22 DIVISION- OF WATER RESOURCES 



cash oiithiy may he less tliaii tlu' cost ^ivcii. Xo allowaiiec has been 

 ^ made for supcriiitcinlciice by the individual farm operator, the inclusion 



of this not bein<r usual in such siudies. 



The rate of (lepreeiation of plantinus is an item on ■which there is not 

 always an a<ireement aiiioii^' students of farm maiuij;emeiit. The A<:ri- 

 cultural Extension Service assumed a life of 40 years * for citrus trees 

 and has written otf depreciation of the trees at the rate of $31 an acre 

 each year. Ix'tiinuiu^^ with the tenth \('ar.t They further assumed a cost 

 of approxinuitelx' $1,000 an acre, exclusive of laud, for briu<i-in<i' a citrus 

 jrrove to ten years of age, this beinji' the net cost after creditinji income. 

 These fijjures have been accepted in this study of i-easonable irrigation 

 I charut's for citrus fru.its in the uppei- San Joa(|uin \'alley, altlioujjh it 



is known that in some cases the life of citrus ^'roves is considerably 

 more or less than 40 years and that there is considerable variation in 

 the cost of grrowino: the trees. Depreciation of citrus trees at the rate 

 of $31 an acre is one of the lar^e items in the cost of ])roduction of that 

 crop and in practice mi<>ht not be justified. 



Dei)reciation of im])rovements and eciuipinent has been com])uted by 

 tlic farm advisoi-s lar<|-ely on tlic basis of the owners' estimates of 

 present value and lenytli of life. Theii- fi<zui'('s have been accepted for 

 theii' records. Where costs have been detei'iniued throuj^h direct con- 

 tact with growers, rathei- than from data pathered by others, deprecia- 

 tion has been com])uted at the following' rates: 



IJiiildiufi's, f) i)er cent ; irri.uation pipelines, 4 pw cent, and farm 

 ecpiipmeiit, lo per cent. 



This repoi't of course is not dii-ectly concerned with farm profits, 

 excepting as interest may be considered in that catefrory, as it is by 

 some, and excepting- as they determine broadly the economic condition 

 of any i)articular branch of a<i-ri('ulture and thus fix the general scale 

 of production expenditures, including the expenditure for irrigation 

 ^\a1(■l•. Incidentally, however, the tables and cliarts which follow are 

 so set up as to indicate profits wit liin the yield and ])rice ranges used 

 when income is large enough to return a profit. 



Correlation of Cost of Irrigation Water With Other Production Costs. 



While it has not been usual in economic and engineering studies to 

 attempt to show any relationship between costs of ii'i'igation water and 

 other farming costs, ihe roniiei- ^-onietimes lia\'e been expressed in the 

 past as pei'centages of the Liross I'arm ijicoiue and in othei- cases as i)(>r- 

 ceiitages of the net farm income. There is some justification for such 

 an attempted correlation because, i)roadly speaking, the amount that 

 reasonably can be paid for ii'rigation water is determined by the \alue 

 of the |)roducts grown and by the pi'ofits to the grower. The chief 

 difticiilty in attempting such a correlation, howevei-, is found in the 

 wide varialion in harxcsl costs. At aii\ i-a)e. it was felt that the numbei' 



• Sliifp romplftldii <.r ihc I'liinimtiitliiiis for this i-f|H)fi ilic Aj;ri<'ull ur;il lOxti'iision 

 Sorvlcp lins I'Xti'iulcfl lli<- nsstmicil llf<' of <)|-;niK<' Rrovt-s in tlio Tlllart^ <Mlnis belt to i-t 

 yi-arx to lonrorin tf> ItH af'siiiiiption.s ff)r soiitiicrn Ciilifoi'iiin. Tlii.«, however, would 

 not iiiiili-rliillv altiT till- liKures in Ihf rei)oi-l. 



t II \f>y lifiii sii"U''Hleil that till- prefornhle nroccduri' fm- cuniiinl iiiu ilrpri'i-ial ion is 

 llic "slnklnii fnn<r' Jnst.'ail of tlir ".'^trainlit -line" method. Since tlu' .^iiiKinp; fnnd 

 d«>IMif.|l and lnliTi-.«l i<u the I'litlic hnesl nieiit lojjcther do not \a r.v widely from the 

 HlraJKlit-IInc- depri-eiat ion and Inten-st on "ax'Taue in\estn\ent," and since the latter 

 mcthoil Is arlopti-d In all of the .ARrieultnral lOxten.^lon .Service records used, it is 

 i.'Hed In this report. 



/ 



