Leak test approved by state for Kyger Pit, closing date planned for March
February 7, 2014
The state-mandated leak test for the Kyger Pit has been accepted by the state engineer's office, Town Attorney Ian McCargar told the Windsor Town Board during Monday's meeting.
"That's a big step that will trigger a scheduling of closing," McCargar said.
The town board unanimously approved a $4.5 million loan from the Colorado Water Conservation Board toward the purchase of the Kyger Pit at a meeting Dec. 9, allowing the town to move forward in its process to buy the property for use as a water storage area.
He said the town is also looking to negotiate an agreement after closing on the deal for what will happen to the water that filled the reservoir after the flood. The seller and town agreed to close assuming 1,000-acre-feet of water, but will share the cost of a sonar survey to get a detailed view of the bottom of the reservoir. That data, he said, will allow them to "true-up" the purchase price to an exact amount.
The town and the seller will negotiate that operating agreement and bring it back to the board in the near future to explain the details.
"At that time we can explain not only it standing alone, but how it fits into the total transaction with Kyger," McCargar said.
He said the town still anticipates closing on the deal in early March.
The term of the $4,545,000 loan is 20 years at an interest rate of 2.75 percent. The town anticipates making annual payments of $295,000, which will be financed with revenues from the town's Water Enterprise Utility fund, according to town finance director Dean Moyer. Revenues in the water fund include water fees and tap fees.
Beyond the loan, the town plans to finance the remainder of the estimated $6.3 million project cost from a few different sources:
» $750,000 from the water fund, which came from money the Greenspire Subdivision paid the town for half of the cost of the lake pump house, which allowed the subdivision to buy irrigation water from the town.
» Instead of buying $200,000 worth of water to store in Windsor Lake, Moyer said the town instead plans to put the money toward the cost of the project.
» $625,000 from both the Park Improvement Fund and the Capital Improvement Fund.
Moyer said the town has set aside more money than is needed to cover the cost to allow for price fluctuations. He said in the event costs come back lower than expected, the town would likely reduce the amount taken from the loan.