THE AFFECT OF URBANIZATION ON THE COST
OF OPERATING AN IRRIGATION DISTRICT OR CANAL COMPANY
John Wilkins-Wellsl Thayne Coulter
ABSTRACT
This is a report of data collected on irrigation districts and mutual ditch and irrigation companies (what we broadly term irrigation enterprises) in the intermountain region, and comprising the states of Colorado, Idaho, New Mexico, Utah and Wyoming. The data are from a three year study funded by the U.S. Bureau of Reclamation and entitled Irrigation Entemrise Management Practice Study HEMPS).l The study was located at Colorado State University. A variety of data were collected on thirty-six irrigation districts and canal companies, including operation/maintenance and administrative costs from 1945 to 1995. The combined effective irrigated acreage served by the sample is 1,478,720 acres (1995), or a little over one-tenth of all intermountain irrigated lands served by gravity canal systems. Costs reported are, in effect, the water costs borne by farmers for surface gravity supplies provided by local irrigation enterprises. What follows is (1) a brief overview of average water costs, and (2) a more in-depth analysis of the affect of urbanization on the cost of operating these two forms of enterprises. The conclusion is that urbanization in the region appears to be having a dramatic affect on operating costs, and therefore the price paid by farmers for water supplied through these enterprise.
BACKGROUND
The urbanization of prime irrigated lands is clearly one of the major issues facing the West today.2 The intermountain region, an area that has served for many years as a summer recreational haven for those wishing to escape the heat and noise of urban living, is now experiencing rapid and permanent urban settlement. This is occurring in many areas traditionally dominated by irrigated agriculture and its associated economy. Most of the desirable locations for new urban growth have been developed through the years, in great part, by irrigated agriculture. These
lSenior Research Scientist, Special Assistant Professor, Department of Sociology, Colorado State University, Fort Collins, Colorado, 80523.
2 Sociologist, Resource Management, Bureau of Reclamation, Denver Federal Center, P.O. Box 25007-D8580, Denver, Colorado, 80225-0007.
241
enterprises enterprises
these these
for for
items items cost cost
major major are are laterals laterals and and canals canals bury bury to to municipalities municipalities
by by
made made
demand) demand) a a of of
form form the in in (often (often request request the the or or needs, needs, developer developer
facilitate facilitate to to
crossings crossings
right-of-way right-of-way for for petition petition The The agencies. agencies. planning planning and and
developers developers dwellers, dwellers,
urban urban by by
challenged challenged routinely routinely are are rights-of-way rights-of-way enterprise enterprise
Irrigation Irrigation ways. ways.
numerous numerous in in
liabilities liabilities legal legal their their and and management, management, enterprise enterprise
irrigation irrigation
on on
demands demands the the
increase increase activities activities these these of of All All activities. activities. other other and and
running, running,
biking, biking,
birdwatching, birdwatching,
walking, walking, recreation; recreation; light light for for haven haven a a as as enterprises enterprises
irrigation irrigation by by
created created
vegetation vegetation and and waterways waterways view view to to tend tend dwellers dwellers Urban Urban
avail. avail.
no no of of
often often is is it it agriculture, agriculture, irrigated irrigated by by created created
largely largely
were were
habitats habitats
other other
and and wetlands wetlands
local local these these of of many many that that out out point point agriculturalists agriculturalists
when when
Even Even
instituted. be be must must
order" order"
legal legal "new "new a a that that hears hears frequently frequently
4 4
One One
meanders. meanders.
river river natural natural
and and habitat habitat riparian riparian wetlands, wetlands, destroy destroy enterprises enterprises
irrigation irrigation
of of
practices practices
traditional traditional the the that that made made frequently frequently are are Challenges Challenges
corridors. corridors.
urban urban
through through
meandering meandering rivers rivers of of value value aesthetic aesthetic the the to to obstructions obstructions
as as
planners planners
municipal municipal and and
dwellers dwellers urban urban by by viewed viewed often often now now are are water, water, over over
competing competing
enterprises enterprises
between between
improve cooperation cooperation improve to to and and flows, flows, river river in in valleys valleys
and and
peaks peaks
overcome overcome
to to
supplies supplies
water water scarce scarce stretching stretching of of means means a a as as practiced practiced
been been
often often have have
which which
diversions diversions
and and exchanges exchanges water water Traditional Traditional years. years.
