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78 Rev. 4 -8 -69 G. PAYMENT CAPACITY Reference is again made to the agricultural economy studies performed by the U. S. Bureau of Reclamation with respect to the Narrows Unit, Colorado. Based upon these studies, the. gross payment capacity resulting from the supplying of supplemental water has been chosen as $11.40 per acre -foot at the farm headgate. In Chapter VI it was estimated that the project would result in 3,100 acre -feet of additional headgate deliveries per year. Multiply- ing this by $11.40 results in total gross payment capacity of $35,340 per year. Earlier in this chapter it was explained that average annual OM &R costs for irrigation, amounting to $25,250, are expected to remain the same upon completion of the project. There will be no new OM &R costs for irrigation. Thus, the $35,340 per year, as developed in the preceding paragraph, represents the water users' amortization capacity. The repay- ment schedule has been formulated to utilize approximately 78 percent of this amortization capacity, or $27,500 per normal year. H. LOAN REPAYMENT SCHEDULE In Section E of this chapter, the total Small Reclamation Projects Loan Obligation was determined to be $1,355,700. This is to be amortized over a period of 50 years, with constant principal payments after the first 3 years, as shown in columns 2 and 5 of Table VII -E. Principal payments in the first 3 years are reduced to accommodate the fact that the increased annual water diversions, and hence payment capacity, will be limited during the Grand River Ditch construction period. It will be seen that, for the last 47 years, principal payments are $27,500 per year. The average for all 50 years is approximately $27,115 per year. The Principal payment (column 2) becomes the regular assessment (column 6) chargeable by the Company to all its stockholders in propor- tion to their holdings. The annual interest attributable to excess irrigated land holdings, tabulated in column 3, is calculated by multiplying the Interest Rate of 0.395 %, as derived in Section F, by the unpaid balance of the Loan Obligation (column 5) for the preceding year. This amount by definition equals the excess land assessment (column 7). Total annual payments to the United States are tabulated in column 4.