USDA B&I Feasibility Study Case Study: A Tribal Enterprise Travel Center on Trust Land at I-40 Exit 53 in Thoreau, New Mexico, Feasible with Conditions

A new travel center proposed by a tribally chartered enterprise on 18 acres of trust land at the I-40 and Thoreau interchange in McKinley County, New Mexico, on the segment between the Milan fueling node and the Gallup port of entry, which carries the heaviest truck traffic in the state. The borrower is a federally recognized tribe's economic development enterprise, the land is held in trust and financed through a Bureau of Indian Affairs approved business site lease and leasehold mortgage, the tribe's gaming enterprise sits outside the borrower, and the tax stack is the Nation's rather than the county's. At a $14,220,800 total project cost, financed with a $9,954,560 USDA Business and Industry guaranteed loan and $4,266,240 of tribal equity, the travel center covers at 1.32x in Year 3, 1.43x in Year 4 and 1.51x in Year 5 on 4,600,000 diesel gallons and $4,780,000 of nonfuel sales. Determination: feasible with conditions, conditioned on the BIA lease and leasehold mortgage approvals, a limited waiver of sovereign immunity, an NMDOT classified count at the exit, the state and tribal tax position for the site, and a title status report for every parcel.

Model study prepared by MMCG Invest | Michal Mohelsky, J.D., FMVA | October 2, 2026

MMCG concludes that the proposed travel center at the I-40 and Thoreau interchange in McKinley County, New Mexico is feasible with conditions. On a Year 3 base of 4,600,000 diesel gallons at a 22 cent margin, 1,300,000 gasoline gallons at a 31 cent margin and $4,780,000 of nonfuel sales at a 45.3 percent gross margin, the travel center earns EBITDA of $1,230,515 and covers its debt at 1.32x in Year 3, 1.43x in Year 4 and 1.51x in Year 5. The structure is a $9,954,560 Business and Industry guaranteed loan at 70 percent of a $14,220,800 total project cost, amortized over 30 years within the program's 40-year maximum, and $4,266,240 of tribal equity, 30 percent of total project cost, above the 25 percent the program requires of a new business whose lender requests the loan note guarantee before construction is complete; at the 25 percent minimum the loan rises to $10,665,600 and Year 3 coverage falls to 1.23x, which is why the study carries the higher equity the model enterprise is assumed to fund. The margin above 1.25x in Year 3 is 2 percent of forecast gallons, widening to about 7 percent by Year 5. The credit's distinguishing features are not in the operating model, which is the model of any independent travel center on a rural interstate, but in the collateral and the tax stack: the lender's security is a leasehold mortgage on a BIA-approved business site lease rather than a fee mortgage, the borrower is an arm of a sovereign and must waive immunity for the loan documents, the county's property tax is replaced by the Nation's possessory interest tax and a negotiated service payment, and the sales and fuel taxes that apply at the pump and the register depend on which parcel the improvements sit on and who the customer is. The determination is conditioned on the BIA approvals, the waiver, an NMDOT classified count at the exit at or above the underwriting basis of 21,000 vehicles per day and 35 percent trucks, the written state and tribal tax position for the site, and a title status report for every parcel in the lease.

This is an MMCG model study: a complete feasibility analysis of a travel center on a model parcel at a real interchange, prepared with public data to show USDA guaranteed lenders and tribal sponsors how MMCG underwrites a trust land travel center against the corridor, the competitive set, the program, the land tenure and the tax regime. It is not a client engagement. The parcel is a model site described by its acreage and interchange, the borrower is a model enterprise described by its structure, and no tribe, enterprise, landowner or sponsor is named or implied; MMCG has no relationship with any of them, and the analysis does not represent an offer, an appraisal or a recommendation. The Thoreau interchange sits within the checkerboard of trust, allotted and fee land along I-40 in McKinley County, and the study carries the tax stack that the Office of the Navajo Tax Commission publishes for trust parcels within the Nation as the regime most likely to apply at this exit, identified as such. Figures drawn from the New Mexico Department of Transportation, the City of Gallup's corridor report, the Office of the Navajo Tax Commission, the New Mexico Taxation and Revenue Department, the Federal Highway Administration, the Federal Motor Carrier Safety Administration, TravelCenters of America's last public filings and the operators' own location pages are identified as such. Figures labeled MMCG assumption or MMCG estimate are underwriting inputs set by MMCG, and items that could not be verified from a primary source at the study date are listed in the Conditions and Limitations section. In particular, the NMDOT count at Exit 53, the trust status of any specific parcel at the exit, the tribe's current business site lease rent and possessory interest tax practice, the county's service payment practice, and whether the state's special fuel tax and the Nation's fuel excise tax both apply at the pump were not confirmed and are carried as stated assumptions.

