HomeMy WebLinkAbout13 Broadband Implementation Agenda Item # � 3
Memorandum
To: Board of Directors
From: Peter Holzmeister
Date: July 16, 2004
Workshop
Status of Broadband Business Implementation
July 21, 2004
LAFCo: We have submitted the Risk Mitigation Plan to LAFCo to satisfy the final requirement set
forth in their resolution granting conditional approval. LAFCo then retained the services of Jon
Cristy, and attorney who specializes in public finance, to review the COP financing documents. His
task was to express an opinion to LAFCo as to whether TDPUD water and electric funds are
protected. He suggested a few minor changes to the documents, all of which have been made by
our bond counsel, and Mr. Cristy has said in a meeting I attended that he is satisfied that water and
electric funds are fully protected.
LAFCo asked that we submit a revised business plan, using a format that they preferred, including
information that our initial business plan to not contain. We revised our business plan according to
their wishes and submitted it to them. The LAFCo committee members, consisting of SR Jones,
Scott Brown and Paul Norsel reviewed the financial spreadsheet and found what they considered
to be problems. We are not in the process of working with them through the details of the
spreadsheet. They have retained the services of a CPA in Grass Valley to help with this process.
At this time, we expect LAFCo to hold a special meeting in Truckee on August 11, 2004 to grant
final approval for activation of the latent power.
Financing: We talked at an earlier meeting about the increase in financing from $17 million to $24
million. Attached is a comparison of the two financing. And the twelve year spreadsheet showing
projected financial performance for the system. if LAFCo approves the activation of the latent
power on August 11, we should be able to close on the financing by around September 15.
Construction: if financing is closed on September 15, or thereabouts, construction can begin in
October. We estimate that construction should take about one year, possibly eighteen months if
there are unanticipated delays.
Sources & Uses for First 24 Months
USES .,,W
re and Optical Gear $ 8,556,735 $7,786,224 $ 770,511
tion&Core Network $ 7,911,386 $5,594,230 $ 2,317,156
Related Expenses $ 3,342,718 $3,706,017 $ (363,299)
nel Labor $ 1,362,416 $828,000 $ 534,416
$ 510,388 $909,317 $ (398,929)
g Costs $ 2,885,000 $1,525,000 $ 1,360,000
l Payments $ _ $ _ $
Total $24,568,643 $ 20,348,788 $ 4,219,855
SOURCES
ation $ 460,211 $727,037 $ (266,826)
$ 685,888 $745,310 $ (59,422)
M:Add-on
Video, Data $ 4,121,107 $4,744,586 $ (623,479)
Services $ 97,578 $35,730 $ 61,848
Income $ 238,920 $350,421 $ (111,501)
Total $ 5,603,704
$ 6,603,084 $ (999,380)
Loan Proceeds $24,000,000 $17,000,000 $ 7,000,000
Surplus/(shortage) $ 5,035,061 $3,254,296 $ 1,780,765
Debt Payments(interest only) $ (3,057,600) ($2,210,000) $ (847,600)
Net available fa) fartofYar $ 1.977.461 S-1.044.M $ 933,165