many many
over over
practiced practiced
been been
have have that that
scheduling scheduling release release storage storage reservoir reservoir and and agreements agreements
exchange exchange
water water
agriCUltural agriCUltural
informal informal to to made made are are challenges challenges companies, companies, canal canal and and
districts districts irrigation irrigation
local local of of
areas areas
service service the the into into creeps creeps gradually urbanization urbanization As As
Urbanization Urbanization With With Associated Associated Costs Costs
minimal. minimal.
therefore therefore
is is
needs needs
farming farming
of of
knowledge knowledge their their
and and farm, farm, the from from removed removed generations generations three three
or or
two two
often often are are
residents residents
urban urban
Present Present agriCUlture. agriCUlture. with with kinship kinship strong strong a a felt felt
therefore therefore
and and
farmers, farmers, were were
grandparents grandparents or or parents parents their their that that claim claim casually casually could could
residents residents
urban urban
when when days days the the
are are Gone Gone daily. daily. newspapers newspapers local local in in observed observed
are are
priorities priorities
and and values values
urban urban and and rural rural between between conflicts conflicts and and Differences Differences
farmers. farmers. to to
concern concern of of
are are that that
shift shift demographic demographic this this with with associated associated priorities priorities
and and
values values
changing changing the the but but
people, people, of of number number the the only only not not is is it it However, However,
lands. irrigated irrigated
3 3
prime prime
protect protect to to
designed designed are are
zoning that that zoning and and covenants covenants ordinances, ordinances,
municipal municipal
or or
county county through through
urbanization urbanization
of of control control some some gain gain to to attempting attempting are are Others Others
change. change.
inevitable inevitable the the to to
themselves themselves resigned resigned seemingly seemingly have have communities communities
agricultural agricultural
traditional traditional
Many Many growth. growth. urban urban new new this this with with economically economically
or or
politically politically
deal deal to to
unprepared unprepared appear appear frequently frequently tourism, tourism, and and mining mining
agriculture, agriculture, on on
founded founded
those those
particularly particularly communities, communities, many many time, time, same same the the At At
environment. environment. arid arid very very otherwise otherwise an an in in vegetation vegetation
ample ample
and and
growth growth urban urban
support support to to supply water water good good a a have have localities localities select select
Conference Conference Technical Technical 14th 14th 242 242 USCID USCID Affect of Urbanization on Operating Cost 243
today. Lawsuits associated with accidents along irrigation enterprise rights-of way may not necessarily lead to unfavorable settlements for these enterprises, but such lawsuits almost inevitably result in substantial costs to retain attorneys to protect enterprise assets.
Irrigation Enterprise Operating Costs
Reporting average costs per irrigated acre, or cost per acre foot of water delivered to the farm headgate, must be treated with extreme caution. There was no strong correlation in the lEMPS data between the size (acreage) of an irrigation enterprise service area and the cost per irrigated acre borne by farmers in financing the enterprise. The cost of operating an enterprise in the intermountain region varies greatly because of differences in physical location, canal engineering and administrative requirements. Therefore, the cost of water for irrigated agriCUlture varies considerably from one enterprise to the next. Water cost can vary by $20 per acre or more between irrigation enterprises immediately adjacent to each other.
In the lEMPS sample of thirty-six enterprises, and for the year of 1995, operation/maintenance and administrative costs (and therefore the price paid by farmers for water supplied through these nonprofit enterprises), ranged from $5.00 per irrigated acre to $78.00 per irrigated acre, with an average of about $20.68 per irrigated acre. The $20.68 per irrigated acre cost can be broken down as follows: $7.75 per irrigated acre for total 0 & M costs, $11.87 per irrigated acre for administrative costs, .88¢ for debt payment on the irrigation enterprise and .17¢ for special project costs.
Prorating an average cost of $20.68 per irrigated acre for a sample representing 1,479,000 irrigated acres, and an effective water supply of approximately two acre feet per acre for the region, would give an average cost of $10.34 per acre foot for water supplied by enterprises in the intermountain region. This would mean that for an average size farm of280 acres, the annual water bill would be about $5,790 dollars. It is believed that these are generally conservative estimates for irrigation water costs in the region.
