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WWRC 86-05ee
State Financing Alternatives for Wyoming Water Development: Outline of Presentation

Outline

I. Background of water development in Wyoming

II. Funding in recent past

A. Total budgeting

1. Prior to 1983, $199 million with $42.7 million expended

2. In 1986, added $86 million for total of $280 million

B. Projects approved

1. Buffalo Bill; $47 million

2. Deer Creek; $45 million

3. Sulphur Creek; $25 million

4. Cheyenne Water Project; $107 million, including $40 million loan

C. Middle Folk Project put on hold

III. We are now at a stage where we need to reexamine funding sources

A. Decline in value of oil, natural gas, and other minerals with reduced revenues. ($1.00 decline in oil price = $190,00 loss to the Water Development Account II.)

B. Long start-up time requires advance planning

C. Discussion of present system

IV. Repayment of loans to local governments

A. Water revenue bonds

B. General obligation bonds

C. Optional sales tax (two-year option-the fourth one cent)

D. Capital facilities optional sales tax (the fifth one cent)

E. Combinations of these options mixed with appropriations from the general fund

V. Other approaches to funding

A. Arizona

B. Montana

C. Industrial companies-Little Horn Group

D. Intermediation option

1. Bring capital from other sources to entities that cannot borrow on their own

2. WCDA as possible intermediary

E. Secondary repayment sources

1. State loan with take-out later

2. Substituting tax revenues which are not pledgeable under the Witzenburger decision with federal mineral royalties; permissible under the Herschler decision

VI. Summary & conclusions

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