OCR Text |
Show 48 WAR FOR THE COLORADO RIVER ponent necessarily varies with the size of the power or water supply investment, and therefore, the use of the interest component discriminates against irrigation pro- jects which are not directly associated with power or water supply projects, or in which such investments are small in relation to the size of the total project." Circular a-47 proposed a repayment period of 50 years. The crsp plan called for repayment in 100 years, possibly more. The circular also took a swipe at the inclusion of secondary benefits (such as the cigars mentioned earlier). One Budget Bureau executive, R. L. Cochran, a former governor of Nebraska, probably had more to do with preparing the material and findings of a-47 than any other man. Over a year before the issuance of the circular, Cochran had torn to shreds the benefit-cost ratio system used by the Bureau of Reclamation for showing the feasibility of projects. It was, he main- tained, completely phony. He told the Budget Bureau that: "During the past few years the Bureau of Recla- mation has lowered its standards in computing benefits and costs to a point where benefit-cost ratios gave little or no guidance for checking the feasibility of project proposals. "The Reclamation Bureau assumed 100 years of useful life for a project, while the Federal Power Com- mission, the Department of Agriculture, and the Corps of Engineers assumed only 50 years. "The Reclamation Bureau placed a monetary value on indirect benefits and used this value in computing total benefits. This practice was criticized by the Agri- culture Department, the Power Commission, and the Army Engineers. |