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California Water Today 95 <br /> Figure 2.11 <br /> Costs escalate quickly with higher agricultural water cutbacks <br /> Marginal cost with Marginal cost with <br /> 5%water cut 25%water cut <br /> (2008$/af) (2008$/af) <br /> $60—$74 $115—$249 <br /> ❑ $75—$99 $250—$499 <br /> $100—$149 $500—$699 <br /> $150—$300 $1,800+ <br /> ri <br /> 1 <br /> '�S1Y 'CSD► <br /> 0 mi 50 100 150 f <br /> 0 km 80 160 240 <br /> SOURCE:Statewide Agricultural Production model. <br /> NOTES:The maps show the loss of farm revenue incurred by the last acre-foot of water lost when supplies are reduced by 5 and <br /> 25 percent.This is the value that farmers would be willing to pay to purchase an additional acre-foot of water to apply to their fields. <br /> as those in the west side of the San Joaquin Valley,have more productive farms <br /> but less secure water supply contracts.Water transfers are particularly valuable <br /> when farmers with less secure rights grow tree crops,which will die without water. <br /> Water subsidies are not necessarily a hindrance to water marketing,because <br /> farmers still have incentives to sell water as long as they can earn more by <br /> selling water than by producing crops.In contrast,crop subsidies can create a <br /> disincentive if the subsidy payment is tied to the volume of production. Crop <br /> subsidies are now less closely tied to crop acreage and production than in the <br /> past,with payments based on past volumes and acreage. However, it is likely <br /> that farmers still consider the potential for the loss of subsidies with program <br /> adjustments when they make their planting decisions (Bhaskar and Beghin <br />