Nov. 5, 2003
Mr. Will
Tully
Bureau of Reclamation Eastern Colorado Area
11056 West County Road 18E
Loveland, CO 80537-9711
Mr. Chandler Peter, Project Manager
US Army Corp of Engineers
2232 Dell Range Blvd., Suite 210
Cheyenne, Wyoming 82009
Re: Financial Feasibility: Scoping questions and positions for the Windy Gap
Firming project.
Dear Messers. Tully and Peter:
Funding of the projects;
In doing a preliminary review of the funding mechanisms used for the payment of
debt for the Firming Project, a number of issues have come to our
attention that we feel need additional review by the Scoping Committee.
It is our understanding that the entire project will be paid for by a financial
commitment from each of the nine participating entities. Each will pay in direct
proportion to their call for water from the total available by the Firming
process. In other words, Erie is requesting 6,600/a/ft. They will then be
responsible for providing $20 million if it were a $300 million project. This is
6.6% of the total 100,000 ac/ft reservoir and 6.6% of the cost.
In the case of Erie, they also have a commitment to the NISP project for 12.2%.
By using the same ratio calculation they would then be responsible for another
$50 million or so of a $300 million project (probably a very low estimate in
view of other recent projects), making their total commitment for the two
projects to something between $60-$80 million.
In looking over Erie’s ‘01 audit it was noticed they are presently carrying
about $20 million in debt for water projects. All of this debt is in an
Enterprise Fund and probably was accumulated without a public vote. It can
be assumed that they have been able to service this debt with fees collected
from growth, development fees, and maybe some user fees. The question that comes
to mind is; will Erie be able to take on an additional debt load of up to
$80 million and then be able to service the debt? What would the rate of
growth have to be to service that debt? To us it seems astounding that they
would even be considering such a fiscal move and it would also seem questionable
why any bonding institution, or underwriter would ever consider this. In
addition, it is alarming that by running these bond issuances through enterprise
funds the public will never get a chance to vote on whether the community will
want to commit to that level of indebtedness, an indebtedness that will be with
them for a couple of generations. What happens if the growth rate slows? (This
already occurred in Berthoud and the public got stuck with a doubling of service
fees!)Who will then pay the debt? Will this indebtedness occur without the
public ever knowing of it? The city council will have to vote on the issues as
they govern the enterprise fund, but will they represent the wishes of the
public?
While Erie is the only municipality I have had time to review, it would have to
be assumed that this situation may also exists in some of the other entities
involved. Greeley is also into both projects at very high levels. The reason for
this level of financial commitment by these small communities, a level that has
not occurred historically, is due to the lack of federal and state funding.
As a result of this critical situation, the local governments are being asked to
pick up all of the tab on the project. What I am saying is two fold; One, it
looks unlikely that the communities have the financial where-with-all to
actually fund this project. Secondly, and more interestingly, if the public
finds out the level of indebtedness, they will be committed to, they will be in
an uproar and will deny the councils right to commit to it. In the end, it is
all about financial feasibility. One thing for sure, if the public were given
the opportunity to vote on this expendurature it would not pass! My guess is
that some communities will force it to the surface and portions of the funds
represented by that community will be cut off. Presently, I do not believe any
of the affected citizens are even remotely aware of this financial situation.
Interestingly, a large portion of the local citizens are opposed to our present
rapid rate of development. When they find out they may have to pay to subsidize
it, they will not be content citizens.
In summary, I would say that the systems being set up to fund this project are suspect because of their vulnerability to disruption. It is not as though there was a single confirmed source of funding. There are nine entities that must make a commitment and be able to service their debt. Probably, the most noticeable of concerns is the nature of the mechanism itself--the revenue bonds being held in enterprise funds. In the event citizens understand this mechanism, they will not approve it, ( much like what happened with Ref. A) and the funding will cave in on itself. I believe it is necessary to explain and to demonstrate these funding systems to the public in general, so that they understand the debt may fall on them as water users and as tax payers.
Inclusion of Larimer Open Space Project with the Chimney Hollow Site:
Citizen Planners would like bring to attention of the scoping committee the importance of including a comprehensive multi-use recreational site surrounding the proposed Chimney Hollow reservoir. At present Larimer County has developed a large, well-thought out open space area in the immediate vicinity of Chimney Hollow. We feel that it is fitting to expand this effort. From out point of view this inclusion is imperative to meeting the recreational needs of the future and providing a substantial open space site.
Thank you very much for your help and considerations.
David Wright
13850 Swanson Ranch Rd.
Loveland Co. 80538
The follow is the scoping presentation of Trout Unlimitd. This document is
endorsed by Citizen Planners located in Fort Collins, Colorado.
Re: Scoping comments on Windy Gap Firming Project EIS
Dear Messers. Tully and Peter:
On behalf of Colorado Trout Unlimited, a non-profit organization with over 8300
members in the State of Colorado, we are pleased to submit these comments
regarding the appropriate scope of National Environmental Policy Act (NEPA)
compliance for the proposed Windy Gap Firming Project (WGFP).
Using the Windy Gap Firming Project Study (WGFPS, February 2003) as a starting
point, there are several issues that will require more attention in the
Environmental Impact Statement (EIS) than they received in this report. We list
them here and then discuss them in more detail below: