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the amount already expended the cost of the additional wells and the dam if needed, and the cost per acre will be obtained by dividing the total by 10,000. The cost for operation will be small because of the power from the Roosevelt project. The annual cost per acre will be the annual installment of construction, interest, and depreciation costs, plus cost of operation; but the board does not attempt to put the annual cost per acre for the Santan project into figures, as is done for the 30,000 acres on the south side.

192. For the 30,000 acres to be irrigated on the south side of the river, called the Sacaton project, there will be required 40 wells, costing about $600,000; a power plant of about 1,350 kilowatts capacity, costing about $135,000; 40 miles of transmission lines, costing about $80,000; a diversion dam at the head of the Little Gila, costing about $150,000; and a distribution system, costing about $12 per acre, or $360,000. The total estimated construction cost is therefore $1,325,000, or $44.17 per acre. If this amount is assumed as returnable in 20 annual payments, and if interest at 3 per cent compounded annually is added, the annual installment of construction cost per acre will be $2.97.

193. The amount of electric power per year for pumping on the 30,000 acres may be taken at about 4,200,000 kilowatt hours, and the cost as about 13 cents per kilowatt-hour, or a total of $73,500; but since there will be a saving of fuel when river water is used, the annual cost may be taken as about $63,000. The depreciation on the elements of the project may be taken as averaging about 5 per cent, except for the diversion dam, which it is assumed will not deteriorate; and the annual charge for deterioration will therefore be 5 per cent on $1,175,000, or $58,750. The operation for the system, not including power, may be taken as $1 per acre per year, or $30,000 for the project. The total annual cost for operation and for depreciation is therefore $151,750, or $5.06 per acre. On this basis the Sacaton project will be charged $8.03 per acre per year for the first 20 years, and thereafter $5.06 per acre per year.

194. In the description of the San Carlos Reservoir project elsewhere given, it was stated that there was to be included in the project the 10,000 acres of the Santan project, with one-half water right in stored water and with present power right and use of well water, and 30,000 acres of land on the south side of the river; and that the estimated cost chargeable to the Indian lands was $2,437,091. If this is to be repaid in 20 equal annual installments and if the interest at 3 per cent compounded annually is added the annual installment per acre on the south side will be $4.68, and for the 10,000 acres on the north side $2.34.

195. For the 10,000 acres on the north side there must be added the construction charges assessed against them for the work already done, less the value of the power in excess of that necessary to operate 8 wells. The acreage on the north side may be increased by the construction of 8 additional wells to use the power for which the Santan project has a right. On account of the uncertainties in regard to what is the proper basis of settlement for the 10,000 acres, the board assumes that the one-half right will be charged for operating the storage works and for desilting, only one-half the average cost per acre, and that the charges for such elements of the storage and distribution system as are subject to deterioration should be similarly distributed.

196. For the 30,000 acres on the south side, the yearly cost can be more definitely stated. The operation and maintenance of the reservoir and main canals is estimated at $45,000 for 90,000 acres, or $0.50 per acre. The operation and maintenance of the distribution system for the south side lands may be taken as $1 per acre per year. The total annual charge for operation and maintenance for the 30,000 acres will therefore be $1.50 per acre. For 20 years the charge against the land on the south side will be $6.18; for the remaining time until desilting begins, the charge will be $1.50, and after desilting begins, the annual charge may be as much as $4.83.

197. The degree of accuracy attaching to the estimate of the combined flood and well-water system is not equal to that attaching to the estimate for the storage project. The above figures, however, show that the yearly cost of the former system will exceed that of a storage project for Indian and private lands, provided the entire present flow of the stream is available for the storage and none of the stored waters have to be delivered free in satisfaction of existing rights.

198. Under the supposition that the United States is entitled to practically the entire flow of the stream (par. 183), a flood-water system without either a storage or a pumping reserve could be installed. It would involve the construction of one or possibly two diversion dams on the reservation, and the necessary distribution system. Its cost on a basis of 20,000 acres irrigated would be about $17.50 per acre.

