Members of the

U.S. Advisory Commission on Intergovernmental Relations

(October 1991)

Private Citizens

Daniel J. Elazar, Philadelphia, Pennsylvania

Robert B. Hawkins, Jr., Chaimzn, San Francisco, California

Mary Ellen Joyce, Arlington, Viginia

Members of the U.S. Senate

Daniel K. Akaka, Hawaii

Dave Durenberger, Minnesota

Charles S. Robb, Viginia

Members of the U.S. Hour of Representatives

Donald M. Payne, New Jersey

Craig Tbow Wyoming

Ted MUSS, New York

Officers of the Executive Branch, U.S. Government

Debra Rae Anderson, Deputy As&ant to the Resident,

Director of Intergovernmental Affairs

Samuel K. Skinner, Secretaq of Transportation

vocaney

Governors

John Ashcroft, Missouri

Booth Gardner, WAshington

George A. Sinner, North Dakota

Stan Stephens, Montana

Mayors

Victor II. Ashe, Knoxville Tbnnessee

Robert M. Isaac$ colorado springs, Colorado

Joseph A. Leafe, Norfolk, Viginia

*f=Y

Members of State Legislatures

David E. Nething, North Dakota Senate

Samuel B. Nuneq Jr., President, Louisiana Senate

Ted L. Strickbmd, Colorado Senate

Elected County Offkials

Ann Klinger, Merced County, California, Board of Supervisors

James J. Snyder, Cattaraugus County, New York, County Legislature

D. Michael Stewart, Salt Lake County, Utah, County Commission
Coordinating

Water Resources

in the Federal System:

The Groundwater-Surface Water Connection

U.S. Advisory Commission on

Intergovernmental Relations

October 1991 l A-l 18
U.S. Advisory Commission on

Intergovernmental Relations

800 K Street, NW

South Building

Suite 450

Washington, DC 20575

(202) 6533640

FAX (202) 653-5429

ii U.S. Advisory Commission on Intergovernmental Relations
Executive Summary

Groundwater appears in basins throughout the

United States. It serves half of the nation’s population

with drinking water and provides significant

amounts of the water used for irrigation, livestock,

and industry. In addition to being an important

source of water supply, groundwater basins are also

sources of storage capacity In fact, underground

storage has greater capacity than surface storage and

is more desirable in several respects.

The value of groundwater basins as sources of

water supply and storage has been increasing for

several reasons: (1) increasing water use; (2) greater

past development of surface water supplies; (3)

increasing concerns about water quality; (4) needs for

protection of instream flows of surface streams; and

(5) increasing reliance on groundwater supplies for

the more highly consumptive uses of water

A crucial factor in the determination of the value

of groundwater supplies-and, hence, the perceived

need for improved management - is the very uneven

distribution of supplies and use, even within regions.

Groundwater availability and types of basins also

vary throughout the country As a result, most groundwater management has been initiated by state and

local governments, despite increased calls for active

federal management

In many cases, state and local governments have

pursued conjunctive management of groundwater

supplies together with available surface water supplies Conjunctive management-the coordination

of conjunctive use - exploits the different characteristics of surface and groundwater, and coordinates use

and storage so as to increase the total water yield over

time; increase reliability of water supply; reduce risks

of total loss of supply from quality degradations; and

lower the costs of construction, transmission, distribution, and maintenance. Conjunctive management

(managing surface and groundwater supplies together) is distinguished from integrated management

(managing groundwater supplies and groundwater

quality together).

Management is defined in terms of functions,not

in terms of the types of organizations that perform

those functions, thereby recognizing that multiple

organizational and interorganizational forms maybe

effective. The functions of conjunctive management

are: control of overdraft, which in turn involves

limitations on water withdrawals and assuring sufficient replenishment regulation of storage capacity;

protection of water quality from degradation resulting from management practices; the assignment of

management costs; and maintaining adaptability

and error correction capabilities.

Most planned conjunctive management combines public and private institutions to coordinate the

conjunctive use of surface and groundwatersupplies.

Debates over the proper models of organizationprivatization versus centralized public authorityoverlook the experience of groundwater management and the desirability of a noncentralized,

public-private management setting. This helps to

define and represent different communities of interest, with real advantages in conjunctive management, particularly for enhancing efficiency and

equity while maintaining adaptability.

The United States has a complex and regulated

water economy, involving provider and producer

organizations (importers, wholesalers, retailers,

and regulators). This complex water economy involves hundreds of thousands of organizations and

interorganizational relationships, which can be

understood using the organizing concepts of our

mixed political economy.

Conjunctive management calls for the coordinated

use of surface and groundwater supplies This does not

necessarily mquiie organizational integration The large+cale physical facilities and capital investments

required for surface water development call for a

different scale of organization than groundwater development This is demonstrated by the fact that most small

water systems rely on gnnmdwater while the very large

systems mly primarily on surface water

U.S. Advisory Commission on Intergovernmental Relations iii
Coordination is achieved through a variety of

interorganizational arrangements, including contracting. Dispute resolution also is achieved by several means, including negotiating., bargaining and

adjudication. Special districts frequently have been

established because their jurisdictional boundaries

can be adjusted to communities of interest, because

their separate existence increases their financial

autonomy, and because they can act as functional

specialist organizations.

State and local initiatives to improve management of groundwater supplies range from centralized administration of state statutes to local special

district operations without statewide authority, and

also include interstate and interlocal cooperation and

coordination. It is impossible to distill a model for

state or local groundwater supply management from

among the many options.

Nevertheless, important barriers to more effective conjunctive management remain. Most of these

barriers are institutional, having to do with the rules

governing behavior and the incentives facing water

users. Many states’ water rights rules inefficiently tie

water rights to land ownership, leave water rights

unquantified, generate disincentives to conserve

water supplies and to use underground storage, and

inhibit transfers of water rights from lower valued to

higher valued uses. Federal laws have created unspecified “reserved water rights,” generating additional uncertainties for state and local decisionmakers. More effective management requires water

rights characterized by certainty and flexibility. Most

existing systems impose obstacles to both.

The continued underpricing of water, whether as

a result of local pricing practices, state and federal

subsidies, or both, reduces incentives to use water

conservatively. In many cases, local water users have

organized as much to seek state and federal water

subsidies as to improve management The subsidization game, whereby local beneficiaries attempt to

spread costs to the residents of larger jurisdictions, has

encouraged the overuSe of cheap water supplies and

inhibited improved management

The federal government has considered several

groundwater management initiatives during the past

decade. Most of these are mandates and conditions of

federal assistance to state and local governments,

despite the fact that the scope of direct federal action

was expanded by the Supreme Court’s ruling that

groundwater is an article of interstate commerce

(Sporltnse v. Nebmskn, 1982). Mandates and conditions

may inhibit innovations. In particular, conditioning

financial assistance for water projects on federal

approval of state or local groundwater management

programs is likely to be counterproductive if an

approved project develops subsidized and underpriced water supplies

Some pending federal action would help to

remove barriers to effective groundwater management Increased research, especially on institutional

arrangements, appropriately organized on a national

scale, aids state and local decisionmakers in devising

and implementing effective programs. Increased

information sharing programs among state and local

governments would also improve the base for management decisions.

This report concludes with a set of recommendations for federal, state, and local contributions to the

improved management of groundwater supplies.

The recommendations do not include the development of additional water supplies, but emphasize

improving the institutional arrangements for allocating, managing, and protecting groundwater supplies

in a federal system.

iv U.S. Advisory Commission on Intergovernmental Relations
Preface

Water supply and water quality emerged as

important issues during the 1970s. Early in the 198Os,

former Environmental Protection Agency Administrator William Ruckelshaus described groundwater

management as “the environmental issue of the

decade.” Both decades were characterized byincreasing groundwater use, multiple (and sometimes conflicting) claims to existing water supplies, greater

concerns about protecting environmental quality

and aesthetic values of surface water supplies, and

restricted availability of public sector funds for additional water development During this period, the

attention of concerned citizens and policymakers

turned toward improved management of groundwater supplies. This has led to a general consensus in

support of the idea of conjunctive management, the

coordinated use of groundwater and surface water

supplies, where possible, Coordinated use can increase total water supply, with greater reliability and

lower costs, while protecting water quality

This kind of coordination entails active management and high information requirements. Moreover,

availability of and dependence on groundwater

supplies differ widely from one location to another.

This combination of factors prompts a consideration

of institutional arrangements and intergovernmental relations in water resources, an important concern

for the 1990s.

This report contains contrasting perspectives on

groundwater use and management Among other

things, the report encourages consideration of governance of groundwater resources in a federal system in

substantive rather than organizational terms.

Among the findings in the report is that the

involvement of several governmental and nongovernmental bodies does not necessarily preclude

effective water resource coordination. In several

instances, it reflects the coordinated activity of functional specialist organizations, with extensive intergovernmental cooperation in dealing with the multiple attributes of groundwater resources. Different

organizational forms have been effective,suggesting

that a federal system such as ours in fact has great

organizing and coordinating strengths.

All types of governments in the American

federal system have roles to play in facilitating

improved water resource coordination. The several

functions involved have different appropriate scales

of operation. Some, especially the development of

basic research, applied research capability, and the

production and dissemination of information, are

appropriately organized on a national scale, whether

through direct federal activity or support for universities, water resources research centers, and the water

resources associations and organizations. Other functions, such as the improvement of institutional capacity for regulation and conflict resolution, the establishment of incentive-compatible laws governing

water rights and transfers, and technical and financial assistance to groundwater management institutions, are appropriately organized by the states Still

other functions, such as appropriate water supply

pricing, and activities requiring close knowledge of

the groundwater resource and its users, such as

controlling overdraft and regulating underground

water storage, are organized on a local scale, often by

special governmental units. Many of these functions

are performed by these governments, and this report

contains several examples of their work and the

coordination among them.

One of the more important roles that governments could play is to change laws and policies that

obstruct more efficient water use. This report identifies important barriers and suggests changes that the

state and federal governments could make to reduce

incentives for water user behavior that is inconsistent

with water resource coordination.

The Advisory Commission on Intergovernmental Relations is pleased to offer this contribution to the

consideration of how to improve the management of

groundwater supplies in the United States.

Robert B. Hawkins, Jr.

Chairman

U.S. Advisory Commission on Intergovernmental Relations v
Acknowledgments

William Blomquist, Assistant l?mfessor of Political

Science at Indiana University was the principal investigator for this project and the author of this report

ACIR is grateful to the following individuals who

reviewed and commented on the study: Roy Arnold,

Julie Baker, Bruce L Bandurski, Ray Beurket, Enid

Beaumont, Judith Burrell, Don Chery, Jr, Jo Clark,

William G. Colman, Tom Curtis, James B. Hyland,

Louise Jacobs, Kent Jeffreys, Rick Kuhlenberg, Steve

Light, E. Blaine Liner, William Lord, Daniel R.

Mandelker, Ardith Maney, Marian Mlay, Debra Nesbitt, Edith Page, Eugene Patten, Ken Rubin, Michael

Rubino, R. I? Shimer, Ethan T Smith, Tom Schwa&erg,

Alex Varela, and Thomas Wehri.

Others who read and commented on portions

of the report include Ronald J. Oakerson, Elinor

Ostrom, Vincent Ostrom, and reviewers from the

U.S. Army Corps of Engineers and the U.S. Bureau

of Reclamation. Staff members of U.S. Rep. Andrew

J. Jacobs, Jr., of Indiana and Rep. George Miller of

California, and Sen. Richard Lugar of Indiana

provided information on legislative developments. Their assistance is appreciated.

At ACIR, the project was directed by Bruce D.

McDowell, Director of Government Policy Research.

Joan Casey edited the report for publication, and

secretarial assistance was provided by Lori Coffel and

Suzanne Spence.

The Commission and its staff are grateful to

Professor Blomquist and to all who provided assistanceon the report,but retain full responsibility for its

contents

John Kincaid

Executive Director

vi U.S. Advisory Commission on Intergovernmental Relations
U.S. Advisory Commission on Intergovernmental Relations vii
Contents

Findings and Recommendations .............................................................. 1

Findings .......................................................................... 1

1 .

2.

3.

4

5 .

6 .

7 .

8 .

Significant Water Supply Problems Exist in the United States, and Groundwater

Is an Element of Many Such Problems. . . . . . . . . . . . . . ..a........................

United States Water Problems Are Largely Problems of Coordination and Incentives,

Rather than Problems of Scarce Natural Supplies. . . . . . . . . . . . . , , . . . . . . . . . . . . , . . . .

Groundwater Potentials for Helping to Meet America’s Water Needs

Have Not Been Fully Considered. . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . .

Coordinated Management of Underground and Surface Water Resources

Offers Great Potential for Helping Solve Many of America’s Water Supply Problems

Success in Coordinating Surface and Underground Water Supplies Rests,

to an Important Degree, on Adequate Protection of Water Quality. . . . . . . . . . . . . . . . .

Properly Coordinated Water Resource Management Requires Intergovernmental

and Interagency Cooperation, and Does Not Necessarily Require “Consolidation”

of Responsibilities. . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . .

There Are Several Barriers to Improved Water Resource Use and Coordination

in the United States . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . .

Despite Many Barriers to Success, There Are Promising Examples of Water Resource

Coordination in the United States . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . .

Recommendations. . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . .

1 . Encouraging Better Coordinated Governance of Water Resources . . . . . . . . . . . . . . . . .

2 Providing Incentives for, and Removing Institutional Barriers to, the Coordinated

Use of Water Resources . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . .

3 . Facilitating Improved Water Resource Use and Protection through Research,

Information, and Broadly Trained Water Resource Managers . . . . . . . . . . , . . . . . . . . . .

Chpter 1 - Groundwater and Intergovernmental Relations ...................................... 9

Scope and Purpose ................................................................. 10

Conjunctive Management and Integrated Management: An Important Distinction ..... 10

Other Studies .................................................................. 10

The Plan of this Report ......................................................... 11

Chpter 2 -The Value and Use of Groundwater ................................................. 13

The Value of Groundwater Resources ................................................. 13

Groundwater as a Source of Water Supply ......................................... 13

Groundwater Basins as Sources of Water Storage and Distribution ................... 16

“Quality is Quantity”: The Importance of Protecting Groundwater Resources ............. 17

GroundwaterUse .................................................................. 18

A “National Groundwater Problem”? ............................................. 18

Where Is Improved Management Most Needed? ................................... 22

1

1

2

2

2

3

3

4

4

4

5

6

viii U.S. Advisory Commission on Intergovernmental Relations
Summary .........................................................................

Chapfer3-The Concept and Practice of Conjunctive Management ................................

The Concept: Maximizing the Value of Water Resources .................................

The Variability of Surface Water Supplies .........................................

Regulating Surface Variability with Underground Storage ..........................

Uniting Alternative Sources of Supply ............................................

Underground Transmission .....................................................

Conjunctive Use and Conjunctive Management .......................................

Defining Conjunctive Management in Substantive Terms ...........................

Controlling Overdraft ..........................................................

Regulation of Storage ...........................................................

Protection of Quality ...........................................................

Distribution of Costs ............................................................

Adaptability ...................................................................

The Practice of Conjunctive Management: Case Studies .................................

Centralized State Administration: The 1980 Arizona Groundwater Management Act ...

Interjurisdictional Coordination: Los Angeles County California ....................

Intergovernmental Contrads: The Solano Project ..................................

Appropriation Permits, Offsets, and a “Water Czar”: The New Mexico State Engineer ...

Interstate Competition and Interstate Coordination: The Delaware River Basin ........

Interlocal Coordination .........................................................

Additional State and Local Innovations ...........................................

Lessons Learned ...................................................................

Chapter 4- Understanding the Organization of Water Resource Management ......................

A Complex Water Economy ..........................................................

The Role of Special Water Districts ....................................................

Private Suppliers in the Water Economy ..............................................

The Role of Associations ............................................................

Adjudications and the Rights of Providers and Producers ................................

Regulators in the Complex Water Economy: The Protection of Water Quality ..............

TheRoleoftheStates ...............................................................

StatesasRegulators.. ...........................................................

States as Water Suppliers ........................................................

States as Rulemakers ............................................................

States as Policy Innovators ......................................................

The Role of the Federal Government ..................................................

A Supportive Federal Role: Information and Technical Assistance ....................

The Federal Government as Water Supplier .......................................

The Federal Government as Regulator ............................................

Summary .....................................................................

Chapter 5- Water Resource Management: Problems and Barriers .................................

Lack of Definition and Transferability of Production and Storage Rights. ..................

State Water Rights Laws .........................................................

Legal Separation of Surface and Groundwater Rights ..............................

Rights to Store and Recapture Water .............................................

Authority for Conjunctive Management Agencies ..................................

Problems of Unspecified and Latent Rights .......................................

Lack of Transferability of Production Rights .......................................

Distortions Created by Water Subsidies ................................................

Lack of Information Distribution .....................................................

Summary .........................................................................

23

U.S. Advisory Commission on Intergovernmental Relatiions ix

27

27

27

27

28

28

28

29

29

30

3 1

3 1

3 1

3 1

32

36

40

42

44

45

47

49

55

55

59

6 1

6 1

62

63

65

65

67

67

67

68

68

7 1

72

73

79

80

80

82

83

84

84

89

95

98

99
Chapter 6-Modifying Intergovernmental Relations in Water Resources Management:

Whether,Why,andHow............................................................ 105

Applying Concepts and Lessons Learned . . . . . . . . . . . . . . . . . . . ..a....................... 105

The Concept of Scale, the ‘lhsks of Conjunctive Management, and Multiple Jurisdictions . . . 106

Protection of Groundwater Quality A Different Set of Roles and Relationships? .s..... 110

Ending Subsidies, Increasing Information, and Supporting Quality Protection:

What the Federal Government Can Do . . . . ..*.........*........................... 116

Changing Water Rights Laws, Encouraging Basin Management,

Setting Quality Protection Policy. What the States Can Do . . . . . . . . . . . . . . . . . . . . . . . ...* 123

Getting the Prices Right: What Local Public and Private Water Organizations Can Do . . . . . . 124

Summary . . . . . . . . . . . . . . . . ..*...................................................... 125

Appendix A - Tables .......................................................................... 129

Table A-l - Groundwater Withdrawals as a Percentage of All Water Withdrawals, 1985 .... 130

T’bZe A-2 - Groundwater Withdrawals Per Capita Per Day, in Gallons, 1985 .............. 130

Table A-3 -Percentage of Population Served by Groundwatel; 1985 ...................... 131

TubleA4-Percent of Public Water Supply from Groundwater Withdrawals, 1985 ........ 131

TubleA-5- Percent of Withdrawals for Industrial Use from Groundwater, 1985 ........... 132

Table A-6-Percentage of Withdrawals for Irrigation from Groundwateq 1985 ............ 132

Appendix B-Bibliography .................................................................... 133

Figures

Figure 21 -Underground Aquifers in the United States ........................................... 1 4

Figure 22 -Average Annual Precipitation in the United States ..................................... 2 0

Figure 2-3 - Groundwater Dependency in Selected States, 1982 and 1985 ............................ 21

Figure 2-4-Simplified Water-Resources Budget for U.S. Water-Resources Regions, 1980 ............... 22

Figure 3-1 -Active Management Areas and Irrigation Non-Expansion Areas in Arizona ............... 34

Figure 3-2 -Simplified Pictorial Representation of Conjunctive Management

in Los Angeles County, California ................................................... 3 9

Figure 4-Z - Groundwater Research Expenditures, by Federal Agency and Program Category .......... 70

Figure 5-l -Comparison of Annual Utility Bills, 1950-1984 ......................................... 9 4

x U.S. Advisory Commission on Intergovernmental Relations
Findings and Recommendations

FINDINGS

1. Significant water supply problems exist in the

United States, and nroundwater is an element of

many such prbblem;.

In the West, there are many arid areas and major

population centers supplied from large water impoundments created by the federal government As

development pressure has been placed on this finite

number of impoundments, competition for this water

has grown to great intensity At the same time, most of

thebest opportunities for impounding surface waters

have been developed already, and efforts to expand

surface water storage capacities arr subject to increasing costs and growing environmental objections.

In areas with rapid growth and high dependence

on groundwater, such as Florida, the land sometimes

subsides when too much water has been withdrawn.

Excessive ratesof groundwaterwithdrawal lower the

water table and increase pumping lifts, energy use,

and expense. In addition, coastal areas may experience infiltration of the groundwater by sea water as

the groundwater table is pumped down.

In New England and certain other places, there

have been highly publicized cases of groundwater

contamination by toxic chemicals and other pollutants Contamination can leave groundwater supplies

unusable or subject to the need for treatment, which

generally has not been provided for groundwatel As

a consequence, new federal groundwater quality

protection regulations have gone into effect, requiring state groundwater planning and regulation.

In most parts of the nation, groundwater and

surface water resources are usually managed separately. Most communities have only a single source of

water supply, and are highly vulnerable in times of

drought or other catastmphe. Alternative supplies on an

adequate scale would not be available in the short run

Most water supply planning has been done for

surface waters. Most places that use groundwater

assume that they can continue to do so without

planning.

Asmostofthebestopportunitiesforimpounding

surface waters have been developed, and as environmental objections to new impoundments have

grown, it has become increasingly difficult to expand

surface water storage capacities.

Despite these problems, many regions of the

nation and many communities enjoy abundant water

supplies relative to current and projected needs.

