If a fishway over a dam or obstruction is considered impracticable by the commissioner because of cost, the owner of the dam or obstruction, in order to compensate for the loss resulting from the dam or obstruction shall, at the owner's option
(1) pay a lump sum acceptable to the commissioner to the state fish and game fund;
(2) convey to the state a site of a size satisfactory to the commissioner at a place mutually satisfactory to both parties, and erect on it a fish hatchery, rearing ponds, necessary buildings, and other facilities according to plans and specifications furnished by the commissioner, and give a good and sufficient bond to furnish water, lights, and necessary money to operate and maintain the hatchery and rearing ponds; or
(3) enter into an agreement with the commissioner, secured by good and sufficient bond, to pay to the fish and game fund the initial amount of money and annual payments thereafter that the commissioner considers necessary to expand, maintain, and operate additional facilities at existing hatcheries within a reasonable distance of the dam or obstruction.
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