WSP07068 - Laserfiche WebLink

Home Browse Search

Z3i5 FRYlNGPA-.'l-ARKANSAS PROJECT, COLORADO 33 resultee! in any revision of project benefits beyond those included in the revaluation statement. of ,T anuary 19GO. The relationship of benefits to costs presented t.o the committee in WGO showed a rat.io of 1.59 to 1, on the basis of total. benefits for a 100-year period. Ratios bnsed on lesser periods and on.direct. bene- fits only range downward from this amount; but. the most severe test of justification, that being direct. benefits only for 50 years, shows a ratio of 1.08. Since estimated costs have not changed in the in- tervening yenr, tbese remain valid indications of project justification. As st.ated previously, we have had occasion to reexaminate the financinl feasibility of the Fryingpan-Arkansas project. in accord- ance with the conditions of repayment provided for in the bills here beill.~ considered. The resulb:) of our findings are summarized in Ur brief report. entitlecl "Supplemental-Feasibility Ana]ysis, Frying- pan-Arkansas Project, Colorado," dated March 1%1. This report has been made a part of the departmental report on the bills and as such has already been furnished tlus committee. Very briefly, this analysis demonstrntes t.hat the ent.ire reimbll]"~able cost of the Fryingpnn-Arkansas project can be returned from anti- cipated project. revcnues within a period of 50 yellrs following com- pletion of construct.ion of the project. In these ana lyses the hydro- electric power allocation of $G~,G(\'j,OOO plus $~,184,000 of reimburs- able interest during construction would be repaid to the Treasury based on a current interest rate of ~.G3~ percent by the 41st year after completion of 1111 power facilities. This would be accomplished by applying net power revenues obtained through the ?ale pi energy" to preference and l10npreference customers ut an estmmtE!t1 rate of 6.fi mills per kilowatt-hour. The supplemental analysis also demonstrates the costs allocable to municipal and industri'al water supply, excluding the cost of de- livery systems, conle! be returned during the 40t.h year following completion of construction using a current interest rate of 2.Q32" percen t. Repayment of these costs, consisting of a construction cost alloca- t.ion of $8l472,OOO plus $:~02,O(lO interest. during construction, would Le accomplished by proceeds from w~lter deliveries and a component of conservancy dist.rict tax revenue. Should it be demonstrated on the basis of the required secretarial finding that municipal water delivery systems would be constructed as a part of the project worl" as provided in section 1 (c) of the bi!]s, these facilities could be repaid at an appropriate interest rate Within 50 years nft.er the facilities begin to proyide service. Revenues to accomplish this repayment would be from proceeds from delIvery of water to Colorado Sl)rin~s and Arkansas River Val- . " ley towns. The amonnt ret.unmblc under this fLrrallO"ement would con~ ~t of $13,'jG1,000 in project eostsplus M,9,000 inh,rests during con- ~uct.ion. In pn-ssinz. it shoulcLbe obseI'yed thnt if the~p" works a.re undertaken, 5uitahle '-l'epayment" contract. con~I'aO"e will he obtained prior to the initiation of constnlCt.ion, ns en\"isio~ed in the bills. The int.er~st-free irrigation alloc.ation of $GG,097,OOO would be re- turned wIthm 50 yeJjs b.'i:' conserva~c.~' dist.rict re'iE}n1J~~, -comprised of wa~el' ch~l'geSIlli2.."lWe paId by the ll"l'lgators, ad y!t1pte.m.taxes and financml asslstan~rom net power revenues. I: '