8009 - Laserfiche WebLink

Home Browse Search

By their nature, instream benefits may be slow to develop and hard to measure. some federal agencies and other environ- mental groups trying to acquire water for instream flows. Sometimes it is difficult to arrive at a price that properly aligns the value to the seller or lessor and the value to the Trust. In the Buck Hollow lease transaction (see Oregon Water Trust), it was relatively easy for the rancher to value his water right. He used the water on a particular pasture to irrigate hay to feed his cattle. He knew the pasture normally produced 68 tons of hay and, at the going rate, that amounted to $6,600 worth of hay. That became his asking price. It was more difficult for the Trust to be sure that it was going to achieve $6,600 worth of fisheries benefit in one season of leaving the water in the creek. By nature, instream benefits may be slow to develop and hard to measure. To some extent, then, the Trust is operating on faith that over time its investments will pay off. Boulder Creek: When a water right is donated, the donor may have to justify the cost of the instream flow right to its constituents. In the City of Boulder's transaction, the city estimates the value of the transferred rights at $12 million, calculated as the yield of the water right times the tap fee for that amount of water. In addition, the water right donation costs the city about $150 per acre foot per year in additional operation and maintenance (O&M) costs since the city treats poorer 18 quality water from other sources to replace the water left in Boulder Creek. This extra O&M cost adds from $87,500 to $265,000 per year to the cost of Boulder water, depending on how much water must be left in the creek to meet the minimum flow requirements. The entire value of instream flow water may not, however, be lost to a city. Boulder Creek's instream flow right is dedicated only to a point east of the city where the sewage treatment plant discharges. Beyond this point, there is no scarcity of stream flow, and the water left in the stream that formerly was consumptively used is considered "new" to the stream at this point. Boulder retains ownership of this water downstream of the treatment plant and can, therefore, lease, store or exchange it out at other locations.