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<br />-, <br /> <br />. <br /> <br />. <br /> <br />"", <br />~ <br />00 <br />0-1 <br /> <br />irrigated pasture. The total crop production would be almbst <br />doubled. The local ranchers are of a most decided opinion that <br />instead of forage for big game animals decreasing, it would <br />materially increase. They do not believe that they should be <br />penalized for placing their own private lands under irrigation. <br /> <br />As has been stated, the additional private lands which <br />would be placed under irrigation in the White River area would <br />total 15,740 acres. The proposed project plan, however, con- <br />templates the removal of 16,800 acres of land, of which 14,000 <br />acres is in private ownership, from a domestic livestock usage <br />to a purely big game habitat. The local residents feel that such <br />an exchange would do little, if anything, to add to the economy <br />of the area. <br /> <br />It is pointed out that the lands proposed to be devoted <br />to big game habitat now constitute an essential part of the <br />grazing lands being used by various livestock interests in the <br />area. It is further pointed out that the lands in question are <br />now being grazed by big game animals in complete harmony with <br />domestic livestock. A serious question, therefore, arises as to <br />whether or not the conversion of the Oak Ridge area to big game <br />habitat would accomplish anything other than a serious loss to <br />the economy of Rio Blanco county. <br /> <br />While the members of this staff do not profess to have <br />any expertise concerning big game habitat, we believe that the <br />irrigation of additional lands in the White River Basin will have <br />an incidental benefit of increasing the forage available to big <br />game animals. Aside from the speculation about big game habitat <br />however, two fundamental issues are raised by the proposal set <br />forth in the project plan. <br /> <br />The first of these two issues is the effect upon the <br />benefit-cost ratio. Under the project plan the $900,000 esti- <br />mated as the cost of acquiring the 14,000 acres in the Oak Ridge <br />area is considered as damages and therefore weighs against the <br />cost side of the project. Using an interest rate of 3-1/4 per- <br />cent, as was used in the project report, the sum of $900,000 as <br />a mitigating expense does not destroy the economic feasibility <br />of the project. During this year, however, the discount rate of <br />3-1/4 percent has been replaced by a rate of 4-5/8 percent. <br />Applying this rate to the project its economic feasibility be- <br />comes critical, and the $900,000 additional cost assessed to <br />mitigate big game damages serves to further aggravate the <br />critical balance between benefits and costs. <br /> <br />Memo <br /> <br />-3- <br /> <br />January 8, 1969 <br />