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<br />. <br /> <br />. <br /> <br />~ <br />"':" <br />00 <br />~ <br /> <br />period of one hundred years and an interest rate of 3.25 percent, <br />is 1.46 to 1. The benefit-cost ratio is therefore quite favor- <br />able. However, if a discount rate of 4-5/8 percent is applied <br />to the project as is now being proposed, then the benefit-cost <br />ratio would show a material decrease. <br /> <br />Virtually all of the municipal and industrial water <br />uses contemplated by the project are predicated upon the future <br />development of the tremendous oil shale reserves in the White <br />River area, and more particularly in the Piceance Basin. Con- <br />struction of the project as now planned would be contingent upon <br />assurances that the municipal and industrial allocation cost of <br />$17,103,000 would be repaid with interest. Depending upon future <br />events, it might be desirable that the project be constructed in <br />stages so as to accommodate the irrigation needs first and the <br />M & I needs as they occur. <br /> <br />The Yellow Jacket Water Conservancy District concurs <br />in the plan of development with one significant exception. This <br />exception goes to page 42 of the report which contains a para- <br />graph as follows: <br /> <br />"In order to mJ.n1l1lJ.ze losses to big-game hunting, <br />estimated at $6,500 annually, 14,000 acres of private <br />land in the Oak Ridge area located between the White <br />River on the south and the upper section of the potential <br />Josephine Basin Canal on the north would be acquired and <br />developed along with 2,800 acres of adjacent public domain. <br />The lands would be made available to the Colorado Division <br />of Game, Fish and Parks for administration as big-game <br />range. " <br /> <br />The cost of obtaining the 14,000 acres of private land <br />above referred to is estimated at $900,000. This cost would be <br />charged to the project to be repaid by the water users. Both <br />the Yellow Jacket Water Conservancy District and the residents <br />of the area take considerable exception to this part of the <br />project plan. The objections basically are as follows: <br /> <br />Virtually all of the lands to be irrigated under the <br />project are now in private ownership. In the White River area <br />the project would bring under irrigation 15,740 acres of land <br />which are now dry farmed or used for grazing purposes. About <br />25 percent of the area is used for the production of wheat. <br />With irrigation, the principal crops would be alfalfa and <br /> <br />Memo <br /> <br />-2- <br /> <br />January 8, 1969 <br />