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<br />MWSI Project <br />Interruptible Supply Framework Report - DRAFT <br /> <br />August 21, 1995 <br /> <br />use of options were seen as a way for irrigators to economically survive the drought, <br />Contracts can be set up so that during a year when an option is exercised, the seller <br />ends up in a better economic condition than would have occurred had no contract been <br />in place. This impact can positively affect sales tax revenues for the community, <br /> <br />Unemployment may rise, however, during these same years, The impacts of <br />unemployment will depend on levels of mechanization of the affected crops, <br />Preliminary investigations in the MWD/PVID case indicate less than 1 % of the valley's <br />work force was laid off due to the program (Pinnes, 1994). Local economic impacts <br />due to increased unemployment can be minimized through programs which compensate <br />affected individuals directly or through payments by the buyer to an agency responsible <br />for the distribution of social service funds, <br /> <br />Other local economic issues include the impacts on local businesses which <br />support agricultural activities. This impact has not been quantified, With regards to <br />overall economic impact on the community, the degree of impact is higWy dependent <br />on the significance of the seller in the region as a whole. If, as in the case of <br />MWD/PVID, the affected area is small compared to the surrounding agricultural <br />regions, impacts on the region will be minimized, Impacts are also:minimized if the <br />affected land is distributed over a larger geographical area, versus concentrated in one <br />area. <br /> <br />4.1 .5.3 Injuries to Other Individual Entities <br /> <br />As with any water transfer, injuries to other water right owners needs to be <br />analyzed. Impacts due to changes in return flows and water quality need to be <br />considered, In addition, potential impacts to an affected ditch company (e.g" <br />decreases in operational efficiency due to reduced canal flow) need to be studied, <br />These issues need to be investigated on a case-by-case basis. <br /> <br />4.2 Specific Contract Terms <br /> <br />Panies can make the contracts as simple or as complicated as necessary to meet <br />their specific needs. Key issues which need to be detennined include: <br /> <br />. Price and payment arrangements (including price adjustments over time)3; <br />. Overall length of the contract; <br />. Amount of water to be transferred; <br />. How a transfer will be triggered; and <br />. How much notice will be necessary, <br /> <br />3 Typically, there is an option pric"e (the payment from lhe buyer to the seller for having the option) and exercise <br />pnce (the payment made during a year that the option is exercised). <br /> <br />Hydrosphere Resource Consultants <br /> <br />15 <br />