Groundwater supplies, in general, are much larger

than surface supplies, and groundwater supplies am

satisfying an increasing share of water needs in the

United States However, water resou~es differ so much

fromplacetoplacethatwaterneedsmustbeconsidered

within the context of each region and each community

based on current and long-term prospects

2. United States water problems are largely problems of coordination and incentives, rather than

problems of scarce natural supplies.

Overall, the United States is blessed with abundant water resources. Surface supplies of water are

great and have been augmented massively over the

years. In addition, the nation’s groundwater supplies

are many times as great as its surface supplies.

In areas where adequate water supplies have

not been available naturally, public works projects

have brought water from great distances to meet

growing needs, and even to create new uses for

water in those areas.

Still, demand for water sometimes outruns supply.

Crops that need great amounts of water are grown in

arid areas Urban dwellers fail to conserve water:

Irrigation techniques too often let a high portion of the

water escape into the air or ground without benefit

Underground and surface waters are seldom managed

in conjunction with one anothe4 despite the potential

for these supplies to augment and complement each

other: Abundant gmundwater supplies, in some cases,

have been polluted to the extent that they have had to

U.S. Advisory Commission on Intergovernmental Relations 1
be left unused. Water rights, under present laws in some

places, allocate abundant amounts of water to certain

uses while denying it to others

If these problems are to be addressed, water

resources must be managed effectively and efficiently. Intergovernmental and interagency coordination mechanisms and processes, as well as

incentives for cooperation, have been useful in

addressing these problems.

3. Groundwater potentials for helpingto meet America’s water needs have not been fully considered.

Groundwater resources are of irreplaceable value to the United States. Groundwater now provides

approximately 20 percent of all U.S. water withdrawals, and supplies part or all of the drinking water for

approximately 50 percent of the nation’s population.

In addition, underground water basins provide a

low-cost, high-quality means of water storage and

transmission with potentially increasing value as

above-ground water storage and transmission facilities grow more costly, both economically and envimnmentally Even in areas where surface water provides

an adequate primary supply, groundwater may be

available for use as an alternative supply in cases of

drought, pollution, or other primary supply loss

If groundwater is accurately quantified,allocated

among users, managed well, and replenished faithfully, it could become even more significant in

meeting America’s water needs. Unfortunately many

groundwaterbasins have been neither quantified nor

allocated among the users with a claim on them,

including the reserved rights on federal and Indian

lands. In addition, sound planning and management

of groundwater is more the exception than the rule.

4. Coordinated management of underground and surface water resources offers great potential for helping

solve many of America’s water supply problems.

The overall goal of coordinating the allocation,

storage, conservation, and use of underground and

surface waters is to optimize the performance of total

water resource systems in meeting the needs of a

population and sustaining the natural environment.

This type of management requires multi-objective

performance goals and performance measures to

guide the actions of multiple providers and users of

water. These goals and measures should apply equally to groundwater and surface water resources.

The following performance goals apply to water

supply management systems generally: (1) efficiency in

resource use and in administration of the management

system, (2) equity in the distribution of costs and

benefits, (3) maintenance of acceptable water quality, (4)

ensuring long-term sustainable yields, and (5) adaptability to meeting changing conditions and needs

Where groundwater and surface water supplies can be

physically interconnected, a broad consensus has developed in favor of optimizing efficiency in resource use

through the coordinated management of surface water

supplies and storage with groundwater supplies and

storage. This coordination takes account of the value

and the limitations of both sources of water

The following performance goals are part of

coordinated water resource management systems: (1)

control of overdraft, (2) regulation of storage capacity

and water in storage, (3) assignment of costs, (4)

adaptability, and (5) protection of water quality. Well

performing water resource management systems

that meet these goals contribute strongly to the

attainment of the general performance goals of

efficiency, equity, adaptability quality, adequacy, and

sustainability of supply.

Coordinated management of groundwater supplies necessarily broadens management considerations beyond those of managing the supply of water

in a groundwater basin alone. Water storage and use

of the storage capacity of surface and underground

reservoirs, surface water availability and use, and water

quality protection all become elements of the management system As a result, the information requirements

of coordinated water resource management are especially high, and include not only hydrologic information but close knowledge of changes in resource

conditions as well as information on water quality

conditions and risks associated with contamination

5. Success in coordinating surface and underground

water supplies rests, to an important degree, on adequate protection of water quality.

The importance of water quality protection

deserves special mention because of its relationship

to effectivesupply management. While surface water

quality has improved over the last two decades,

groundwater contamination is a serious and growing

problem in many communities in the United States.

Groundwater quality degradation not only poses risks

to human health and to the animal and plant life of

water ecosystems, it also creates imposing challenges

for the coordinated allocation, storage, conservation,

and use of surface and underground water supplies

The relationship between water quality and

water supply is captured by the expression “quality is

quantity”; that is, deterioration in the quality of water

can render it unusable as a source of water. There has

been considerable federal, state, and local activity

over the last two decades intended to protect and

restore groundwater quality, but much remains to be

done. The information requirements of groundwater

protection are high-especially with respect to risk

assessment that relates levels of contaminants to effects

on human health Capital and technical requirements

of water quality protection also are high.

2 U.S. Advisory Commission on Intergovernmental Relations
The appropriate configurations of intergovernmental roles and relations for protecting groundwater quality may be different from those involved in

managing water supplies. The leadership role of the

federal and state governments has been, and is likely

to remain, greater than local governments in protecting groundwater quality. Still, coordinated use of

surface and groundwater supplies cannot proceed

without taking account of water quality protection.

Coordinated water resource management must, at a

minimum, ensure that water quality is not harmed; at

a maximum, it should contribute to the protection and

enhancement of water quality. Nevertheless, as the

experience of several states demonstrates, water

quality protection and water supply management do

not have to be completely integrated organizationally for each to perform well.

6. Properly coordinated water resource management requires intergovernmental and interagency

cooperation, and does not necessarily require “consolidation” of responsibilities.

Attention to the coordinated management of

surface water and groundwater supplies,with a view

to improving the performance of water resource

systems, requires a recognition of “the boundary

problem.” The boundaries of existing political jurisdictions- especially general purpose jurisdictions,

such as municipalities, counties, states, and the

nation-often do not match the boundaries of

groundwater basins or of interrelated surface water

and groundwater systems. This is an inherent characteristic of natural resource systems.

Fortunately, the American federal system provides opportunities for instituting public decisionmaking processes on scales more nearly conforming

to those of a given natural resource system and its

constituent elements. In many areas of water supply

management, new jurisdictions have been created to

encompass some part or all of a water supply system.

In other cases, intergovernmental arrangements -

such as compacts, commissions, agreements, and

stipulated adjudications - have been devised among

existing jurisdictions that share a water source. Often,

both the creation of new jurisdictions and the development of intergovernmental arrangements have

been employed in the design of water supply management systems. This degree of public entrepreneurship has been coupled with considerable private

entrepreneurship in the water supply field. Altogether, the many organizational forms (private as well as

public) and interorganizational arrangements for

water provision, management, and regulation have

come to constitute a complex “water economyF

Although none of these various forms and arrangements axe cost free, problem free, or error fme, there is

considerable scperience on the record that such institutional innovations can contribute to improved water

resource coordination. There is no presumption in favor

of any one organizational form or set of interorganizational agreements for improving the performance of

water management systems everywhere. Indeed, when

the opportunities provided by a federal system for

devising decisionmaking pmcesses are coupled with

the variety of water supply conditions across the United

States, there is a presumption in favor of diversity in the

organizational forms and intemrganizational arrangements for managing water supplies This finding

reinforces the importance of maintaining a focus on the

performance of management systems, rather than on

particular organizational forms

7. There are several barriers to improved water resource use and coordination in the United States.

The principal barriers to successful coordination of

water resources are lack of institutional flexibility and

leadership for effective participation in intergovemmental management processes, the diversity and inflexibility of water rights laws, inadequate and dysfunctional incentives for efficiency in water use, and inadequate

research, information, and training support for impmved water resource coordination practices

With respect to institutional inflexibility and lack of

leadership, it is important to recognize that tesponsibilities for water supply generally are separated from

responsibilities for water quality Within the realm of

water supply, institutional responsibilities for groundwater and surface waters are also generally separate. In

addition, the interests of water providers and users may

be different Finally the local, state, and federal govemmerits have separate responsibilities with respect to

both water supply and water quality

These divisions have advantages and disadvantages. The advantages lie in promoting the entrepreneurial spirit, advocacy for better service provision,

and maintenance of a program focused on control of

the source of pollutants. The disadvantages are in the

lack of coordination and long-term respect for sustainable supplies and ecologies.

The diversity of jurisdictional boundaries multiply the divisions of basic interests. Groundwater

basins and surface watersheds do not always exactly

coincide, while city, suburb, and rural districts compete politically for the use of the same water resources. Single-minded water districts sometimes

promote one concept of water use, while general

purpose governments support another

The larger coordination issues too often lead to

confrontations over who is right-win or lose-rather

than to efforts to accommodate diverse interests

within a shared water resource basin. Arenas for

resolving water issues include the courts, political

forums, and administrative processes, Strong political leadetship often is necessary to resolve key issues

U.S. Advisory Commission on Intergovernmental Relations 3
It is clear in many water resource basins that

basinwide intergovernmental coordination bodies

with real governing authority over surface and

underground water resources, sometimes shared

with state and sometimes with federal authority, are

needed. Interstate cornpads -such as the Delaware,

Susquehanna, and Potomac compacts -offer a range

of models to consider in establishing additional

compacts where there are recognized needs for them.

With respect to water rights, some rights run with

the land as a property right others are appropriated

proportionately in accordance with established agreements and pmcedurrs; and still others aw relatively

illdefined. Sometimes, water rights determinations arr

a matter principally for the courts; at other times, they

are regulated in accordance with planning pmcesses

and administrative determinations Thus, water rights

are more flexible and more amenable to adjustment and

coordination in some cases than in others

Water use incentives also vary considerably Some

promote greater use, while others promote conservation. Often, existing incentives werr established many

yegrs ago under different cimnnstances, and may be

due for reevaluation In many cases, however, these

incentives are established by law, reinforced by

long-time practices, and difficult to change.

Many water supply policies in the United

States - federal,state,and local -were designed for

different phases of the nation’s history. Those were

times when policies promoted water development,

agricultural expansion, and the settlement of new

lands, times when the nation’s population and

commerce were concentrated in the humid East,

andtimeswhen highqualitywaterwasavailablein

such abundance that little attention was given to

metering its use and pricing it according to its

replacement cost. Although past investments and

settled expectations cannot and should not be

ignored, improved water resource coordination

requires, as a first step, acknowledgment by all

partners in the federal system that times have

changed. Present policies that directly or indirectly

encourage water consumption over water conservation may need to be revised. Water supply

subsidies, in particular, need to be reconsidered. In

addition, water policies that favor solving problems by using construction and technology to alter

natural phenomena - rather than by altering laws,

policies, and institutions-need to be examined

further as to their efficiency, cost effectiveness, and

ability to meet the dual goals of environmental

protection and adequate water supply.

Particular note should be taken regarding current and potential federal roles in water resource

allocation, conservation, and use. Generally, federal laws have shown great deference to state laws in

appropriating water rights and interstate transfers

of water. Howevecrecent U.S. Supreme Court cases

make it clear that water is an article of interstate

commerce subject to preemptory regulation by

federal law, and that state constitutions and laws

may not burden the transfer of water across state

lines except in certain narrow respects. On this

basis, groundwaters in Nebraska and New Mexico

have been allowed to be exported to neighboring

states in contravention of the laws of Nebraska and

New Mexico. In addition, the U.S. Supreme Court

has upheld conditions attached to federal spending

on water projects as valid exercises of the Constitution’s spending power. Bills have been pending in

Congress since 1987 that would impose comprehensive federal groundwater management requirements on state and local governments. Although these requirements would apply only to the

17 “reclamation states” in the West, hints have

surfaced that such requirements might be extended

nationwide at a later time. If such legislation, or its

implementing regulations, were to require inflexible institutional and regulatory forms and practices,itcouldsubstantiallyrestrict theauthorityofstate

and local governments to find innovative and practical

solutions to their water resource problems

8. Despite many barriers to success, there are promising examples of water resource coordination in

the United States.

This report has reviewed a number of precedents

for enhancing coordinated management of surface

and underground water resources. Cases studied

include the 198OArizona Groundwater Management

Act, interjurisdictional water resource coordination in

Los Angeles County, California, coordinated management of surface and underground waters by

contract in Solano County, California, appropriation

permits and controlled water mining in New Mexico,

interstate coordination in the Delaware river basin,

and interlocal coordination in two California locations as well as in metropolitan Washington, DC

None of these examples are perfect, or even comprehensive, but each offers practical potential for improving the coordination of water resource allocation, storage, and use to meet current needs.

RECOMMENDATIONS

Recommendation 1

ENCOURAGING BETTER COORDINATED

GOVERNANCE OF WATER RESOURCES

The Commission finds that substantial benefits

in water resource availability, efficiency, quality, and

equity can be gained in many cases through the

coordinated allocation, storage, and use of surface

and underground water resources. However, the

4 U.S. Advisory Commission on Intergovernmental Relations
boundaries of water resource systems (whether surface water systems, groundwater systems, or hydrologically interconnected surface and groundwater

systems) often do not coincide with the boundaries of

existing general purpose governments.

Several innovations have been undertaken in

recent decades to coordinate the use of surface water

supplies and storage with groundwater supplies and

storage. These innovative cases of coordination have

employed admini&ative and nzgulatory approaches,

intexjurisdictional compacts and contracts, and the

creation of specially organized jurisdictions. No

single model appears to be preferable in all respects

and under all circumstances for improving the coordination of water resources. Relatively self-governing systems developed by water users and local and

state governments appear most likely to achieve the

high levels of participation and compliance neces-

‘sary for successful implementation.

A, State Action on Water Resource Coordination

‘Ilre Commission recommends, therefore, that state

government ofJicials support and encourage coordinated

use of water Tesources within their borders. Coordination

mechanisms, which may include inferjurisdictional arrangements as well as the creation of new public jurisdictions, should be empowered to undertake the range of

functions necessary to coordinate the allocation, conservation, storage, and use of surface and underground water

supplies, where coordinated use is appropriate. To the

maximum extent feasible, in order to ensure sustainable

programs of water resource developmenf, use, conservation, and protection, these coordination mechanisms should

be self-governing, directed by the water users themselves

and the affected local and state officials. To fhe extent

feasible, thesegovernance strucfures should be serffinancing, with costs assigned among the bent$ted water users

and localgovernments, and withfinancial participation by

thestates to the extent that benefits are statewide.

B. Interstate Regions for Water Resource Coordination

Because many systems of sur/ace and undeqround

water ESOUIWS extend beyond state boundaries, the

Commission recommends that the Congress authorize

and approve the creation of interstate regional mechanisms, including joint federal-infers ta te compacts, for

governing the coordinated use of suTface water supplies

and storage with groundwater supplies and storage,

where such coordinated use is appropriate. These interstate mechanisms, which will necessarily include interjurisdictional arrangements as well as new public jurisdictions, should be empowered to undertake the range offrt nctions

mcessaq to achieve coordinated use and conseruntion.

Federal agencies involved in the operation offederal surface

water pn$cts should be directed to cooperate with the

coordinated use programs of these interstate mechartisms.

Except in clear instances of violation of federal laws or the

United States Constitution, no fideral ofjicial or agency

s!wuld be autlwrized to withhold participation in or to veto a

coordinated water resource use prqram established by

interstate agreement. bztersfafe water resource coo&nation

mechanisms should be(a) established pursuant to negotiations

among the parties affecten; (b) selfperning: (c) dided by

representatives of affected state and local governments, the

federal governments, and water users; (d) self-financing to the

extent possible; and (e) empowered to fake ef@tive action

within the scope of responsibility agreed to. 7IeCongn?ss and

the President should encourage the negotiation and -al

offtieral-interstate compacts in wafer resource basins where

fhe statesquest them.

C. Independent Groundwater Systems

Because not all groundwater systems aye physically

infercunnected with sur@ce wafer systems, or capable of being

interconnected, the Commission recommends that state government oficials support and encourage the Aevelopment of

mechanisms for governing isolated groundwater basins

within the states, and that Congress authorize and app”Tue the

creation of interstafe mechanisms for governing isolated

groundwater basins that cross stateboundaries. Thesegoverning mechanisms should be empowered to take all actions

necessary fo regulate basin yield and storage capacity, and

should be self-governing and selffinancing.

LX Aderal Restraint

Because of fhe diversity of state and local government

structures and responsibilities, as well IIS the diversify of

water rights and water resources situations, the Congress

and the Execu tive Branch should not imposeanyparticular

management form on states and local governments,

whether through mandates or through condifions on

participation in federal programs. Furthermore, the Congress and the President should not preempt the water

resource programs of local, state, or regional governing

mechanisms, and should not institute direct federal management ofgroundwater supplies and storage capacify.

Recommendation 2

P ROVIDING I NCENTIVES FOR ,

AND REMOVING INSTITUTIONAL B ARRIERS T O ,

THE C OORDINATED U S E O F WATER RESOURCES

The Commission finds that, in most cases, what

stands in the way of providing adequate water

supplies is not so much the absence of water as the

presence of legal constraints and inflexible or inappropriate administrative practices that hinder the

conservation of those supplies, the coordinated all@

cation of surface and underground waters in accordance with changing needs, the protection of important water-based environmental values, and the

U.S. Advisory Commission on Intergovernmental Relations 5
resolution of conflicts over water use. In most cases,

marginal adjustments in patterns of water use could

significantly help alleviate shortages, resolve conflicts, and protect environmental values.

The Commission recommends, therefore,fhefollowing

actions designed fo remove institutional barriers to coordinated allocation, use, storage, and conservation of surface

and underground water resources:

A. Systematizing State WaterRights Provisions

Sfates not currently employing water management

systems that assign and qua?ttify zznter rig1rts sltozrld

consider doing so as soon as possible in order to facilitate

improved use, monitoring, and conserzlationof surface and

undqound wafer supplies.

States that do not allozo wafer users to store,conserzle,

and recapture quantified amounts of water underground

should consideraddingsuchprovisions to their waterrights

laws, in order to improve the coordinated use of surface

wafer supplies and storage capacity with groundwater

supplies and storage capacify. Appropriafestate, local, and

regional governing au Niorifies should be empowered, either

singly orjointly, to monitor undqound wafer storage, to

regulafe water storage and zoithdrawals taken ther#rom,

and to establish conservation-oriented prin’ng policies to

protect the interests of all users of the water supply system.

States that hazje not united their su$ace water and

groundzoater rights systems should consider doing so in

order to establish coordinated rights throughout urater

supply sysfems and to facilitate the coordinated use of

surfizce water and groundwater supplies.

In addition to quantifying zoater rights, states that

have not already done so should consider making water

rights transferable for compensation, within water supply

systems, in order to enhance fhe efficient use of water

resources by rewarding water rights owners for conservation rather than maximum use. The local, state, orregional

governing authorities responsiblefor the coordinated use of

water resources should oversee and administer such

transfers in order fo minimize adzterse impacts on private

property. In order todiscollragespeczllntion in waterriglzts,

transfers should be approved only upon a showing of

demonstrable needs of the trmsferee.

B. Quantifying li?deral and Indian Water Rights

The Congress and the President should direct the

Secreta y of the Interior to complete the quan fijication of

federal reserved water rights pursuant to state procedural

Iaur, in order t/tat water resources coordinntion may proceed

in an atmosphere of certainty rather than uncertainty.

‘Lhe reserved water rights of the Indian tribes that

remain unquantified should be quantified through direct

negotiations betzoeen tribal representatives and affrcted

parties, including local users, states, and the federal

government, and other parties at if&rest.

C. Resolving Disagreements among Meral Agencies

The Cangress and the President should legislate a process

firn?solm’ng disagnxments among federal agencies concerning local, state, or rt@onal pmgrams for the use of surfac

water supplies and storage as well as groundwater supplies

and storage, including proiect to facilitnte coordinated use.

This dispute resolution process should be az~ailable upon

quest by an affecten state, local, or regional itnit of

goziernmenttJtnt is a parlicipant in the planned mm or

pmject. The Congress should designate the [Attorney General]

to convene the aff2ctedfederal agencies and overseethe dispu te

tffolution process. Tile disptc fe resolution pmcess should be

mnpleted within a specified numberof daysestablished by the

conzlenor in consultation utith the a#&d parties.

D. Authority for Interjurisdictional Arrangements for

Federally Contracted Water

The Congress and the Executive Branch should remove

re&ictions in new or existing federal contra& with local

irrigation and other water districts flat prPuent those local

water districts j?om enteting info interjurisdictional arrangements for the coordinated use of water resources

zoithin the project area.

E. Water Use and Conservation Incentives

The federal goz~ernment should continue to decrease

the subsidization of the water it supplies. Ultimately, water

users should pay the full construction, mainfenance, and

operation costs of federal water supply projects. When

water supply contracts are renewed by the Bureau of

Reclamation, they should contain provisions to decrease

subsidies over time in order to allow for manageable

adjusfments in water use practices by irrigators.

State and local governmenfs that finance and operate

wafer supply projects should place the construction and

operation of such projects on a “user pays” basis to the

extent practical.

Local water suppliers should implement full-cost

pricing of water to consumers to the eaten t practical. Where

metering of water use by households and businesses does not

occurit should be institutedso that households and businesses

can be charged water rates that bear a direct relntionship to

tlreir zoater use. Where necessary, “lifeline rates” should be

instituted to protectlozi+inane households.