The cost of irrigation water in the intermountain region may be understated by researchers working in the field. This is primarily due to the fact that (I) farm labor costs associated exclusively with water application, (2) farm capitalization costs associated exclusively with irrigation, and (3) pumping of supplemental water from private irrigation wells are often ignored in the calculation of farm water cost.s These additional costs may double the cost per unit (acre foot) of water applied to the land. Only the cost of gravity surface delivery by irrigation enterprises is generally used. This is all that is reported in the present study when the value of $20.68 per irrigated acre is indicated for the sample. 244 USCID 14th Technical Conference
The decade of the 1970s appears to be one in which irrigation enterprise operation/maintenance and administrative costs begin to show their most rapid increase. Some of this is undoubtedly due to the general inflation in the economy at this time. However, the trend continues unabated thereafter. Another jump in cost occurs in the 1980s and continues into the present. Much of this later jump in costs appears due to urbanization in the intermountain region, plus the overall affects of the general increase in environmental regulations, including the administrative burden associated with environmental requirements. Discussions with irrigation enterprise managers and board members clearly point to urbanization as a major factor in explaining the increase in costs of approximately 300 percent between 1975 and 1995.
It will come as no surprise that the relationship between the cost of operating an irrigation enterprise, and the degree--and perhaps even the pattern--of urbanization being experienced by the county that the irrigation enterprise is located in, is an important one. This relationship is a major focus of the IEMPS research effort. The problem has been to develop methods that will allow quantitative data to be used to assess and monitor this relationship over time. These will be discussed momentarily.
A major contributor to administrative costs appears to be employee salaries. Some of this increase is obviously due to incrementally higher pay rates for higher skilled managers, office secretaries and additional field staff over the years. The cost of employee health and retirement benefits is rapidly growing in importance too. IEMPS found that employee salaries were generally sixty percent (60%) higher for enterprises located in urbanizing counties compared to enterprises located in more rural counties.
IEMPS cannot at this time state with any degree of precision what percentage of irrigation district or canal company operating costs are directly the result of accommodating the specific needs of urbanization. Examples of these needs include dealing with housing subdivision development within the irrigation enterprise service area, dealing with a rapidly rising rural non-farm population of hobby farmers and rural-to-urban commuters, litigation over protection of irrigation enterprise rights-of-way, increased costs ofliability insurance for irrigation enterprises and other urbanization-generated costs. These costs are . often disguised in the annual expense statements of these enterprises. Attempts were made by IEMPS to extract these urbanization-based costs in various ways, since they are rarely reported as separate line items in enterprise expenditures.
As mentioned earlier, most of the thirty-six irrigation enterprises in the sample are located in separate counties. Each of these counties in turn show unique demographic characteristics, based on an analysis of U.S. Census data going back to World War II. The census data have been useful in developing a typology or Affect of Urbanization on Operating Cost 245
classification of county demographic trends specifically designed for IEMPS research needs. We will now turn to a discussion of these demographic types and what they tell us about the affect of urbanization on irrigation enterprise costs
COUNTY DEMOGRAPHIC TYPES
The analysis of demographic data on fifty-six important irrigation counties in the intermountain region, of which thirty-six have an irrigation enterprise that IEMPS collected data on, appears to show three principal demographic types for our interest.6 They are: 1) the urbanized agricultural county; 2) the quasi-urban agricultural county, and; 3) the typical ruraJ agriculturaJ county. These three demographic types are more or less defined by the particular configuration of three principal population groups in these counties over time. These popUlation groups are: 1) the urban population, 2) the rural non-farm population, and; 3) the rural farm population. Table 1 shows the county affiliation of thirty-six irrigation enterprises relative to these three demographic types. We will now examine these three types.
Type #1 - Urbanized Agricultural County
There are several counties in the intermountain region that still possess valuable irrigated lands, despite having a sizable urban population. These counties might be considered as urbanized agriculture counties, rather than urban metropolitan counties. Such counties appear to have been in the process of becoming slowly urbanized since shortly after World War II. Their urban population usually comprises 66% or more of the total county population today. However, it will come as no surprise that they are usually close to a major metropolitan area in the region, such as Denver, Boise or Salt Lake City.
Larimer County, Colorado and Davis County, Utah seem to represent examples of this demographic Type #J agricultural county, where irrigated agriculture is still relatively important, but where enormous growth pressures are being exerted daily on irrigated agriculture. The demographic trends for Larimer and Davis counties, along with the population numbers for the three principal population groups (urban, rural non-farm and rural farm) are shown in Figures 1 and 2.
Irrigated acreage in Larimer County has decreased by about 18% since 1949, while irrigated acreage in Davis County has decreased by about 27% over the same period. Despite these decreases, the acreage remaining in irrigation is still important in both counties, and is of course served by important canal companies in these counties too.
Colorado Colorado
Co., Co.,
Morgan Morgan District, District, Irrigation Irrigation Sterling Sterling North North . . 10
Idaho Idaho , ,
Co. Falls Falls Twin Twin Company, Company, Canal Canal River River Salmon Salmon 9. 9.
