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N—ecessary Gross Up Adjustments <br />No <br />The load ratio share investment level which CMMPA contracts for in the <br />upstream agreement needs to be grossed up for the following adjustments <br />71 Externally driven <br />• Inflation from 2010 $ to the 2011, 2012, 2013 and 2014 construction years <br />• To accommodate an increase for the upstream CM Max <br />• To finance bond underwriting costs <br />Internally driven <br />0 To allow for CMMPA indirect cost associated with financing <br />• Interest during Construction <br />• Setting up Debt Reserve Fund <br />To accommodate financing for the first two years 0 & M <br />E3 The recovery of 0 & M will always lag by two years due to the Attachment 0 tariff filing process <br />o We conservatively an 0 & M cost of 5%/year of the original investment <br />This could be substantially lower than this <br />In any case may probably want to set up some sort of reserves fund for Renewals and Replacement <br />As a the investment level indicated in your formal resolution need to gross up the <br />$6,265,278 investment level (i.e. its Pro Rata of its Load. Ratio Share) by 14% to a <br />investment level of $7,140,953. <br />m In the event that a co-participant chooses less than their pro-rata load ratio share, if YOU want to leave the <br />option open to investment higher than its pro-rata load ratio share, then you may want to consider <br />designating a number based on greater than its pro-rata load ratio share <br />0 All participants will be have first rights to their pro-rata load ratio share and any remaining investment I-ights <br />will. be available pro-rata to participants interested in investing over their pro-rata load ratio share <br />