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... . ~ 001513 Mr, Bob McCue February 14. 1997 Page 3 stingy basis of irrigation's on-farm increase in income per acre, These completely inconsistent economic valuation approaches yield an unrealistic and ridiculous comparative value. [n their 1990 study, "Economic Importance of Irrigation [n Nebraska," F. Charles Lamphear and Merlin W. Erickson calculated that for production year \ 985, irrigation would have a $405.57 per acre economic impact in the event ofa substantial drought. For the 220,000 acres served by the Districts' projects, the economic impact in a substantial drought year would exceed $89 million. This dwarfs the DBO's conclusion that the irrigation value of the projects totals $15 million. As a primary purpose for these projects is drought protection, the Lamphear- Erickson kind of ecunumic analysis necessary to determine the projects' irrigation value, not theat submitted the DBO. The dramatic discrepancy demonstrates that the Service needs to take a fresh -- and more realistic and comprehensive -- look at the economic importance of the irrigation component of these projects. Mitigation Costs The DBO concludes that surface water irrigation fanners can be counted on to contribute $5 per irrigated acre in mitigation costs yielding a total mitigation $9.5 million. This nearly arbitrary calculation apparently is meant to reflect the amount of mitigation costs the Districts could expect to pass through to its irrigators. NWU is alarmed at the Service's approach to mitigation recommendations -- based on how much money can be extracted rather than based on scientifically determined need. Water Conservation As has been the case with every proponent of massive resource reallocation under the guise of these relicensing proceedings, the FWS calls for the uncompensated transfer of water rights currently held by irrigators to environmental purposes. NWU has repeatedly stated , _ LlmrngbQUl tl1e various stages ofthese proceedings -- any water reallocated to envirolU11ental purposes must come from the reregulation of hydropower flows. No relevant legal authority exists that would sanction the LIse of any water allocated for irrigation use for habitat flows. The Nebraska State Constitution's priority allocation system for water is clear on this point and is not subject to modification by the FERC. The water conservation proposals presented in the DBO not only are contrary to state law, but also appear to be hydrologically deficient. In addition, the proposals are so vague in terms of methodology as to be meaningless. The DBO apparently stands for the proposition that a minimum 10% of the water currently "lost" to irrigation must be conserved and transferred to environmental purposes, whatever the costs and whoever pays.