Colorado Colorado
Co., Co., Sedgwick Sedgwick District, District, Irrigation Irrigation Julesburg Julesburg . . 8
Utah Utah
, , Co. Millard Millard Company, Company, Irrigation Irrigation Abraham Abraham . . 7
Idaho Idaho ., .,
Co
Jefferson Jefferson Company, Company, Canal Canal Lake Lake
Market Market
and and Butte Butte . . 6
10 10 N= N=
Idaho Idaho Co., Co.,
Jerome/Gooding Jerome/Gooding Company, Company, Canal Canal Side Side North North . . 5
Idaho Idaho
, , . Co Fremont Fremont , , Company Canal Canal Bench Bench Egin Egin . . 4
Utah Utah , , . Co
Emery Emery
Company, Company, Irrigation Irrigation Huntington-Cleveland Huntington-Cleveland 3. 3.
Utah Utah ., .,
Co
Emery Emery Company, Company, Canal Canal Creek Creek Cottonwood Cottonwood 2. 2.
Colorado Colorado
., ., Co Costilla Costilla Company, Company, Irrigation Irrigation Trinchern Trinchern . . I
County County
Agricultural Agricultural - Rural Rural #3 #3
Type Type = = Enterprise Enterprise Irrigation Irrigation of of Location Location
Colorado Colorado Co., Co., Weld Weld District, District, Irrigation Irrigation Henrylyn Henrylyn 17. 17.
Wyoming Wyoming , , .
Co
Waskakie Waskakie District, District, Irrigation Irrigation Hanover Hanover Upper Upper . . 16
Idaho Idaho ., ., Co Cassia Cassia District, District, Irrigation Irrigation Burley Burley 15. 15.
Idaho Idaho
, , .
Co Falls Falls Twin Twin Company, Company, Canal Canal Falls Falls Twin Twin . . 14
Utah Utah ., .,
Co Sanpete Sanpete Company, Company, Irrigation Irrigation Gunnison Gunnison 13. 13.
Colorndo Colorndo , , .
Co
Grande Grande Rio Rio District, District, Irrigation Irrigation Valley Valley Luis Luis San San . . 12
Wyoming Wyoming Co., Co., Platte Platte District, District, Irrigation Irrigation Wheatland Wheatland I. I. I I
Wyoming Wyoming
, , .
Co Park Park District, District, Irrigation Irrigation
Mountain Mountain
Heart Heart . . 10
17 17
N= N=
Wyoming Wyoming Co., Co., Park Park District, District, Irrigation Irrigation Shoshone Shoshone . . 9
Colorado Colorado ., ., Co Otero Otero Company, Company, Canal Canal Catlin Catlin . . 8
Colorado Colorado , , . Co Weld Weld District, District, Irrigation Irrigation Bijou Bijou . . 7
Colo. Colo. Co., Co.,
Montrose Montrose Association, Association, Users Users Water Water Uncompahgre Uncompahgre 6. 6.
Colorado Colorado
., ., Co Plata Plata La La District, District, Irrigation Irrigation River River Pine Pine . . 5
Wyoming Wyoming , , Co. Goshen Goshen District, District, Irrigation Irrigation Goshen Goshen . . 4
Wyoming Wyoming , ,
Co.
Fremont Fremont District, District, Irrigation Irrigation Valley Valley Riverton Riverton 3. 3.
Utah Utah , , .
Co Duchesne Duchesne Company, Company, Irrigation Irrigation Gulch Gulch Dry Dry . . 2
Utah Utah
Co., Co.,
Elder Elder Box Box Company, Company, Irrigation Irrigation River River Bear Bear I. I.
County County
Agricultural Agricultural
Quasi-Urban Quasi-Urban -
#2 #2 Type Type = = Enterprise Enterprise Irrigation Irrigation of of Location Location
Utah Utah
Co., Co.,
Utah Utah Company, Company, Canal Canal Highline Highline Strawberry Strawberry . . 9
Colorndo Colorndo , , Co.
Pueblo Pueblo , , Company Irrigating Irrigating and and Ditch Ditch Bessemer Bessemer . . 8
Colorndo Colorndo
Co., Co., Mesa Mesa District, District, Irrigation Irrigation Mesa Mesa Orchard Orchard . . 7
Colorado Colorado
, , .
Co Mesa Mesa , , Company Irrigation Irrigation Valley Valley Grand Grand 6. 6.
Colorndo Colorndo , , .
