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Because the present law allows a preference only for junior direct flow irrigation appropriators we do not believe there is a danger of storage rights being threatened by year-round uses such as recharge or electric power. Therefore, we recommend that the statute remain in its current form. ALTERNATIVE #5 (formerly #9): Develop more specific guidelines as to what Is necessary to extend as application for water for a sup- plemental project that not been completed. The Commission does not recommend adoption of this alternative. We believe that the current statutes maintain a suitable balance between the need of pro- ject sponsors to have their water rights protected dur- ing periods of reasonable delays and the need of the state to see that water is not wasted. ALTERNATIVE #6 (formerly #10): Increase annual appropriation to the resources develop- ment fund. The Commission strongly recommends adoption of this alternative as part of the overall funding package. Construction of economically feasible water storage projects should be a major state funding priority. A higher level of funding would encourage larger projects and more applications. It would also give local spon- sors more certainty about state funding commitment to their projects. ALTERNATIVE #7(formerly #11): Designate an add-on (Increase) to an existing state tax such as sales or Income tax to be used for supplemen- tal water projects. The Commission believes revenues must be raised for water projects, and we would support this alternative in preference to no increase in funding. However, we do not believe this is the best method of generating ad- ditional funds. ALTERNATIVE #8 (formerly #12): Levy a special tax on commodities such as cigarettes or liquor to be used for supplemental water projects. We do hOt believe that this alternative is the best method of generating additional funds. We would support this alternative in preference te no increase in funding. However, we do not believe that special taxes on commodities are the fairest method of genera.ting revenue. ALTERNATIVE #9 (formerly #13): Specify that a percent of the severance (oil and gas) tax fund be used for supplemental water projects. (Amendment to Neb. Rev. Stat. ~76-1801) VI. The severance tax on gas and oil is currently used for education. If we were to begin using this fund for water projects an alternative source of education funds would need to be found. We don't believe that cutting our funds to educational activities is the way to finance water projects. We would find the opposition such a move would generate to be understandable. While we support funding projects, we suggest that another method be found. ALTERNATIVE #10 (formerly #14): Im- plementation of the amendment to article XIII, Section I of the constitution of Nebraska by pass- ing legislation which would allow revenue bonds to be Issued for construction of water retention and Impoundment structures. The Commission strongly recommends that this al- ternative be adopted. We supported adoption of the constitutional amendment which made this legislation possible. In passing that amendment the people of Nebraska made their commitment to water resources development clear. We believe it is now time to take the final step by passing legislation which allows revenue bonds to be issued. Such a final step can be taken by passing LB 545 in the modified form previously suggested in our funding package. ALTERNATIVE #11 (formerly #15): Allow the State to issue general obligation bonds with or without a referendum for development projects. (Amendment to constitution of Nebraska, Article XIII, SEC. 1.) The Commission strongly supports adoption of this alternative. It is an integral part of the funding paCkage presented in the first section of these recommenda- tions. As discussed in that funding package, an ac- ceptable variation of this alternative would be state guarantee of local general obligation bonds. ALTERNATIVE #12 (formerly #16): Allow the State to Institute water-use fees to be used as revenue to pay for supplemental water projects. Although the Commission does not believe this should be the sole method of obtaining funds for water projects, we do support adoption of this alternative. We feel that having water users pay a higher share of taxes used for water development is a fair method of raising revenues. We also believe it would help lend credibil- ity to the remainder of a legislative package for water development. ALTERNATIVE #13 (formerly #17): Allow ex- ceptions to the local Option Tax Control Act for increases in expenditures by local governments for supplemental water developments. (Amend- ment to Neb. Rev. Stat. ~77-3401 Et. Seq.)