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Water System Improvement Rocky Ford, Colorado
Loan Fund Project Highlight
Where: Rocky Ford, Colorado
Need: Interim financing for much-needed water systems improvements
Solution: RCAC provided a construction loan of $2.8 million to the city which will be repaid by loans and grants from USDA once the system is complete.
Rocky Ford is an agricultural community with a population of about 4,200 in Otero County in Southeastern Colorado. The Median Household Income (MHI) for Rocky Ford is $23,359. In 2000, the MHI of Otero County was $35,906 and the state MHI was $47,203.
The community needed to upgrade its water system to meet Safe Drinking Water Act requirements and increase supply.
The city of Rocky Ford water plant needed major improvements to its water system, including a new storage tank, new pump station, new well, new water treatment equipment and water line replacements. USDA obligated $4,328,902 ($2,822,415 loan and $1,506,487 grant) for the improvements along with $425,207 from the Colorado Department of Local Affairs (DOLA). The improvements will be completed in six phases.
Although permanent sources of financing were secured, the community had to find a way to finance the construction of the improvements on an interim basis. Bank financing for such a project was not available even prior to the recent economic environment.
The RCAC Loan Fund provided a $2.8 million construction loan to pay for various phases of the project. Interest payments are included in the loan so that the community does not have to pay the extra monthly expenses during construction. USDA funds will repay RCAC when the project is complete and approved.
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