Co
Larimer Larimer , , Company Irrigation Irrigation
Poudre Poudre North North . . 5
N=9 N=9
Mexico Mexico New New
Co., Co.,
Ana Ana Dona Dona District, District, Irrigation Irrigation Butte Butte Elephant Elephant 4. 4.
Utah Utah , ,
Co.
Davis Davis
Company, Company, Canal Canal Counties Counties Weber Weber and and Davis Davis . . 3
Utah Utah
Co., Co., Cache Cache Company, Company, Irrigation Irrigation River River Cub Cub 2. 2.
Idaho Idaho
., .,
Co Bonneville Bonneville District, District, Irrigation Irrigation Progressive Progressive I. I.
County County
Agricultural Agricultural
Urbanized Urbanized -
#1 #1 Type Type = = Enterprise Enterprise Irrigation Irrigation of of Location Location
Types Types
Demographic Demographic
County County
Three Three
by by
Enterprises Enterprises Irrigation Irrigation Thirty-Six Thirty-Six Classifying Classifying - I Table Table
major major a a to to
adjacent adjacent
Being Being
1990s. 1990s. the the into into steadily steadily continuing continuing 1950s, 1950s, the the in in
beginning beginning
urbanization urbanization
toward toward
trend trend a a show show to to tend tend counties counties #1 #1 Type Type summary, summary, In In
Conference Conference Technical Technical 14th 14th 246 246 USCID USCID Affect of Urbanization on Operating Cost 247
Figure 1 - Larimer County, Colorado Population Trends 1940·1990 Breakdown by Key Population Groupings ,..,.,r-=---,c::--:----". 100%
80% ~.. 60% '"3. 40%
20%
0% 1940 1950 1960 1970 1990 Vear Source: us 8~reau ofC~nsu.s
Figure 2 - Davis County. Utah Population Trends 1940·1990 Breakdown by Key Population Groupings ...... -=--.,-:=--,---". 100%
80% ..!:f 60% '";a. 40%
20%
0%
Vear Sourc~ ; us SCIre-au ofC~(tsU$ Figure 3 - Delta County. Colorado Population Trends 1940-1990 Breakdown by Key Population Groupings ...... "".-::-:==---.,. 100% I II II II II I.. -.) : , BO% ..!:f 60% IIII II II II II I '"3. 40% I 11111 1/ II II I
20% 1 II II II II II I
0% 1 II 11-11-11_11 1 I I I I '.1 • I ":, III
Vear $oure.a-: us Sur~ilu OfC~('t .1U$ 248 USCID 14th Technical Conference
Figure 4 - Goshen County, Wyoming
Population Trends 1940-1990
80%
~ 60% g a 40%
20%
0%
Velr SOClrc.. ; us Burellel ofCef7sus Figure 5 - Sedgwick County. Colorado
Population Trends 1940-1990 Breakdown by Key Population Groupings 1 00% rr--.,.rr----,.rr---,~~m_-rI1rF 80% i 60% co a 40% 20% 0% Vear Figure 6 - Emery County, Utah Population Trends 1940-1990 100% 80% ~ 60% ~ 40% 20% 0% Vear Affect of Urbanization on Operating Cost 249 metropolitan area pretty much defines their growth pattern. Larimer County is an example of an agricultural county that was nevertheless considerably urbanized prior to World War II; being 52% urban in 1940. It is close to the Denver metropolitan area. A regional land grant college was present early on, and several large corporations began moving into the county in the 1960s. On the other hand, Davis County had an urban population of only 21 % in 1940. It is located just north of Salt Lake City. Some of the counties of this type, such as Davis County, were Type #2 counties (our next type described below) shortly after World War II. However, Davis County moved rapidly into the Type #1 category as Salt Lake City and Ogden grew and people began moving into suburbs developing in neighboring Davis County. Type #2 - Ouasi-Urban Agricultural County The next county type we encounter in the data is the quasi-urban agricultural county. These counties usually have at least one major trade center of 5000 people or more. However, they are unique in having a substantial rural non-farm population. They tend to occur in the following two situations: 1) Several small trade centers combine to make up a mixture of both urban and rural non-farm population. However, the rural non farm population often makes up 40% to 60% of the total county population. This is generally not the result of the presence of a large nearby metropolitan area, but rather the result of several small trade centers. Delta County, Colorado (Figure 3) and Goshen County, Wyoming (Figure 4) might be examples; 2) The county has a substantial rural non-farm population spilling into it from an urban metropolitan county or an urbanized agricultural county and its economy (Type #1 above). Cassia County, Idaho and Sevier County, Utah might be examples (demographic charts not shown). Regardless of which of the two Type #2 situations one is discussing, this quasi urban agricultural county shows an unusually large rural non-farm population relative to the two other popUlation groupings. This rural non-farm population is not engaged in farming, but rather employed in the local agri-business sector or in the neighboring metropolitan area economy. Long-distance commuting by car to work may be noticeable on local state or interstate highways in these counties. Type #3 - Typical Rural Agricultural County Finally, there is the typical rural county where the urban population is very small. However, the rural farm population may be only about seven to ten percent of the 250 USCID 14th Technical Conference Figure 7 -Irrigation <erprlse Cost by Demographic Type for 1995 (Nominal DoUar. per Irrigated Acre) 18~ ______~ 16 14 I!! 12 ~ I 10 __Linear (Admin CoSI) 8 f ••••••. Linear (O&M Cost) ! y = -5.1483x + 18.384 ... 