|
<br />OOOl~G-
<br />
<br />,
<br />
<br />34
<br />
<br />Revision of our proposed report is not necessary as a result of the
<br />reviews. It is necessary, however, to modify the economic and financial
<br />analyses in the proposed report to conform them to our current pro-
<br />cedures for evaluation of water resources develo!>ments, current
<br />policy for cost-sharing of recreation and fish and wild ire enhancement
<br />facilities, and the current interest rate. The estimntcd construction
<br />cost of $8,470,000 has not been changed.
<br />In our proposed report, a portion of the estimated costs of the
<br />Closed Basin Division was allocated to the area redevelopment func-
<br />tion on a nonreimbursable basis. Our current procedure is to recog-
<br />nize and include in the economic analysis the btmefits estimated to
<br />be derived from that function but not mclude area redevelopment in
<br />the cost allocation and repayment analysis. Thus, it is necessar)' to
<br />eliminate from the cost allocation in our proposed report the con-
<br />struction ($425,800) and operating ($9,800) costs allocated to that
<br />function and, in turn, to revise the allocation. This results in the
<br />construction costs being allocated $7,414,600 t.o water salvage,
<br />$850,400 to fishery enhancement, and $205,000 to recreation. '
<br />Application of the provisions of recently enacted Public Law 89-72,
<br />the Federal Water Project Recreation Act, results in a finding that a
<br />separable recreation cost of $102,500 plus $2,800 interest during con-
<br />struction and 8. separable fishery cnhaneement cost of $147,000 plus
<br />$3,100 interest during construction, totaling $225,400, ",,'ould be re-
<br />imbursable by non-Federal public bodies, in addition to annual
<br />operating costs of $19,300 for recreation and $12,700 for fishery en-
<br />hancement. The remaining recreation and fishery enhancement con~
<br />struction costs (S805,900), us well as the constructIon cost ($7,414,600)
<br />allocated to water salvage, would be nonreimbursable. Execution of
<br />agreements with non-Federal public bodies to administer the land and
<br />water areas for recreation and fishery purposes and to bear the re-
<br />imbursable costs would be u. prereqmsitc to construction of the
<br />facilities.
<br />The use of the current interest rate of 3}k percent reduces the evalu-
<br />ated benefit-cost ratio of 5.4 7 to 1 in our proposed report to a ratio of
<br />5.32 w L
<br />Our pr<;,posed report of November 16, 1964, and accompanying
<br />Regional Director's report elated July 1963, us revised January 29 llnd
<br />February 26, 1964, urc hereby further modified to reft.ect the changes
<br />in economic llnd finllllciallllHllyses described above. A :mmmary of the
<br />changes resulting from this reanalysis is attached.
<br />I recommend that you approve llnd ndopt this report as your report
<br />on the Closed Basin Division, Still Luis Valley project, Colorado, and
<br />that you transmit it, together with the attnched comments, to the
<br />President tilld subsequently to the Congress ill accordance with the
<br />Reel.mation Project Act of 1939.
<br />Sincerely yours
<br />.. ,
<br />
<br />FLOYD E. DO~ISY, Commissioner.
<br />Appro,..d and adopted August 19, 196.5.
<br />STEW.....UT L. UDALL,
<br />Secrew.ry oj tM InlerWr.
<br />
|