HUERFANO COUNTY INVESTMENT PROSPECTUS. Fo u n d a t i o n fo r a S t ro n g F u t u re

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1 HUERFANO COUNTY INVESTMENT PROSPECTUS Fo u n d a t i o n fo r a S t ro n g F u t u re

2 THE WALSENBURG OPPORTUNITY ZONE Huerfano County, Colorado Investment Prospectus 2

3 KEY STRENGTHS Climate Water and Sewer Transportation Quality of Life The climate is warm and arid with an average high temperature of 67 degrees. Winter temperatures average in the high 40s while summer temperatures are in the upper 80s and higher. Huerfano County is in the top 15 percent of counties in terms of annual sunshine and annual solar radiation. This creates opportunities for solar energy and for waterefficient indoor agriculture. The City of Walsenburg has senior water rights meaning that it has the first claim on water in the Cucharas River. The current water system is sized for a population of approximately 35,000 compared to the current population of just under 3,000. The filtration plant has capacity for 6.0 million gallons per day (GPD). Current use averages 750,000 GPD or 12.5 percent of its capacity. The sanitary sewer has a capacity of 1.0 million GPD compared to current use of 250,000 GPD. Huerfano County is located at the intersection of: I-25 US Highway 160 State Route 10 State Route 69 State Route 12 The Burlington Northern Santa Fe Railroad (BNSF) and Union Pacific operate rail service through the area The Spanish Peaks Airfield is a general aviation airport that offers a 4504 foot asphalt runway and self-service Jet-A fuel with tie-down parking. Enjoy unlimited access to excellent hiking, biking, and outdoor recreation Beautiful unspoiled landscapes provide a backdrop to art galleries, restaurants, and more Each community in the County offers a unique experience for residents and visitors The Scenic Highway of Legends, Highway 12, runs through one of the most beautiful regions in Colorado Find out more at Huerfano County, Colorado Investment Prospectus 3

4 COLORADO ENHANCED ENTERPRISE ZONE PROGRAM New Employee Tax Credit Huerfano County is an Enhanced Rural Enterprise Zone and businesses qualify for a $2,000 credit per new employee Investment Tax Credit Businesses investing in Enterprise Zones through business personal property can earn a 3% tax credit Job Training Credit Companies that implement a qualified job-training program 12% of their eligible costs. Employer Sponsored Health Insurance $1000 per net new employee insured under a qualified health plan for which the employer pays 50% of the costs Vacant Commercial Building Rehabilitation 25% of the rehabilitation costs for a building that has been vacant for 2 years. Limited to $50,000 Commercial Vehicle Investment Investment in commercial trucks, tractors, or semi trailers registered in CO and based in an Enterprise Zone quality for a 1.5% credit Huerfano County, Colorado Investment Prospectus 4

5 HIGH IMPACT PROJECTS T R A N S F O R M AT I V E O P P O R T U N I T I E S Huerfano County, Colorado Investment Prospectus 5

6 SPANISH PEAKS INDUSTRIAL PARK This is a two phase project to develop a 200+ acre Industrial Park along with Spec Buildings near Walsenburg in close proximity to a planned Truck Stop, located just off I-25 Phase 1 will cover extending utilities and roads to the site and creating several shovel ready 5-acre pads Phase 2 will involve development of several spec buildings and a possible rail spur San Isabel Electric Co-op will fund the development of a substation on the site and the City of Walsenburg will extend water, sewer, and gas to the site. FUNDING SOURCES FOR TOTAL $14M PROJECT City and County Funds, $1,700,000, 12% Opportunity Zone Funding, $2,000,000, 14% Federal Grants, $4,400,000, 31% County and City are currently negotiating with land owners on acquisition and have been awarded grants for design, preliminary engineering, and environmental assessment. Huerfano County Economic Development Inc. is in advanced talks with a potential anchor tenant and continues to seek other tenants. The City and County expect a return of $20K per acre for land and anticipate a strong demand for spec buildings. Anticipated return on investment is 30%, most of the funding is from grants, there are no loans required San Isabel Electric Co-Op, $4,300,000, 31% State Grants, $1,600,000, 12% Huerfano County, Colorado Investment Prospectus 6

7 GASIFICATION PLANT A C l e a n e r Te c h n o l o g y Gasification of base materials to produce chemicals and fuels is a mature industry, with hundreds of plants worldwide used to make ammonia, methanol, substitute natural gas, and diesel fuel. In gasification, steam and oxygen convert coal into synthesis gas or syngas. Syngas is composed of hydrogen and carbon monoxide with relatively small amounts of other impurities that must be removed. This syngas is then converted into a syncrude that could be converted into a number of end products. The project is seeking initial commitments of at least $4M to conduct a front end loading study. Project will require a capital expenditure of $295M in today s dollars. Assuming a 60/40 debt to equity ratio, we anticipate a return of 8% to 9%, with an 8% return for debt and a 13.1% return for equity. Anticipated cost of capital is 5.5% to 6% The source material can be coal, most likely from the Powder River Basin or possibly from the New Elk Mine in neighboring Las Animas County. Biomass can also be a source material, but that requires more study. Using biomass would also raise the required capital expenditure by 20% to 25% Huerfano County, Colorado Investment Prospectus 7

8 OTHER PRIORITY PROJECTS Assisted Living Facility We are seeking a developer or investor for a $4M to $6M project An assisted living facility would be built in proximity to the Hospital and share services with the Veterans Home and Hospital Such a facility would be built by a development company and leased to the Hospital for 10 years before the Hospital has an option to buy The Spanish Peaks Regional Health Center currently operates a five star rated veterans nursing home and would expand its services to this new facility RV Park We are seeking an active investor for a $2.5M project to develop a luxury RV Park on 100 acres of land just off of I-25 just south of Walsenburg. The site adjoins 500 acres of recreational land in conservation easements The Park will consist of 150 pull-through sites designed so that many will accommodate the largest of trailers and fifth-wheelers, including Big Rigs. The RV Park will be visible from I-25 at Exit 49. Average Daily Traffic at the Exit is 400,000 vehicles or 14,600,000 million vehicles per year. Investor will own 67% of the project and the land owner will contribute 100 acres of land for 33% ownership. Education Campus Seeking an investor for a $5M project to develop a community facility that would provide job training and educational opportunities for local employers, the Hospital, industrial park tenants, and high need fields such as computer programming Discussions are progressing with Trinidad State Junior College to serve as the anchor institution. Would Prospective location is the Washington School in Walsenburg, a 30,000 sq ft historic building Housing We are seeking investors and developers for future housing projects. Huerfano County, the City of Walsenburg, and Huerfano County Economic Development Inc. are conducting a Housing Needs Assessment that is expected to be complete in late spring. The City and the County own properties within the City that are suitable for in-fill development. There are also several lots that are on the market and located in prime spots for apartment buildings. There is also developable land available in the immediate vicinity of the City of Walsenburg. The City and the County will seek grants to aid the development of new housing in the region. Huerfano County, Colorado Investment Prospectus 8

9 REACH OUT TODAY! Lola Spradley Co-President, HCED Karen Wilson Co-President, HCED John Galusha Huerfano County Administrator James Toth Walsenburg City Administrator Carl Young Huerfano County Economic Development and Tourism Director Real Estate Brokerages Bachman and Associates Capture Colorado Code of the West Huerfano County, Colorado Investment Prospectus 9