The Project will operate as a 24-hour travel center on 18.0 acres of trust land at the I-40 and Thoreau interchange, Exit 53, in McKinley County, New Mexico, 32 road miles east of the Gallup port of entry and 26 miles west of the Milan and Grants fueling node, on the segment of I-40 that carries the heaviest truck traffic in New Mexico and sits one hours-of-service driving day east of the Southern California ports' inland distribution hubs and one day west of the Oklahoma City and Dallas lanes. The physical program comprises a single-story 8,000 SF masonry building housing a 3,600 SF convenience store with a beer cave, a fountain and coffee program, a hot case and a Native arts and crafts section, a 60-seat grill with counter service, a driver lounge with eight private showers, laundry and a fuel desk, restrooms sized for a truck stop, an office and back-of-house, together with a six-lane diesel canopy carrying dual-sided high-flow dispensers with diesel exhaust fluid at every lane, a 12-position auto fueling canopy, an 80-space heavy-duty truck court with 16 reserved spaces under a paid reservation program, a CAT scale, a six-tank double-wall underground storage system holding 160,000 gallons with interstitial monitoring, and a lighted pylon sign visible from both directions of I-40. The travel center will operate 24 hours a day, seven days a week, with a general manager, two assistant managers and 24 full-time-equivalent store, grill, fuel desk and porter staff for 27 FTE, with hiring preference for tribal members under the enterprise's charter. The borrower is a tribally chartered economic development enterprise that holds the business site lease, the improvements and the business and borrows the B&I guaranteed loan under a limited waiver of sovereign immunity; the tribe's gaming enterprise is a separate entity that neither owns the borrower nor guarantees the loan, and no gaming is conducted at the site. The Project is positioned as the full-service stop between the Milan node and Gallup with diesel priced at or within two cents of the chain's posted cash price, fleet card acceptance on the major networks, a lot that does not fill by early evening, and a grill and gift program aimed at the interstate tourist traffic that the I-40 corridor through the Southwest carries.

Marketing and Sales Strategy

The launch is anchored on the fleet card networks and the driver apps, with enrollment with the major fleet card processors before opening, directory and parking app listings with the reservation program live at opening, and a 90-day opening promotion of free showers with a 50-gallon fill and a loyalty card that credits inside purchases against fuel. The reserved parking program is sold through the parking apps and the fuel desk at $18 a night. Business outreach targets the regional carriers that run the Gallup port of entry, the uranium district and energy service fleets in Cibola and McKinley counties, and the tribal enterprises and chapters along Route 66 for direct-bill fuel accounts and bulk DEF. The grill and the arts and crafts section market to the interstate tourist through the corridor's travel guides and the tribal tourism office, and the enterprise's own purchasing from tribal artisans is the acquisition channel for the gift program. Retention runs on the loyalty program, clean showers and the diesel price position against the Milan node and Gallup.

Amenities

The subject is a model 18.0-acre tract of trust land at the Thoreau interchange, carried under a 25-year business site lease at $60,000 a year of rent rather than a fee acquisition, with $90,000 of prepaid rent, survey and BIA lease approval costs in the land line. Thoreau is an unincorporated community in McKinley County on the north side of I-40 at the Continental Divide approach, in a county whose seat, Gallup, had a 2020 population of about 21,700, far below the 50,000 threshold in 7 CFR 5001.3, and the exit lies outside any urban area; the site is rural without a petition. The interchange lies within the checkerboard of trust, allotted and fee parcels that alternates along I-40 between Grants and Gallup, which is why a title status report for every parcel in the lease is a condition of the determination rather than a closing formality.

