Water Subsidies: Impact of Higher Irrigation Rates on Central Valley Project Farmers
RCED-94-8
Published: Apr 19, 1994. Publicly Released: May 20, 1994.
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Highlights
Pursuant to a congressional request, GAO reviewed the Bureau of Reclamation's Central Valley Project (CVP), focusing on: (1) the mandated higher irrigation rates' and other rate increases' impact on farmers' profits; (2) the financial benefits to the federal government of increasing irrigation rates; and (3) how farmers could mitigate the impacts of increased rates.
Recommendations
Matter for Congressional Consideration
| Matter | Status | Comments |
|---|---|---|
| If Congress decides to pursue this issue of increasing irrigation rates, Congress may wish to consider in its deliberations such factors as: (1) the extent to which farmers can absorb increased irrigation costs; (2) the potential adverse impacts on farmers and local economies; (3) the increased revenues to the U.S. Treasury that could be generated; (4) the ability of farmers to mitigate the effects of the price increases; (5) the environmental and water supply benefits resulting from higher irrigation rates; (6) the impacts of future water supply reductions; and (7) whether the increases should apply to already renewed contracts. Other options, such as using water markets in which rights to use water are bought and sold, may achieve similar benefits but would impact farmers differently. | Congress has not acted on this recommendation. |
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Topics
Agricultural productionAgricultural programsCost analysisEnvironmental monitoringFarm subsidiesProfitsUtility ratesWater resources conservationWater resources developmentWater supply managementIrrigation