4 R2 =0.9758 Type 1 (nag) Type 2 (n"17) Type 3 (n"10) total population as welL In fact, today, there are almost no important irrigation counties in the intermountain region that have a rural farm population greater than fifteen percent. Irrigated agriculture tends to produce viable local trade centers supporting a sizable rural non-farm population. Consequently, in these typical rural agriCUltural counties, the rural non-farm population predominates as well. It is just that the rural farm population remains significant at the same time. Examples of this Type #3 demographic pattern might be Sedgwick County, Colorado (Figure 5) or Emery County, Utah (Figure 6). In summary, we would anticipate that the cost of operating an irrigation enterprise in this third demographic type would be the least costly environment. On the other hand, the urbanized agriCUltural county (Type #1) might be expected to show the most costly environment for irrigation enterprises. Finally, irrigation enterprise costs in Type #2 counties might be expected to fall somewhere in between irrigation enterprise costs in Type #1 and Type #3 demographic environments. We can examine this relationship statistically. Again, Table I shows the names of thirty-six irrigation enterprises for which information on operation/maintenance and administrative costs were available for 1995. Figure 7 shows the average overall operation/maintenance cost, and then the average administrative cost alone, for the three county types. It is clear that the Type #1 demographic pattern shows higher costs per irrigated acre for Affect of Urbanization on Operating Cost 251 irrigation enterprises. We will now turn to some supporting evidence for our thesis that urbanization results in increased costs for irrigation enterprises, and therefore the price of water paid by farmers. THE BEALES CODE Dr. Calvin Beales is a U.S.D.A. sociologist who developed a numerical classification scheme for more carefully identifying and understanding the demographic character of counties. 7 The Beales Code is a useful and widely accepted typology for classifying counties on a rural-urban continuum, and is based on a variety of economic, social and political factors. The numerical continuum runs from "0" signifying most urban county to "9" signifying most rural county. We will use this classification to further explore and substantiate the effect of urbanization on the cost of operating an irrigation enterprise. Using IEMPS data from two Table 2 - Irrigation Enterprise Costs (Combined 0 & M and Administrative CosU) Per Irrigated Acre By Beales Code reporting years (1975 and (1974,1993) 1995), Table 2 and 3 show BEALES COUNTY Average IE Cost Average IE Cost comparisons of the cost per CODE Per Irrigated Acre Pcr Irrigated Acre irrigated acre of operating an CLASSIFICA nON in 1975 in 1995 irrigation enterprise in two oto 5 (A $6.51 $22.82 rural-urban subgroupings, using Predominantly Urban County) the earliest (1974) and the most 6t09(A $5.91 $19.35 recent (1993) Beales Predominantly Rural classification. These data tend County) to show that the cost per Based on 16 irrigation enterprises having complete cost data for irrigated acre is 1975 and 1995. lower when these enterprises are located in more rural (6 to 9) counties, than in more urban (0 to 5) counties. Note also the relatively dramatic increase in operational costs in the short span of twenty years. Irrigation enterprise costs per irrigated acre are similar for the two subgroupings in 1975. However, they are considerably different twenty years later. This may be explained by the fact that many of the urban counties in 1975 were really our Type #2 counties (quasi-urban agricultural counties) discussed in the previous section; whereas in 1995 these same counties have moved into the Type #1 county demographic pattern and are more clearly urban in nature. Overall, Table 2 and 3 tend to further substantiate our thesis about the affect of urbanization on irrigation enterprise costs over the years. When the three county demographic types discussed earlier are taken together with the Beales Code analysis. the data seem to give strong support to the thesis individual individual to to enterprise enterprise nonprofit nonprofit the the by by on on passed passed are are costs costs These These enterprise. enterprise. irrigation irrigation an an operating operating of of costs costs increasing increasing to to lead lead to to appear appear influences influences Urbanizing Urbanizing . . region intermountain intermountain the the in in areas areas producing producing food food of of preservation preservation the the to to dangerous dangerous extremely and and perverse perverse understood, frequently frequently understood, poorly poorly often often are are relationships relationships These These influences. influences. urbanizing urbanizing to to due due bill bill water water enterprise enterprise irrigation irrigation its its in in increase increase sizable sizable a a