WSP09853 - Laserfiche WebLink

Home Browse Search

003118 quire careful explication so they can be properly translated into opera- tional guidelines. I. Least-Cost Source of Water Supply The first condition for evaluating an interbasin transfer is that it should represent the lowest-cost source of water supply available to the importing area. If other, lower-cost sources of equally reliable supply can be found, then they should be used. According to the Na- tional Water Commission: All alternative sources of water should be evaluated and com- pared. Costs of foregone future uses in the area of origin and the environmental costs should be included in the evaluation. Two ba- sic points of the "least-cost alternative" criterion are that (I) the calculation of costs of alternatives should be made on one, uni- form, consistent basis and (2) all social costs should be included in the evaluation. 52 It may be argued that such an evaluation is unnecessary since, presumably, the transferring entity is economically rational and will therefore seek the lowest-cost alternative. However, in the past, the massive subsidies available in the federal reclamation program made large-scale transbasin diversion projects artificially attractive to state and local entities. Such subsidies will be far less available in the future, though many states are looking for ways to develop other sources of low-cost financial support for such projects. In addition to artificial financial incentives, water-seeking entities are likely to be influenced by other factors. For example, there may be institutional and political problems associated with transferring water from existing uses within the local watershed or basin, or with using groundwater. The desire to avoid adverse public or special-interest reactions is often buttressed by the strong financial position of many conservancy districts and urban utilities, which can spread costs over a real estate tax base and/or over many rate payers. Under such cir- cumstances, cost minimization is often given little weight by the dis- trict or utility. 2. Benefits Must Exceed Costs The benefits associated with out-of-basin transfers are frequently taken for granted, the initiative of the transferor being accepted as evi- serve the purpl>!i.es at hand. Second. the value or the water in its new uses should be greater than the value of water in its old uses plus the ensl of transfer III other words. benefits (approprialely reduced 10 reflect foregollo? future ll~t' ill Ihe Mea uf origm) should exceed cosls. 52. /d.