Interstate 40 through McKinley County is the corridor fact. The New Mexico Department of Transportation's data presented to the Legislature carries the I-40 segment from the Arizona line to Albuquerque at about 20,000 vehicles per day with about 30 percent trucks on 2016 counts, the City of Gallup's corridor report describes the Gallup segment as carrying more than 6,000 trucks a day, the busiest truck segment in the state, and NMDOT's 2024 corridor study records truck traffic through the Gallup port of entry growing about 6 percent a year from 2017 to 2022, more than 80 percent of commercial truck trips as through trips, and a long-term all-vehicle growth rate of 1.1 to 2.8 percent a year. The Arizona Department of Transportation's count at the state line is 21,761 vehicles per day. MMCG's underwriting basis of 21,000 vehicles per day with 35 percent trucks sits between the dated NMDOT share and the heavier Arizona reading and is carried as a condition; on that basis 7,350 trucks and 13,650 passenger vehicles pass the exit each day.

The hours-of-service rules place the subject at the end of the first driving day east from the Inland Empire distribution hubs and the Southern California ports, and at the start of the last day west for a truck that reset in Albuquerque or Amarillo: a property-carrying driver may drive a maximum of 11 hours after 10 consecutive hours off duty, may not drive beyond the 14th consecutive hour after coming on duty, and must take a 30-minute break after 8 cumulative hours of driving. The Gallup port of entry, 32 miles west, is where every eastbound truck entering New Mexico stops for weight and credential screening, and the Milan node, 26 miles east, is where the chains capture the fleet-contract diesel on this segment with a Love's and a Petro at one interchange. The subject's demand is the truck that leaves the port with a partial tank, the truck that finds the Milan lots full at dusk, and the truck whose fleet card routes to an independent price on a 58-mile segment with no other travel center.

Stabilized diesel volume of 4,600,000 gallons a year is 12,603 gallons a day, 133 fueling trucks at an average fill of 95 gallons and 1.80 percent of the trucks passing the exit; the Year 1 figure of 3,312,000 gallons is 96 trucks and 1.30 percent. At six dual-sided lanes that is about 64,000 gallons a lane a month, at the top of the independent band MMCG carries and well below the chain nodes, which is the volume the credit depends on. Gasoline is modeled at 1,300,000 gallons at stabilization, 324 cars a day at 11 gallons and 2.37 percent of passing passenger vehicles, with the interstate tourist traffic and the Thoreau and Crownpoint local trade inside that figure.

MMCG identified two chain travel centers at the Milan node, one at Gallup and three tribal travel centers east of Grants on the I-40 corridor. Truck parking counts are taken from the operators' pages where published and from directories where not, and the directory counts are flagged.

Competitor Number 1 Love's Travel Stop, Milan This travel stop is located at I-40 Exit 79, Milan, NM, about 26 miles east of the subject. It is the chain's node between Albuquerque and Gallup and the subject's price reference. Its truck parking count was not retrieved from the operator's page.

Competitor Number 2 Petro Stopping Center, Milan This travel center is located at I-40 Exit 79, Milan, NM, at the same interchange as Competitor Number 1. It is the full-service stop on the node with truck service. Its truck parking count was not retrieved from the operator's page.

Competitor Number 3 TA Gallup This travel center is located at I-40 Exit 16, Gallup, NM, about 37 miles west of the subject. Directories list 76 truck parking spaces. It is the chain stop at the port of entry city and the westbound driver's last full-service stop before Arizona.

Competitor Number 4 Route 66 Travel Center This travel center is located at I-40 Exit 140, west of Albuquerque, NM, about 87 miles east of the subject, adjacent to a tribal casino. The operator's page lists more than 300 truck parking spaces. It is the largest tribal travel center on the corridor and the model for the casino-outside-the-borrower structure the subject adopts.

Competitor Number 5 Dancing Eagle Travel Center This tribal travel center is located at I-40 Exit 108, NM, about 55 miles east of the subject, and was reported at its 2001 opening with 100 paved and 50 gravel truck parking spaces and a casino shuttle. Its current count was not verified.

