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<br />The Upper Basins' Political Conundrum: A Deal is Not a Deal <br />government, but the O&M costs of separate features devoted to <br />these purposes must be borne by anon-federal entity. <br />6. On man ro'ects, if irri ators lack the ability to pay both O&M costs <br />YP J g <br />and construction costs, then they have to pay only O&M costs and such <br />portion of the construction costs allocable to irrigation purposes as are <br />within their "ability to pay." The portion of construction costs which <br />exceeds irrigators' ability to pay is recovered by increasing the charges to <br />those who purchase hydropower from a project (i.e., the power users bear <br />not only the O&M and construction costs allocable to the power function, <br />but also a portion of the construction costs, although without interest, <br />allocable to the irrigation purpose). <br />Obviously, the federal reclamation program constituted a very attractive <br />subsidy to those interested in water development. Not surprisingly, this set <br />the stage for numerous conflicts, and eventual political compromises and <br />agreements, between upper and lower basin interests as each sought to gain a <br />share of the Congressional dollars which flowed into the federal reclamation <br />program.30 The stakes, measured in terms of regional economic development, <br />were very large. <br />Federal Flood Control and Navigation Projects <br />Federal involvement in navigation improvements to the Nation's rivers dates <br />back to the very early 1800x, when the U.S. Army Corps of Engineers was <br />first authorized to remove snags from the Mississippi River. Over the course <br />of that century, vast numbers of projects -- from removal of snags, to the <br />dredging of channels, to the construction of dams and locks -- were authorized <br />in the Mississippi, Ohio, Tennessee, Missouri and other major rivers of the <br />Nation. In general, both the cost of constructing capital improvements, and <br />the cost of operating and maintaining them, were borne by the federal <br />government, with there being no requirement for the repayment of these costs <br />by benefitted users until recently. <br />g0 More than $16 billion dollars have been invested in reclamation projects. These <br />projects deliver water annually to about 28 million people and about 10 million acres of <br />irrigated land (which is about one-third of the irrigated acreage in the 17 western states), they <br />generate approximately 60 billion kilowatt hours each year (making the Bureau of <br />Reclamation the nation's second largest producer of hydroelectric power and 11th largest <br />electric utility, based on generating capacity), they provide water-based recreation to about <br />80 million visitors each year, and they have prevented nearly $200 million in average annual <br />flood damages between 1950 and 1990. <br />12 , <br />