with with confronted confronted when when water, water, obtain obtain to to system system canal canal a a upon upon relying relying and and river, river, the the from from distance distance considerable considerable a a located located farm farm a a for for alternative alternative other other no no be be may may There There values. values. estate estate real real farm farm increasing increasing rapidly rapidly from from benefit benefit and and farm farm the the sell sell to simply simply is is strategy strategy Another Another resources. resources. groundwater groundwater local local deplete deplete potentially potentially may may strategy strategy this this , , However . . enterprise irrigation irrigation local local the the by by provided provided supplies supplies surface surface the the than than less less is groundwater groundwater of of cost cost the the available--when available--when where where groundwater groundwater of of use use greater greater make make to to is is farms farms irrigated irrigated many many for for alternative alternative One One region. region. the the in in agriculture agriculture irrigated irrigated for for crisis crisis of of type type one one reflect reflect clearly clearly factors factors These These urbanization. urbanization. with with associated associated costs costs enterprise enterprise irrigation irrigation in in trends trends on on here here shown shown information information the the considering considering unrealistic unrealistic not not is is scenario scenario This This $1,700. $1,700. by by farm farm same same this this for for bill bill water water the the increase increase would would influences- urbanizing urbanizing with with associated associated costs costs administrative administrative 1995. 1995. and and 1975 1975 for for data data cost cost and and complete complete having having operation operation enterprises enterprises increased increased irrigation irrigation of of 16 16 on on Based Based result result a a as as primarily primarily farm--and farm--and County) County) Rural Rural same same the the to to water water delivering delivering Predominantly Predominantly $12,08 $12,08 01 01 , $2 6t09(A 6t09(A enterprise enterprise irrigation irrigation an an operating operating of of cost cost the the in in County) County) Urban Urban increase increase Predominantly Predominantly percent percent 30 30 A A $5,600. $5,600. about about 83 83 , $14 44 44 . $3 Oto5(A Oto5(A of of bill bill water water annual annual an an in in result result 1995 1995 1975 1975 CLASSIFICATION CLASSIFICATION would would foot, foot, acre acre per per 0 0 $1 $1 of of cost cost in in Acre Acre Irrigated Irrigated in in Acre Acre Irrigated Irrigated CODE CODE Per Per Cost Cost IE IE Average Average Per Per Cost Cost IE IE water water Average Average average average an an COUNTY COUNTY with with BEALES BEALES farm, farm, acre acre 280 280 a a on on acre acre per per feet feet acre acre 1993) 1993) (1974, (1974, Code Code Beales Beales By By Acre Acre Irrigated Irrigated Per Per Only) Only) Costs Costs two two of of (Administrative (Administrative budget budget water water Costs Costs Enterprise A A Irrigation Irrigation costs. costs. 3 - 3 Table Table water water increasing increasing rapidly rapidly to to vulnerable vulnerable very very be be to to tend tend industry--farmers industry--farmers sheep sheep and and hog hog dairy, dairy, , , cattle/calve the the for for production production feed feed and and production, production, commodity commodity regional regional of of importance importance the the despite despite region- the the in in production production agricultural agricultural primary primary to to returns returns low low relatively relatively the the to to Due Due CONCLUSION CONCLUSION income. income. farm farm their their of of out out comes comes It It cost. cost. the the absorb absorb Growers Growers them. them. imposing imposing is that that juggernaut juggernaut very very the the to to farmers farmers by by on on passed passed be be urbanization urbanization with with associated associated costs costs the the can can Rarely Rarely enterprise. enterprise. irrigation irrigation an an operating operating of of cost cost the the increases increases urbanization urbanization that that Conference Conference 252 252 Technical Technical 14th 14th USCID USCID Affect of Urbanization on Operating Cost 253 farmers, who in tum are absorbing the costs of urban expansion onto irrigated lands that were developed in part through the U.S. Bureau of Reclamation revolving fund and private capital. The problem is that these and other market factors affecting water rates for irrigated agriculture and reallocation of river basin supplies are generally oblivious to the prioritization of land use. The way of life represented by agriculture and its important value system aside, Class I and Class II farm land is placed in harm's way due to the frequent unwillingness or inability of county and local government to deal effectively and timely with urban sprawl and its associated rural non-farm population growth. If farmers could pass on at least an equitable