Christensen, Prudenti al Bache Securities; Burrows Smith Division, Mr. Fenn Putman; Salomon Brothers, Inc., Mr. Don Larson; Smith Barney, Harris Upham, and Company; and Mr. Bob Ferdon of Mudge, Rose, Guthrie, Alexander, and Ferdon developed this bond financing example in concert with the Reclamation and Western. 27