Competitor Number 6 Sky City Travel Center This tribal travel center is located at I-40 Exit 102, NM, about 49 miles east of the subject. Directories list 75 truck parking spaces, eight fuel lanes and a casino amenity.

Between the Milan node at Exit 79 and Gallup at Exit 16, a distance of 63 miles, no travel center was identified; fuel at the Thoreau and Continental Divide interchanges was not verified from operator sources and is carried as fuel without a truck program. No travel center announced, permitted or under construction within 30 miles of the subject was identified in chain newsrooms, local news or planning agendas between 2024 and 2026; the chain's 2026 New Mexico openings at Albuquerque and Truth or Consequences lie outside the segment. The three tribal travel centers east of Grants, with roughly 525 combined truck spaces, show the model working on this corridor; the subject is sited west of that band rather than inside it.

Federally recognized Indian tribes are eligible B&I borrowers under 7 CFR 5001.126, and a tribally chartered enterprise that is engaged in a business and able to give the collateral and the guarantees the program requires borrows on the same terms as any other borrower, subject to the same rural area test and the same requirement in 7 CFR 5001.126(d) that the loan be collateralized with fixed assets that remain in the United States. Two structural questions decide the application.

The first is the casino. The exclusion in 7 CFR 5001.127(b) for Tribal-authorized gaming proceeds applies only as approved by the Agency and only where the gaming is conducted to raise funds for the approved project, so a travel center whose borrower also holds a casino floor would face the 15 percent test on the combined revenue. The subject's borrower is the tribe's economic development enterprise, the gaming enterprise is a separate entity with its own charter, ownership and cash flow, no gaming is conducted at the site, and the gaming enterprise does not guarantee the loan. Because 7 CFR 5001.126(a)(2) requires co-borrowers where entities depend on each other, the separation is real in operation as well as in form: no shared management contract, no revenue sharing and no cross-default, and the study carries no gaming revenue in any line.

The second is land tenure. The improvements sit on trust land under a 25-year business site lease approved by the Bureau of Indian Affairs under 25 CFR Part 162, with a leasehold mortgage to the lender approved by the BIA as the lender's security, a term that exceeds the loan's 30-year amortization only with a lease renewal the lease must grant, and a limited waiver of sovereign immunity by the borrower and the tribe for the loan documents with an agreed forum and governing law. The lender's recovery in a default is the leasehold and the improvements, not the land, which is why the credit rests on operating cash flow more than on collateral and why the tribe's 30 percent equity matters to the lender. The 25-year lease term and the 30-year amortization are reconciled by a renewal option exercisable by the lender or its assignee, and the study carries the leasehold mortgage, the BIA approvals and the waiver as the first two conditions.

The county's property tax does not apply. Under the federal leasing regulations at 25 CFR 162.017, permanent improvements on leased trust land are not subject to state or local taxation, and the study carries no McKinley County ad valorem tax on the building, the canopies or the court. In its place the Nation's possessory interest tax applies at 3 percent of the value of the possessory interest, with business site leases classified as commercial, leasehold improvements excluded from the taxable value and no tax below a $100,000 threshold; the study carries $18,000 a year on a lease value near $600,000 as an MMCG estimate. A negotiated service payment to the county and the fire district for emergency response is carried at $36,000 a year, about 25 percent of the hypothetical county bill on the improvements, as an allowance that stands in for the agreement the enterprise would reach; no published payment in lieu of taxes agreement for a travel center on trust land in New Mexico was located.

The sales and fuel taxes depend on the parcel and the customer. The Nation's sales tax of 6 percent applies to gross receipts at the register on trust parcels within the Nation, replacing the state's gross receipts tax for a tribal enterprise selling on its own trust land, and the study models it as collected from the customer rather than as an expense. New Mexico allows a 100 percent deduction from the state gasoline tax of $0.17 per gallon for gasoline sold on tribal land where a tribal gasoline tax applies, and the Nation's fuel excise tax on gasoline is $0.18 per gallon, so the pump price on gasoline is at parity with the state; on diesel the state retains 100 percent of its special fuel tax of $0.21 per gallon and the Nation's special fuel excise tax has been $0.25 per gallon since July 1, 2010, so a trust parcel diesel pump may carry both taxes, $0.46 per gallon, against $0.21 at a fee parcel, unless the intergovernmental agreement between the Nation and the state on fuel excise tax enforcement, in place since 1999, resolves the stacking for the site. That question decides whether the subject can hold its diesel price within two cents of the Milan node, and it is the fourth condition: the written state and tribal position on the special fuel tax, the sales tax and any gross receipts exposure for the parcel, obtained before the lender submits. The study carries the diesel margin at 22 cents on the assumption that the position allows price parity; a stacked diesel tax that the market will not bear is a 25 cent margin problem, and the 16 cent sensitivity case is the proxy for it.

