V. ENGINEERING ANALYSIS 



A. Tongue River 



1. Feasibly Irrigable Land Analysis 



DNRCs methcxJ of analyzing feasibly irrigable land 

 (FIL) in the Missouri River Basin was adopted by the Re- 

 served Water Rights Compaa Commission (RWRCQ to 

 determine FIL on Indian reservations in Montana. This 

 method is documented in DNRCs "Methodology Manual 

 for Conservation Districts Water Reservation Applicadon" 

 (DNRC. 1989). 



The determinadon of RWRCC's FIL is based on a 1 to 

 1 benefit/cost (B/Q rado. A 1:1 B/C ratio has been estab- 

 lished by the courts as a means of determining tribal water 

 rights for agricultural purposes. Wyoming v. U.S.. 1 09 S. Ct. 

 2994 (1989). DNRC s method evaluates the probability that 

 a project will generate a specific amount of net annual rev- 

 enue. 



Numerous conditions affect the economic feasibility of 

 an irrigation development such as crops raised, yield, price, 

 and production costs. Because alfalfa is the most widely raised 

 crop in the study area, it is used to determine feasibility. The 

 crops raised are the basis on which the other factors are 

 determined. 



Alfalfa yield is assumed to be directly related to its water 

 consumption. Several regional studies (Bauer and others 

 19-4, Hill 1981. USDI 1983, Wilcox 1978, and Wright 

 1981) have analyzed yields compared to consumption of 

 water. While each study had slighdy different results, a gen- 

 eral relationship between the consumption of water and 

 alfalfa's potential yield was established. This relationship was 

 used to determine the peak per-acrc yield for aifelfa on the 

 Northern Cheyenne lands. The amount of water consumed 

 by crops in the area was calculated to be 29.1 inches per 

 irrigation season. 



It was assumed that alfalfa would be grown with an 8-year 

 rotation where alfalfa is grown for the first 7 years followed by 

 1 year ofsmall-grain production. Alfalfa yieldsare low thefirst 

 year, rapidly increase to a peak, and then gradually decline. 

 These varNing alfalfa yields were estimated by proportion- 



ing the yields reported in "Optimal Replacement of Alfalfa 

 Stands: A Farm Level Decision Model" (Stauber and 

 Goodman 1986) based on the calculated peak alfalfa yield. At 

 the end of the seventh year, the stand of alfalfa is replaced with 

 a small-grain crop. The following year alfalfa is planted and the 

 cycle begins again. A 70-year planning period is used. The 

 peak vield used in thisstudy is 5.6 tons per acre with an average 

 yield of 4.4 tons per acre. 



Crop prices are then forecast and these forecasts are com- 

 bined with yield to provide an estimate of gross revenue per 

 acre. This price forecasting is based on a statistical relationship 

 established between alfalfa prices and a number of variables 

 including calf prices, wheat prices, state-wide alfalfa produc- 

 tion, and precipitation. Forecast prices are based on this statis- 

 tical relationship. TTiree hundred forecasts were made in order 

 to encompass as many scenarios as possible. 



Grain prices were also forecast because the stand is re- 

 placed bv a grain crop in 1 out of8 years. Grain Yields are more 

 constant than alfalfa, so an average yield of 70 bushels per-acre 

 was used. In a year when alfalfa has been plowed under and 

 grain planted, the gross revenue was calculated by multiplying 

 the average grain yield by the forecast price of grai n in that year. 



Production costs also vary with yield. The production 

 costs for establishing alfalfa, established alfalfe, and irrigated 

 grain were based on a machinery costs computer program and 

 a crop enterprise budget computer program (DNRC, 1989). 

 When combined, these programs account for all production 

 costs, except for the irrigation development and water appli- 

 cation costs which are developed separately. These programs 

 determine annual per-acre production costs based on farm 

 size, cropping pattern, size and t\pe of equipment, annual 

 equipment use, fertilization, and projected crop yields. 



The study uses the production costs established by 

 DNRCs "Methodology Manual for Conservation Districts 

 Water Reservation Application" (DNRC 1989). Using ibis 

 production cost information, an alfalfa price of S64 per ton 

 and an average yield of 4.4 tons per acre, the annual farm 

 benefit was Si 54.35 per acre. This did not include any cost 

 change for irrigation. This means that a positive B/C ratio can 

 be obtained as long as the irrigation system and water delivery 

 costs do not exceed that amount. The $154.35 per acre is 



