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I I I I . I I I I I ~. I I I . I .. I I "~"""~ ,"S. . / t' ! J .... oJ ~ .... assumptions for that analysis are not clear. It is considered at this time that the WWC estimate of 58,000 acre-feet is the correct value to use for this appraisal. In arriving at the 58,000 acre-feet value, the operation study assumed no return flow or that there would be 100 percent consumptive use. Market Comparisons A common and appropriate method of appraisal is to determine comparable sales on the open market place where the value is set by negotiations between knowledgeable sellers and buyers. A difficulty in applying this method is to be sure the sales are comparable. In this particular instance, most recent sales are for developed water supply and the most active market is along the Front Range for municipal purposes. With these caveats, it is worthwhile noting some recently reported sales or appraisals. P & M obtained an appraisal of their conditional water rights on the Gunnison River in connection with the donation of those rights to The Nature Conservancy for instream !low purposes. The appraisal was prepared by Frank Nisley Jr. and John W. '. Nisley of Grand Junction, Colorado in June 1988. Several sales which had been reported in Water Market Update were summarized in their report. The report is confidential, but they found that the market price has varied over the years from a high of about $2,700 per acre-foot in 1980 to about $1,000 per acre-foot in 1986. It is apparent from this fluctuation that as the economic conditions improve, the demand for water increases and the price increases. When development is slow, the price decreases. From a long-range view, the price of water and water rights will undoubtedly increase in the future. 10