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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 />EXECUTIVE SUMMARY <br /> <br />then be represented through the use of regional multipliers. The multipliers represent the <br />ratio of the total effect of the Project to the magnitude of the direct effect. The two types <br />of multipliers that are of the greatest interest are: (1) the income multiplier, which reflects <br />the change in total household income for all sectors of the regional economy as related to <br />the earnings of workers directly employed in the production of the basic output; and (2) the <br />output multiplier, which relates to change in total regional output, in all sectors of the <br />regional economy to the change in direct demand in the basic industry. The secondary <br />income and output benefits of ALP are examined in this report. <br /> <br />The report also identifies all the costs that would be associated with the development of <br />ALP, including some that extend beyond those that would normally occur in any <br />construction activity. The comparison between Project benefit and cost has been <br />traditionally displayed in a benefit-cost ratio and used as a method for evaluating water <br />projects. <br /> <br />The construction of ALP is a major component of the Colorado Ute Indian Water Rights <br />Settlement. The failure to complete the Project would in all probability require the Southern <br />Ute and Ute Mountain Ute Indian Tribes to return to court for determination of their <br />reserved water rights. Under the Winters Doctrine, it is possible that the Tribes could be <br />found to have senior water rights to virtually all of the available water on the La Plata <br />River, effectively eliminating present water uses on as much as 14,200 acres of land held by <br />non-Indian irrigators. The Indian water rights claims could also impact the city of <br />Durango's municipal water supply on the Florida and Animas Rivers. In addition to the <br />negative economic impact, such water right claims would have on the region, it has been <br />estimated that as much as $30 million could be consumed by legal expenses if the water <br />rights case went to litigation; this would include lawyer fees, fees paid to expert witnesses, <br />and other expenses which surround water rights litigation. The prevention of additional <br />costly and lengthy litigation should be treated as a benefit from the construction of ALP and <br />has been included in the benefit-cost ratios developed in this report. <br /> <br />1-5 <br />