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<br />r <br /> <br />;-1 <br />, <br />" <br />, <br /> <br />If a lower interest rate were used, the present value <br />of annual benefits would be a greater number. Likewise, <br />if a larger discount rate were used, the present value of <br />annual benefits would be a smaller number. It is believed, <br />however, that in private enterprise a discount rate of at <br />least 10% should be used in the benefit analysis. <br /> <br />The project will provide 1059.4 acre-feet of water <br />for consumptive use and is estimated to cost $850,000. <br />For the proposed structure with 2,000 acre-feet of storage, <br />this analysis yields a benefit/cost ratio of 0.5. <br /> <br />$415,948 I $850,000 = 0.5 <br /> <br />C. <br /> <br />Beef Production <br /> <br />-i ~ <br /> <br />In the Meyring Livestock operation, it has been deter- <br />mined that each cow consumes about 20 pounds of air-dried <br />foliage per day. This is equal to 7,300 pounds per year <br />or 3.65 tons per cow per year. Using all of the 1,555.3 <br />tons which are expected to be produced with supplemental <br />water, an additional 426 cow units could be carried in <br />the operation. <br /> <br />:"';,] <br /> <br />.,""' <br />'j <br />tJ <br /> <br />1,555.3 tons/yr. ~ 3.65 tons/unit/yr. = 426 cow units <br /> <br />:.J <br /> <br />It is a common practice for ranches to be appraised <br />according to the number of cow units they are capable of <br />running. Presently ranches in North Park are appraised <br />at a rate of $2,500 per cow unit. These numbers yield an <br />additional appraised value for the Meyring Livestock <br />Company holdings of $1,065,000. <br /> <br />$2,500/cow unit x 426 cow units = $1,065,000 <br /> <br />Using this additional appraised value concept as a <br />measure of primary benefits yields a benefit/cost ratio <br />of 1. 3. <br /> <br />$1,065,000 / $850,000 = 1.3 <br /> <br />This is based on using the cost figures derived for <br />the large project containing 2,000 acre-feet of storage. <br /> <br />D. Calf Crop Benefits <br /> <br />.:-.;' <br /> <br />The beef production analysis in paragraph C shows <br />an additional capability for the ranch of 426 cow units. <br />In the past, the cows on Meyring land have experienced a <br />calfing rate of 90%, i.e., 383 additional calves per year <br />could be produced as a result of the increased hay pro- <br />duction. <br /> <br />-40- <br />