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2-8 I I I' I I . I I I I I I '. I I I I I I 01';3' ':" t;.v .... other water originating further upstream users may also be adversely affected due to decreased return flows after a transfer. To supply high quality water to their users, the metropolitan areas prefer the waters from high mountain streams and reservoirs. When this source of water is limited, denied or of high cost, agricultural water may be purchased, Water is also exchanged from the lower Arkansas River upstream to headwaters areas. The water quality .of the lower Arkansas River can deteriorate because this high quality water is used before mixing with the local return flows, An off-setting factor in the water quality issue is the reduction of irrigation practice, since irrigation also degrades water quality (Miles 1977). Water quality can also affect water quantity. For example, clear water scours ditches and causes increased seepage losses, while silty water seals ditches and allows greater water delivery to fields. I Water users and others, whether agricultural, municipal, industrial or recreational, desire to protect the quantity, quality and timing of their water supplies. Effects on these users are increasingly being recognized by the courts. 2. Economic, financial and social; commerce, opportunity and quality of life Water users are impacted by water transfers, but so are members of the local and regional communities, For example, the dollar in the farmers pocket pays taxes and is spent with the local merchant, and the merchant in turn pays taxes. The impacts of a dollar spent can vary significantly: a dollar deposited with out of state bank works differently than the dollar paid to the local farm laborer, Transfer of water brings a one-time flow of cash to sellers; this mayor may not be spent in the study area. Some (perhaps most) may be used to repay lenders, including some local bank debts, which may increase local capital supply. However, there may be little need for additional capital in the locality so it will flow elsewhere, Transfer of water results in loss of acreage in irriga~ed agriculture: a, If water is transferred outside the study area, loss of agricultural production is greatest, b. If water is reallocated within the study area to agriculture, loss of production is lessened--and possibly no loss occurs, c, If water is reallocated to other uses within study area (e,g., M&I, wildlife, recreation), loss of agricultural production may be offset by economic gains in other sectors. d, If water transfer requires construction of diversion works within the study area, rather than upstream, or requires revegetation of dried up land, there will be some temporary economic benefit and job creation which will offset some of the economic loss. ' e, Loss of irrigated acreage will reduce property values in the study area, Lower property values will adversely impacttax revenues of all local governments, school and special districts. Colorado constitution amendment 1 (1992) has added new restrictions on tax revenues.