share of the costs of the urbanization of agricultural lands to food consumers, the economic impact on agriculture might be considerably lessened. However, these costs are difficult for agriculture to pass on to the consumer. One may argue that water costs could be alleviated through improved water use and conservation. However, on-farm water conservation is primarily paid for by farmers through their individual investment in new and more efficient irrigation technologies, and/or increased labor costs to improve water application on the farm. Concurrently, technological improvements for the irrigation enterprise itself cannot be passed on to the general pUblic. These costs associated with the urbanization of irrigated lands are now absorbed almost entirely by farmers. There is little discussion today about the public'S need to share in these costs, costs directly associated with how urban dwellers utilize land. In recent years, irrigation enterprises have been forced to develop special water rates for subdivisions and other fractional water users to achieve equity in the relationship between water used and the water service provided. These water rates are frequently set higher for fractional water users than for bulk users represented by actual income-producing farms. This is one important way to defray the cost of urbanizing influences, but often does not get at the problem of preserving the geographical integrity and physical assets of irrigation enterprise service areas. There are long-term investments that all farms in an irrigation enterprise service area have made in developing the canal infrastructure over many years. This past investment cannot be easily recuperated through special water rates for non-agricultural users; thereby ensuring equity in benefits received from the irrigation facilities relative to the individual investments made over many years. IEMPS has shown that thirty-six irrigation enterprises, for which data was available in the single year of 1995, reported $214,202,003 in fixed assets (the book value of primary canal systems only), or approximately $157 per acre of irrigated land. The book value of irrigation infrastructure in the 5 state intermountain region, and again for primary canal systems only, is conservatively estimated at $1.4 billion based on IEMPS data. Dams, local water storage 254 USCID 14th Technical Conference facilities, and major pumps and diversion structures are not included in this book value. Each converted acre of irrigated land to urbanization potentially represents an income loss from future assessments needed to maintain the operating condition of these valuable canal assets. This is a troubling trend. If irrigated lands and the associated canal infrastructure are needed to meet future food production needs, which they inevitably will, the cost of moving onto Class III and Class IV lands because of the loss of Class I and Class I11ands--and the associated cost of reinvesting in new irrigation system infrastructure to serve these new lands--will result in ever increasing costs of producing crops. If past trends continue, farmers may be expected to absorb these costs as well. The urbanization of agricultural counties is generally not supported by a proper and detailed assessment of the long-term costs and consequences of losing these agricultural assets. Despite the constant warning about the loss of agricultural land, it is the loss of "prime irrigated lands" to urban development that poses the most concern for food production in the future. However it is not just the land, but also the valuable irrigation water delivery infrastructure that has been developed over the years--frequently with federal support--and at a great cost to agricultural incomes in the past. Finally, the trends noted here potentially represent the loss of much needed farm income, viable farms and experienced farmers. REFERENCES 1. 1. Wilkins-Wells, R.L. Anderson, G.A. Pavelis and M .. S Anwer, Irrigation Enterprise Management Practice Study, U.S. Bureau of Reclamation, Project # EI.D4.4, January (1999). 2. U.S.D.A., Agricultural Resources and Environmental Indicators, 1996-1997. An Economic Research Service Report, Agricultural Handbook No. 712, July (1997). 3. 1. Freedgood, Saving American Farmland: What Works, USDA, Natural Resources Conservation Service (1997). 4. C.F. Wilkinson, Aldo Leopold and Western Water Law: Thinking perpendicular to the Prior Appropriation Doctrine, Land and Water Law Review, 24:1 (1989). 5. G. A. Pavelis, Natural Resource Capital Formation in American Agriculture: Irrigation, Drainage, and Conservation, 1885-1980. USDA, Economic Research Service, Natural Resource Economics Division (1985). Affect of Urbanization on Operating Cost 255 6. Part of this analysis has been infonned by N. Brooks, D. Reimund and R.N. Peterson, Effects ofPopulation Growth and County Type on Farm Structure, 1970-1980. USDA, Economic Research Division, Agriculture and Rural Economy Division. 7. PJ. Cook and I.F. Hardy, Updating the ERS County Typology. USDA, Economic Research Service, Agriculture and Rural Economy Division, December (1993).