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IS DIVISION OF WATER RESOURCES 



(ii-antiii;^- this scpai-at i()ii dI' IIh' " permissible" watci' charo'e from the 

 other cost items pi-esonts (liffienlties, llie writers believe such separa- 

 tion is iievertlieless feasible, provided the total of the other items of 

 cost can be reasnjiably detei-mincd from the data available. It is 

 believed such is the case and the study has ])r()cee(led accoi'din<i;ly. 



Interpretation of Data. 



It is clear from what has been s1ate(l above that the vai-iation in cost 

 of producinp; the crops grown in the upper San Joaijuin Valley is wide, 

 and that, due to this variation, wluit one farmer can afford to pay for 

 watei- witli any aiven yield and price may be more or less than another 

 can |)ay. with the same yield and ])riee. Tt may be stated further that 

 one whose cost of jiroduction is hijiher than that of others may still be 

 able to jiay a hiiiher water chai'ii-e because the higher cost of ])roduction 

 may be due to better farming;' practice which results in better yields. 

 These difficulties^ can not all be ijiven mathematically correct weight in 

 the pi-esent study, because the data are not sufficiently complete to 

 l)ei'mit the coi-i-elation. Xoi-, consid( ring that to a large extent esti- 

 mates are being dealt with, does this seem necessary for reaching a 

 practical answer to the (luestion under consideration. The entleavor 

 has been nuuh' to meet these difficulties by using costs of i)roduction 

 which seem to rei)resent good ])ractice. Although termed "average" 

 costs in the i-eport, they are not always strictly the ai'ithmetical average 

 of the individual records used, because ])ersonal judgment has 

 influenced clioice of the costs decided on as con-ect foi' use in this 

 study. 



It miuiit be argued lluit perinissi!)le irrigation charg(\s based on costs 

 of pi'oduction undei" "good practice." whethei- these costs are the 

 average or above or below the average, will be excessive for those 

 whose costs ai"e higher. Accoi-ding to this thought, foi" instaiu-e. if 

 the costs used were the median of the records stiulied and farm inconu% 

 were always directly related to fai'm costs, the charge would be too 

 high foi- hair of the fai'uu'rs. The point is, however, that costs of pro- 

 duction and farm income are not always directly related. Tlii^her 

 co<ts iiia\- result from b.'ttei- practices, which, in turn, bi'ing higher 

 yields. ( )n the other hand, jowci' production costs, because some 

 important operation tias been eliminated or cui-tailed, may rediu-e the 

 incoiMi'. In an.\- event, a certain ])roportion of those whose costs of 

 ))i-oduclion are hiyher than the costs used will lia\e incomes sufficiently 

 iiu'rcased through hiirher yields to pei'iiiit the iii-igation chai'ge sug- 

 geste(| and still cover the allowance foi' depreciation and I'oi' interest 

 on the values of the land assume(| in the report. Therefoi'e, moi'C 

 farmei'.s than those whose costs of production do not exceed the figures 

 used in the aiudysis will be able to pay the iri'igation chai'ges suggested 

 without hai'dship. 



If costs of |)rodiiction are higher without any compensating iiu'i'case 

 in yield, the ix-rmi.ssible charges suggestecl will be too gi-eat for the 

 particular individuals concerne<|. These chai'ges could not be jtaid 

 without encroaching U|ion the allowance foi- de|)i-eciat ion and ijiteicst. 

 unh's> the excess is covered b\- the dilfei'ences between the total iriargiii 

 of tin' I'aiMii income above all costs and the pernnssible iri'igation charges 

 suggested. If. howevei-, the plight of these farmers were due to poorer 



