A bond issue totalling $5.4 million was issued (guaranteed by the Province) and construction was completed in 1923, with the diversion works located on the Oldman River 16 kilometres west of Fort Macleod. The main canal is 85 kilometres long and has a capacity of 22 cubic metres per second.
An unprecedented flood on the Oldman River, in 1923, destroyed the diversion works and resulted in the spending of the entire bond issue on original construction and repairs to the flood-damaged works. The resulting construction cost of $136 per irrigable hectare necessitated procuring a loan from the Alberta government for operation and maintenance of the system.
However, it was soon apparent that farmers could not pay the high water rates levied. It became necessary for the provincial government to absorb a considerable portion of the district debt, amounting to about $7 million. The price the government asked for this assistance was a greater share in controlling the affairs of the district and, in 1926, the elected trustees who administered the district were replaced by a government appointee. This was the first acceptance by the government of Alberta of the responsibility for any capital outlay in the establishment of irrigation on lands within the province. This reduced the outstanding debt of the district to a level where the water rate charged to the farmers could be met.
This method of administration, by a government trustee, continued until 1968 when with the passing of the new Irrigation Act, the farmers opted for an elected board of trustees to manage the district.
This district has no on-stream storage on its supply source, the Oldman River, and very limited off-stream storage. Hence, in recent years, the irrigation demand has frequently exceeded the river flow. In 1974, the district declared a moratorium on the development of any further irrigated lands, because of supply problems and inadequate storage. It became necessary in 1977 and 1979 to shut down all irrigation for approximately two weeks each year, because of a Ovate shortage. However, the district manage to irrigate just over 40,500 hectares in 1979.