Recommendation 3

FACILM-ATING IMPROVED

WATER RESOURCE USE AND PROTECTION

THROUGH R ESEARCH, I NFORMATION,

AND BROADLY T RAINED

WATER RESOURCE MANAGERS

The information and technical requirements of

coordinated water resource use are substantial. Technological developments and innovations in water

6 U.S. Advisory Commission on Intergovernmental Relations
resource use, conservation, and protection are developing rapidly, and the dissemination of information

does not always keep up with the pace of change.

Many water resource managers are inadequately

trained and equipped to use the most current concepts and techniques of coordinated water resources

management Programs of research and technical

assistance to water system managers concerning

coordinated use practices and groundwater quality

protection requirements would help raise the level of

competence in water resource programs.

The Commission recommends, theref0re, continuation

of federal programs that increase knowledge concerning

water supply and water qualify, and that extend information to state and local oficials and to other citizens. These

programs should include research, data management,

assistance with problem identification and policy analysis,

technology transfq and training.

Federal and state agencies should continue their

extensive and successfil cooperation in developing information about water conditions, and should also collect

information concerning mechanisms and prac tices governing the coordinated use of surface and underground water

supplies and storage.

The federal government should continue to pursue an

aggressive program of research info the extent and effects of

groundwater contamination, including the determination

of safe levels of contaminants in drinking watet; and fhe

program of support and technical assisfance to states in the

development and implemenfafion of groundwafer quality

protection policies.

States should require assessment of thegeological and

hydrological propriety of proposed or possible landjill sites,

in order to provide the information base for responsible

siting decisions based on thean ticipafed effects of a proposed

landfill on water quality.

U.S. Advisory Commission on Intergovernmental Relations 7
8 U.S. Advisory Commission on Intergovernmental Relations
Chapter 1

Groundwater

and Intergovernmental Relations

Waterpolicy and organizatiotl is basically a prob

lem in inteqqnwrnmental relations. . . . [P]oUcy

and organization issues posefundamental prob

lems thatstrikeat thevery heart of ourfederal system of government.1

Issues of groundwater management have received increased attention in recent years. Despite an

abundance of water resources nationwide, there are

problems of scarcity and contamination in many

places. These problems have generated dramatic

fights over water rights involving cities, industries,

farmers, state and federal agencies, and Indian tribes.

Increased reliance on groundwater for consumptive

wateruses has been accompanied by projections that

underground supplies in several places either will be

depleted or will become too expensive to reach

within a few decades. Some states have developed

regulatory and other efforts to shift water supplies

among uses. Competition for additional water resource development projects has intensified while

funding has been restricted, cost-sharing requirements have been raised, and concern about the

envimnmental impact of large-scale projects has

reached new heights. As the repoting of incidents of

water contamination has mounted, one alarming case

on anotheq gmundwater quality protection has also

em@ into the limelight

In the past decade, several changes have been

made or proposed concerning federal and state roles

and actions with respect to the management and

protection of water resources, and of groundwater in

particulac Suggestions have included calls for federal

leadership through enactment of a national groundwater policy, calls for the federal government to act

with state and local governments in a “new partnership,” and several federal legislative and regulatory

proposals to address specific aspects of water resource management Proposals introduced in recent

sessions of the Congress include the establishment of

a nationwide nondegradation standard to replace

variability in state programs, and federal require-

‘merits of major new statewide planning efforts for the

allocation and management of groundwater supplies. In 1982, the United States Supreme Court

opened the door to direct federal regulation of

groundwater supplies, ruling that groundwater is an

article of interstate commerce and striking down

certain state regulations restricting its export

These issues and trrnds share two common themes

The first is that there has been and remains an acute

need to develop and implement improved techniques

and institutional arrangements for the management of

gmundwater resources The second is that the development and implementation of any such improvements

must occur within the federal system, thereby engaging

additional considerations of the roles and relationships

of the federal, state, and local governments

Charles Corker, a professor of law at the University of Washington and long-time participant in western water issues and struggles, once wrote of “two of

the most difficult problems with which people in the

United States must live. One is water, the other is

federalism.“2 He continued, “Water, even uncomplicated by federalism, nurtures controversies which are

both long and bitter . . . [I]t has frequently been nip

and tuck whether differences of opinion would be

resolved by briefs or by bulletsu3 Groundwater in

particular, with its uneven distribution, irregular

boundaries, and multiple attributes as source of supply

and storage, “will test our federal system of govemment”4 Coordinating gmundwater use, allocation, and

pmrvation is a challenging task, which “may include

international, national, inteM.ate-rtzgional or major

river basin, state, intrastate river basin, county, and local

boundaries and jurisdictions”5

While federalism complicates the water resource management picture, this report attempts to

look beyond the complexities and search for the

U.S. Advisory Commission on Intergovernmental Relations 9
opportunities created by a federal system. Our

interest is not only in whether and in what ways the

federal system presents obstacles, but also in

whether and in what ways the system provides

advantages for tailoring institutional arrangements forwater management to enhance performance, accountability, and citizen control.

On the other hand, much of the structure of

intergovernmental relations in the water resource

field evolved during a period when the primary

policy emphasis was on the development of supplies

In the past two decades, the emphasis has shifted to

supply management and water quality protection.

This shift in emphasis raises questions of whether the

roles and relationships among governments that

may have worked for development are advantageous

for management and whether the appropriate intergovernmental relationships for water quality protection might be different from either of these.

S COPE AND P URPOSE

Two principal approaches for improvingwater

resource management have come to the forefront

of national attention, each of which presents complex engineering and management challenges

“even uncomplicated by federalism.” The first of

these is the conjunctive management of groundwater supplies together with surface water supplies.

The second is integrated management of groundwater supply and quality.

This study focuses on the institutional arrangements and relationships involved in the conjunctive

management of groundwater and surface water

supplies. Although there will be attention to intergovernmental arrangements for protection of

groundwater quality, this report has to do primarily

with maximizing, allocating, and preserving the

supply yield of gmundwater resources It is hoped that

this focus may contribute to an understanding of

intergovernmental roles and relationships in groundwater management and that such an understanding

may help in adapting some of the information gained

from hydrologic investigations, environmental management studies, and water supply plans to improved

resource management

Conjunctive Management

and Integrated Management:

An Important Distinction

As is the case in any specialization, terminology

in water resources management can result in confusion. In this report, the terms “conjunctive use” and

“conjunctive management” designate the cooniinated use of surface water supplies and storage

capacity together with groundwater supplies and

storage capacity. The terms used here do nof refer to

the management, protection, or restoration of water

quality (except to the extent that management practices should not result in the deterioration of water

quality, a sort of “first, do no harm” criterion).

In the literature reviewed for this report, the term

‘integrated management” was used in a couple of

sources and “unified management” was used in

another source to convey what is described here and

elsewhere as conjunctive management Integrated

management, as used in this report (and elsewhere)

refers to the attempt to manage groundwater supply

and groundwater quality as one effort. The term

unified management is not used in this report Groundwater supplies may be managed together with surface

water supplies or not, and water supplies may be

managed together with water quality or not (There are,

of course, other possibilities: for instance, surface water

quality and quantities could be managed togethes but

gnnmdwater supplies and groundwater quality managed independently, and so on)

Other Studies

In recent years, there have been numerous

studies devoted to groundwater supply conditions,

management,quality protection, and water resources

policy, of which the following are only a few. In 1985,

the Urban Institute published a report on several state

initiatives in improving community water supplies,6

which described the changing role of state governments in the water supply industry.

In 1986, the Conservation Foundation’s National

Groundwater Policy Forum produced its influential

report Grourrdwnter: Sming tlte Unseen Resortrce, which

focused principally on protecting quality.7 The forum

was attended by representatives from the academic

community; persons with technical and administrative experience in groundwater development and

management and local, state, and federal

policymakers. The forum’s report, which called for

“Action Now” in groundwater quality protection,

recommended a “new partnership” among governments in the federal system.

Also in 1986, the National Research Council’s

Committee on Ground Water Quality released its

report on state and local activities in the protection of

groundwater qua1ity.r’ That report attempted to relate

the characteristics of groundwater resources to the

proper roles and activities of state and local governments in their protection. It also highlighted individual state and local programs

In 1987, reports were prepared for the National

Council on Public Works Improvement on water

resource and supply! Each of these reports contained

considerable information on the organization of water

10 U.S. Advisory Commission on Intergovernmental Relations
management and the water supply industry, along with

findings, conclusions, and commendations

In 1988, the United States General Accounting

Office (GAO) produced reports on its review of

groundwater quality protection among the statesJO

These reports focused in particular on the drinking

water standards set by the U.S. Environmental Protection Agency (EPA), states’ use of those standards in

water quality protection programs, and states’ adoption of their own additional drinking water standards.

Since 1983, the United States Geological Survey

(USGS) has published a NafionaI Wafer Summary,

with each issue focusing on a particular concern.

There has been one summary on groundwater supply and on on groundwater quality

In 1989, The Urban Institute, in cooperation with

EPA, conducted an extensive assessment of the groundwater protection strategies being developed by the

stat= The project was guided by a national advisory

committee composed of state officials and experts in the

field The project also included a National Forum on

Groundwater Protection in October 1989 and produced

a report entitled State Management of Groundwafer:

Assessment of Practices and Progres~.‘~

As these reports indicate, much of the attention

given to groundwater management in the literature

in the past decade has focused on contamination and

the problems of protecting and restoring quality.

Studies that have attended primarily to the provision

of water supplies-such as the ones prepared for the

National Council on Public Works Improvement and

the USGS National Water Summaries-have inventoried and assessed the state of water resources,

including their sources, distribution, and use patterns.

The Plan of this Report

Chapter 2 contains a discussion of the value of

groundwater resources as sources of supply and of

storage and distribution. There also is an examination

of groundwater use, including dependence of various

areas of the United States on groundwater for different uses, and where-and why-the limits of renewable water supplies are being reached.

Chapter 3begins with a discussion of the concept

of conjunctive management of surface and groundwater supplies as a method for maximizing the yield

and the value of water resources, and (at least

potentially) alleviating some of the problems caused

by occasional shortfalls of supply. The chapter also

reviews and discusses several conjunctive use arrangements by and between governments, and some

of the advantages of a multijurisdictional system in

improving water resource management

Chapter 4 presents an organizing concept for

making sense of the tremendous variety of interorganizational arrangements for managing groundwater resources, especially conjunctive management

The chapter pays particular attention to the role of the

states and the national government

There follows in Chapter 5 a discussion of some

of the barriers that remain to effective conjunctive

management of water supplies in the intergovernmental setting. Again, particular attention is given to

state and national government practices that may

inhibit improved allocation and management

In Chapter 6, possibilities for modifying the practices and relationships of the national, state, and local

governments are considered, applying the concepts

developed in Chapter 4 and the lessons learned from

cases presented in Chapter 3 to some of the problems

identified in Chapter 5. Chapter 6 also includes the issue

of groundwater quality protection, in order to engage

the question of whether intergovernmental Elationships for protecting groundwater quality in the American federal system should be the same as or different

from those for managing groundwater supplies

Notes

’ Lyle Craine, “Intergovernmental Relations in Water Development and Management.” Presented at the Southern Political Science Association Annual Meeting. Gatlinburg, Tennessee, 1959, p. 1.

‘Charles Corker, “Water Rights and Federalism-The

Western Water Rights Settlement Bill of 1957,” C~lijorornin

Law Review 45 (December 1957): 604.

3 Ibid. (emphasis added).

4Neil S. Grigg, “Appendix: Groundwater Systems,” in

Kyle Schiing et al., ne Nution’s Public Works: Report on

Water Resources (Washington, DC: National Council on

Public Works Improvement, 1987), p. B-5.

5 Stephen J. Burges and Reza Marnoon, A Systematic Examination ofIssues in Conjunctive Use ofGround and Surface

Wafers. Water Resources Information System Technical

Bulletin No. 7 (Olympia: Washington Department of

Ecology, 1975), p. 6.

6 Nancy Humphrey and Christopher Waker, Innovative

State Approaches to Community Wafer Supply Problems

(Washington, DC: The Urban Institute, 1985).

’ National Groundwater Policy Forum, Groundwater: Saving the Unseen Resource (Washington, DC: Conservation

Foundation, 1986).

* National Research Council, Committee on Ground Water Quality, Ground Water Quality Protection: State and Local Strategies (Washington, DC: National Academy Press,

1986).

9 Schilling et al., Report O?I Water Resources; Wade Miller Associates, 7’he Nation’s Public Works: Report on Water Supply

(Washington, DC: National Council on Public Works Improvement, 1987).

lo U.S. General Accounting Office, Groundwater Quality:

StateActivities to Guard against Contaminants and Groundwater Protection: The UseofDrinking Water Standards by the

States (Washington, DC, 1988).

I1 See especially The Urban Institute, Proceedings oj the National Forum on Groundwater Protection (Washington, DC,

1990), and State Management of Groundwater: Assessment

of Practices and Progress (Washington, DC, 1989).

U.S. Advisory Commission on Intergovernmental Relations 11
12 U.S. Advisory Commission on Intergovernmental Relations
chapter2

The Value and Use of Groundwater

The United States relies increasingly on groundwater resources for water supply Groundwater basins also have value as underground storage reservoirs and distribution systems, especially where they

coexist with surface water supplies

Patterns of groundwater use and dependence

vary widely from one place to another Although

residents of some water-short regions have engaged

in groundwater supply management since the early

decades of this century, the relative abundance of

supplies in most places delayed attention to management issues Recently, emerging localized shortages,

growing awareness of threats to quality, and increasing recognition of the irreplaceable value of groundwater resources have drawn greater attention to

issues of management and protection.

TH E V ALUE O F GROUNDWATER RESOURCES

Understanding the value of groundwater resources involves placing them in the overall picture

of water resources and use. Trends in availability and

use are enhancing the significant value of underground water supplies, storage, and distribution.

Groundwater as a Source of Water Supply

Underground water basins appear throughout

the United States (see Figure 21). Generally, only the

mountainous (and least populated) areas lack significant groundwatec The vast majority of the nation’s

population lives and works in areas with readily

accessible groundwater supplies

Groundwater supplies far exceed surface water

supplies, constituting over 90 percent (perhaps as

much as % percent) of the total fresh water supply

potentially available.’ The amount of “economically

accessible” groundwater (i.e., within reasonable

pumping distance from the land surface) is estimated

to be as much as 17,250 trillion gallons2 Estimates of

the amount of groundwater within 2,500 feet of the

land surface range from 33,000 trillion gallons to

59,000 trillion gallons.3

To place this in perspective, the long-term renewable water supply available (most of which is directly

renewable surface water supplies) is about 1.4 trillion

gallons per day4 Total fresh water withdrawals as of

1985 were estimated at approximately 340 billion

gallons per day, or about one-quarter of long-term

renewable water supplies.5 Groundwater withdrawals comprised about 73 billion gallons, or just over 20

percent of this daily totaL

Furthermore, the bulkof the water withdrawn for

use each day (whether from surface or groundwater

sources) is not actually consumed. Nearly three-fourths

of the withdrawals come back as mtum flows6 Total

consumptive use of water is estimated to be about 92

billion gallons per day, or appmximately 6.6 percent of

total renewable supplies’

Clearly from a simple input-output, nationwide

view, there is no lack of water supply8 Particularly with

reference to the nation’s vast supply of groundwatec

there appears to be real abundance. Total gmundwater

supplies are hundreds of thousands of times greater

than total daily consumptive use of water The thousands of trillions of gallons of gnnmdwater available

nationally are tapped each day for less than 75 billion

gallons, not all of which is consumed

Groundwater clearly represents an enormous

sourceofsupply,butinordertoassessitsvalueseveral

considerations must be taken into account besides the

absolute quantity of water available and total use.

Trends in total water use and consumption, groundwater use and consumption, surface water availability, and concerns about quality all affect the value of

groundwater supply

Increasing Water Use and the Growing Role of

Groundwater. Fresh water withdrawals have increased substantially relative to population growth

since 1950. From 1950 to 1985, the population of the

United States grew by about 60 percent During the

same period, total fresh water withdrawals rose by

U.S. Advisory Commission on Intergovernmental Relations 13
slpM 0) u!w/@ @ se qmw se pls!A Al~e~Ouat3

~I!M isq~ rm)!nbe Aq u!e)Jopun eq 01 UMOU)( 80~ 0
nearly 100 percent, from about 175 billion gallons per

day to about 340 billion gallons per day9 Daily water

withdrawals per capita increased from just over l,KKl

gallons in 1950 to about lb50 gallons in 1980. There is

evidence that water withdrawals and consumptive use

stopped growing between 1980 and 1985,‘O but the overall trend has been an escalation in total water use.

Surface water supplies have been developed

more intensively than groundwater, and they are

becoming increasingly scarce relative to the demands

placed on them. One-fourth of the available fresh

surface water supply each day is withdrawn for

of&ream uses When this is combined with concerns

about water quality, the preservation of instmam

flows, and the environmental impact of new water

impoundment projects, it appears that the United

States is drawing relatively nearer to the limits of its

surface water development

Therefore, groundwater supplies are being relied

on to a greater degree. Since 1950, groundwater supplies

have been developed more rapidly than surface water

supplies, and withdrawals are increasing at a relatively

greater rate than surface water withdrawals for all

purposes other than electric power pmduction.ll From

1950 to 1985, surface water withdrawals increased by 85

percent, but groundwater withdrawals grew by 115

percent As total water supplies remain fairly fixed

while demands increase, groundwater will continue to

grow in value as a source of water supply

Water Quality Concerns and the Value of Groundwater Supplies. The greater development of surface water

supplies; the location of major urban and industrial

concentrations adjacent to rivers, lakes, streams, and

estuaries; and the more direct vulnerability of surface

waters to discharges and runoff containing harmful

substances have rendered a greater proponion of

surface water subject to repotted pollution and degradation than has been the case for groundwater Indeed, the

contamination of lakes and rivers was the focus of

public attention as well as legislation and regulation

during the 1960s and 1970s

By contrast, groundwater supplies remain more

nearly pure. As of 1983, it was estimated that contamination had reached between 1 percent and 4 percent

of the usable groundwatei? A 1988 report by the U.S.

General Accounting Office (GAO) stated that in 92

percent of water well locations studied the quality of

the groundwater exceeded federal safe drinking

water standards for every constituent element” The

GAO finding does appear to confirm that known

groundwater contamination has been relatively limited. (This in no way denies the severity of groundwater contamination where it does occur, or that its

occurrence is increasing.)

Greater concern over water quality during the past

three decades has incmased the value of gmundwater

as a less commonly contaminated soume of water

supply Reliance on gmundwater has gmwn for certain

uses, especially for safe drinking water This trend may

be expected to continue in light of constraints on surface

supplies As a 1989 publication observed, “Groundwater

already supplies over half the nation’s drinkingwater

. . . and its share is rising as standards promulgated by

the U.S. Environmental Protection Agency eliminate

many surface ~ources.“~~

Protecting Surface Flows and Habitats. The United

States is also nearing the limits of surface water

development because the supplies are subject to

instream uses and demands that limit their availability for offstream and consumptive uses

First, hydroelectric power demands require approximately 3,050 billion gallons per day, dwarfing

the total daily withdrawals of water for offstream and

consumptive uses15 and dictating that much of the

nation’s surface water remain flowing in its channels

Second, and of growing significance, instream

flows are desired to meet demands for recreation,

habitat preservation, and scenic areas. Only surface

water provides recreational opportunities, and those

who use the nation’s waters for those purposes are

interested in maintaining them. Diversions of surface

waters to offstream and consumptive uses also can

disrupt the natural environments of various forms of

fish and wildlife. Greater appreciation of this fact in

recent decades has prompted actions directed toward

maintaining sufficient stream flows and lake levels

for aquatic life and surface animal habitats. Furthermore, the scenic beauty of some of the nation’s

waterways has been recognized as a value worth

preserving. Legislative action to protect scenic waterways can limit the diversion of waters

This set of social values that has emerged in the

last three decades affects water resource management16 Groundwater resources,being outof sightand

not per se the habitat of aquatic life, play an incmasing role in water supply nationwide.

Groundwater and Consumptive Use. These limits

on surface water development and use mean that

groundwater, while representing about 20 percent of

withdrawals,constitutesconsiderably higherprwportions of the supply for offstream consumptive uses In

addition to scenic, recreational, and habitat needs,

surface water supplies are relied on to a greater extent

for less consumptive purposes

Hydroelectric power, for example, is generated

with surface water and requires tremendous amounts

of it, but the water that turns the turbines returns to the

streams. In addition, water withdrawals for cooling

purposes in thermoelectric power production constitute about one-third of the 340 billion gallons of daily

fresh water withdrawals, but nearly all of the water

used in thermoelectric power production is surface

U.S. Advisory Commission on Intergovernmental Relations 15
water, and only 2 percent of it is consumed. When

withdrawals for nonconsumptive thermoelectric

power cooling are subtracted from the total fresh

water withdrawals, the surface water share for consumptive uses declines to 65 percent and the groundwater share increases to 35 percent

Groundwater constitutes a greater share of withdrawals for the more highly consumptive uses of

water Groundwater constitutes 15 percent of withdrawals for industrial uses, for which the consumptive use rate is about 16 percent,” but 33 petrent of

withdrawals for irrigation and livestock watering for

which consumptive use is about 54 percent (with

another 17 percent lost in conveyance).1B Irrigation

accounts for 80 percent of the consumptive use of watec

while industrial uses account for only about 8 percent

Another 11 percent of the consumptive use of

water comes from domestic use for drinking water and

other purposeslq Gmundwater supplies accounted for

40 percent of total water withdrawals by public water

supply systems as of 1985 (up from 34 percent in 1980)

and nearly all (98 percent) of the water withdrawn for

domestic uses by the nation’s rural population20

Groundwater supplies serve fully half of the

people of the United States with drinking water?

