OCR Text |
Show thinking should be resolved, that the necessity for public and private activity existing side by side, operating for the public advantage, should be rec- ognized, and that the governmental machinery needed for resources development should be established. Reimbursement should be used as a positive instrument of public policy, to achieve national goals. These goals will be defined in the process of planning for resources development; in the same process, means will be found for adapting reimbursement requirements to the different pur- poses it can serve. In order to be fully effective, reimbursement policy must be articulated with other policies to achieve maximum development of water re- sources for all beneficial uses. Specifically, this means that: 1. Reimbursement policy should be based on the demonstrated superiority of comprehensive, multiple-purpose basin programs over single- purpose projects. 2. It should distinguish clearly between private and public benefits. Public benefits should be recognized as the reason for and justification of public investment in water resources programs. Benefits which are primarily public, or which cannot be assessed against particular beneficiar- ies, should be nonreimbursable, to be covered out of public revenues. 3. The assessment and recapture of private benefits should be a main objective of reimburse- ment policy. Any charges below costs should re- quire special justification in relation to the public interest. Capitalizable increments, such as spec- ulative increases in land values associated with proposed irrigation developments, for which ade- quate reimbursement has not been required, should either be prevented or recaptured by ap- propriate charges. 4. Reimbursability should be one of the criteria in determining whether programs should be undertaken, but it should not alone be decisive. 5. Reimbursement policy can be used to en- courage local participation in financing resources development. The Federal Government can command large financial resources but is legally limited in the devices by which it can recapture the value of benefits from private individuals. State and local governments may have limited financial capacity but generally are legally able to levy assessments on those individuals. By combining their tax powers, costs could be shared more equitably between local and national in- terests, and the recapture of private benefits made more exact. Current Practices Present reimbursement practices have de- veloped piecemeal over the years in numerous statutes and administrative decisions dealing with particular functions such as irrigation, naviga- tion, flood control, drainage, and electric power. The several Federal agencies have applied reim- bursement requirements in accordance with their own authorizations, but there has been little, if any, consistency between reimbursement prac- tices in essentially complementary water resources program functions. A brief summary of current reimbursement practices will provide a necessary basis for further consideration of the possibility of introducing greater consistency. Reclamation.-Investment in irrigation proj- ects is regarded by Congress as 100 percent reim- bursable without interest. But as project costs have gone up, this policy has been increasingly questioned. The sources of the funds for the repayment of the investment assigned to irrigation are the pay- ments by the users of irrigation water and the rev- enues from power and municipal water supply and from other miscellaneous purposes. Since 1939, repayment charges assigned to the irriga- tors have been based essentially upon ability to pay, i. e., repayment capacity is considered in the light of the increased annual farm income which may be anticipated from project development. It is determined after reasonable allowances have been made for production expenses, including operation and maintenance of irrigation facilities, family living, and return on the farm investment. Costs properly allocable to irrigation but in excess of such repayment ability are met from power or other available revenues. In the case 69 |