(1) The present values used in determining the severance fee pursuant to 85-7-2125, MCA, shall be calculated as follows: (a) The present value of debt to be included in the severance fee shall be equal to the existing irrigation district debt apportioned to the petitioned tract. (b) Future operation and maintenance costs are assumed to be based on the average of the operation and maintenance costs for the three most recent years before severance and are assumed to change annually over the 20-year period at a rate equal to the average annual change in the consumer price index (CPI-U) for the most recent ten years before severance. (2) The formula for calculating the average annual change in the CPI-U is: , where v (3) The present value formula for operation and maintenance costs is available through most spreadsheet programs and is specified as follows:
History: 85-7-2125, MCA; |