According to a 1987 study for the National Council on

Public Works Improvement, groundwater is the primary source of water supply for 80 percent of the

58,530 community water systems, and for 96 percent

of the 144,800 non-community water systems?2

Groundwater’s share of water consumption is 36

percent and rising, considerably higher than its 20

percent of water withdrawals. Furthermore, groundwater supplies are not generally as rapidly replenished as are surface water supplies In fact, in some

areas, replenishment rates to groundwater basins

from surface water flows and precipitation are small

to virtually nonexistent Of the estimated 17,250

trillion gallons of groundwater within economically

accessible range of the land surface, only about 2

percent (345 trillion gallons) isavailableon a continuing basis (i.e., is replenished at a rate roughly equivalent to rates of withdrawal) and much of that is in the

more humid regions of the country.”

As surface water is devoted increasingly to nonconsumptive uses, the nation is drawing on its compamtively more plentiful but less renewable groundwater

for a rising share of consumptive uses Over the long

term, this pattern of withdrawals and consumption is

likely to continue to increase the relative scarcity and

value of groundwater as a source of water supply.

Groundwater Basins as Sources of Water Storage

and Distribution

Groundwater basins function as underground

storage reservoirs and distribution systems, and in

many places are connected with surface water supplies The advantages of natural underground storage

and transmission, coupled with the limitations of

surface reservoirs, have increased the value of this

use of groundwater basins Indeed, in economic

terms, there is evidence that this is the more valuable

use of an underground water basinx These additional potential uses of groundwater resources have

given rise to new management possibilities

Total Capacity and Usable Storage Capacity. As

noted, the underground reserves throughout the

country contain immense amounts of groundwater

and have a total storage rapacity equivalent to many

thousands of times our annual consumptive use. Of

course, some of this groundwater is at depths so great

that its recovery is not economically feasible, and not

all of the storage capacity is equally valuable.

“Usable storage capacity” is limited to that

within economic pumping lifts and, in coastal

‘basins, above sea level.% Nevertheless, the amount

of usable underground water storage capacity is

huge relative to surface storage. According to the

1986 report of the National Groundwater Policy

Forum, the amount of groundwater stored within

economic pumping lifts of the land surface is at

least six times greater than that of all of the waters

stored in all of the surface lakes and reservoirs .26

In addition to their storage capacitygroundwater

basins can be operated as water distribution systems,

depending on their physical characteristics. Wells

sunk into a groundwater basin can provide water

near the point of use for a community of users

extending over hundreds (sometimes thousands) of

squam miles The groundwater basins throughout the

United States, therefore, represent a large and valuable

resource as water storage reservoirs and distribution

systems that is lily to become more significant as

demands for water use continue to rise while surface

water availability and storage capacity remain limited.

Advantages of Underground Storage and Distribution. The construction of surface storage reservoirs,

above-ground water tanks, and surface distribution

systems for capturing, retaining, and conveying

surface water supplies is a very costly undertaking. It

is becoming even more difficult and costly in metropolitan regions, where land is becoming scarcer and

more expensive. Moreover, most of the best surface

water reservoir sites have been developed, and the

sustained yields of these reservoirs are decreasing

due to accumulation of sediment”

Thus, a major advantage to be gained from

underground water storage capacity is less need to

construct costly surface storage and distribution

capac$P Aquifers can store and release water and

distribute it to multiple points of use, as can surface

reservoirs and pipelines, while saving the substantial

16 U.S. Advisory Commission on Intergovernmental Relations
costs of building and maintaining the 1atteP Conversely, underground water storage capacity is valuable from a replacement standpoint; if an aquifer

system is damaged or destroyed by depletion or

degradation, then surface water storage facilities will

need to be constructed in its place.3o

Underground water storage and distribution are

more efficient because water is not lost to evaporation

as it is from surface water impoundments and

aqueducts31 Evaporation losses can be significant for

long-term surface storage, especially in the more arid

parts of the United States where evaporation rates are

high. In New Mexico, for example, the state engineer

estimated evaporation losses from surface reservoirs

during 1985 to be 423500 acre-feet or 20 percent of the

state’s total consumptive use. In Montana, the Department of Natural Resources and Conservation reported evaporation losses from surface reservoirs to

be 3.9 million acre-feet or 54 percent of the state’s total

consumptive use of water=

Surface water storage and distribution facilities,

whether large-scale dam and reservoir operations or

community water tanks, require maintenance, While

it is possible to damage an underground aquifer

through dewatering, groundwater basins do not

require actual maintenance and do not breakdown or

wear out, although recharge facilities, such as spreading grounds, do require maintenance. Surface water

storage and distribution facilities are also more

vulnerable to damage from earthquakes, flooding,

and sabotage than are underground supplies”

Surface water storage displaces existing or other

,possible uses of land. In recent years, this issue has

been the source of a considerable amount of litigation

concerning the impact of proposed new surface

water projects Use of existing underground storage

capacity can allow for continued use or development

.of land. Certainly, land uses in groundwater recharge

areas need to be controlled, but storage of water

underground does not foreclose as large a range of

surface uses as does storage of water above ground.

This is a point of particular significance for the

eastern and midwestern United States While the

western states contend with perennially low rainfall

and runoff, the eastern states are more likely to

experience infrequent, unpredictable, but severe

droughts (as witnessed in the Southeast in 1986 and in

the Midwest in 1988). To prepare for such exigencies

through the construction and maintenance of surface

water storage facilities requires a large investment in

physical facilities that are unneeded most of the

time% Underground water storage can be especially

valuable in circumventing the need for such facilities

and their associated costs

In addition, while it is important to recognize that

surface water quality has improved somewhat during

thelasttwodecadesandthattherraresomeseriousand

persistent groundwater contamination pmblems, water

stomd underground is exposed to a smaller range of

contamination risks, both natural and human% Both

underground and surface waters in storage are

exposed to contamination from hazardous waste

disposal, storm runoff, and a variety of nonpointsource threats However, such threats are more likely

to reach surface water relatively unimpeded, while

the soil through which recharge waters pass before

reaching an aquifer may provide some partial filtering of pathogens, and absorption of low concentrations of nitrates and phosphates.% Surface water also

faces eutrophication problems (such as “algae

blooms”) during times of low replenishment.

The advantages of underground water storage

from a quality protection standpoint may be seen in

the plans of some water agencies in the United States

(and elsewhere) to cover surface water reservoirs The

Los Angeles Department of Water and Power, for

example, is installing covers over its smaller reservoirs at an estimated cost of several hundred million

dollars. The purpose is “to keep out bird and rodent

droppings, prevent human pollution of innumerable

sources and block out sunlight that promotes the

growth of troublesome algae,” which combines with

chlorine in water treatment to form potentially

carcinogenic trihalomethanes3’

QUALITY IS QUANTITY:

THE IMPORTANCE

OF PROTECTING G ROUNDWATER RESOURCES

Any contemplation of the use of underground

water basins for water storage and retrieval must at

least consider the old water adage that “quality is

quantity.” If water quality is sufficiently degraded to

render it useless for its intended purposes, then from a

practical standpoint that quantity of water may as

well not exist This relationship between quality and

quantity holds true for waters underground as well as

at the surface. Once contamination of an underground aquifer occurs, its value is impaired or lost for

a long time. Therefore, the preservation and maximization of the value of groundwater resources require

rigorous attention to quality protection.

Unconfined aquifers and aquifer recharge areas

are vulnerable to transmitting contaminants into the

water supply Land uses and waste disposal overlying

such locations must be carefully guarded. Moreover,

there are naturally occurring sources of water contamination to which an underground water supply

can be susceptible. For instance, along the extensive

coastlines of the United States, fresh underground

water supplies lie adjacent to the salt waters of the

oceans If the extractions from and replenishment to

the underground water supplies are not kept in

balance and groundwater levels decline sufficiently,

U.S. Advisory Commission on intergovernmental Relations 17
salt water intrusion can occur and can render water

pumped from underground essentially unusable.

The “quality is quantity” adage underlies the

argument that both elements must be managed

together because they are essentially inseparable.

There can be no gainsaying that attention must be

paid simultaneously to groundwater supply management and quality protection. There remains,

however, a question of whether the intergovernmental relationships and organizational arrangements for protecting groundwater quality ought to

be the same as for managing supplies. It is possible

that the roles of federal, state, and local governments and nongovernmental organizations may

be different in each case. This question is considered at greater length in Chapter Six.

GROUNDWATER USE

The trends and concerns identified above-increasing reliance on groundwater supplies for consumptive water uses, limits on surface water availability and diminishing prospects for additional

development, the importance of groundwater basins

as alternatives or supplements to surface water

storage and distribution, and growing concerns about

water quality - have been noted by several observers

and have prompted calls for improved groundwater

management In and of themselves, calls for improved management are unlikely to be contradicted

or even controversial. However, the translation of

“improved manageme&’ into a set of roles and

relationships for the national, state, and local governments in a federal system can involve considerable

differences of opinion. The recommendations of

observers and advisors vary concerning the allocation of responsibilities for improved management

within the federal system. These differencesderive, at

least in part, from different perceptions of the nature

of the issues involved.

For example, is there a “national groundwater

problem?” If there is, a different set of recommendations concerning the allocation of responsibilities

within the federal system will emerge than if there is

not If there is not, then what are the problems with

respect to the management of groundwater resources? Are they primarily problems of localized

resource shortages, and if so, where? Are they problems that derive from different degrees of dependence on groundwater supplies? Are the problems

that do appear generated by a lack of water availability or by allocation and management practices? If the

latter, which governments within the federal system

are best situated to redress the deficiencies? The

remainder of this chapter focuses on patterns of

groundwater use and availability, including the

question of whether supply problems appear to be

generated primarily by natural resource availability

or by resource allocation and management practices.

A “National Groundwater Problem”?

Arguments in favor of assigning principal responsibility for improved groundwater resources

management to the federal government build on

some of the information presented above. For example, groundwater supplies provide half of the nation’s drinking water. This establishes the importance

of groundwater resources to the United States as a

whole. To this one can add that groundwater resources appear everywhere, that some aquifers extend across state boundaries, and that groundwater

problems have appeared throughout the country.

These observations have led some analysts to the

conclusion that groundwater, or “the groundwater

issue,” is a “national issue.” And a national issue needs

a “national policy.” Consider the following statement

from the codirectors of the National Center for

Ground Water Research in Oklahoma:

The people also know that with its astounding abundance and its predominantly

excellent quality, our National grourrdwnter resources are endangered. They are constantly reminded of this Nufional issue by documentaries, articles, reports, discussions and series

which accompany all of the information media to which they are constantly subjected.. . .

It is imperative that n nntiortal policy be issued at the earliest possible time. It should

provide a kinetic approach to addressing our

ground-water problems in the coming years

by providing the foundation for honest debate among experts representing the legal,

philosophical, and technical aspects of tile

ground-wnterissue. It is to be expected that this

policy will continue to be adjusted as we

come to grips with near term problems.38

Yet, equally incontrovertible national statistics

can be used to contend that, at least from a demand-supply standpoint, there is no national

groundwater problem. It was observed earlier in this

chapter, for instance, that the potentially available

groundwater reserves are enormous compared to use

rates, and that available renewable fresh water

resources are several times fresh water withdrawals

and consumptive water use. In the Nationnl Water

Summary 2983, the U.S. Geological Survey made such

an observation, and suggested that groundwater

problems were more likely to be localized problems

of availability and quality:

Thus, considering only the overall supply of

water without regard to development, distribution, or quality, t\fere is 110 crisisfficirtg tlteNrrtion; the resource fnr exceeds fhe preset t level of

lrse. However, this in itself does not guarantee

that adequate water supplies of an acceptable quality will be available where and

when they are needed in the years to come.39

18 U.S. Advisory Commission on Intergovernmental Relations
The italicized portions of the two quotations

above illustrate some of the drawbacks to using

national data to assessthegroundwateravailability

and quality challenges. Concluding either that

there is a national problem or that there is no

problem could miss important local variations in

the availability, use, and scarcity of groundwater,

and of water resources generally

As a result, other analysts have been less receptive

to the idea of groundwater resounx management as a

national issue or national problem.” They stress the

diversity in availability scarcity, and use, and question

whether something that can be accurately labeled “the

ground water issue” exists They emphasize that the

balance (or imbalance) of water demands and gmundwater supplies is determined locally, not nationally

Just how diverse are the use, availability, and

scarcity of groundwater resources? How much variation is masked by the national totals and national

averages given above?

The groundwater supply and demand situation is highly uneven, stemming in part from

variation in precipitation and atmospheric humidity, which affect replenishment and evaporation

rates. Figure 2-2 demonstrates that precipitation is

substantially lower in most of the West than in most

of the East. This contributes to higher daily water

withdrawals per capita,regardless of whether from

surface or groundwater, in the western states than

in the eastern states.

Nine of the ten states with the highest total daily

gmundwater withdrawals per capita (see Appendix A,

Figure A-l) are west of the 100th meridian (the longitudinal parallel that runs roughly from the border

between Minnesota and the Dakotas south to the border

between Tscas and Louisiana, and that most nearly

defines the arid West and the more humid East). All ten

of the states with the lowest per capita daily gmundwater withdrawals are east of that division. It is also

apparent that the variation in groundwater withdrawals masked by national averages is huge: groundwater

withdrawals per capita per day vary from Rhode

Bland’s 38 gallons to Idaho’s 6,281 gallons, while the

national average is 363 gallons

Beyond the sheer volume of water withdrawals,

dependence on groundwater supplies does not vary

systematically by region. Measures of groundwater

dependence include: groundwater share of total

water withdrawals, percentage of the population

served by groundwater, and groundwater share of

withdrawals for different uses (public supply, industrial, and irrigation).

For purposes of illustration only Figure 23

presents these measures in a sample of five states in

different parts of the country, each of which adopted

significant new groundwater supply management

and/or quality protection policies during the 1980s (as

did several other states). The figures show how

different the patterns of groundwater dependence

can be. The figures presented in Figure 2-3 for the five

states are presented for all 50 states in Appendix

Tables A-l, A-3, A-4, A-5, and A-6.

Arizona and Mississippi, an arid western state

and a humid eastern state (see Figure 22), both show

high dependence on groundwater supplies across all

measures By contrast, gmundwater mpmsents less than

one-fourth of water withdrawals for all types of use in

Connecticut, and only about one-third of the population of Connecticut is served by groundwater supplies

Illinois and Washington illustrate how varied

groundwater dependence can be for different types

of water use within a state. In Illinois, groundwater

contributes a relatively small share of total water

withdrawals, public water supplies, and water

supplied by industry for its own use, but contributes

all of the water used for irrigated agriculture. By

contrast, Washington relies very little on groundwater for irrigation, and yet over half of the state’s

population is served by groundwater supplies,which

make up a third of public supply withdrawals.

As can be seen by referring to Appendix lkbles

A-l through A-6, the states in Figure 23 do not represent

the extmmes among the states For any measure of

groundwater reliince, the variability from most dependent state to least dependent state is even greater For

example, the gmundwater percentage of total water

withdrawals varies from 91 percent in Kansas to 2

percent in Montana (Figure A-l), with five western

states among the ten least dependent states on groundwater for their total water withdrawals

Variations are also extreme in the dependence on

groundwater for different types of uses. Earlier in this

chapter, it was noted that half of the U.S. population is

served by groundwater supplies, but that proportion

ranges from 95 petcent in Hawaii to 20 percent in

Colorado (Figure A-3). Groundwater comprises 40

percent of withdrawals for public water supply systems

in the United States as a whole, but ranges from 92

percent of publicsupply withdrawals in Idaho to 9

pemnt in Maryland (Figurn AA).

Similar variability exists in reliance on groundwater supplies for industrial and irrigation uses The largest

quantities of water withdrawn for industrial uses am

concentrated, as would be expected, in the eastern

statesql But dependence on groundwater supplies to

meet those industrial demands exhibits a variability of

its own. For instance,98 percent of water withdrawals

for self-supplied industrial use in New Mexico comes

from gnnmdwam but in neighboring Colorado the

corresponding figure is 6 percent (Figure A-5).

Reliance on groundwater for irrigation also

varies widely across the states The greatest use is in

the western states, but dependence follows a different

variation. In Illinois, Indiana, and Wisconsin, for

U.S. Advisory Commission on Intergovernmental Relations 19
Fip re 22

Average Annual Precipitation in the United States

Source: U.S. Geologicd Survey, hbtio~m~ b’afer SUJJJJJJ~J~ I%3 (Washington, DC, 1984).

20 U.S. Advisory Commission on Intergovernmental Relations
Eiglcre 2-3

Groundwater Dependency in Selected States, 1982 and 1985

1982’ 19852

Arizona

Pementage of Water Withdrawals3 57 48

Rrcentage of Population Served 65 64

Percentage of Public Supply Withdrawals 54 62

Percentage of Industrial Withdrawals3 88 98

Percentage of Irrigation Withdrawals 58 45

Connecticut

Percentage of Water Withdrawals3 11 24

Percentage of Population Served 32 32

Pexentage of Public Supply Withdrawals 17 18

Percentage of Industrial Withdrawals 310 12

Percentage of Irrigation Withdrawals 8 7

Illinois

percentage of Water Withdrawals 35 35

Percentage of Population Served 49 48

Percentage of Public Supply Withdrawals 27

percentage of Industrial Withdrawals 3

10 2

Percentage of Irrigation Withdrawals loo 100

Mississippi

Percentage of Water Withdrawals 354 83

Percentage of Population Served 93 92

Percentage of Public Supply Withdrawals 82

Percentage of Industrial Withdrawals 3

61 E

Percentage of Irrigation Withdrawals 65 82

Washington

Percentage of Water Withdrawals3 9 18

Percentage of Population Served 71 52

Percentage of Public Supply Withdrawals 37 35

Percentage of Industrial Withdrawals3 15 19

Percentage of Irrigation Withdrawals 4 13

1 U.S. Geological Survey, National Water Summary 1984 (Washington, DC, 1985).

2 Wayne Solley, Charles Merk, and Robert Pierce, Estimated Water Usein the United States 1985, USGS Circular 1004 (Washington, DC, 1988).

3Excluding withdrawals for thermoelectric power.

example, groundwater supplies nearly all of the water used for irrigation; in Montana, 1 percent: and in

Alaska and New Hampshire, zero (Figure A-6).

As the states vary, use patterns in localities also

vary In Tstas, for example, slightly less than half of

the population is served by groundwater,but the City

of San Antonio is entirely dependent on groundwater

supplies, and the irrigation of High Plains agriculture

comes almost wholly from underground. About

one-third of New York state’s population is served

from gmundwatec which constitutes only one-quarter

of the water withdrawals for public water supply, but

Long Island’s communities depend almost entirely

on their underground aquifers

The uneven distribution of groundwater use and

dependence means that the relative scarcity of supplies varies even more dramatically. Geographic

differences in use are compounded by differences in

available supply. The nation’s groundwater reserves

are enormous relative to demand, but those reserves

are very unevenly distributed. They are unequally

available everywhere and they are not most plentiful

everywhere they are most needed. In one location,

dependence on gmundwater supplies might be high

but available supplies may be smaller and of limited

renewability In another area, reliance on gmundwater

supplies may be low but supplies abound in quantity

U.S. Advisory Commission on Intergovernmental Relations 21
Figme 2-4

Simplified Water-Resources Budget for U.S. Water-Resources Regions, 1980

Depletion

Consumptive Renewable Consumptive Use of Groundwater

Use SUPPlY as Percent of Storage

Region O-w0 O&9 Renewable Supply (bgd’)

New England 0.6 78.4 1 0.0

Mid-Atlantic 1.8

South Atlantic 5.6

2ES 2 0”:;

Great Lakes 1.6 74.3 ; 0.0

Ohio 2.1 139.6 2

Tennessee iv 41.2 1 i:;

Upper Mississippi

Mississippi 4213

77.2 0.0

464.8

3

Sour-is-Red-Rainy 0.5

6;;

8 E

Missouri 19.3 31 2:2

Arkansas-White 11.0 68:7 16 3.6

Texas-Gulf Rio Grande 8.3 33.1 25

Upper Colorado ::;

5.4 2

13.9 ;; 0:o

Colorado (all) Great Basin 10.8 4.1 10.30 10541 k!

Pacific Northwest 12.6 276.2 5 0:o

California 25.5 74.6 34

Alaska 0.04 975.5 0

Hawaii 0.7 7.4 9

1 Billions of gallons per day.

Source: U.S. Geological Survey, National Wafer Summy 1983 (Washington, DC, 1984).

and renewability. Other possibilities exist between

these extremes-for example, locations of heavy

use but large quantities, or of lower quantities and

lesser use. Dependence on groundwater also will

be affected by availability of surface water supplies, and vice versa.

Where Is Improved Management Most Needed?

Because they are driven by use and dependence

as well as by availability, water scarcity and shortages

have occurred in all regions of the United States*

Nevertheless, there do appear to be some areas where

water use is reaching the limits of renewable water

supply, and where groundwater in storage is being

drawn down to meet demands.