199. It is impracticable to estimate closely what quantity of water could be caught by such a system, and not all that could be caught could be usefully applied, for on a flashy stream like the Gila a flood-water system has this essential defect that often, perhaps when water is needed most, the river may be dry, while when the river is in flood only a portion of the flow may be required or can be diverted. But possibly by such a system 30,000 to 50,000 acre-feet might be put upon the lands, or sufficient for the irrigation of, say, 20,000 acres. This would give the Indians as much water as with their primitive methods of diversion, distribution, and cultivation, they have hitherto been able to use, but is far less than is now thought to be their due. (Par. 216.)

200. Moreover, it appears advisable to point out what would result from the enforcement of the assumed right to take the entire flow of the stream. It would certainly mean depriving the irrigators near Florence of so much water as to make irrigation in that district precarious if not impossible. For 20 years it has been known that the diversion of water near Florence was reducing the quantity of

1 The run-off measured (and estimated) at San Carlos, is the actual present run-off, allowing, of course, for the quantity diverted at Guthrie and Safford. In view of the lack of any adjudication in which the rights of the Pima Indians have been considered, the board could not assume that irrigation at these places would be abolished or reduced in amount. On the other hand, the board's discussion of the projec assumes that no diversion in excess of present ones will be permitted above the dam site, or between the dam site and the reservation.

Should a court decide that everywhere above the reservation irrigation must cease except at times when the flow exceeded the "normal flow," the effect might be to prevent or at least greatly reduce irrigation at Safford and Guthrie. The board lacks the data necessary for determining what effect is produced at the reservation by the diversion of water at Safford and Guthrie; and has therefore confined the discussion in the text to the effect that would be produced upon irrigators at and near Florence, by the enforcement of the assumed rights of the United States to the greater part of the total flow of the stream. For "normal flow" see the Kent decision in Hurley v. Abbott. In the case of the larger storage project, as already indicated, the quantity of water arrived at as available for storage does not assume the cessation of irrigation at Safford and Guthrie, but does assume that there shall be no increased diversion above the dam site.

water available for the Indians below the quantity needed by them. Nevertheless such diversions have not been prevented by the United States. On the contrary, they may be said to have been encouraged, for so far from withdrawing the public lands in the vicinity from entry, the United States has allowed them to be homesteaded and even entered upon under the desert-land act which requires that for a patent to issue land must be irrigated. Bad as conditions are they are constantly getting worse, and this is one of the reasons why the board has so strongly recommended a judicial determination of water rights along this river. It also equally recommends that no further land entries requiring irrigation from the Gila River or its tributaries above the Gila River Indian Reservation be permitted and that lapsing entries be canceled and not reissued.

201. Up to this point it has been assumed that if there are rights adverse to those of the Indians, they exist above the reservation. It is by no means certain, however, that there are not similar rights in the case of lands downstream from the reservation. From whatever point of view this question is considered, the necessity of a judicial determination of rights appears at once, and it seems that this determination should extend to rights throughout the full length of the stream.

PRACTICABILITY AND ADVISABILITY OF PROJECT.

202. The board finds that the San Carlos irrigation project is entirely feasible from physical considerations.

203. The advisability of the project, as before stated, will depend on its cost as compared with the benefits to result from it.

204. The cost of the project per acre will depend upon the number of acres that can be taken under the project, and this upon the quantity of water physically and legally available.

205. The board has pointed out that the following uncertainties exist as to the water supply legally available:

(a) It is not known whether the run-off at San Carlos, as determined by the board, will continue to be available or whether additional diversions above that point will be made.

(b) It is not known whether all of the water that can be taken into the main canal will be available for lands under the project or whether a part of it will have to be delivered free to lands not entered under the project.

(c) It is not known whether a part of the water that might be taken into the main canal may not have to be left in the river to satisfy rights below the reservation.

