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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 />r!i)02~2 <br /> <br />"b. The present value of un inflated future project revenues, as deferred to <br />account for market and legal uncertainties, shall then be calculated using a <br />real discount rate that has been adjusted for inflation. <br /> <br />"c. The estimated development costs may be based on the 1984 Little Snake <br />report referenced above, shall be estimated in consultation with the water <br />right owner, shall be assumed to be incurred without inflation 5.10 years <br />prior to the assumed start-up of project revenues, shall be discounted to a <br />present value using the same adjusted real discount rate, and shall be netted <br />from the present value of future project revenues. A shorter discount period <br />will be applied to development costs since future costs may be more certain <br />than future revenues, and since costs must necessarily be incurred in advance <br />of revenues. <br /> <br />"2. Alternative methods for appraising the present fair market value of the P&M <br /> <br />water rights shall be reviewed, and applied if appropriate, and an appraiser's opinion of <br /> <br />the present fair market value of these water rights shall be rendered." <br /> <br />This report presents the estimates of value that were developed using the net future <br /> <br />project revenues procedure as set forth in the contract for services and comparable market <br /> <br />.. <br /> <br />sales. <br /> <br />'. <br /> <br />2 <br />