Figure 24 presents illustrative, simplified comparisons among water resources regions identified

by the U.S. Geological Survey The amount of water

consumption (as opposed to water withdrawals) is

compared with the estimated renewable supply

(surface and groundwater) for each region. The

results confirm previous evidence presented in this

chapter, namely, that the nation as a whole is in no

danger of approaching the limits of its available

renewable water supplieP and drawing down its

groundwater resources,but that thereare areas where

the limits of renewable supplies are being reached

and groundwater is being depleted. Those regions are

the Arkansas, Colorado, Mississippi, Missouri, and

Rio Grande River basins, and parts of California and

the Great Basin.

The region of most rapid depletion of groundwater storage, at a rate of nearly 6 billion gallons per day,

is the Mississippi River region. In the Colorado River

Basin, total daily water consumption now exceeds

estimated renewable supply.

With the population of the western states expected to grow by over 40 percent between 1980 and

2000, and with the populations of Arizona and

Nevada in particular expected to more than double

during that brief period,“R expectations quite naturally arise that water shortages in the arid regions in

particular can only worsen. Such expectations have

been at the heart of calls for swift and decisive action

to “manage” water supplies. And it is understandable,

under the circumstances, that there is not much

patience for those who suggest pausing to consider

whether perceived current and impending “shortages” are real, whether there really is not enough

water to go around. But water-scarce lands have

given rise to mirages before, and, despite an understandable impatience, it may be prudent to examine

&I U.S. Advisory Commission on Intergovernmental Relations
whether nature’s reality or human perception is

driving the “water crisis.”

Are these areas experiencing problems of water

availability or allocation? In the areas where consumptive use is approaching or has reached the limits

of renewable water supply, is this occurring because

there is not enough water or because of the way in

which water is allocated and used?

As noted earlier in this chapter, some water uses

tend to be more highly consumptive than others.

Consumptive use rates for irrigated agriculture (most

of which is located in the Midwest, Great Plains, and

Southwest) are in excess of 50 percent, while the rates

for industrial use (most of which occurs in the

Northeast and South) and public supply are less than

25 percent, These differences translate into a simple

comparison of the eastern and western states presented by the U.S. Geological Survey The overall

consumptive water use rate in the eastern states is

about 11 percent, and in the western states, it is 41

percent The eastern United States accounts for 53

percent of the nation’s water withdrawals,but only21

percent of water consumption. The western United

States accounts for 47 percent of the nation’s water

withdrawals and 79 percent of the nation’s water

consumption. Much of this difference is attributable

to the different uses of water in different areas.

To illustrate the impact of highly consumptive

irrigation practices even more plainly, and to offer an

answer to the question of whether water shortages

are driven mainly by availability or allocation, consider the following analysis of the Colorado River

Basin states, where water use has reached the limits of

renewable supply. Below are the estimated 1988

populations of some western states, alongside estimates of the populations that could be supported by

the water resources of those states at 150 gallons per

capita per day, if all were devoted to municipal and

industrial u~es:~

Water1988 Sustainable

State Population Population

Arizona 3,466,ooo 19,700,ooo

California 28,168,ooo 296,600,OOO

Colorado 3PJ,~ 39,800,ooo

Nevada v%Qoo 27,100,OOO

New Mexico 1#510,ooo 13,300,ooo

Utah 1,691,OOO 3fGw~

Wyoming 471,ooo 39/2@qoo

Have the Colorado River Basin states really

reached the limits of water development, or has

allocation and use in some of thosestates caused them

to appear to be close to the limits? According to these

figures, California has enough “room,” in terms of

available water resources, for a population larger

than the population of the United States. Arizona,

Nevada, and New Mexico, generally considered to be

the most arid states, could accommodate population

increases of 6-fold, 25fold, and &fold, respectively.

Incidentally, none of the populations of these states is

projected to come anywhere near these estimates by

the middle third of the 21st century

The vast majority of water rights, withdrawals and

diversions, and consumption in the western states

(including the Colorado River Basin) is accounted for by

irrigated agriculture. Agriculture holds the rights to an

estimated 85 percent of the water in the West%

Agriculture accounts for about SO percent of water use

(self-supplied industrial use, 12 percent urban uses, 7

percent; and rural domestic use, 1 petcent):7 and about

90 percent of western water consumption.48

Where is improved management most needed?

There do not appear to be too many simple answers to

that question. A simple regional answer, that improved

groundwater management should be targeted at the

western states (or the Colorado River Basin states, or the

Mississippi River states, etc) does not seem sufficient,

because groundwater use and dependence is high in

some states and low in some states in all regions On the

other hand, a simple answer that improved management is needed everywhere overlooks the diversity of

water msources and is so broad as to be essentially

meaningless Clearly, continued improvements in water resources management are needed in pans of the

Southwest, but they also are needed in other places

where water scarcity and water quality problems have

occurred on a variety of scales, from interstate regions to

individual local groundwater basins

SUMMARY

How does one reconcile all of this information

concerning groundwater resources, their value, their

uses, the importance of protecting quality, and the

presence of abundance and shortages and different

allocations of water across the country? The United

States has abundant water resources relative to its

population. This is true even of the relatively arid

western states, where water consumption is pressing

against the limits of renewable supplies and where

stored groundwater reserves are being drawn down.

On the other hand, potentially significant water

supply problems have been seen on the horizon for

decades. Current and projected imbalances between

limited or shrinking supplies and growing demands

are seen as certain attributes of the present and the

future. There appears to be plenty of evidence, in the

form of overdrafting of groundwater supplies, the

drying up of surface water supplies, and the comparisons made in Figure 24 above, that in several locations

demands for water are indeed outstripping supplies

What reconciles these perceptions is the recognition of the role of institutional arrangements in the

U.S. Advisory Commission on Intergovernmental Relations 23
allocation and management of water resources. In the

words of the National Wafer Summary 1983:

The actual availability and quality of water are determined, to a large degree, by the

way in which the resource is developed and

managed in the face of changing demands

These matters are governed by human decisions regarding the engineering works mquired to develop new supplies, the management strategies and operating policies

governing the use of &sting supplies among

users or among States, and the policies or actions employed to ensure the quality of water

supplies49

Recognition of the role played by institutional

factors prompts us to inquire whether apparent water

shortages are in fact the result of limits imposed by

physical conditions. It is hard to know the limits

imposed by physical supply conditions, if demand

for the resource is being conditioned by institutional

arrangements that freeze the ways in which supplies

can be used.

In fact, the physical characteristics of water

supplies and the institutional arrangements affecting

water use are both potential variables in the resource

equation. “[Mlany people do not realize that institutions, rather than physical conditions, are often the

cause of shortfalls in water s~pply.“~ What appears

on the surface to be a shortage of supply dictated by

nature is often the manifestation of underlying

institutional factors that result in existing supplies

being overused or used inefficiently.

Given the overall abundance of water resources relative to population in all areas of the

country, problems of supply availability and reliability may be viewed as problems of institutions

and management practices rather than of resources. The United States does not confront a crisis

of natural water supply availability, or even a

“national groundwater problem,” but many localized issues that differ in nature and severity.

How can the management of water resources be

improved in ways that take advantage of the value of

groundwater resources and surface water supplies,

allocate them wisely among uses, and preserve and

protect them for the future? What improved management options are available, how are they arranged,

and how do they operate? What changes in intergovernmental roles and responsibilities would facilitate

improved water resource institutions and management practices? In the next chapter, we turn to the

concept and practice of conjunctive management of

surfaceandgroundwaterresources,examiningseveral examples of intergovernmental arrangements for

improving the allocation and management of water

resources, and maximizing their value.

Notes

1 C.H.. Ward, N.N. Dunham, and L.W Canter, *Ground

Water-A National Issue,” Ground Wafer 22 (March-April

1984): 138.

2 Warren Viessman and Claire Welty, Water Management:

Technology and Institutions (New York: Harper and Row,

1985), p. 17.

3 Wayne Solley, Water Use in tke United States, 1980 (washington, DC: U.S. Geological Survey, 1983), p. 3. These

quantities may be placed in some perspective by noting

that the lower estimate of 33,OMl trillion gallons of water

is equivalent to the total amount of water deposited by

the Mississippi River into the Gulf of Mexico during the

entire 200 years of the Republic.

4 United States Geological Survey, National Water Summary 1983 (Washington, DC, 1984), p. 1.

5 Wayne Soiley, Charles Merk, and Robert Pierce, Estimated Useof Water in the United States, 1985 (Washington,

DC: U.S. Geological Survey, 1988), p. 59.

6 U.S. Geological Survey estimates the disposition of water withdrawals as of 1980 to be: 72 percent return flow,

23 percent consumptive use, and 5 percent conveyance

loss, irrigation. SoUey, pp. 4-5.

’ Solley, Merk, and Pierce, p. 1.

a U.S. Geological Survey, National Water Summary 1983, p.

1 .

9 Soiley, Merk, and Pierce, p. 1.

lo Ibid

l1 Ralph C. Heath, “introduction to State Summaries of

Ground-Water Resources,” National Water Summary

1984 (Washington, DC: U.S. Geological Survey, 1985)! p,

121; James W Dawson, “State Groundwater Protectton

Programs-Inadequate,” Ground Water 17 (January-February 1979): 108.

t2 Wade Miller Associates, 7lie Natiolt’s Public Works: Report

on Water Sllpply (Washmgton, DC: National Council on

public Works Improvement, 1987), p. 68.

l3 U.S. General Accounting Office, Groundwater Protection:

7he Use of Drinking Water Standards by the States (Washington, DC, 1988), p. 1.

l4 #Groundwater Contamination: Common Ground for

the Common Law,” Water Strategist 2 (January 1989): 1 + .

l5 Solley, Merk, and Pierce, p, 1.

l6 Helen J. peters, “Groundwater Management,” Writer Resources Bulletin 8 (February 1972): 197. This phenomenon

is observed with reference to California in Susan M.

Trager, “Emerging Forums for Groundwater Dispute

Resolution: A Glimpse at the Second Generation of

Groundwater Issues and How Agencies Work Towards

Resolution,” Pacific Law Journal 20 (October 1988): 31:

“While competition for California’s limited surface water supplies is increasing, the supplies available for agricultural, municipal, and industrial uses are decreasing,

due to environmental demands.”

l7 Solley, Merk, and Pierce, p. 30.

l* Ibid., p. 14.

l9 Ibid.

z” Ibid.

2 1 Heath, p. 120.

2 2 Wade Miller Associates, pp. 17-18.

24 U.S. Advisory Commission on Intergovernmental Relations
23 Viessman and Welty, p. 17.

24 See for example, California Department of Water Reso&es, California’s Ground Water (Sacramento, 1975), p.

iii; and William Blomquist, Getting Out oftke Trap: Ckangingan Endangered Commons to a Managed Commons. Ph.D.

Dissertation, Indiana University, 1987, pp. 524-528.

25 Helen J. Peters, “Ground Water Management in California.” Paper presented at the American Society of Civil

Engineers Conference, Las Vegas, 1982, p. 3.

26 National Groundwater Policy Forum, Groundwafer: Saving the Unseen Resource (Washington, DC: The Conservation Foundation, 1986), p. 9.

n Heath, p. 121.

za Stephen J. Burge s and Reza Marnoon, A Systemmntic Examination of Issues in Conjunctive Useof Ground and Surface

Waters (Olympia: Washington Department of Ecology,

1975), p. 33; also, Peters, “Groundwater Management,l p.

197.

29 Erwin Cooper, Aqueduct Empire (Glendale, California:

Arthur H. Clark Co., 1986), p. 137.

%Neil S. Grigg, “Appendix: Groundwater Systems,” in

Kyle Schilling et al, 7ke Nation’s Public Works: Report on

Wafer Resources (Washington, DC: National Council on

Public Works Improvement, 1987), p. B-2.

3* Burges and Marnoon, p. 33; California Department of

Water Resources, p. 129.

g Solley, Merk, and Pierce, p. 52.

33 Cooper, p. 137. In August 1989, the Los Angeles Aqueduct,

which conveys up to 75 percent of the water supplies of

the City of Los Angeles, was blocked by debris from

heavy storms that caused flooding. Portions of the aqueduct structure were twisted! and concrete walls cracked

and buckled. Although reparrs proceeded promptly and

took only two weeks, the incident illustrates the vulnerability of surface water facilities. The aqueduct was also

the target of vandals’ bombings in the 1920s and once

during the 1970s.

34 Charles W. Howe and K. William Easter, Inferbasin ‘Bensfers of Water: Economic Issues and Impacts (Baltimore:

Johns Hopkins University Press, 1971), p. 3.

35 California Department of Water Resources, p. 129.

36 Burges and Marnoon, p. 34; Grigg, p. B-2.

37 Frederick M. Muir, “Drinking in the View,” Los Angeles

‘hes, January 31,199O.

ss Ward, Durham, Canter, pp. X38-140 (emphasis added).

39 U.S. Geological Survey, Nafional Wlzter Summary 1983, p.

1 (emphasis added).

40 See, for example, Harvey 0. Banks, “Management of Interstate Aquifer Systems,” ASCE Journal OJ the Water Resources Plamling and Management Division 107 (October

1981): 574, contending that a “specific set of guidelines

for ground-water management cannot be applied uniformly throughout the country”; and Frank Rayner,

“Ground-Water Management -A Local Government

Concern,” Ground Water 10 (May-June 1972): 2-5.

41 Wade Miller Associates, p. 128; Solley, Merk, and Pierce,

p. 30.

* Note the following observation from Wade Miller Associates, p. 8:

The problem of adequacy of supply has now

spread to east of the Mississippi River. . . . Water

shortages, seldom encountered until the 1970s

east of the Mississippi, promise to become more

prevalent in the future. Water will still be plentiful, but better management of the resource will be

necessary to ensure an adequate supply for all

uses.

rw The United States as a whole consumes about 7 percent

of national renewable water supplies. Solley, Merk, and

Pierce, p. 60.

44 Rodney Smith, “A Reconciliation of Water Markets and

Public Trust Values in Western Water Policy.” Transactions of the Fifty-Third North American Wildlife and

Natural Resources Conference, 1988, p. 328.

*Frank Welsh, How to Creafe a Wafer Crisis (Boulder:

Johnson Books, 1985), p. 16.

46 Christine Olsenius, “Tomorrow’s Water Manager,“Jonrnal of Soil and Water Conservation 42 (September-October

1987): 312.

47 Smith, p. 329.

* E Lorenz Sutherland and John A. Knapp, “The Impacts of

Limited Water: A Colorado Case Study,” Journal of Soil

and Water Conservation 43 (July-August 1988): 294.

4 9 U S Geological Survey, National Wafer Smnmnry 1 P8.3, p.

1: .

so Viessman and Welty, p. 49.

U.S. Advisory Commission on Intergovernmental Relations 25
26 U.S. Advisory Commission on Intergovernmental Relations
Chapter 3

The Concept and Practice

of Conjunctive Management

Groundwater supplies are part of a hydrologic

cycle that includes surface water and precipitation.

The notion that groundwater is separate from and

unrelated to surface water is, as the National Water

Commission observed nearly two decades ago, a

myth long ago abandoned by hydrologists’ The

water supplies and problems of any given locale

exhibit an “essential unity”2

The water stored underground in aquifers frequently is received from surface streams through

percolation from their channels. Conversely, the base

flow of many surface streams is fed by underground

water sources outcropping onto the land surface or

feeding up through springs, And both surface waters

and groundwater are fed by precipitation and runoff

that reach and traverse the land surface?

THE CONCEPT

MAXIMIZING THE VALUE OF WATER RESOURCES

Recognition of these attributes, combined with

the developments described in Chapter 2, has led to

the concept of conjunctive use of surface water

supplies and underground water reservoirs. Conjunctive use involves the use of underground water

storage in coordination with surface water supplies

so as to increase the total water yield over time.4 More

complete and reliable use of the total water resources

of an area is possible by employing surface and

groundwater supplies together, through “an operating strategy that exploits the different characteristics”

of surface and groundwater supplies5

The Variability of Surface Water Supplies

Groundwater and surface water supplies are not

distributed evenly throughout the United States

Some places have plentiful surface and groundwater

supplies; others have a paucity of both. Still other

locations have plentiful surface water supplies but

fewer groundwater sources, and others are underlain

by substantial groundwater reserves though surface

supplies are barely present

Surface water and precipitation are subject to

considerable temporal variability. Rainfall and surface water flows can be erratic, unpredictable, and

sometimes insufficient to meet all demands. This

variability of surface water supplies presents a challenge in securing a reliable water supply, whether for

municipal, industrial, or irrigation uses

Groundwater supplies generally are contained

within large aquifers and are available throughout

the year Groundwater supplies respond more slowly

to variations in rainfall and runoff, and thus generate

less uncertainty in planning.6

Regulating Surface Variability

with Underground Storage

Reliable water supply systems require storage

capacity to regulate the variability of rainfall and

surface water flows Storage provides for adequate

water deliveries during periods of deficient precipitation and runoff

This cyclic storage can be secured by use of

surface reservoirs or the available storage capacity in

underground water basins’ Underground aquifers can

“smooth the pulses of arrival and withdmwaP that

characterize the sounxs of water supply (precipitation

and runoff) and the sequences of water demand

Conjunctive use can relate underground water

supplies and storage with surface water supplies to

regulate surface supply variability. During periods

when precipitation and runoff are plentiful, consumptive uses can be satisfied directly from surface

watersources. Duringsuch periods,surplussurface

supplies also can be used to recharge underground

reservoirs. In times of scarce precipitation and

dwindling surface flows, underground supplies can

U.S. Advisory Commission on Intergovernmental Relations 27
be drawn down, providing relatively inexpensive

and reliable fresh water yields. These extractions

create available storage capacity underground that

can be recharged during the next wet period?

Extraction of groundwater during drier periods

also can allow for the satisfaction of instream flow

requirements of surface water supplies. During times

of lowered surface water flows,communities may not

be forced into a losing choice between satisfying

needs for offstream consumption on the one hand

and maintenance of aquatic life, wildlife habitats,

and scenic values on the other

The pressure of increasing water demand has led to

water storage in surface reservoirs that wem originally

built for flood controL This can have disastrous consequences Floods have occurred in several states because

partially filled flood control sites were unable to hold

additional runofP Where underground aquifers of

sufficient capacity are available, their use for water

storage could aid communities in meeting water demands while leaving flcodcontrol dams and reservoirs

free for their intended use.

Uniting Alternative Sources of Supply

There are several desirable aspects of having

alternative sources of water supply. Conjunctive use

of alternative sources is possible and can generate

economies.” This is especially likely when the

sources of supply have different spatial, temporal,

and quality characteristics, as is the case with surface

and groundwatec

The use of groundwater basins as storage facilities saves the cost of constructing surface storage and

conveyance facilities to handle “peak” demands.

Surface water facilities can be constructed for meeting normal demands, and peak needs can be satisfied

by pumping underground yields. This can be an

especially valuable aspect of conjunctive use when

surface waters are being transported considerable

distances or conveyed from one watershed to another

as part of an interbasin transfer”

The ability to draw on alternate water supplies

allows water purveyors to respond to limitations

imposed by quantity or quality. Groundwater sup

plies are a valuable supplement to surface water

flows, and conversely, access to surface water can

extend the useful life of the groundwater source in

communities dependent largely on groundwater but

where replenishment is small relative to demand

(e.g., the Southwest and High Plains).‘3

Similarly, quality problems are less threatening

to communities that can alternate between sources of

supply. Groundwater quality degradation, for instance, can result in increased demand for surface water

supplies, which might be met by encroaching on flood

control storage or reallocating the rights to storage in a

surface reservoir*4As degradation problems continue to

escalate, it can be of nearly inestimable value to a

community to be able to switch to another source rather

than lose its entire water supply (surface or underground) to a contamination incidenti

Underground Transmission

As noted in Chapter 2, groundwater basins

provide a natural and practical water distribution

system that can supplement or replace surface distribution works. Solitary reliance on surface water

requires the construction and maintenance of an

extensive system of waterworks to carry water from

its point of capture or storage to every point of use

within the served community. An underlying aquifer

provides a water supply source throughout a served

community, and water recharged into an aquifer at

one point may be withdrawn in many places.16

For all practical purposes, anyone overlying a

groundwater basin may be physically able to withdraw water by means of a well and (usually) a pump.

This characteristic of groundwater basins is often

cited as one of its vulnerabilities,as multiple demands

placed on a single ~psource am expe&d to lead

frequently to overexploitation and the socalled “tragedy of the commons” It is worth noting, howevet; that

this characteristic of an underground water supply is

one of its advantages as well as one of its vulnerabilities

As part of a coordinated use program, a groundwater

basin can be a source of water supply, a source of

storage, and a means of transmission that complements

surface water distribution systems and allows them to

be built and maintained on a reduced scale.

CONJUNCTIVE USE

AND C ONJUNCTIVE MANAGEMENT

Conjunctive use may occur without a deliberate

plan or objective and without explicit coordination in

an attempt to maximize the total yield of water

supplies. Conjunctive management may be defined

as directed efforts to use available water supply

sources and storage capacity together toward the

objectives of maximizing, allocating, and preserving

supplies.*7Conjunctive management of surface and

groundwater supplies can maximize efficiency, directing resources to their higher valued uses as

sources of supply and storage.

