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Although there is uncertainty regarding the use of $217 per acre foot reduced on-farm deliveries, it is the best available information at this time. Based on an average annual reduction of 11,400 ac-ft of on-farm deliveries in Reaches 17 through 19, the total annual cost of this project would be about $2.5 million. o Third-Party Impact Considerations: A water management program can alter the timing and quantity of water in the river, in which case, there are potential hydrologic and corresponding economic third party impacts on downstream users. If water conserved through these alternatives is not protected from downstream diversion, there may be positive and negative third party hydrologic impacts. Additional flows under this scenario may allow downstream junior water rights holders to make greater use of their water rights. Additional hydrologic benefits related to changes in irrigation techniques exist for areas prone to high water tables because groundwater recharge will be reduced. Negative third party hydrologic impacts from these alternatives are most likely to occur to nearby farmers who have traditionally relied on tailwater runoff or groundwater recharge from participating farms for a portion of their water supply. Positive and negative third party hydrologic benefits may be minimal depending on how close to the critical habitat these programs are implemented. Apart from the potential third party hydrologic impacts identified above, there could also be third party economic impacts on agricultural equipment suppliers, farm workers, processing industries and local communities that depend on agriculture. The economy in the study area is dependent on agriculture to a large degree, in which case economic and fiscal conditions are impacted by changes in crop patterns and crop production. For all programs, changes in the farm product can have negative impacts on processors, shippers, purchasers of farm products as well as local livestock growers, and local communities that depend on agriculture. For conservation cropping there may be third party economic impacts on farm workers and input suppliers because of differing requirements between traditional crops and alternative crops grown as a result of the program. Deficit irrigation will likely result in reduced yield, potentially impacting processors, shippers, livestock growers and others relying on this production. If land is reclassified as dryland under a land fallowing program it will have reduced value for tax purposes. A reduction in tax revenues would be a negative fiscal impact. For all water management options considered, if water deliveries are significantly reduced within an individual canal company or irrigation district's service area, company or district revenues may be negatively impacted. Negative third party economic impacts can be reduced to a degree if participating properties are geographically dispersed because it is unlikely that regional crop patterns and the value of crop production would change significantly. Third party environmental impacts associated with water management programs can be both positive and negative. Water quality could improve during the summer months when additional flows are added to the river. However, water quality could be degraded and fish and aquatic habitat negatively impacted during the winter months when river flows are reduced due to reductions in return flows. It is unlikely that a water management program will have any third party impacts on recreational activities. C:\Drnft Willer AClion Phl.l1 (May 30, 2000)\wnpc report (Version 6 BND2)-.doc 35