PUB00041

• Year: 1998
• Title: Western Irrigation Economic Benfits Review
• CWCB Section: Finance
• Author: Family Farm Alliance
• Description: White paper on the role of irrigated agriculture in the 21st century.
• Publications - Doc Type: Tech Report

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regional economic hCl1cfirs \\ hill' cuntrihuting to a 10\\-ellSI fond supply for ronsUllH.'rs. the
suhsidy question innlkcs ;1 duuble standard for (]cHlopmcllt rcp:lymcnh h.;tck to the
f('llcnll gO\"l'rnmcnt rd:ttin' to olher nll':lSUrCS, and the projects haH' contributed to many
new rcen'alian:!1 and l'll\inlllltll'llt:lIl11'ndits. Thl' dt'l):'llc has Ill'en, and ('an continue to he.
indccisin without prO\iding much puhlic polic~' resolution.

6.1.

Princip"1 Comme1lt oil/he Irrigation Sub.'ih(r bSIU',

As T:lhlc 5 "null) sUggl'st. thl' irrigation subsidy dehate is somewhat circuhlr in
natun'. with rn;lIl~' partil's ;lthall,:ing daims and ('ounter daims. And to some e\tent. it also
is unclear \\ hethel' tl1(' dullar amount of tlH' past subsidies merits thl' acrimony it has
recl'ind in compari"on to pre"ent-day "uh"idies Olffl'cting cn\ironment:11 n'sourCl'
II1lllt:l~enH.'IlI, as \H'II as federall':\IH.'llditurcs for infrastrul'tun' in gencral--thc distribution
of benefits and cnsts for an)' one soun'l' uf gO\'ernml'nt npenditurl's is ne\'l'r purc!)
equit.lhle :1('ross all sl'gmcnts of society.

But it is most imporlanl and pnlgmalically rde\'ant to address issues affecting the
future allocation of wall'r rcsourCl'S and 10 pro\'idl' policy criteri3 that ('(fidently allocate
water by acknowlrdging marginal economic \'alues and rconomic tr:.ldc-offs, The
fundamental issue today is not thl' value of past decisions :!ffeeting the irrigation projects.
as this rern'H'nls sunk costs--a larg(.'ly irrnocahle commitml'nt of capit:!1 resources (public
and pri\"ale) :lIld estahlislH.'d financial struclures, What hecomes signifiunt to society
today is the economil' nllue of water resource trade-offs and the opportunity costs that arc
confronted in making watl'r n'allocation decisions.

Particuhlrly in de.lling with elnironmental resources, actions to reallocate water
:lW.I)' from C:\isting: irrigation projccts--or in some cases. to prennt further irrigation
denlopment using w:.lter de rind from evolving efficiency practices--c:lIl han negatiH'
economic tnlde-uffs. and in sume cases, producing few economic or em"ironmentallH.'nefits.
These trade-offs need to he carcfull)' a<.;sesscd prior to making:1 water reallocation decision,
The economic criteria ..upporling policy decisions :lIld implt~ll1l'ntation :lctions Ill'cd to

Economic5 Bcncfit RcvicUl/Pagc-Ig