An example of the difference between conjunctive use and conjunctive management is contained in

the following excerpt from a 1962 engineering report

concerning the use of the Main San Gabriel Basin in

southern California:

The ground water basin underlying San

Gabriel Valley has been used for many years

as a water storage reservoir and as a water

transmission system. As quantities of re28 U.S. Advisory Commission on Intergovernmental Relations
charge and extraction have varied, water levels have fluctuated in order to balance the

difference between inflow and oufflow with

change in ground water storage. In other

words, the ground water basin has been “operated” in a manner very similar to a surface

reservoir The main difference is that the

ground water basin has been operated unintentionally to a far greater extent than are

most surface reservoirs. As more expensive

supplemental water is brought into San Gabriel Valley it will be important that the basin

be operated more intentionally than in the

past so that neither the local water nor the

supplemental water is wasted from the area.

The operation of the basin is also important

to downstream users.16

In a period characterized by increasing water use

and tight public financial resources, optimal resource

use may only be obtainable by the coordinated

conjunctive use of surface and groundwatetlq Additional development projects appear to be subject to

increasing problems and decreasing probability. Under these circumstances, attention turns more to impmved management As the author of a recent article on

artificial mcharge put it, “If water purveyors can no

longer beat water supply problems to death with

money, they must solve them with ingenuity”” Conjunctive management is part of that approach it has

been described as “a software tactic” that “can generate

new increments of water cheaper than can the building

of hard~are,~ such as surface water projectszl

Defining Conjunctive Management

in Substantive Terms

Although conjunctive management has emerged

as a consensus in the water resources management

literature for decades, implementation of the concept

has been less than universal.22 Conjunctive management has a nearly lOByear history? and, while it is still

not used in most of the largest population centers, the

number of communities (e.g, Los Angeles, Phoenix,

‘Albuquerque, and Houston) and water utilities investigating arranging, and adopting conjunctive use programs is growing at an impressive rate. 24

Conjunctive management will not be feasible in

communities that do not have access to both surface

and groundwater supplies Further, in areas where

water use is relatively low and supplies (surface,

ground, or both) are plentiful, citizens may choose not

to pay the costs of managing supplies that are

abundant relative to demand (this does not refer to the

importance of efforts to maintain the quality of those

supplies). In most areas, however, there is access to

surface and groundwatersupplies,and water uses are

increasing relative to supplies so that scarcity either is

a problem or looms on the horizon.

For those communities, pursuing conjunctive

management involves understanding what it entails.

Some discussions in the water resources literature

approach the issue of what constitutes “management” by identifying organizational forms. For example, some authors recommend a single,central public

authority for “groundwater management,“% on the

presumption that the presence of multiple organizations implies lack of functional coordination.% Such a

view suggests that “groundwater management@ tequires a “groundwater manageP authorized to perform all functions This defines “management” organizationally: one organizational form produces

“management,” while others do not

Alternatively, the substance of groundwater

management may be identified in terms of the

necessary functions to be performed, leaving open

the possibility of a variety of organizational arrangements. This approach also leaves evaluation of

organizational performance primarily to the citizens

whose interests are to be served

Conjunctive management coordinates the

amount and location of groundwater recharge and

withdrawals together with the withdrawal, use,

return flows, and storage of surface waters. The

functional elements of conjunctive management are

controlling overdraft, regulating storage, protecting

water quality from degradation, assigning costs, and

adaptability and error correction.27 This is consistent

with the definition of conjunctive management as

the coordination of conjunctive use. With a view of

management as coordination (with diverse institutions and jurisdictions involved in related activities),

the questions for evaluation become whether functions are being performed, whether they are being

coordinated, and whether citizens are satisfied.

Controlling Overdraft

The control of overdraft is a necessary element of

groundwater management because of the threats to

an aquifer and the overlying land from excessive

withdrawals. At a minimum, withdrawals in excess of

recharge to the aquifer result in the lowering of

underground water levels; this produces longer

pumping lifts, which increase the associated energy

costs and may necessitate lowering pumps and

deepening or replacingwells?s Excessive dewatering

of aquifers (not to be confused with “controlled

mining” as part of a management plan) can lead to:

(a) soil compaction, which robs the aquifer of future

storage capacity and thus decreases its value; (b) land

subsidence (as has occurred in several places), which

threatens surface structures and residents;29 and (c) in

some cases, salt water intrusion that threatens the

usefulness of the fresh water supply

The dangers of overdraft dominated discussion

of groundwater management through most of this

U.S. Advisory Commission on Intergovernmental Relations 29
century. Groundwater supplies were recognized as

limited, and the aquifers were recognized as subject to

these threats. The resulting recommendation, following a prudent and risk-averse strategy based on the

state of hydrologic knowledge, was that long-term

maintenance of a groundwater basin required that

annual withdrawals be limited to the “safe yield” or

“sustainable yield,” defined as the average annual

amount of water that naturally recharges the basin.W

Such a strategy was directed at maintaining underground levels at an elevation sufficient to preclude

damage to the water or the aquifer from compaction,

subsidence, and contamination.

As information about and experience with

groundwater supplies and use have grown and

concepts of groundwater management have changed,31

it has become apparent that in many cases previous

strategies may have been too rigid. Excessive dewatering of aquifers is still understood and accepted as

inviting the kinds of damage described above, but the

definition has been modified by stperience.

In many places, sediment compaction, land

subsidence (including sudden sinkhole appearance),

and quality degradation have occurred. In many

other places, groundwater supplies were overdrafted

by considerable amounts over extended periods

without producing deleterious effects other than

increased pumping lifts Dangers that were once

ascribed to any overdrafting of groundwater supplies

are now recognized as being dependent on such

variables as the rate, degree, and duration of the

overdrafting, and especially on the physical characteristics of the s~pply.3~ (Underground water in

certain karat areas, for instance, may be considerably

more susceptible to the sinkhole phenomenon than

alluvium and bedrock valley-fill aquifers.)

Therefore, in defining the elements of conjunctive management, emphasis has been placed on

controlling rather than eliminating overdraft The

distinction is a deliberate and important one.

Conjunctive management requires the use of

underground storage capacity. Using a groundwater

basin for temporary or long-term storage implies that

the capacity is available. This implication is inconsistent with an objective of maintaining a groundwater

basin as full as possible at all times. The conjunctive

use of surface and groundwater supplies in such a

manner as to maximize the total water yield counterintuitively demands that groundwater basins not be

maintained at their fullest possible levels. Maintenance of groundwater levels at their highest elevation

within an aquifer leaves no available space to accommodate any surplus of surface water A surplus of

precipitation and runoff with full groundwater mservoirs, produces the same result as with surface mservoirs: water spills across the land surface, potentially

causing surface damage and resulting in waste.%

Conjunctive management of groundwater and

surface water supplies, therefore, requires the creation of “regulatory storage capacity”34 by temporarily

overdrafting the groundwater basin during lowrecharge periods and returning water to storage

during high-recharge periods. Conjunctive management is inconsistent with rigid safe-yield requirements, which “often have limited the potential usefulness of basins to offset variations in annual

precipitation and particularly to postpone or reduce

the need for importations of water”% Groundwater

levels are managed with the objective of maintaining

them within a desirable range defined in part by the

regulatory storage capacity

Therefore, controlling as opposed to eliminating

overdraft in a groundwater basin is a balancing practice. Given the diversity of underground basins from

one location to another, it follows that the maintenance

of groundwater levels within a range that does not

aggravate the tendencies toward compaction, subsidence, or contamination, provides for the cyclic storage

of water underground, and maintains economic pumping distances, will involve considerably different desired ranges and targets among aquifers

Controlling overdraft requires some limitation

on groundwater withdrawals. There are various

means of accomplishing this, including judicial or

administrative determinations of pumping rights, and

the imposition of surcharges on quantitie Assurance

and, where needed, enhancement of groundwater

replenishment also are essential to controlling overdraft As with limiting withdrawals, there are several

means of implementation. Flows in stream channels

can be extended to allow for greater percolation, water

spreading basins can be operated with waters diverted

from ordinary stream channels, and so OI-L~

Assuring and enhancing replenishment also

involves maintaining a balance within a range of

parameters. Excessive recharge of an aquifer can

produce marsh-like conditions and move the water

table so close to the land surface that potential

flooding problems may be aggravated. Insufficient

recharge fails to take advantage of the aquifer’s

storage capacity, increases pumping lifts and costs,

and may leave users with less than adequate supplies

for peaking and dry-period withdrawals. The balance

to be achieved is one of sufficient recharge to

optimize the uses of the underground reservoir, while

maintaining adequate storage space for future exigencies and sufficient depths to water

Regulation of Storage

The regulation of storage is necessary to groundwater management and, indeed, is of the essence of

conjunctive management3’ Part of the task has been

alluded to: the maintenance of sufficient regulatory

30 U.S. Advisory Commission on Intergovernmental Relations
storage capacity to accommodate possible surplus

flows while at the same time avoiding an excessive

dewatering of the aquifer Another vital aspect of

managing underground storage capacity is allocating storage space. Space within a single groundwater

basin might be desired by competing users for

different uses such long-term storage, short-term

storage, peaking, and transmission.

Among the potential problems to be addressed

in this element of conjunctive management is the

issue of rights to stored water. No entity, public or

private, is likely to undertake storing water underground without first being assured of the ability to

reclaim the value of that water in some way. As will

be discussed at greater length in Chapter 5, not all

states have legal systems governing water rights

that are conducive to such practices.

Protection of Quality

Protecting the underground supply from contamination is an obvious element of conjunctive

management Among the factors to be considered am

the initial quality of the surface and groundwater

supplies,and the impact of recharge and withdrawal.

If, for example, water is to be recharged into an

underground aquifer for subsequent withdrawal for

drinking use, the water that is recharged must meet

drinking water quality standards. Moreover, a considerable distinction in the quality of recharge waters

and naturally occurring waters could complicate the

issue of rights to recapture and whether water of

equivalent value is being obtained by the entity that

stored water in the aquifei?

Water replenishment also must take account of

quality impacts. Raising water levels in one portion of

agmundwaterbasin can bring them into contact with

contaminated soils nearer the land surface. Replenishment in one portion of a basin also may aggravate

:the movement of an underground “plume” of contaminated water, pushing it toward production wells

that had previously been free of contamination.39

Distribution of Costs

Among the most challenging tasks to be met in

the conjunctive management of surface and groundwater supplies is the assignment of the costsa

Coordination of conjunctive use must include provisions for sharing burdens and benefits Ideally, costs

would be borne by beneficiaries in proportion to the

benefits obtained.” As will be discussed at some

.Iength in Chapter 5, the distribution of costs is

connected with water pricing practices, which

through their impact on user behavior has tremenduus significance for successful management

Adaptability

An essential element of conjunctive management is the capacity for adaptability and error

correction.” Adaptability involves responsiveness to

changes in conditions -shifting amounts and patterns of use, quality or quantity problems, advanced

technologies of water production or consumption.43

Error correction involves a responsiveness to

mistakes made by msoume managers and planners For

example, use amounts and patterns may not have

changed, but may have been erroneously calculated or

forecast Adaptability and error correction require that

any conjunctive management scheme be characterized

by institutions that encourage the development of

information and flexibility of management practices

THE PRACTICE OF CONJUNCTIVE MANAGEMENT:

CASE STUDIES

Conjunctive management, with its multiple

functional elements, is likely to present a highly

complex picture when conducted within a noncentralized, public-private system of organizational arrangements and relationships. To illustrate different

ways of organizing the elements of conjunctive

management, this section presents examples of innovation and diversity, including

A centralized administrative apparatus implementing a comprehensive statewide

groundwater management statute;

A set of intergovernmental provider-producer

relationships exhibiting significant division

of labor, as a provider contracts for the services of several producers in a pair of adjudicated groundwater basins;

A set of intergovernmental contractual relationships whereby different service providers

contract with a producer agency that performs a whole range of conjunctive management functions in a nonadjudicated basin

served by a federal water proja

A “water czar” who used the appropriation

permit scheme in his state to regulate

groundwater withdrawals and surtace water

diversions together;

A federal-interstate compact that has responded to groundwater depletion and contamination problems by developing conjunctive management plans on a river basin scale;

and

Agreements between local governments for

the use and operation of water storage in order to maximize available water yields.

These examples, some of which trace back to the first

half of the century, are followed by a discussion of

U.S. Advisory Commission on Intergovernmental Relations 31
recent innovations in institutional design and management methods from a number of states and

communities

Centralized State Administration:

The 1980 Arizona Groundwater Management Act

In 1903, the Congress authorized the Salt River

Project to help develop reliable water supplies for

central Arizona, which was then a territory The Salt

River Project was one of the first federal water

projects authorized under the Reclamation Act of1902,

and one of the first projects completed.M In the 198Os,

the Central Arizona Project (CAP) began to bring a

supplemental supply of Colorado River water to

central Arizona. Depending on the future course of

federal water resource development policy, the CAP

may be one of the last federal water projects completed under the Rec2mrzntiorzAct. The history of water

management and law in Arizona has been influenced by federal-state relations perhaps as much

as by any other single factoc The development of the

1980 Arizona Groundwater Management Act was

certainly no exception.

There are special reasons for the influence of the

federal government on water use and law in Arizona.* The stab&aridity and topography render it well

endowed with sites for reclamation projects The

United States also owns 71 percent of Arizona’s

territory, including Indian lands to which the federal

government is committed to supplying water In

addition, the land irrigated by reclamation project

water, :vhile accounting for a very small share of

farmland, has produced a disproportionately large

share of farm income. Thus, it is considered vital by

the state’s agricultural community, which has always

had a large influence on politics and policy Furthermore, much of the controversy surrounding water

supply in the past half-century focused on the

interstate fight over rights to the waters of the

Colorado River, a case that involved the Congress and

the United States Supreme Court from the early 1920s

to the mid-1960s. The determination of Colorado

River water rights delayed approval of the Central

Arizona project for years.

Even while the Salt River Project was being

designed, water users envisioned a project to bring

more water to central Arizona from the Colorado

River At the time, the project was deemed technically

and financially infeasible and was shelved. As Salt

River Project waters became fully employed to bring

new lands into agricultural production, Arizonans

turned to groundwater for additional supplies Development of groundwater in the Salt and Gila River

Valleys brought thousands of additional acres into

production from the 1930s to the 195Os.& Increased

pump efficiency and lower pumping costs resulting

from rural electrification and lower electricity costs

spurreda rapid increasein groundwaterwithdrawals

in the 1930s. Groundwater also met increasingmunicipal and industrial needs. Groundwater pumping

continued to expand rapidly during the 1940s and

195Os, and by 1960 the withdrawals were estimated at

5 million acre-feet per year4’ Eventually, the state

relied on groundwater supplies to meet 60 percent of

its water uses.

Groundwater withdrawal rates were several

times greater than natural recharge rates, as much as

11 and 12 times greater in Maricopa and Pinal

countiesa At some places, underground water levels

declined by as much as 400 feet from the 1930s to the

1980s. Declines along the reaches of the Salt River

west of Phoenix were more modest, around 100 feet”

Declining water levels increased pumping lifts and

costs, and caused localized problems of land subsidence, earth fissures, and quality deterioration.

By the 194Os, serious consideration was being

given to the idea of bringing Colorado River water to

central and southern Arizona. The Central Arizona

Project was planned to carry Colorado River water

over some 300 miles. Bills to authorize the project

were introduced in the Congress beginning in 1949.50

Opponents from California resisted the authorization, claiming that Arizona did not have a right to the

waters The debate continued in the Congress and the

United States Supreme Court until the Court determined in 1964 that Arizona had the right to the waters.

In 1968, the Congress authorized the Central Arizona

Project as part of the Colornllo River Bnsin A~f.5~

The feud with California doubtless helped

coalesce support for the Central Arizona Project

among the various interests, who otherwise would

have been in conflict with each other over the

allocation of local water supplies. Among the basic

conflicts was (and is) a division between the growing demands of residential and commercial users

and the agricultural irrigation users.

Agriculture accounts for 89 percent of water

consumption. Forty-six percent of all water consumed

is from mining of groundwater stocks, This cannot be

attributed to the 11 percent of water consumption

from mining and’municipal and industrial uses. As of

1980,47 percent of irrigated cmpland was planted to

cotton, a surplus crop; cotton production alone could

account for all of the groundwater mining Another 16

percent of farmland was planted to alfalfa hay, which

consumes more water per acre than any other crop.

The claims on the state’s water supplies by

irrigated agriculture are so great that existing supplies

plus the water from the Central Arizona Project could

not support them, even if every Arizonan not engaged in farming moved out On the other hand,

existingsupplies plus CAP water could support a state

population of as much as 20-25 million people if all

32 U.S. Advisory Commission on Intergovernmental Relations
irrigated agriculture ceased, and projections do not

anticipate a population of even 10 million persons by

2035. These facts led the first director of the Arizona

Department of Water Resources to state, ‘The conclusion that we have overexpanded our agriculture is

inescapable.“52 The clear direction for Arizona groundwater management has long been to strike a balance

between these extremes, so that some of the demands of

irrigated agriculture would be reduced to accommodate

the current and anticipated future population

Yet, efforts to reduce groundwater consumption

and to shift water away from irrigation toward

municipal and industrial uses did not meet with

much favor Efforts to reform groundwater law have a

history as long as that of the Central Arizona Project,

and the two have important points of intersection.

Two bills, both with the support of Governor

Sidney Osborn, were introduced in the 1945 session

of the Arizona legislature to regulate the use of

groundwater That Spring, further impetus was given

to reform when the federal Bureau of Reclamation

indicated that it would not support any central

Arizona water project unless the state acted to restrain

agricultural consumption of groundwater. The legislature struck a weak compromise, producing the

Groundwater Act of 1945, which provided for the

acquisition of groundwater data and information on

existing wells but contained no regulation of use.%

In 1948, in a third special session called by

Governor Osborn in the midst of a prolonged

drought, the legislature enacted the Groundwater

Code of 1948, which remained Arizona’s groundwater law until 1980. It authorized the designation of

critical groundwater areas for the restriction of new

irrigated agriculture development in areas experiencing severe overdraft54

After initially upholding the 1948 law against a

legal challenge asserting the right to the use of

groundwater as a private property right appurtenant

to land ownership and limited only by the doctrine of

“reasonable use,” the Arizona Supreme Court revetsed itself and restored the private property reasonable use doctrine to groundwater law. This decision

reflected the influence of agricultural interests.” After

the reversal in 1953, “interest in ground-water legislation virtually ceased,“% despite a 1951 repetition of

warnings from the U.S. Department of the Interior

about the importance of reform to a favorable

disposition of the Central Arizona Project For the next

luarter-century, alterations in the understanding of

tizonagroundwater law came only from occasional

ourt decisions

The growing conflict between municipauindustrial water demands and heavy irrigation use was

heightened by two events in the mid-1970s The

Arizona Water Commission, which was working on a

state plan, reported the findings of a 1975 study

indicating that central Arizona faced a severe impending water crisis. That report, combined with the

1976 decision of the state Supreme Court in Fmners

hesfmmf Company (FICO) v. Beffwy, helped set

competing water rights claimants against each other

The FICO decision upheld the superiority of

water rights claims by overlying agricultural users

against the appropriation and transportation of

water to nonoverlying lands for mining, municipal,

and industrial uses. The FICO decision threatened the

cities and mines that were dependent on appropriated groundwater and precipitated a reexamination of groundwater laws?’ The legislature and the

governor responded with an amendment to the 1948

Groundwater Code providing for the selective transportation of groundwater and the appointment of a

study commission.

The study commission began meeting in November 1977. The cities and industrial interests, which

held a combined majority on the commission, produced draft recommendations in July 1979, with the

agricultural interests sharply dissenting and issuing a

minority report The conflict over the recommendations was so sharp and their potential impact on

agriculture so severe that the draft was considered to

be politically infeasible. A “rump group” of the

commission continued to try to reach compromises

and work out a framework for a more palatable

legislative proposal.

By all accounts, when these negotiations broke

down, the intervention of Governor Bruce Babbitt

provided the initiative for arbitration.% The governor

personally led negotiating sessions among the representatives of municipal, industrial, and agricultural

water users over a six-month period. When a delicate

compromise was reached on the substantive issues of

a groundwaterlaw proposal, Governor Babbitt called

a special session of the legislature, where the Groundwater Management Act was passed in a seven-hour

session on June 11,198O. The governor signed the law

the next day.

Just as in 1945, in 1979 a crucial federal push was

added to the process Secretary of the Interior Cecil

Andrus stated that the department would not support

the Central Arizona Project unless the state adopted a

new groundwater law placing restrictions on use.

The magnitude of the influence of that federal

condition may be gathered from the anticipated

impact of CAB The importation and use of water,

when CAP is operating at its full capacity of 1.2

million acre-feet per yeas is expected to reduce

reliance on groundwater supplies in central and

southern Arizona enough to cut the overdraft by as

much as two-thirds.

The master repayment contract between the U.S.

Department of the Interior and the Central Arizona

Water Conservation District specifies that CAP water

U.S. Advisory Commission on Intergovernmental Relations 33
Active Management Areas and Irrigation Non-Expansion Areas in Arizona

Philip C. Briggs, “Groundwater Management inArizona,“]ournal of WaterResources PlanningandManagement, July

1983.

must replace, not supplement, agricultural use of

groundwatec That is, no new agricultural lands may

be brought into production using CAP water (except

on Indian lands), and existing agricultural users of

groundwater who receive water from the CAP must

reduce pumping by equivalent amounts.59 In times of

shortages, municipal and industrial uses of CAP water have an absolute priority over agricultural uses

Compliance with these contract provisions alone “effectively redirected Arizona water po1icyP

The remaining one-third or more of the statewide

overdraft is to be solved by management and conservation methods. The Groundwater Management Act,

which repeals and supplants all previous legislation,61 designates four active management areas

(AMAs) and two irrigation non-expansion areas

(INAs) with boundaries approximately coterminous

with those of major groundwater areas (see Figure

3-l). Eighty percent of Arizona’s population and 70

percent of its water consumption are located within

‘the four AMAs. The goal of the legislation is to

establish a balance between water supply and demand within the AMAs by 2025 (except in the

predominantly agricultural Pinal AMA, where a

controlled mining operation willbe pursued). Within

each AMA, a director is responsible for the implementation of the act, with the recommendations of a

five-member AMA advisory council.