206. Until these uncertainties are cleared up, either by an adjudication or by competent legal opinion as Congress may determine, it would be inadvisable for the United States to proceed with this project. In the following discussion, therefore, it is assumed that all of the above questions are settled in favor of the project, so that the existing run-off at San Carlos is available for use under the project. 207. Some of the benefits to result from carrying out this project and some of the incentives for the United States to proceed with it can not be expressed in dollars and cents. Thus there is the plain duty of restoring the water of which the Indians for many years have been illegally deprived; the obligation, growing out of the relation of guardian, to supply even a better system of water supply than

that formerly enjoyed in order to permit proper opportunity for development and advancement of the Indians; and finally the advantages of conserving water which otherwise would largely be lost, and of utilizing it upon these desert lands, both Indian and private, thus adding materially to the producing power of the State and providing additional profitable industries to the people.

208. Assuming the availability of the existing run-off, it is proposed to include in the project 40,000 acres of land on the Indian reservation (30,000 with full water rights and 10,000 with half rights) and 55,000 acres of private land near Florence. The cost will be. about $70 per acre in each case.

209. The board is of opinion that, considering land, climate, etc., $70 an acre is not a prohibitive price in southern Arizona for such a water system as that contemplated in this report. Under present conditions, however, it is close to the limit. As time goes on the land probably can afford to pay more. On this account, whatever be the decision of Congress as to adopting the San Carlos project at the present time or in the near future, the San Carlos Dam site and reservoir site ought not to be given up. No railroad should be permitted to build through the dam site at a lower elevation than 200 feet above the stream, and any new railroad construction in the reservoir site or any extensive relocation of present lines ought to be permitted only upon the understanding that no compensation will be due from the United States if later these new railroad lines are forced to move because of the carrying out of the San Carlos project. 210. Under the plan of repayment proposed by the board, the cost per acre to private land, including operation and maintenance, will be about $6.24 a year for the first 20 years, $1.50 a year thereafter until desilting begins, and thenceforth, with desilting, not to exceed $4.83. 211. In saying that the cost of the project is about as high as it is at present advisable to go the board of course does not mean that there would be any difficulty in making an annual profit of $6.24 an acre on the land under this project. Land under the Florence Canal, even with its present deficient and uncertain water supply, now rents for $5 and $6 per year. But it must be remembered that the land

1 Beginning about the year 1900 a cost of $20 per acre for irrigation was considered high, but when it began to be appreciated that the land with a sure water supply would yield a large return on a value of $50 or even $100 per acre it was recognized that larger investments in construction would be justified. Year by year the limits of assumed feasibility have been increased, so that by 1905 it was assumed that $30 per acre was large, then $40 per acre, and finally, in 1910, a cost of reclamation of $60 per acre was not considered prohibitory for lands, especially in the southern part of the country. In fact, when consideration is had of the great value of orchard lands, an expenditure of $100 or more per acre to provide water is feasible. In semitropical lands, for example, in the Hawaiian Islands, where pumping plants have been erected for raising water for irrigation to a height of 550 feet, an outlay of several hundred dollars per acre is not considered out of the ordinary.

In the northern temperate regions, for example, in Colorado and Montana, for the ordinary field crops an investment of $40 to $60 per acre may be now considered as large but not prohibitory. This may be increased notably for warmer regions with longer crop season, such as those of southern Idaho and portions of Oregon and Washington. Going south from here to points, as in Arizona and California, where crops grow throughout the greater part of the year, an increase of 50 per cent in the amount above named may be considered as moderate.

If estimates are based on the crop production of thoroughly irrigated lands, it can readily be seen that these give a good income on an investement of from $200 to $500 per acre, so that theoretically the figures above given could be increased several fold, but as a matter of fact, under existing conditions, it is hardly safe to ngure on this basis, although it is possible to look forward to a time when far larger investments than now considered wise will be the rule rather than the exception. (Principles of Irrigation Engineering, Newell & Murphy, p. 282.)

