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<br />repay their contractual share of the irrigation investment. As a result, the financial <br />feasibility of the projects has declined. <br /> <br />The cost of purchasing power from the Colorado River Storage Project is a <br />significant portion of the epsts of operating the Dolores and the Animas-La Plata <br />Projects, Both projects are energy intensive, since water must be pumped into canals <br />and distribution systems before it can be used in either project. The Animas-La <br />Plata Project must also pump water from the Animas River for storage in the Ridges <br />Basin Reservoir, Since the late 19705, the cost of buying power from the Colorado <br />River Storage Project has risen to 16,72 mills per kilowatt-hour,8 a significant <br />increase over the 6.1 and 6,6 mills per kilowatt-hour that were originally estimated <br />for the Dolores and the Animas-La Plata Projects, respectively, The manager of the <br />Dolores Water Conservancy District stated that the District was very concerned <br />about the power rates for pumping on the Dolores Project and that power costs were <br />expected to be about 40 percent of annual operation and maintenance expenses <br />when Project facilities are fully transferred to the District. Similarly, the Bureau <br />estimates that Animas-La Plata Project power costs will account for about half the <br />costs of Project operation. <br /> <br />In contrast to the escalating costs of operating the Dolores and the Animas-La Plata <br />Projects, crop values have increased less than 60 percent since the projects were <br />planned, Crops for both projects consist primarily of low value forage, such as wheat <br />and alfalfa used in livestock production, Additionally, the growing season in the <br />areas of the Dolores and the Animas-La Plata Projects is short, less than 140 days. <br />Thus irrigators may not be able to increase their farm revenues by growing and <br />harvesting crops from the same land more than once a year, Further, farmers in the <br />area have been the recipients of payments intended to curtail the production of crops <br />that are identified by the V.S, Department of Agriculture as in surplus supply <br />nationally. As such, low crop prices have likely affected the ability of the irrigators <br />to pay for the costs of agricultural production. <br /> <br />Because of the status of the agricultural economy and the cost of on-fann <br />development, the Bureau has subsidized water rates on the Dolores Project since <br />farmers first began receiving water 6 years ago, Since initiation of deliveries from <br />the Dolores Project, we estimated that the Bureau has capitalized more than <br />$570,000 of incremental operation and maintenance costs associated with water <br />deliveries, which the farmers have not paid. Bureau officials told us that water was <br />delivered below cost during the construction period to allow farmers to develop on- <br />fann irrigation systems. Bureau officials also told us that they expected water to be <br />delivered below cost during the construction of the Animas-La Plata Project and that <br />operation and maintenance costs for the Project could exceed the irrigators' payment <br /> <br />B-rbe basic unit o[ electric energy, which equals an average of 1 kilowatt o[ power applied over one <br />hour. <br /> <br />12 <br /> <br />, ' <br />