The provisions of the 1980 act apply within the

designated areas. Outside of the AMAs and INAs,

groundwater withdrawal and use are essentially

without restriction (i.e., they are restricted only by the

legal doctrine of “reasonable usen), and even within

the AMAs and INAs, operators of small domestic

wells (less than 35 gallon per minute capacity) are

generally exempt

The act established a formal decisionmaking

structure that centralizes authority in the governor

and the Department of Water Resources (DWR) and

its director and creates weaker authority in the local

agencies d The law created “a highly centralized and

authoritative State Department of Water Resources

with broad powers over management and policy

issues,” and a “powerful director”@ The department

took over the activities of the Arizona Water Commission and added groundwater management to them.

The governor appoints the DWR director as well

as the local AMA advisory council members. The

DWR director appoints the AMA directors and is

responsible for making a series of lO-year management plans for each AMA (with tighter water use

restrictions during each period). The director is authorized to determine maximum water duties for irrigation and water conservation requirements for municipalities and industries within the AMAs, review the

plans of local authorities for reducing groundwater

withdrawals in critically overdrafted areas, file for

civil and criminal penalties for violators of regulations promulgated under the act, set water withdrawal fees, and, ultimately, take land out of agricultural

production if necessary

34 U.S. Advisory Commission on Intergovernmental Relations
The 45year period from 1980 to 2025 has been

divided into five management periods to establish

step-by-step control and eventual elimination of

groundwater overdrafting. In the first period, from

1980 to 1990, the Department of Water Resources

registered wells and defined groundwater rights

through an application-and-permit program, with

different classes of withdrawal rights but without

many requirements or restrictions. The intention was

to bring the implementation of the Code along

relatively slowly at first, to try to heighten compliance

with the first stages before the more restrictive

provisions are applied.

The act requires that groundwater withdrawal

wellswithin designated areasbe registered regardless

of their use. Wells above domestic-use capacity in the

AMA have to be metered and their annual production

reported.64These requirements will help to generatea

data base that will be useful in all aspects of groundwater management

The first class of groundwater withdrawal rights

is “grandfathered irrigation rights,” which are

awarded to persons who pumped or received

groundwater from a well used to irrigate two or more

acres of land prior to 1980. Lands that were not

irrigated at some time between January $1975, and

January 1,1980, do not qualify for a grandfathered

irrigation right and may not be brought into irrigated

agricultural production.6 The clear intention is to

freeze the level of irrigated agricultural production

that existed in 1980. Reductions in irrigated agricultural acreage and water consumption are reserved for

later management periods.

Grandfathered irrigation rights remain with the

land and can be used by a new owner. The groundwater may be used only on the overlying land, however,

and the rights remain with the land. If lands with

grandfathered irrigation rights are sold for uses other

than irrigated agriculture, the rights transfer at a

predetermined rate of 3 acre-feet per year These

provisions of the law restrict the transferability of

agricultural water rights relative to some other states

that use permit schemes for allocating groundwatec

Under the new law, farmers who manage to obtain

groundwater withdrawal rights may find their rights

less marketable.&

Municipalities, water companies, and irrigation

districts apply for permits for service area rights to

withdraw, transport, and distribute groundwater,

provided they remain within percapita waterconservation requirements set by the DWR director Persons

not eligible for grandfathered irrigation rights or

service area rights may apply for groundwater withdrawal permits for non-irrigation purposes.

Within the irrigation non-expansion areas, no

new lands may be brought into irrigated agricultural

production. No new rights are created. Owners of

existing agricultural lands may continue those lands

in production and may withdraw and apply as much

water as they choose. Irrigated lands may be sold, and

the new owners are equally free to irrigate as were the

previous owners. Water withdrawal and consumption for other types of uses may develop without

restriction. INAs may be converted into AMAs should

such conversion become necessary in order to either

protect the agricultural economy or preserve the

availability of groundwater supplies for municipal

and industrial uses6’

Groundwater management activities are financed on a 50-50 basis with appropriations from the

state General Fund and funds raised from water

withdrawal fees assessed against groundwater

pumping. Groundwater users who are required to

meter their wells and annually report their pumpage

are also required to pay the “pump tax.” The withdrawal fee is set by the DWR director within the

guidelines of the law, with a cap of $5.00 per acre-foot

Up to $1.00 of the withdrawal fee may be used to meet

operating costs of DWR. Up to another $200 may be

used for water supply augmentation after the director

has established an augmentation plan for the AMA (this

may begin during the 1990s). The remaining $200 of

the fee is for the purchase and retirement of agricultural land, and cannot be levied until after 2006.@

The 1990-to-2000 management period calls for

the implementation of a plan to augment water

supplies. The director may propose any means of

augmentation from artificial recharge to weather modification. The ZlO@to-2010 management period includes

the possibility, after 2006, of purchasing and retiring

agricultural land to meet water conservation goals and

ensure a balance between demand and supply

The law did not specifically provide for conjunctive management, although it does require the augmentation of water supplies It does not provide for a

system of using both surface and groundwater supplies in ways that take advantage of each source. The

provisions are designed more to encourage the use of

surface water by denying access to groundwater

when surface supplies are available. For instance,

some kinds of groundwater withdrawal permits

would be granted only if the applicant could demonstrate that no alternatives were available, and if

surface water supplies subsequently became available, the director could require the permit holder to

switch to surface water6g

In 1986, Arizona enacted an Underground Water

Storage Act that addresses more explicitly a purpose

to “further the conjunctive management of the water

resources of this state.“70 Although the law does not

define “conjunctive management,” it does authorize

the Department of Water Resources to issue separate

storage-and-recovery permits to applicants, on a

determination that other water users will not be

U.S. Advisory Commission on Intergovernmental Relations 35
damagedn This permit scheme would provide those

who stomd waters underground with considerable

assurance that they would be entitled to recover those

waters, A bill introduced in 1989 would further encourage the use of underground storage capacity by offering

municipalities grants for up to 50 percent of the cost of

storing surplus CAP water undergmundn

The Arizona Groundwater Management Code

enacted in 1980 was selected by the Ford Foundation

in 19% as one of the ten most innovative programs in

state and local government It has been praised by

observers and policymakers, not only for the compmmise it reached between strongly entrenched political

and economic interests, but for its structure and content

The 1980 Arizona Groundwater Management

Act has withstood an initial challenge to its constitutionality The state supreme court upheld the act as a

constitutional exercise of the state’s police powers.73

The activities of the first management period, although limited principally to the well registration

program and the determination of groundwater

rights and issuance of permits, presented a considerably more formidable task than was initially anticipated, according to the deputy director for engineering of the Department of Water Reso~rces.~~ The

water conservation requirements of the law become

more stringent over time, so additional tests of

compliance and success lie ahead.”

Interjurisdictional Coordination:

Los Angeles County, California

The approaches to groundwater management in

Arizona and California contrast sharply California

has not adopted a comprehensive statewide groundwater management law, but has pursued a policy of

encouraging local water users to develop governance

stn~ctums for water management (usually through the

combined efforts of special water districts and water

users’ aswciations) with the support of state agencies

such as the Department of Water Resources (DWR).

The state has encouraged neighboring communities sharing similar water resource problems to

form special water districts to address areawide

management challenges. This policy has been followed in most of the inhabited areas of southern

California, and in several areas in northern California.76 The policy does not appear to indicate neglect of

the importance of water management, but is a

different approach to the development and implementation of management programs:

The legislature has moved cautiously with

respect to groundwater problems and legislation has focused on local solutions, with emphasis on the importance of fashioning management solutions to meet local conditions and

local needs Nevertheless, water resources

management is treated as an issue of great

public interest and given high priority in large

part because of the scarcity of water resources

in the areas with the greatest demandn

The absence of a state groundwater management

code and state administration has been evaluated in a

number of ways. These assessments generally divide

into two categories, one quite critical of the absence of

central authority, and the other supportive of local

diversity and innovation.

The Critics. According to critics, the absence of a

statewide code or administration means that “there is

no groundwater management in California.” Although provisions concerning groundwater are

“[slcattered throughout the state Water Code:. . . none

of these Code sections provides California with a

needed management program.“% The state’s approach is described as “inaction,” “failure,” “inadequate,” and “a ‘no action’ groundwater management

system.“79 A representative observation is the following “Groundwater meets 40 percent of California’s

annual water needs, yet is essentially unmanaged.“@

The anticipated consequences of the lack of a

statewide groundwater program, in the view of these

observers, are severe. Current arrangements “can

only lead to disaster?i Because local management

takes diverse forms in various groundwater basins, it

is criticized as “piecemeal,” producing “inefficiency”

and uuncertaintyH’82 Critics point to 42 groundwater

basins in the state with some degree of overdrafting,

11 of which were identified by DWR in 1980 as in

“critical overdraft.”

Conversely critics promote statewide management

as good in and of itselc which “must be enacted to

pmtect that public interest,“B3 and “would ensm ejkiency

in the beneficial use of gmundwater”84 “Effective”

statewide management of California’s hundreds of

groundwater basins would “need to be simple, flexible,

equitable, and inexpensive to administePs

The Advocates. There are other observers who view

the absence of statewide groundwater management

as rational in light of the degree and variety of local

initiatives and activities. What is seen by critics as an

inadequate and ineffective “piecemeal” approach is

seen by others as “a relatively well-developed and

diverse system of local groundwater management

that has evolved on a piecemeal basis over many

years.“u This diversity developed for “good reason,”

since”thehistoryofuseand theproblemsvatiedfrom

basin to basin.@’

These observers view the legislature’s repeated

demurrer to adopting statewide management proposals as “justified because of the diverse nature of

groundwater problems requiring different types of

local solutions.“BB In fact, most of the “scattered

provisions” in groundwater laws have been initiated by

36 U.S. Advisory Commission on Intergovernmental Relations
water useIs seeking authorization to create or extend the

powers of an existing local governance structure. The

legislature has usually responded affirmatively

Artificial recharge projects in southern California, using groundwater basins to store surface waters

for later use, date back at least to the 1920sB9 Flood

waters were moved out of stream channels,diked and

ponded in permeable areas, and allowed to sink into

the underground strata. Temporary dams were constructed in more permeable stream channels to

obstruct surface flows and increase recharge to

groundwater basins, which could then serve both

storage and transmission purposes In the 198Os, over

2 million acre-feet of water per year were placed in

underground storage by local water agencies

In some locations, extensive spreading grounds

were constructed, some of which were designed to

recharge the groundwater supply while providing

surface recreational opportunities for local residents.

The Orange County Water District was a leader in this

multipurpose facility development Groundwater

pumping was taxed by local special water districts to

provide the funds for artificial replenishment programs that primarily benefited pumpers and consumers. Later innovations included “in-lieu replenishment” (whereby water useis in basins with access

tobothsurface and groundwater supplies are encouraged to take surface water in lieu of pumping

groundwater when surface supplies are plentiful)

and the use of reclaimed water for basin *charge and

sea water barrier projects. Reviewing the development and implementation of these elements of

conjunctive management, one DWR observer wrote

in 1982: “Many of California’s local water agencies use

gmund water storage capacity in the same way

surface reservoirs are used to hold water from winter

to summer and from wet years to dry years,“gO and

described the extent of employment of conjunctive

management of groundwatersupplies as unmatched

elsewhere in the United States.

In the latter half of the 197Os, the Rockefeller

Foundation supported a study by the RAND Corporation of water use and conjunctive management in

southern California. While noting that the presence

of management activity does not necessarily mean that

optimal management has been achieved, the authors

cited the adaptability of existing local programs to the

needs of different locations and to changes in conditions over time,+” and concluded “Since there already is

a locally developed management program in place in

major Southern California basins, there is no need for

the state to impose yet another management scheme.. .

local management in place should be retained, subject

to appmpriate state review?

Thmugh the 198Os, in the aftermath of the severe

drought of the late 197Os, as population growth

continued apace and as the allotment of Colorado

River water for California declined with the beginning of operations of the Central Arizona Project, still

more emphasis has been placed on wiser water

management, conservation, and reuse of wastewatern. Environmental concerns and budgetary constraints have largely eliminated the prospect of future

water development projects. Local water agencies

have focused increasingly on the use of pricing to

regulate the demand side of the water supply equation,on reaping new supply availability from conservation, and on interlocal agreements and water rights

transfers to move water from wasteful and lower

valued uses to higher valued uses.

A 1985 report to the U.S. Army Corps of Engineers

on the management of water resources in the Los

Angeles County drainage area concluded: “Ground

water basins in the area are well managed.. . . Legal

limits are placed on amounts of annual withdrawal

from various basins, and extensive artificial recharge

programs have been developed to augment the

natural recharge of the basins.n93 While noting that

most regulation of groundwater withdrawals by

special districts was concentrated in the southern part

of the state, a 1987 report by the Institute of Public

Administration acknowledged that California “leads

the way” in the special district approach, “in the

belief that the complexities of groundwater management can best be dealt with by specialized units of

government operating at the local or regional rather

than the state leveL”%

The Evolution of Local Programs. Both critics and

advocates of California’s approach have observed that

a lack of defined rights to specific quantities of groundwater has presented significant barriers to effective

management95 It is not surprising then, that determining those rights has been among the first steps taken by

local groundwater agencies The evolution of water

supply management in California has relied sttongly

on the use of judicial institutions and proceedings

In many localities, associations of local water

users, including municipalities, water service companies, local businesses, and agricultural interests,

were organized to discuss ways to determine rights.

Frequently, they employed adjudications in order to

take advantage of a process that limited decisionmaking to the users affected, allowed for expert investigations of hydrologic conditions, balanced total extractions with the available groundwater supply, and

produced enforceable water rights for individual

users Stipulated judgments among the parties were

often used to secure mutually agmeable allocations that

might not have resulted from the strict application of

state water 1awsVhe use of adjudicatory processes has

yielded such a variety of outcomes that “one could

almost say that no two forms of gmundwater management am alike within the group of adjudicated basins@’

U.S. Advisory Commission on Intergovernmental Relations 37
The conjunctive management of water supplies

typically also has involved the creation of special

water districts or watermasters that control and limit

overdraft through monitoring and enforcement, acquire water supplies, replenish the underground

supply and regulate water storage, and protect supplies from degradation. Occasionally, a water district

will produce these services itself; in other cases, the

district will act as a service provision unit contracting

with other specialist producers.” An example of this

system of interjurisdictional relationshipscan beseen

in the conjunctive management of water in the Los

Angeles coastal plain in Los Angeles County?

The coastal plain extends from Los Angeles east

to the Whittier area, south to Long Beach, and along

the coast up to Santa Monica. It is underlain by two

major groundwater basins, the West Coast Basin

along the coast and the Central Basin inland (although the southeast corner of the Central Basin

extends down to the coast in the Long Beach area).

The dividing line between the two basins is the

Newport-Inglewood Uplift, a northwest-southeast

geologic disjuncture parallel to the coast The West

Coast Basin is recharged almost exclusively by subsurface flow across the uplift from the Central Basin,

which in turn receives most of its replenishment from

the forebay area in the vicinity of Whittier Narrows.

Rapid development of the Los Angeles coastal

plain during the first half of this century generated

increased demands for water. These demands were

met largely by use of the groundwater supplies of the

coastal plain, which lacks extensive and reliable

surface supplies. This resulted in declining underground water levels, which in the West Basin sank

below sea level. At points of hydrologic contact

between the West Basin and the Pacific Ocean, salt

water began to intrude, rendering water in some

wells near the coast unusable by the 1920s and 1930s.

The main source of local water supply for the

communities of the coastal plain along the ocean was,

therefore, severely threatened.

During the 192Os, the Metropolitan Water District

of Southern California (MWD) was formed by a

consortium of municipalities in southern California

to develop imported water supplies from the Colorado River. MWD’s Colorado River Aqueduct was

completed in 1941. This gave communities in the coastal

plain the option of acquiring supplemental water

MWD’s construction and operations, and the tepayment of the substantial debt it incurred, were supported

through property taxes, so access to MWD’s water

required annexation to the district

Representatives of West Basin users-municipalities, water companies, local businesses-formed a

West Basin Water Association to determine how to

acquire and pay for additional imported supplies

from MWD and how to gain control of the depletion

problem. The association chose two different avenues, one involving special district formation, the

other involving adjudication of rights to groundwater use. Through a special election in 1947, the

separate small communities within West Basin

formed the West Basin Municipal Water District for

purposes of annexing to MWD, acquiring rights to

purchase Colorado River water, and gaining a collective representation on MWD’s board of directors.

Meanwhile, MWD faced a problem with its sales

of Colorado River Aqueduct water, which was sub

stantially more expensive than pumping local

groundwater or diverting local surface supplies.

Pumpers and diverters throughout southern California, faced with the choice between further overtaxing

local supplies or paying the much greater purchase

costs, went on overusing the local supplies. Between

the completion of the project in 1941 and 1949, the

aqueduct, which was capable of delivering 550,000

acre feet of water each year, had delivered a total of

only 146,000 acre-feet If that situation continued,

MWD’s aqueduct stood a good chance of becoming a

25@mile long “white elephant” Some mechanism

would be needed to shift users away from local

supplies to imported water

Through an adjudication begun in 1945, West

Basin water users sought to acquire quantified rights

to specific amounts of pumping and to limit the total

to the basin’s “safe yield.” That adjudication was

patterned after an earlier one among water users in

the smaller Raymond Basin to the north. Among the

beneficial outcomes in the Raymond Basin was that,

by placing an upper limit on pumping, it forced the

parties to meet additional needs from another

source-i.e., through purchases of supplemental water

from the wholesaler, MWD.

The West Basin litigation involved extensive

hydrologic investigations by the California Department of Water Resources as court-appointed referee,

and considerable negotiation among the parties,

resulting in an interim agreement to limit pumping

in 1955 and a final judgment in 1961. West Basin users

faced two complicated and interrelated difficulties.

One was that, in order to limit pumping to an extent

needed to stop the overdrafting, they would have to

cut back by nearly two-thirds and replace the water

with more expensive imported supplies. The second,

and related, problem was that raising West Basin

water levels enough to halt sea water intrusion would

increase levels along the Newport-Inglewood Uplift

to the point where water would no longer flow in

from the Central Basin because of lowered water

levels there due to overpumping.

The West Basin Water Association, DWR, and the

Los Angeles County Flood Control District (now a

division of the county Department of Public Works)

constructed and operated a pilot project in the late

38 U.S. Advisory Commission on Intergovernmental Relations
Figure 3-2

Simplified Pictorial Representation of Conjunctive Management in Los Angeles County, California

Source: Warren Viessman and Claire Welty, Water Management: Technology and Institutions (New York: Harper and Row,

1985)

1950s and early 1960s to create a barrier against sea

water intrusion along the coast by injecting fresh water underground to form a pressure ridge. The pilot

project was successful, and a full-scale barrier project

was constructed. Operation of the barrier was financed temporarily through the creation of an improvement zone within the county flood control district The creation of the barrier allowed water levels

in the West Basin to be kept lower, thereby increasing

the amount of recharge flowing in from the Central

Basin and reducing the amount by which pumping

had to be cut back

In the 195Os, partly at the instigation of West

Basin users who saw their fresh water supply threatened by continued overextraction upstream, Central

Basin users formed a Central Basin Water Association

and began to explore possibilities for reducing

gmundwater withdrawals and securing additional

supplies and a groundwater replenishment program.

The Central Basin Municipal Water District was

formed and annexed to MWD in 1952, ensuring

access to Colorado River watec As in the West Basin

and Raymond Basin, Central Basin pumpers did not

immediately switch to imported watec However, also

in the 195Os, sea water intrusion began to appear in the

Long Beach vicinity, so Central Basin water quality was

threatened as a nzsult of groundwater overdrak

Water users in the West and Central Basins

needed to achieve several goals: limit groundwater

withdrawals in the Central Basin; raise water levels in

the Central Basin and keep them lower in the West

Basin in order to maximize the subsurface flow into

the West Basin; find a means to finance and operate a

replenishment program in Central Basin; and find a

permanent means for financing and operating the

sea water intrusion barrier projects. Through another

special election in 1959,residents in both areas agreed

to form the Central and West Basin Water Replenishment District under authority of the1955 state Water

Replenishment District Act.

Once formed, the replenishment district initiated

an adjudication of water rights in the Central Basin.

This action began in 1962 and ended with a final

judgment in 1965. At that point, water users in the

West and Central Basins had enforceable rights to

specific quantities of water, which could be (and have

been) exchanged, leased, or sold. Both basins were

placed on a modified safe-yield operation. A replenishment program was implemented, involving local n+

charge and artificial recharge with imported and

reclaimed watec Sea water intrusion was effectively

halted by the barrier pmjects

The total conjunctive management scheme for

the Los Angeles coastal plain is illustrated in the

simplified diagram in Figure 3-2. The Central and

U.S. Advisory Commission on Intergovernmental Relations 39
West Basin Water Replenishment District, with its

staff of three, is the public provision unit that

organizes this program.