The immediate or present value of the crops produced in an area should not be used as the limiting feature, because it is proper to assume that with more complete development of the area there will result larger crop production and better facilities for marketing and handling this. It is also safe to assume that ordinarily when the country is developed there can be no overproduction in the sense that such large quantities of crops will be produced that the value will decrease. This condition may exist temporarily, but with irrigated lands forming such a small percentage of the arid West this condition can not be permanent: bence it is desirable to use a reasonable optimism with regard to future crop values, basing these not upon the temporary conditions of extremely high or low values but upon those which may be considered more nearly normal. (Ibid.)

in the San Carlos project must earn not only the annual charge of $6.24, the livelihood of the owner and family, and the cost of improvements and depreciation thereof, but interest on the enhanced value of the land caused by the adoption of the project.1

212. As regards the Indian lands, it is not so certain that the project is a desirable one. In weighing the desirability of incurring the large expenditures necessary for providing for the Indians by means of this project, there must be taken into consideration the character of the Indian as an agriculturist. In his present condition he is not so efficient an agriculturist as the white farmer; many of the Indians are not provided with the necessary seed, farm implements, and stock required to begin the efficient cultivation of the acreage which is proposed to allot; some of the Indians, having been cared for in a measure by the Government for a number of years, have lost the ability to be self-sustaining, and some time must elapse before there can be developed in them the desire to become self-supporting. In the beginning the Indians can not be expected to efficiently cultivate the entire 40,000 acres proposed to be included in the project, nor in fact to cultivate any considerably greater acreage than that which will afford them a bare subsistence, and yet the failure to efficiently cultivate the entire acreage for which stored water is provided means that the lands will not be earning an income on the investment and that some of the stored water is not being put to beneficial use.

213. For a number of years the United States will have to continue its paternal guardianship of the Indians, and for many of the Indians there must be provided seed, implements, and stock. This latter expense, which the board has made no attempt to estimate, is in addition to the cost of the project. This, however, can be returned to the Government by leasing to white farmers such portion of the Indians' 40,000 acres as they are at present unable to efficiently cultivate. It is believed that such a proceeding would be mere business prudence. It might even be found to be advisable for the Indian Bureau to undertake the cultivation of a certain area, employing the Indians as farm laborers until they have acquired the ability and the means for cultivating temporary allotments afterwards to be assigned to them. Finally, after a number of years of fostering care, permanent allotments may be made. At the present time, to make permanent allotments of 10 acres of irrigated land to each man, woman, and child would result in a large part of the land lying idle and in another part being poorly farmed.

214. In suggesting the lease of the unused portion of the 40,000 acres, the board does not expect that the returns therefrom will be applied to offset the construction costs of the project; but rather that

1 At the time the reclamation act was passed the reclaimable lands could be had at a nominal valuea little more than the cost of keeping the title and procuring the conveyance, or upward of $5 an acre. Within the 10 years subsequent to that time these lands have not been improved in any way, except by the building of the works by which water might be obtained, but the asking price has jumped from $50 to $100 or more per acre. In some cases the prices asked for the raw land have increased a thousand per cent. It is this unearned increment which is really the great load which is holding back the rapid development of irrigated lands in the West, whether watered by the use of public or private capital. It has stimulated the work in one way, and at the same time has developed a class of men who are largely interested in getting a piece of land in the hope of selling a relinquishment of title. They have found that the profits from simply holding the irrigated lands out of the market are greater than those from utilizing these lands in the production of crops; the second or third comer, who may be the real farmer, thus has to incur not only the cost of clearing, leveling, and subduing the soil, adding improvements, and paving for the water supply, but in addition has the burden, equaling or exceeding the other costs, of paying for the unearned increment charged for the land. (Eleventh Annual Report of Reclamation Service, p. 8.)

Not to require the Indian allottees to reimburse the United States for the cost of their share of the project is not incompatible with such a tenure of the land as is prescribed for the Santan lands in section 2 of the Indian appropriation act of Aug. 24, 1912.

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