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right delivery capability. This ditch supplies water to the most productive lands in <br />Chaffee County with the most active irrigation and best lands for production of Alfalfa. <br />It supports shareholders who operate viable ranch operations as well as one of Colorado's <br />few remaining viable family owned Commercial Meat Packing establishments which is a <br />major employer in Chaffee County. Annual cost per irrigated acre is a significant factor <br />in establishing credit worthiness. Most acreage is utilized to produce alfalfa hay crops. <br />Much of this is sold in lieu of being utilized in cow-calf operations. The average <br />production per acre is 4 tons of alfalfa hay and is presently sold at an average of $150.00 <br />per ton. Thus an acre of alfalfa can produce revenues of $600.00 annually. The project <br />costs represent a financial ratio of annual debt service to per acre revenue of 3.4 <br />(revenue per acre/annual debt service). On a per share basis this financial ratio is 8.5 <br />(revenue per share/annual debt service). On an annual basis the total combined crop <br />value of all shareholders is $600,000 gross revenue which represents approximately 1.5 <br />times the cost of the project. If one assumes an average per ton value of this crop over <br />the 30 years of the loan of 50 % of the present market value ($75 per ton) then the total <br />potential revenue would yield $9 million. The total 30 years of debt service would <br />represent 4.5 % of the total potential revenue yield reduced to 50 % of the current per ton <br />crop value. In addition to the benefit derived from crop production is the value of the <br />land and water. In Appendix F are Chaffee County real estate listings that include <br />irrigated acreage. The average asking price per acre is $14,820.30. These are listing <br />prices and include the appurtenance structures as well as non-irrigated lands. These <br />listings are representative of the relative value of the farms and ranches supplied by the <br />New Salida Ditch. This project will protect this economic asset of the county. Using a <br />more conservative estimate of per acre value of $10,000 would yield the irrigated lands <br />of 1000 acres under the New Salida Ditch of an economic value of $10,000,000. This <br />however does not account for the value of the appurtenant structures. <br />Social and Physical Impacts <br />In part this project is undertaken in order to protect the Arkansas River from discharges <br />of material from ditch breakage. The River is an important economic as well as an <br />esthetic feature of Chaffee County. It is an important fishery and recreation area. The <br />project will benefit these values by protecting the river. <br />Conclusions <br />1. New Salida Ditch Company is an incorporated mutual ditch in the State of Colorado <br />and has the ability to enter into a contract with CWCB for the purposes of obtaining <br />a construction fund loan. <br />2. The construction will occur within the existing earthen ditch that was originally <br />constructed in 1882. <br />3. The project is necessary to continue maintenance of the ditch and continue <br />uninterrupted delivery of water to the share holders and protect the Arkansas River <br />an important economic driver of Chaffee County. <br />-6- <br />