When a billion-dollar water project divides neighbors

Just when interest groups ranging from thirsty cities and farmers to synfuel plants and coal-slurry pipelines are battling over the nation's limited water supplies, President Reagan is axing such priority-setting agencies as the Water Resources Council and the Office of Water Research and Technology.

With such bureaucratic buffers scrapped, Mr. Reagan himself will be closer to the decisions on who gets water.

So it seems fitting that two embattled groups of third-generation South Dakota farmers are going straight to the President. Each side hopes that Reagan is enough of a true Reaganite to support its cause.

One side, led by rancher Chet Gullikson, wants the President to honor a 40 -year-old federal pledge to fund a major irrigation project for South Dakota -- thereby helping the state's key beef and grain industries increase productivity to benefit the nation's economy.

The opposition to the $1 billion Oahe irrigation project, led by rancher John Sieh, hopes Reagan will carry through on his campaign pledge to get government off the peoples' backs --in this case, by canceling a project championed by powerful federal agencies but opposed by many local farmers.

Twenty years ago, the Oahe irrigation project won overwhelming support from farmers in this beautifully flat plain near Aberdeen in northeastern South Dakota. A 200-mile system of canals and pumps would lift Missouri River water to their fields. With a slope that rises just 10 feet over 50 miles, this former lake bed would be ideal for irrigated cropland, it seemed.

The project was to be partial compensation for the state's losing 509,000 acres of prime cropland under the 1944 Pick-Sloan Act. That congressional act threw a dam across the Missouri in South Dakota, creating Lake Oahe to protect states downstream from flooding.

By the time contractors cut the first few miles of the Oahe canal four years ago, the impact of the project was sinking in locally. Hundreds of miles of open irrigation ditches would cut through most farms in the irrigation area. To begin with, 600 farms with a total of 190,000 acres would be irrigated. But another 110,000 acres would be taken out of production by the project.

By 1977, the estimated cost was put at $538 million -- or $2,423 per irrigated acre. Due to inflation, current estimates price the project at $913 million, or an investment of more than $4,800 per acre in an area where land currently sells for $600 to $800 an acre.

For some, the anticipated boost in land values and productivity would be a windfall, boosting their crop yields, borrowing power, and net worth. For others, the boost would simply mean higher taxes on land their grandparents homesteaded in the 1880s -- land they never want to sell.

Local grain farmers Everett Hofer and his son, Ed, had hoped to be irrigating their land with cheap Missouri water, which otherwise flows downsteam to raise corn and fatten cattle in other states. Instead, the Hofers are planting this year's corn deep and widely spaced because the rich soil in their level 80-acre fields is bone dry. They see no future for the Oahe project now and instead are glad they know how to make a living from careful dryland farming.

Their neighbor, Chet Gullikson, doesn't take possible defeat so calmly. He recalls bitterly how the dust bowl days of the 1930s bankrupted many farmers in the James River valley.

"I used to watch my mother watching the clouds for rain," he says, "and her dream at that time was bringing water from the Missouri into this valley for irrigation."

Mr. Gullikson remains determined to get Missouri water. He knows that the water South Dakota doesn't use itself has plenty of other takers, with farmers downstream from Nebraska and Kansas to Texas competing against Wyoming's synfuel and oil-shale projects for Missouri water.

To prove the benefits of irrigation, Gullikson irrigates some of his 1,700 acres of cropland. When there is water in the James River, he pumps up enough to flood-irrigate one "quarter section" (160 acres, a quarter of a full square-mile section) and uses an immense center-pivot sprinkler system, which slowly circles another quarter. When the river isn't either dry or flooding, this land turns out 150 bushels of corn per acre, compared with 40 bushels for dryland farming here.

Even this year, with the river too low to permit irrigation, Gullikson has a lush alfalfa crop on one field and prospects for good corn on the other, thanks to remaining subsoil moisture.

Gullikson has heard all the critics' charges that irrigation in this area will build up salts and ruin the land. Yet his own irrigated land hasn't suffered after 16 years of irrigation, he says -- still producing 150 bushels of corn and six tons of alfalfa per acre.

"I want the whole state to prosper because of a stable water supply for the towns and irrigation for the farms," says Gullikson. "The whole area suffers when drought hits, but, with irrigation, this valley could supply grain for feeding cattle in all the surrounding districts instead of trucking in feed in dry years from hundreds of miles away at tremendous cost or selling off our cattle at a loss."

"It should be a criminal act to fight water development in these semi-arid parts of the country, where we have periodic droughts," he says.

Neighboring rancher Sieh doesn't agree.

Mr. Sieh originally supported the Oahe project. But after years of studying local conditions, he decided irrigating cropland here would do more harm than good.

"For irrigation to be successful," he says, "about 25 percent of the water has to pass through the soil -- or the soil salts up and becomes waterlogged and useless." He's seen that happen in other areas.

"This is a very successful dryland area," he says, "and these people have learned how to raise crops dryland [without irrigation], which is important at a time when the country's both trying to cut budgets and save energy."

To make his point, Sieh won election to the local board in charge of water policy. At that point, he says, he ran into "the kind of insensitivity you get when you have government planners working behind practically closed doors with congressmen who have no understanding of the project except that it means bringing hundreds of millions of dollars into their districts."

Cattleman Clarence Erickson, whose parents were both born here in sod houses, puts it more simply: "It just looked like a boondoggle."

Farmers opposing the Oahe project say President Reagan could save $913 million by cancelling it. In return, they want a $70 million project to provide pure drinking water for pipeline for communities here.

But just in case the government insists on spending money, the State of South Dakota has drawn up a wish list of 33 water projects that together would add up to the full $1 billion cost of the Oahe project.