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<br />J <br /> <br />, <br /> <br />Since the inception of the Conservancy District, we have worked <br />closely with the Bureau of Reclamation in reviewing various plans <br />of the Bureau for this project. We have been most happy about the <br />excellent working arrangement that has existed with the Bureau. <br />Late in 1956, the District employed a consultant to review the <br />operation and maintenance estimates.for the Garrison Diversion Unit. <br />as proposed by the Bureau.. In early 1957, we obtained information <br />from the Bureau on water costs, which was made available to in- <br />dividual irrigation farmers. This information was most helpful in <br />securing an expression from the farmers on irrigation development. <br />We have worked closely with the Bureau in all phases of our publiC <br />relations and have relied much on their well qualified personnel to <br />present this program to the farmers. Bruce Johnson and his excellent <br />staff attended many meetings explaining irrigation to interested <br />people throughout the district. Without their assistance, we would <br />not have advanced to our present position. <br /> <br />During the past year, the negotiation of repayment contracts has occupied <br />considerable of our time. Due to the extensive nature of the Diversion <br />Unit and the many beneficiaries, the contracts are of necessity more <br />involved than for an ordinary irrigation project. Briefly theoontract <br />arrangements propose a Master Contract between the Federal Govercment <br />and the District for construction costs, operation and maintenance of <br />the water supply system. In addition, there will be a three-way contract <br />among the individual irrigation districts, the Conservancy District and <br />the Federal Government covering the repayment and the operation and <br />maintenance of the distribution system. These contracts, in effect, <br />provide for the repayment by the water users of their share of the costs <br />of the project. These payments come from two sources, the first being <br />the special assessment levied by the irrigation district on irrigable <br />land and the second being the tax revenue from the Conservancy District's <br />one mill levy on all property in the Conservancy District. We feel <br />that our authority to levy will be of considerable assistance to the <br />localirrigation districts and water users, especially during the early <br />years of development. <br /> <br />These contracts, as proposed by the Bureau of Reclamation, have been <br />carefully reviewed by us. In addition, the Conservancy District employed <br />a Consultant, Mr. H. A. Parker of Ephrata, Washington, who has had much <br />experience in this field, and who made certain recommendations. Basically, <br />there are no major differences between the Conservancy District and the <br />Federal Government about these contracts and we feel that the problems <br />will be worked out Idthout difficulty. At the time of hearings on <br />our project, which likely will be at the next session, we expect to have <br />contracts sufficiently worked out. <br /> <br />Recently the Conservancy District's Executive Committee proposed that <br />a review of the criteria used by the Bureau of Reclamation in providing <br />economic analysis for reclamation projects be conducted. It appeared <br />that the emphasis being given to so-called secondary benefits was not <br />as great as it deserved. Statistics and studies have shown that irriga- <br />tion development provides a great stimulant to the development of the <br /> <br />F-5 <br />