The site is rural under 7 CFR 5001.3, a travel center is an eligible commercial enterprise under 7 CFR 5001.105, and no gaming revenue is projected. The borrower is a new business under 7 CFR 5001.3, which makes the independent feasibility study a requirement of 7 CFR 5001.306(a)(3)(i) for a guaranteed loan greater than $1,000,000 and sets equity under 7 CFR 5001.105 at 25 percent of total project cost where the lender requests the loan note guarantee before construction is complete; the tribe's 30 percent exceeds it. The guaranteed loan of $9,954,560 falls in the $5,000,000 to $25,000,000 tier that USDA guarantees at 80 percent in fiscal year 2026, with a 3 percent initial guarantee fee on the guaranteed amount and a 0.55 percent annual retention fee, and because it is below the $10,000,000 maximum State Director authority under RD Instruction 1901-A it is approved in the New Mexico State Office. The 27 jobs created are below the 50-job threshold for Department of Labor concurrence. The feasibility study, the appraisal, the BIA lease costs and the lender's fees are eligible uses of loan funds under 7 CFR 5001.121(c)(10). The Agency's environmental review under 7 CFR 5001.207 and Part 1970 applies to a new fuel storage facility on trust land, and the study carries the NEPA documentation and the BIA's own environmental review inside the architecture, engineering and permits line and inside the construction schedule.

Water and sewer are carried as connections to the Thoreau community system with capacity fees and line extensions inside the $1,500,000 site work line, which is higher than the Clinton and Effingham cases because of the extension distances a rural New Mexico interchange carries, together with a three-phase electrical service extension sized for the canopies, the refrigeration and the grill. The underground storage system is six double-wall fiberglass tanks of 160,000 gallons total with secondary containment, interstitial monitoring and automatic tank gauging under the 2015 federal UST rule, carried at $900,000 installed; on trust land the federal UST program applies directly, and the Environmental Protection Agency rather than the state is the implementing agency. The site disturbs more than one acre and requires construction stormwater permit coverage under EPA's construction general permit for Indian country, and the truck court drains through oil-water separation to detention. A Phase I Environmental Site Assessment under ASTM E1527-21 and a title status report are carried in the land line. The hard cost contingency is carried at 7 percent rather than 6 because of the remote location and the BIA and NEPA schedule.

Source: U.S. Census Bureau; New Mexico Department of Transportation; City of Gallup; Arizona Department of Transportation; MMCG estimates.

The local trade area supplies the gasoline, the grill's street trade and the labor pool, and the tribal hiring preference is the management component's labor finding. The diesel, the showers, the parking and the tourist trade come from the corridor.

Diesel is modeled at 4,600,000 gallons at stabilization in Year 3, ramping from 3,312,000 gallons in Year 1 and 4,140,000 in Year 2 and growing 3 percent and 2 percent in Years 4 and 5, and gasoline at 1,300,000 gallons. Margin is modeled in cents per gallon. At TravelCenters of America, the last travel center chain to file public financials before bp acquired it in May 2023, fuel gross margin per gallon ran from 14 cents in the first quarter of 2021 to 27 cents in the second quarter of 2022, averaged about 25 cents for 2022 and about 17 cents for 2021, and fell to about 18 cents in the first quarter of 2023. MMCG carries diesel at 20 cents in Year 1, 21 cents in Year 2 and 22 cents from Year 3, and gasoline at 29, 30 and 31 cents. Pump prices are normalized at $4.25 for diesel and $3.25 for gasoline for the revenue and card fee lines; U.S. on-highway diesel stood at $6.382 on September 28, 2026 and the Gulf Coast regional average at $5.955, against a 2025 annual average of $3.660, and because the margin is carried in cents the price level affects the revenue total and the card fees rather than the gross margin. Fleet card fees on diesel are carried at 1.0 percent of sales and consumer card fees on gasoline at 2.5 percent. At Year 3 the fuel lines earn $1,415,000 of gross margin and pay $301,125 of card fees, a net of $1,113,875, which is 34 percent of the Project's total gross margin.

