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Section 3 <br />Alternative Agricultural Water Transfer Methods to Traditional Purchase and Transfer <br />Financial Subcommittee Question 2. <br />'Are annual payments made only to the <br />agricultural participants fallowing for <br />that year or to all program participants?" <br />In this example, all participants are fallowing each <br />year and all are paid annually. MU would make <br />annual payments to farmers who are fallowing on a <br />per-acre basis, based on CU savings from the <br />fallowed lands. Individual farmer contracts allow for <br />different payments to individual farmers. Program <br />participants benefit through generous <br />administrative payments to RFID, reducing <br />operation and maintenance (O~eM) assessments to <br />all RFID shareholders. <br />Generally, all participants would fallow some <br />portion of their land in each year of the program and <br />all participants would receive an annual payment. <br />RFID farmers who choose not to participate in the <br />program would not receive any payments from MU. <br />But this approach creates large administration <br />enforcement costs as all fields must be monitored for <br />compliance with conditions. <br />Supporting Information: <br />1. In the MWD-PVID program, all fallowing <br />participants are in the program for the long- <br />term, all fallowed some acreage each year, and all <br />are paid the same amount per acre fallowed. <br />2. In the SDCWA-IID program, fallowing <br />participants varied by year, but in a given year <br />each participant received the same per AF <br />payment amount. <br />3. In the agreement between Aurora and Rocky <br />Ford, annual payments were made to fallowing <br />program participants on a per share (of the canal <br />company) basis. <br />Financial Subcommittee Question 3 <br />'Are there regional or statewide benefits <br />to an interruptible or rotating fallowing <br />program, such as preservation of open <br />space or providing for environmental <br />flows? Should a portion of the program <br />costs be borne by the public or third <br />parties?" <br />In general, a rotational fallowing program could <br />provide a variety of statewide or regional benefits, <br />especially when compared to a permanent dry-up. <br />There are indeed statewide benefits if the direct <br />parties involved decided to maximize maintaining <br />irrigated agriculture while meeting future water <br />needs. If the goal of maximizing irrigated agriculture <br />was clearly recognized as a statewide value, financial <br />help with a FS, addressing third party impacts and <br />benefits, or equalizing administrative costs (i.e., <br />make more comparable to permanent dry-up), may <br />be warranted. Additionally, if it is desirable to <br />obtain some portion of water for environmental or <br />recreational purposes, a financing mechanismwould <br />be needed and a partnership with the M~eI and <br />agricultural user could be pursued. <br />The long-term sustainability of agriculture, agri- <br />business communities, and rural Colorado is the <br />chief benefit of a rotational crop fallowing program. <br />An important benefit would be the opportunity for <br />the preservation of agriculture as water remains <br />available for irrigation of farms, while at the same <br />time some water is transferred to other uses. A <br />rotational fallowing program could provide farmers <br />who want to remain in agriculture with the financial <br />support to do so. However, there are other agro- <br />economic factors at play and the continued <br />availability of water may not result in the long-term <br />viability of local agriculture. <br />4. In the MW D-Sacramento Valley agreement, all <br />fallowing program participants were <br />compensated on a per AF basis. <br />3-26 FINAL DRAFT <br />