In upper South Dakota, around the rural towns of Pollock and Herreid, about 80 farmers are thirstily awaiting a draught of relief from Uncle Sam.
The relief they're expecting is water that will be provided from a $35 million Interior Department irrigtation project near Oahe Reservoir in the Missiouri River basin.
The water may help improve their corn crops, but the General Accounting Office (GAO), in a new study of federal irrigation programs, says the real relief they'll get is a massive subsidy that never will be repaid.
Users of water in the Pollock-Herreid project will pay $3.10 per acre-foot -- the amount of water needed to cover an acre to a depth of one foot. By GAO reckoning, the true cost to the Treasury would be $130.50.
GAO's review of that and five other projects under construction by Interior's Waters and Power Resources Service (WPRS) produced similar findings: taxpayers are footing huge bills to provide irrigation water for a relatively few farmers.
In response, Interior quarreled with the GAO findings, but officials of the Department of Argiculture generally agreed with the conclusions. Both departments responded before the change of administrations in January.
The GAO study of WPRS projects in South Dakota, Washington, Nebraska, Colorado and California is likely to intensify the already heated debate over federal irrigation policy. Previous studies have shown similar subsidies throughout the West.
Rep. George Miller (D-Calif.) this week will introduce a bill that would require Interior to charge more realistic rates for the irrigation water it provides thousands of famers in the West.
Applied to the Pollock-Herreid project, Miller's formula would cost South Dakota farmers $35.34 per acre-foot of water. That price would allow Interior to recover project construction costs, while still providing a subsidy by charging no interest over a 50-year period.
Miller is a leading actor in the congressional battle over revision of the Reclamation Act of 1902, the law that provides irrigation water for an estimated 11 million acres in 17 western states. Users are supposed to repay construction and operation costs to the government.
"The new GAO report finally blows the cover," Miller said. "Here for years Interior has been trying to say that farmers will pay back the project costs. GAO says that will never come close to paying them back."
Miller added, "It's an absolutely perfect example of what President Reagan is so concerned about -- a well-intentioned federal program that just grew and grew. He is concerned about the affluent getting a school lunch subsidey, for example, and now we find that some of these big farmers are getting this water subsidy."
While the vast majority of western farmers using federal irrigation water are complying with the 160-acre-per-person limits of the 1902 law, Interior studies show that about 2 percent of the farm operators control a third of the irrigated land, most of them far in excess of the legal limits.
Interior Secretary James G. Watt, anticipating a new round of congressional debate over the 1902 law and the water subsidy, last month suspended rule-making procedures that could have led to tougher enforcement. He said he would send policy recommendations to Congress later. e
Watt, meanwhile, has urged western governors to advise him of new projects they would like to see in their states. The GAO study provides a cautonary note to both Interior and Congress about new project starts.
The report urges Interior to use economic analysis techniques that will show the true costs and benefits of the projects. It urges Congress to take a closer look at presumed benefits and the validity of providing large subsidies, particularly to growers who can easily afford to pay higher water rates.
other irrigation projects reviewed by GAO were the Auburn-FOLSOM south unit in California's Central Valley; Dallas Creek and Fryingpan-Arkansas in Colorado; North Loup Division in Nebraska and the Oroville-Tonasket extension of Chief Joseph Dam in Washington.
In each case, GAO found WPRS' proposed charges, based on what it felt was users' ability to pay, were unrealistically low. Higher, more realistic rates might encourage water conservation or simply negate the jusitification for project construction, GAO said.
"It's very clear, with more and more people realizing that water is a valuable commodity, we cannot encourage its misuse -- which is precisely what these subsidized low rates do," Miller said. "Just as the oil companies say higher prices are the only way to conserve their products, price is the only way to regulate water use."