Nonfuel sales are modeled at $4,780,000 at stabilization: $3,200,000 of convenience store and gift sales at a 36 percent margin, $1,000,000 of grill sales at a 64 percent margin after food cost with the kitchen's labor in payroll, $260,000 of diesel exhaust fluid at a 33 percent margin, and $320,000 of showers, reserved parking, scale, ATM and commissions at a 90 percent margin, for $2,165,800 of nonfuel gross margin at a blended 45.3 percent. Store and gift sales of $8,767 a day equal $19.18 per fueling customer across the 133 trucks and 324 cars that fuel on an average Year 3 day, with the balance from drivers parking without fueling and from the tourist trade the arts and crafts section draws. The industry's 2025 survey reports that the typical convenience store's inside basket lost money after expenses in 2025, so the model carries the store at a 36 percent margin and does not assume inside sales grow faster than fuel. Reserved parking is carried at 16 spaces at $18 a night and 50 percent paid occupancy, about $53,000 a year, inside the other income line.

Location: I-40 and Thoreau interchange (Exit 53), Thoreau, McKinley County, NM 87323 Size in SF (Gross): 8,000

Source: Marshall & Swift CoreLogic, MMCG

The land line carries no acquisition, which is the trust land difference: the $880,000 of land the Clinton case carried is replaced by $60,000 a year of lease rent in operating expenses and $155,000 of lease, title and diligence costs. The hard cost is higher than the Clinton case for a smaller building because the base cost is carried at $290 per SF for a remote site, the utility extensions add $200,000 to site work, the NEPA and BIA documentation adds to the professional fees, and the contingency is 7 percent. The reserve of $625,000 funds the Year 1 shortfall of $502,233 and the Year 2 shortfall of $33,060 with about $90,000 of margin, and the legal line carries the leasehold mortgage, the waiver and the BIA approval documents.

Loan Assumptions

At the program's 25 percent minimum equity the loan would be $10,665,600 with annual debt service of $961,524 and Year 3 coverage of 1.23x. The study carries the 30 percent the model enterprise is assumed to fund from enterprise reserves, and the sensitivity table shows the 25 percent case.

The Project is an eligible commercial enterprise in a rural area under 7 CFR 5001.105 and 5001.3, the borrower is an eligible tribal entity under 7 CFR 5001.126, and no gaming revenue is projected, so the 15 percent test in 7 CFR 5001.127(b) does not arise and the gaming enterprise's separation from the borrower keeps it that way. The borrower is a new business whose guaranteed loan exceeds $1,000,000, so the independent feasibility study is required by 7 CFR 5001.306(a)(3)(i) and the lender's credit evaluation must contain a written evaluation of it under 7 CFR 5001.202. Equity of 30 percent of total project cost exceeds the 25 percent that 7 CFR 5001.105(d) requires for a loan note guarantee requested before completion of construction. The loan is collateralized by the leasehold mortgage on the BIA-approved business site lease, the improvements, the equipment and the inventory, all fixed assets in the United States, with the limited waiver of sovereign immunity and the enterprise's guarantee carried under 7 CFR 5001.204; the lender should expect the Agency to require the BIA's approval of the leasehold mortgage as a condition of the conditional commitment. The study presents projected balance sheets, income statements and cash flows through two years of stable operations with a stated assumption list and a pro forma balance sheet at closing under 7 CFR 5001.303, and the lender's global analysis under 7 CFR 5001.315 covers the enterprise and its affiliates other than the gaming enterprise. The fiscal year 2026 guarantee of 80 percent, the 3 percent initial fee and the 0.55 percent retention fee are carried, and the loan is approved in the State Office within the $10,000,000 maximum authority.

