6 BULLETTX lift, IT. S. DEPARTMENT OF AGRICULTURE. 
Integrity of irrigation district bonds. — The effect of the two eras of 
district promotion for speculative purposes has sometimes been the 
placing of greater emphasis upon defaults than a study of the whole 
history of irrigation district bonds shows to be justified. As a matter 
of fact the principal and interest of 71 per cent of all bonds sold by 
irrigation districts in the United States to December 31, 1921, have 
been paid when due although a large percentage of these has been 
issued in recent years and consequently no payments of principal 
have yet become due. The status of all bonds sold to December 31, 
1921 is as follows: 
Per cent. 
Held illegal $3,369,350 3 
In litigation 2,767,000 2 
Defaulted 1, 383, 300 1 
Compromised 19,371,200 16 
Expected to be compromised 7, 852, 100 7 
Interest and principal always paid when due 83, 693, 493 71 
Total bonds sold 118,436,443 100 
REASONS FOR SUCCESS OR FAILURE. 
ELEMENTS OF SUCCESS. 
The successful irrigation districts are those in which, in addition 
to securing and distributing water effectively , sufficient annual income 
has been derived from the soil to pay interest and maintenance and 
operation charges promptly and to retire the principal of the bonds 
as due. To assure such annual income, the following elements have 
proved necessary : (a) Productive land; (b) sufficient water; (c) reason- 
able capitalization; and (d) adequate land settlement. 
Irrigation districts which have been fortunate in the above 
qualifications have almost invariably succeeded. Some such districts 
have suffered reverses, such as damage to the irrigation system, 
unduly severe marketing conditions, etc. ; but few cases have occurred 
where sound district enterprises have been unable to withstand 
temporary misfortune. 
CAUSES OF FAILURE. 
Past causes of failure of irrigation districts may be reduced to the 
following general classes : 
Opposition of principal financial interests. — Some of the earliest 
districts met disaster or at least years of obstruction because of the 
inclusion of too much land belonging to persons opposed to district 
organization. The principal weapon of these landowners — attack 
upon the constitutionality of the law — is no longer available, but 
there are other ways in which they may prove obstructive. How- 
ever, due to the present sounder footing upon which the district 
stands, cases have occurred in recent years in which such opposition 
has been successfully disregarded. This cause of failure, therefore, 
while still to be reckoned with, is not so pronounced as it was some 
years ago. 
Inclusion of unproductive lands. — Inclusion of large areas of land 
Ehysically incapable of bearing their share of the burden of taxation 
as resulted in trouble to some districts. It is the area that is 
actually irrigable and capable of producing satisfactory crops that in 
the last analysis is responsible for the district debts. So-called 
