PRESIDENT REAGAN has taken a brave first
step by proposing that the federal government recover what it spends on building waterways, ports and other water development projects of the Corps of Engineers. His proposal deserves to be strengthened and supported by Congress. Then the legislators and the administration can finish the job by applying the same principle to the companion projects built by the Bureau of Reclamation for irrigation.
Once upon a time federally subsidized water projects made sense. Relatively small expenditures on harbors and canals yielded large payoffs in transportation and trade. Irrigation projects encouraged farmers to settle the open West. Water seemed limitless, so there was no need to worry about waste from underpriced supplies. It cost the government next to nothing to borrow money, and a trillion-dollar federal debt had not been dreamt of.
Now the obvious waterway improvements have been made, and current grandiose navigation projects tend to benefit only those who get the contracts to build them. The West has been settled. The federal budget is the country's central economic concern. And a looming water shortage, exacerbated by massive agricultural waste, threatens the future of the 17 western states.
The administration has proposed that user fees be charged to recover the full cost of the federal investment in navigation projects. While that would be an undeniable improvement over the current practice of government-pay-all, many of today's projects are so ill-advised that users will never materialize and the government will still be left with the bill. A better solution would require the potential beneficiaries to share in the up-front costs of building the project. That will quickly sort out the sensible projects from the boondoggles.
Although all federal irrigation projects are said to require "full repayment" by the users, that description is a fiction. A recent General Accounting Office study of six of these full repayment schemes found that the taxpayer subsidy ranged from 92 to 98 percent of the total cost. In every case, users were to repay less than 10 percent of the cost. The discrepancy comes from a variety of creative accounting measures, including not counting the government's interest costs. The result is that users of one South Dakota project, for example, will pay $3.10 per acre- foot of water that costs the government $131.50 to deliver.
Rep. George Miller of California has introduced a sensible bill that would reduce, though not eliminate, the federal subsidy. Like cost sharing for navigation projects it would increase federal revenues and curtail a subsidy program that has long since outgrown its original rationale. More important it would stop the dangerous waste of precious water that is encouraged--even enforced--by a price that bears no relation to cost. The analogy to the government's past policy of artificially holding down the price of oil is an exact one.
These changes will not come easily. All water projects are politically sacrosanct in Congress, and the administration has no desire to alienate the 17 western states by tightening up the irrigation program. Yet billions of federal dollars are at stake. As more and more important social programs fall by the wayside, these watery wasters cannot remain immune much longer. As the question goes: if not now--when?