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<br />f <br /> <br />. <br /> <br />have been in several previous Administrations, who reside in states where <br /> <br />water is plentiful and the rainfall predictable, and who, in consequence, <br /> <br />regard water projects as wasteful extravagance. One Senator reportedly <br /> <br />said, "All water projects are waste products." We in the West consider <br /> <br />not only the cost of a reclamation project but also the benefits. Propo- <br /> <br />nents of the Project have requested beginning construction funds amount- <br /> <br />ing to $1,350,000 in Fiscal Year 1986 and $3,900,000 in Fiscal Year 1987. <br /> <br />The projected cost of the entire project is now estimated to be <br />$547,300,000. An additional factor in the cost picture is the insistence on <br />the part of the present Administration that affected states share in the <br /> <br />financing of water resource development projects. Colorado, therefore, <br /> <br /> <br />will be expected to assume some portion of the construction cost of the <br /> <br />. <br /> <br />Animas-La Plata Project. <br /> <br />The economic benefits of the Animas-La Plata Project considerably <br /> <br />outweigh its costs. A recent study by a prominent economist in our <br /> <br />reg ion reflects a ratio of expanded total benefits of 2.82: 1, based on a <br /> <br />I <br /> <br />discount rate of 3.25%, the official discount rate used in 1968, the year <br /> <br />the Project was first authorized. (The discount rate is designed to take <br /> <br />into account the likely inflation over the years of the construction and <br /> <br />operation of the project.) Even based on 1984 dollar costs, with a dis- <br />count rate of 8.125% (the current standard applied by the Office of Man- <br />agement and Budget). the ratio for total benefits to cost would be 1.30: 1, <br /> <br />thus easi Iy exceeding the norm for approval of Federal reclamation proj- <br /> <br />ects. <br /> <br />What, then, are some of the benefits of the Project? To name a few, <br /> <br />. <br /> <br />they include (1) irrigation of relatively arid agricultural lands, (2) a <br /> <br />dependable and improved source of municipal and industrial water, (3) <br /> <br />."t <br /> <br />0169 <br /> <br />4 <br />