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Last modified
1/26/2010 12:36:06 PM
Creation date
10/11/2006 11:02:14 PM
Metadata
Fields
Template:
Water Supply Protection
File Number
8220.106
Description
Animas-La Plata
State
CO
Basin
San Juan/Dolores
Water Division
7
Date
12/1/1994
Author
Bookman-Edmonston
Title
Economic Impact Study - Animas-La Plata and Colorado Ute Water Rights Settlement Act
Water Supply Pro - Doc Type
Report/Study
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<br />I <br />I <br />I <br />I <br />I <br />I <br />I <br />I <br />I <br />I <br />I <br />I <br />I <br />I <br />I <br />I <br />I <br />I <br />I <br /> <br />BACKGROUND <br /> <br />INDIRECT BENEFITS <br /> <br />Prior to the Principles and Standards of 1973, Reclamation included both direct benefits and <br />indirect benefits in their evaluation of projects. The early financial studies which support <br />ALP as authorized by Congress were based on both direct and indirect benefits. It is well <br />recognized that the induced benefits of the development playa major role in decisions for <br />a region to encourage the development to take place. Regional development evaluation <br />recognizes several types of beneficial effects such as increased regional income, increased <br />regional employment, population distribution, diversification of regional economic base, as <br />well as other developments which may take place as secondary to the principal purpose for <br />which funds are being expended. <br /> <br />The clearest example of these types of effects is in the case of irrigation where farming <br />activities induced by irrigation create business for farm equipment dealers, seed/fertilizer <br />sales as well as employment opportunities in industries directly engaged in processing the <br />agricultural output. Secondary benefits also occur.in unrelated or less directly related <br />industries as input requirements are met and as households spend their increased incomes. <br />These types of indirect and secondary benefits are generally measured through the use of <br />input/output multipliers that have been developed for specific regions. The use of these <br />input/output multipliers in economic models is an effective way of displaying the benefits <br />that accrue to a region from additional related development. <br /> <br />In the case of the evaluation of ALP and the Colorado Ute Water Rights Settlement Act, in <br />addition to national economic development, consideration should be given to regional <br />development. The Project has been planned and revised by Reclamation and the local <br />beneficiaries to meet the regional needs which have been generated in part by the conflicting <br />demands on the limited water supply. Failure to implement the provisions of the Settlement <br />may create a serious economic crisis in the region, requiring federal financial intervention, <br />likely costing greater sums than the federal investment in the construction of the Project. <br />The Principles and Guidelines allow the development of alternative plans to further address <br />other concerns which are not addressed by the NED plan, thus the evaluation of the <br />regional benefits should be considered, allowing decision makers the ability to judge the <br />beneficial enhancements of these regional benefits in addition to NED. <br /> <br />2-11 <br />
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