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<br />-., <br /> <br />r!1rJ231 <br /> <br />-3- <br /> <br />On projects where existing repayment contracts are in part under the <br />Fact Finders Act and in part under other acts of the Federal Reclamation <br />laws, the unaocrued charges may be merged into two general obligations, <br />one for each type of oontract. <br /> <br />Section 4 (0) provides for a census of annual gross orop returns, now <br />in effect on most projeots, and for a determino.tion of the normal returns <br />for each year. The normal returns would be fixed by averaging the ten best <br />years out of thirteen years, USing the year for whioh the determination <br />is made and the preceding 12 years. The average would be weighted-- that <br />is, consideration would be given to the !l.lll1ual variations in the areas <br />cultivated. ElimiT's.ting the three lowest yea1's in the 13-year period ,'11.11 <br />result in a comparatively high normo.l base and is to the advo.ntage of the <br />water user beoause the high normal results in a quickened reduction in <br />payments when the !l.lll1ual returns are poor. <br /> <br />HOW 1\NNU1.L PAYMENTS ARE DETERMINED <br /> <br />Each year, the contracting orge.nization would be required to pay as the <br />construotion charge the amount of the instalment for the partioular year <br />as sto.ted on the schedule of instalments determined under Seotion 4 (b), <br />increased or decreased in aocordance with the "normal and percentages" <br />plan. :The amount of any such increase or decrease would be determined as <br />follows: The per oent of the normal returns for the year involved by which <br />the a.rnlunl returns for that year are greater or less than the normal <br />returns would be determined. For each per cent that the annual returns <br />are greater or less than the normal returns tt1ere would be 0. two per cent <br />increase or decrease in the instalment for that year. <br /> <br />For purposes of illustration: if the normal returns of 0. project contract <br />unit in the year 1944 should be $30 per acre and the' annual return for that <br />year should be $20, then the annual returns being 33-1/3 per cent less than <br />the normal, there WQuld be a 66-2/3 per cent reduction in tho instalment of <br />the organization's obligation for that year. If the orgwization's <br />insto.lment for 1944 were ;3h,ooo, under the "nonno.l and percentages" plan <br />only $15,000 would be requirod to be paid as oonstruotion charges for that <br />year. <br /> <br />Under the provisions of Section 4 (e), the unaccrued balance of the <br />instalment of $30,000 would be included in those subsequent instalments <br />of the organization'S obligation to Tmich the amount could be added <br />equitably or would be established as an insto.lment or parts of insta1.ments <br />for years subsequent to the last yeo.r for which an instalment waf! provided <br />on the schedule fixed under Section 4 (b). By reason of express limitation <br />in Section 4 (e) an instalment could not thereunder be revised to or <br />established in an amount exoeeding the lo.rgest instalment determined under <br />Section 4 (b). In othor words, inoquitnble pyramiding of oonstruotion <br />charges is prohibited. In 0. year when crop returns are in excess of normo.l, <br />the amount of the instalment would be inoreased under this same procedure. <br />There vrould be contraot provisions for offsetting inoreases and decreo.ses <br />in the instalments. <br />