Payroll of $950,000 at stabilization covers a general manager at $70,000, two assistant managers at $46,000 and 24 FTE at an average of $15.25 an hour, with an 18 percent burden, for an average of $35,185 per FTE across 27 positions over three shifts including the grill, escalating 3 percent a year. The three lines that replace the county's property tax, the lease rent, the possessory interest tax and the service payment, total $114,000 against the $118,000 of property tax the Clinton case carries on a comparable building, which is the practical effect of trust land tenure on a travel center's fixed costs: close to neutral, with the land acquisition removed from the capital stack. Year 3 operating expenses of $2,049,160 are 42.9 percent of nonfuel revenue, below the 49.8 percent the public chain reported for its site-level operating expenses in 2022 because the subject carries no truck service shop. Utilities are carried higher than the Clinton case for the extension-served site, and the hard cost contingency rather than an operating line carries the remote-site construction risk.

The Year 1 shortfall of $502,233 and the Year 2 shortfall of $33,060 are funded from the reserve. The Project covers from Year 3 at 1.32x and builds to 1.51x by Year 5, and its Year 3 EBITDA of $1,230,515 is an 8.7 percent yield on total project cost, rising to 9.9 percent in Year 5, lower than the Clinton case's 9.4 percent because the remote site costs more to build for a smaller building. Total revenue of $28,555,000 at stabilization is 83 percent fuel by sales and 34 percent fuel by gross margin.

At Year 3 margins, the Project's fixed operating cost is $1,994,000 including the replacement reserve, and its contribution after card fees and cost of goods is 53.8 cents for every gallon of fuel sold with the nonfuel sales that gallon pulls into the store and the grill. Thresholds are stated as a share of the Year 3 forecast of 5,900,000 total gallons.

The 1.25x threshold at 98 percent of forecast gallons in Year 3 is the credit's honest statement, and the lender writing a 1.25x covenant should test it from Year 4, when the margin to the threshold is about 5 percent of forecast, or write 1.10x for Year 3. The 1.0x threshold at 91 percent of forecast, 11,479 diesel gallons a day and 121 fueling trucks, is the volume the subject approaches in Year 2.

The Project holds coverage at or above 1.0x in every single-factor case except a 15 percent shortfall in nonfuel sales, which takes it to 0.97x and shows where the risk sits: the store, the grill and the showers are the credit. The 16 cent margin case holds 1.01x and is the proxy for the diesel tax question; if the state's special fuel tax and the Nation's excise tax both apply at the pump and the market will not bear the stack, the subject either absorbs it in margin or loses the price position against the Milan node, and either way the result is the margin case. The 25 percent equity row at 1.23x is why the study carries the tribe's 30 percent.

The determination of feasible with conditions is subject to the following conditions precedent:

The following items could not be verified from a primary source at the study date and are disclosed: the NMDOT count and truck share at Exit 53, in place of which the study carries an estimate between the 2016 corridor share and the Arizona line count; the trust, allotted or fee status of any specific parcel at the exit; the Nation's current business site lease rent for a commercial parcel at the exit and its possessory interest tax valuation practice, in place of which the study carries $60,000 and $18,000 a year; any payment in lieu of taxes or service payment practice of McKinley County for enterprises on trust land, in place of which the study carries a $36,000 allowance; whether the state's special fuel tax and the Nation's fuel excise tax both apply at a trust parcel diesel pump under the 1999 intergovernmental agreement; the truck parking counts of the Milan and Gallup travel centers from the operators' pages; the Thoreau community water and sewer system's capacity and fees; the May 2025 New Mexico nonmetropolitan wages for cashiers, cooks and fuel attendants; and the primary USDA text of any fiscal year 2027 fee notice, which had not been published at the study date.

This model study applies the methodology described on MMCG's USDA travel center feasibility study and truck stop feasibility study pages. MMCG prepares truck stop and travel center feasibility studies for USDA Business and Industry, SBA 7(a) and 504, and conventional lenders nationwide, including tribal enterprise projects on trust land, with engagements from $4,900 and delivery in 9 to 16 business days.