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Show 48 WAR FOR THE COLORADO RIVER Irrigation remained the primary purpose of all fed- erally-financed projects. Commercial power was con- sidered a by-product of, and incidental to, a project. Municipalities were given preference as customers. The government would put up the money to build the power features of a project, and that capital cost would be repaid through the sales of energy. Interest at the rate of three per cent would be charged on the loan. That interest would be paid into the Treasury. In that way the taxpayers would receive a return on their in- vestment. Let it be recalled that under the Reclamation Act of 1902 no interest was required to be paid for irrigation features of a project. The original act also provided that construction costs of the irrigation features should be repaid in equal annual installments, not exceeding ten years. The Extension Act of 1914 lengthened the period of repayment to twenty years. Then came the 1924 Fact Finders Act, which provided for an indefinite period of repayment, and the annual charge was calcu- lated on five per cent of ten-year average crop returns from a project. This vague law was repealed by the Omnibus Adjustment Act of 1926, which substituted a forty-year repayment plan. The forty-year plan was the law when the Central Arizona Project was proposed. After a construction period moratorium of ten years, an irrigation district had forty years in which to liquidate its debt to the government. Originally the settlers on a project were responsible individually for their debt. Then Congress gave the Interior Department the authority to contract with organized irrigation districts for the entire debt. |