One question that arises about the coastal plain

program is why the replenishment district was

created when the West Basin and Central Basin water

districts existed. The districts, like many others in

California, were formed to contract for the delivery of

surface water Such districts generally do not have

artificial recharge programs or pumping asses

sments;@’ or correspond with the boundaries of

groundwater basins. These districts typically represent political jurisdictions and may be formed by the

people of any county or portion of a county, and may

include incorporated and unincorporated areas (although if any part of a municipality is included, all of

it must be included).

Therefore, neither municipal water district was

in a position to finance and operate the replenishment of the Central and West Basins However, as

specialized agents and contractors for purchases of

supplemental surface water, they were ideally suited

to. the acquisition of waters for recharge programs,

The replenishment district had authority to finance

and operate a recharge program, and the needed

jurisdictional boundary fit The replenishment district became a customer for the supplemental water

secured by the municipal water districts The replenishment district purchases supplemental water

through the municipal water districts The water

purchases are financed through taxation of groundwater pumping

The replenishment district owns extensive recharge facilities, but it does not operate them. The Los

Angeles County Flood Control District (now in the

Department of Public Works) has specialized personnel with extensive experience in operating reservoirs,

and it operates the replenishment district’s spreading

program in the Central Basin forebay The Department

of Public Works also operates the sea water intrusion

barrier project for the replenishment district

The Los Angeles County sanitation districts

have operated water reclamation plants at the

Whittier Narrows and nearby San Jose Creek for

years. With authorization from the California Department of Health Services, the replenishment

district purchases as much reclaimed water as

possible from the sanitation districts, which release

the water to the spreading facilities. Locally reclaimed water is much less expensive than water

imported from northern California or the Colorado

River, so the replenishment district buys all it can.

The metropolitan water district, the major imported water wholesaler, also offers surplus replenishment water at a lower price than its treated, filtered

regular water Conjunctive use of groundwater supplies lowers the demand for imported water and

reduces the capacity MWD has to construct and

maintain for dry periods, so the MWD board has

encouraged this practice thmugh the lower price of

replenishment water Similarly, in Yeats when it has

surplus water in the State Water Project, the California

Department of Water Resources has offered water at

reduced prices to local districts for artificial recharge.

Thus, each yeas the Central and West Basin Water

Replenishment District anticipates the approximate

mix of surface water supplies and groundwater

pumping within the coastal plain (based on the

anticipated availability of surface water supplies),

estimates the amount of replenishment and barrier

water needed, and arranges the purchase of that

water and the operation of the spreading facilities

and barrier projects. It then assessesthe purchase and

operations costs to the water users. The conjunctive

management program, now beginning its fourth

decade, is accomplished through a network of intergovernmental arrangements that coordinate the actions of specialized producers.

Intergovernmental Contracts:

The Solano Project

Relationships among governmental organizations engaged in water supply can be arranged by

intergovernmental contracting in a number of ways.

A government such as the Central and West Basin

Water Replenishment District may contract with

several service producers. In other places, several

governments may make contractual arrangements

with a single producer that performs several management tasks. Solano County in northern California has

developed arrangements between a federal agency, a

county district, several municipalities, and an irrigation district

The Solano Project captures the waters of Putah

Creek, which drains the eastern slope of the coast

range of mountains in Napa and Iake counties.

Monticello Dam impounds Putah Creek waters near

the convergence of Napa, Solano, and Yolo counties

and forms Lake Berryessa. Waters from Lake Berryessa are released into a smaller reservoir, Lake Solano,

from which water is diverted by means of the Putah

Diversion Dam into the Putah South Canal, which

conveys water toward the farmland and cities of

Solano County, one of the fastest growing California

counties. As of 1980, the project irrigated about 60,000

acres of farmland on about 900 farms, and provided

supplemental water for three U.S. military installations and for urban and suburban areas with a

combined population of about 300,000.

The county’s climate is semi-arid, with an average annual rainfall of 17 inches, almost all of which

falls in November, December, and January During

the summer months, Solano County residents (espe40 U.S. Advisory Commission on Intergovernmental Relations
cially farmers engaged in irrigated agriculture) have

relied heavily on groundwater irrigation, which

resulted in a falling water table through much of the

first half of this century The Solano Project had the

same purpose as most water development projects in

the West-to capture surplus waters when they were

available in order to increase the supply throughout

the year (and across years), and to relieve some of the

demand pressure on local groundwatet

The Solano County Board of Supervisors formed

a Solano County Water Council in 1940, which

worked on securing federal support for the project

The project was authorized by the Congress in

November 1948 under the Reclamation Act of 1939 as

part of the plans for development of the Central

Valley area. In February 1948, the Solano Irrigation

District, covering most of the irrigable land, was

formed to finance and operate a distribution system

for project water lo1 In 1951, the Solano County Flood

Control and Water Conservation District was authorized by the state legislature and activated by the

county board of supervisors to represent the various

entities desiring water from the Solano Project and to

contract with the U.S. Bureau of Reclamation (and

subsequently with the California Department of

Water Resources for water from the State Water

Project’s North Bay Aqueduct).lM

Construction began in 1953. Monticello Dam and

the Putah Diversion Dam were completed in 1957,

and the Putah South Canal was completed in 1959.

The Solano Irrigation District constructed the $15

million distribution and drainage system, which

consists of several miles of canals and pipelines and

was completed in early 1963. The system was financed with an interest-free loan from the U.S.

Bureau of Reclamation, with repayment scheduled

over a 40-year period ending in 1999. It is estimated

that this arrangement saved the district approximately$3 million in construction costs and about one-third

in financing costs103

The U.S. Bureau of Reclamation entered into a

master water contract with the Solano County Flood

Control and Water Conservation District for the

distribution of the waters developed by the Solano

Project The district provides water to the Solano

Project’s “member units” -the cities of Fairfield,

Suisun City, Vacaville, and Vallejo, the Maine Prairie

Water District, the Solano Irrigation District, the

University of California at Davis, and the California

Medical Facility at Davis (both of which are located in

Yolo County). The Solano Irrigation District is entitled

to 74 percent of the waters developed annually by the

project Another 7 percent is estimated lost to evaporation and seepage, and the remaining 19 percent is

split among the other member units.

The Bureau of Reclamation contracted with the

Solano County Flood Control and Water Conservation District for the operation of the Putah South

Canal and the related distribution facilities The

district subcontracted the canal operation to the

irrigation district, which already operated and maintained the distribution system.

Initially the Bureau of Reclamation operated and

maintained the headworks of the Solano Project-the

Monticello Dam, Lake Solano, and the Putah Diversion

Dam. The irrigation district also has constructed and

operates an electrical power plant at Monticello Dam

As a result of contracting and subcontracting,

neither of the parties to the Solano Project master

water contract-the U.S. Bureau of Reclamation and

the Solano County Flood Control and Water Conservation District-performs any direct operation or

maintenance. The bureau monitors some project

operations and publishes an annual report, and the

county district accounts for the allocation of and

wholesales imported water from the Solano Project

and the State Water Project Thus, in 1988, while the

Solano Irrigation District had a staff of 66 persons,

most of whom were engaged in water supply, the staff

of the Solano County Flood Control and Water

Conservation District, the main contractor for the

Solano Project, consisted of one person in the county

Department of Public Works.

For the Solano Project, then, the irrigation district

operates the dams and canals that comprise the water

supply and conveyance system, the electric power-generating facilities, and sets of water wells-a

wide array of activities for an “irrigation district”

These arrangements have placed the district in a

position to manage its own surface and groundwater

supplies conjunctively, and to enter into agreements

with water retailers in Solano County (such as the

municipalities and the Maine Prairie water district)

for distribution and use.

The irrigation district and Suisun City have a joint

powers agreement whereby the district provides municipal and industrial water to newly annexed areas

while the city agrees to keep those areas within the

territory (and thus the taxing authority) of the district

Suisun City therefore provides its residents with water

from alternative sources that include locally pumped

groundwater, water imported from the Solano Project,

and water imported from the State Water Ptoject

thmugh the North Bay Aqueduct

The City of Fairfield, which relies almost entirely

on imported water, has an exchange agreement with

the irrigation district The district finds irrigation uses

for some reclaimed wastewater from the city and

provides the city with Solano Project water

As Solano Count urbanizes, water previously

devoted to agricultural uses is being gradually shifted

to municipal uses With a service area that encompasses much of the agricultural land in the county and

reaches to some of the municipalities, the irrigation

U.S. Advisory Commission on Intergovernmental Relations 41
district can assist with that transition. The City of Dixon,

which has been supplied by a private water pmduw

the California Water Service Company, has arranged to

purchase additional project watec The Maine Rairie

water district, which is located south of Dixon and has

an entitlement to project water but no conveyance

facilities, has given over part of its entitlement to the

’ district in exchange for delivery of tailwaters to its

service area

The Putah Plain groundwater basin is located in

Solano County, partially within the territory of the

irrigation district, and has a sustainable yield of about

140,000 acre-feet per yeat The irrigation district

coordinates the conjunctive use of Solano Project

water and Putah Plain groundwatet The district

replenishes the groundwater basin with water from

Putah Creek uses more project water in wet years,

and draws mom heavily on gmundwater from the

Putah Plain basin in dry yeaq and operates deep wells

in the Putah Plain that produce gmundwater and draw

more surface water into the basin from unlined canals

and natural stream channels These practices enhance

the total long-term yield, helping meet the additional

demands of a growing u&n population without

always being taken away from agriculture.

Conjunctive practices in Solano County involve a balancing act, however. It is possible to

overfill the Putah Plain basin, especially in the

neighborhood of Putah Creek Depths to underground water there are not very great, and in years

of surplus precipitation and natural percolation, it

is possible for the water table to rise sufficiently

near the land surface to saturate and rot the root

systems of crops. So,at times (especially in theearly

spring of years with above-normal rainfall), the

irrigation district has to turn on its underground

pumps, not because there is too little surface water,

but because there is too much groundwater too

close to the surface. Regulating conjunctive use

thus involves keeping underground water levels

within a range where storage values are taken

advantage of without damaging overlying uses.

Recently, the irrigation district and the municipalities have formed the Solano Water Authority to

discuss with the Bureau of Reclamation the purchase

of the Solano Project The contractual arrangements

for operation and maintenance of the project, combined with the district’s operation of the Monticello

Dam power plant, have prompted consideration of

simply “buying out” the ownership of the project

The U.S. Bureau of Reclamation has expressed some

interest in turning over the operation and ownership of

water projects to local users (although this would

require congressional authorization). Thus, it is possible

that the bureau may in the future be removed from the

set of contractual arrangements for managing water

resources in Solano County

Appropriation Permits, Offsets,

and a “Water Czar”:

The New Mexico State Engineer

New Mexico relies heavily on groundwater for

domestic, industrial, and irrigation uses. The continued availability of supply from this limited resource is

an important concern. While recent attention has

focused on a rash of serious water contamination and

pollution incidents, sustaining sufficient water quantity has been a priority since before statehood.l04

New Mexico adopted the doctrine of prior appropriation for acquisition of rights to groundwater use

in 1931, the oldest “continuously employed prior

appropriations system in groundwater in the

West.“‘Os Enactment of the statute was promoted by

farmers and other civic leaders in the vicinity of

Roswell, where the artesian groundwater basin that

supplied the agricultural economy was exhibiting

loss of pressure.

Several other western states also made groundwater subject to prior appropriation. The New Mexico legislation authorized the state engineer to designate critical groundwater areas and to administer

through appropriation permits the allocation of

groundwater within a basin, on the petition of at least

10 percent of the ~sers.1~ If unregulated exploitation

“reaches a point where it threatens the rights of

existing users, the petition mechanism can be used to

call on the engineer to assess and administer the

rights within the basin.“lmThe appropriation permits

restrict pumping to a specific quantity and set priority

of rights in accordance with seniority (This pattern

was adopted by other states with significant artesian

groundwater supplies, such as Utah and Nevada,

since artesian basins exhibit problems from overuse

relatively sooner). The New Mexico state engineer

also was made responsible for developing information about groundwater resources and promoting the

expansion of irrigation with groundwatec

In the Pecos Basin, an aquifer with significant

recharge where groundwater rights have been adjudicated and quantified, appropriation permits limit

total annual extractions to around 400,000 acre-feet’@

This limitation places the basin on a “safe-yield”

operation, halting the decline in water levels and the

lengthening of pumping lifts Within the basin, appmpriation permits are transferable among pumpers, thus

moving groundwater toward valued uses and avoiding

the retention of obsolete permits

However, it is impractical to attempt to manage

many groundwater basins in New Mexico on a

perpetual “safe- yield” basis because, as in neighboring Arizona and the high plains of the Texas Panhandle, they receive little average annual recharge.

Therefore, the state engineer reserves one-third of the

estimated balance of water remaining in the basin

42 U.S. Advisory Commission on Intergovernmental Relations
and allocates rights to pump (“mine”) the remaining

two-thinls in such a way as to deplete the stock over a

&year period.lo9 Individual appropriators are awarded

permits entitling them to the use of a specified quantity

of water per year over the 40 yearsno

Individual use rights are protected from the

impact of pumping on the lateral underground

movement of groundwater by making sure that wells

are not placed too close together Lateral groundwater

movement is also taken into account through the use

of artificial boundaries, such as those of townships, to

geographically subdivide aquifers that extend beneath a large land area. For purposes of exchanging

appropriations permits, well owners and operators

within such an artificial subdivision are treated as

pumping from a common aquifer The theory behind

this system is that the lateral movement of groundwater means that extractions and return flows from wells

in close proximity will probably have a significant

impact on one another, while the effects of extractions

and return flows from wells that are widely separated

(albeit using the “same” aquifer) are, as a practical

consideration, negligible.111

Appropriation permits may be transferred between pumpers within one subdivision of an artificially subdivided basin. Well spacing regulations

avoid impairment of use rights, and the subdividing

of basins keeps the benefits of return flows within the

same general area. Transfers of permits between

subdivisions are allowed, but they are restricted to the

amount of water estimated to be the original permit

holder’s consumptive use, rather than the amount

pumped. 112 To the users of a common aquifer (or

within close proximity of each other, as in an aquifer

subdivision), there is no material difference between

losing from the common supply the amount of water

consumptively used (extracted net of return flows) on

overlying land, or having that amount pumped and

exported to another location.

The state engineer’s office has faced its greatest

conjunctive management challenge in the administration of the Rio Grande aquifer. The aquifer is

hydrologically connected with the Rio Grande River,

and extractions from the aquifer can lower the stream

flow of the river There is very little rainfall in the

region and not much recharge to the underground

supply. There also is no readily available external

water source from which to import water for artificial

recharge of the Rio Grande system,u3 so the surface-to-groundwater relationship is zero sum over

the long term: groundwater extractions have the

same ultimate effect as diversions from the surface

flow, but with a longer time lag

In 1956, the state engineer designated the Rio

Grande Underground Water Basin as a critical basin,

subjecting it to the appropriation permit process. The

administration of the basin combines controlled

long-term mining of the underground stock of water

with the conjunctive management of the interrelated

surface and groundwater supplies The surface waters have long been fully appropriated. Any diminution of the river flow would invade the rights of some

surface water appropriators. On any permit application to appropriategroundwater from the Rio Grande

basin, the engineer analyzes the relationship of the

requested pumping on the stock of groundwater and

its effect on surface flows. Depending on the mmaining water stock in the basin, a permit may be granted

conditioned on the applicant purchasing and retiring

sufficient rights from senior appropriators on the Rio

Grande to offset the diminution of stream flow caused

by the proposed pumping.l14

The engineer offered to issue a conditional

permit to Albuquerque when the city sought to

appropriate 6,tXKl acre-feet per year from the Rio

Grande aquifer from wells located within 6 or 7 miles

from the river. It was estimated that roughly half of

the water extracted would come from underground

stocks and the other half would diminish the surface

flows. The engineer held that the requested pumping

would impair the surface water rights of senior

appropriators and suggested the conditional plan to

offset the effects of the groundwater appropriation.

The city challenged the ruling, but the New Mexico

Supreme Court upheld the offset plani15

The offset system recognizes the connection

between groundwater and surface water and that

surface water is fully appropriated, but nonetheless

allows new pumpers to undertake water development from the Rio Grande aquifer if they purchase

surface water rights. This extends market principlesto

the whole water resource,rather than treating surface

water rights under one system and groundwater

rights separately

The New Mexico system has yielded important

benefits and offers useful lessons. Surface and

groundwater development and use are being monitored and administered in 31 groundwater basinsu6

Using designated basins shares an advantage with

special districts of limiting “the number of people

involved in the decision to those who are actually

affected by the decision.“l*’ The New Mexico ag

preach also defers the activation of a rulemaking

process “until there is a demand for rules by actual

groundwater users n118 Thus, communities of interest

are defined and involved in rulemaking.

Allowing exchanges of use rights enhances efficiency by directing use of the resource toward those

who value it more. A strict seniority system of water

rights lacks the flscibility to adjust to shifts in the

value of uses of water Allowing transfers of pumping

rights has been described as approaching an optimal

system of allocation.l19 The offset system brings to

light an important benefit of conjunctive manageU.S. Advisory Commission on Intergovernmental Relations 43
ment This administrative variation on water exchange systems, allowing junior appropriators to

“buy out” the rights of their seniors, “might enable

greater productive water use without detriment to the

remaining senior stream rights, except for a risk of

miscalculation.“120

Three qualifications should be noted about the

New Mexico appropriation permit,offset, and “water

czar” system First, the state engineer’s office has

functioned with notable stability and expertise in part

because one person served in that capacity for four

decades. In Steve Reynolds, New Mexico had a true

“water czar” His extensive experience and intensive

knowledge of water resources and use patterns were

invaluable in the administration of the permit-and-offset system, minimizing the likelihood of

erroneous calculation.

Second, New Mexico is not the only state to have

such a system. The Nevada system includesappropriation permits issued by the state engineer, who also

designates overdrawn basins as critical basins And in

a case in Colorado in the 197Os, an offset system was

used to resolve a controversy in which a subdivider

proposed to pump groundwater that was tributary to

an overappropriated stream. The stream users agreed

to a plan whereby the subdivider would purchase

sufficient reservoir water upstream to release into the

river to offset the loss in stream flow resulting from

the groundwater extractions.‘21

Third, the state engineer’s office is not the only

institution involved in the management of groundwater supplies. Various “state and local agencies

(including political subdivisions) charged with water-related responsibilities have been modernized in

order to provide ample latitude for their functioning.“12 Groundwater basin adjudications also have

clarified rights and relationships of users The original

recognition in law of the hydrologic inseparability of

connected surface and groundwater came, not from the

legislature or the enginee? but from the courts

Interstate Competition

and Interstate Coordination:

The Delaware River Basin

As often noted, groundwater basins do not necessarily conform to the boundaries of state or local

political jurisdictions. When a single water resource

system stretches across two or more states, more

interjurisdictional difficulties arise. The states are

sovereign entities, and the laws of water rights and

ownership are state laws. The most fundamental

issues of water management (who has what kinds of

rights to extract and divert how much water) therefore are potentially in dispute. Yet, the parties to those

disputes often are reluctant to develop an interstate

management system or to accept practices imposed

by the federal governmentm

While competition between jurisdictions can

sometimes lead to better and more efficient service

delivery alternatives, competition in the use of a

common resource can produce undesirable results.

Persons on each side of a common boundary underlain by a common aquifer may respond to incentives

to develop the msource as rapidly as possible in order

to capture most of its benefitsJx If persons on both

sides respond to the same incentives in the same

ways, then the “race to the pumphouse” in the

interstate context can yield wasteful overexploitation

and ultimate harm to the resource. In areas where

population growth and other sources of water demand is greatest, these kinds of interstate competition

may be expected to intensify However, the extent of

problems of interstategroundwater depletion maybe

somewhat ovetstated.‘25

Where interstate water problems do exist, the

most common recommendation is to develop and

implement an interstate compact, described by one

author as “the primary means of coordinating and

managing groundwater resources in several Eastern

staksN1~ h-&&ate compacts are cited as preferable to

resource depletion and destruction resulting from interstate competition,and to alternative forms of resolution,

such as equitable apportionment of a water supply by

adjudication. n’ Compacts are preferred for their flexibility finality, and use of experts, and as less timeconsuming and expensive than litigation.128

Interstate compacts can provide for the coordinated use of a common resource among states, as in

the example presented below. There also are some

cautions to be observed. First, there is no guarantee

that a state whose residents are overexploiting a

groundwater resource at the expense of another state

will enter into an interstate compact.12g Second,

transaction costs of reaching an interstate compact,

which not only involves the consent of the Congress but

also squires unanimous adoption by the affected states,

can be very high. Thus, not every interstate compact is

developed with less time and expense than would be

involved in an adjudication Development and ratification of the Colorado River Compact, for example,

spanned five decades, and still ended up in the United

States Supreme Court

Third, it is not obvious that the advantages cited

for interstate compacts over adjudication always

apply Flexibility, finality, and expert development of

settlements can be advantages of the adjudicatory

process as well. Based on experience, there is no

reason to believe that interstate compacts are less

likely to become the subject of recurring litigation

than are equitable decrees.

Finally, there are circumstances in which an

equitable apportionment of an interstate groundwater resource is a reasonable alternative. The most

often discussed interstate aquifer is the Ogallala

44 U.S. Advisory Commission on Intergovernmental Relations
Aquifer of the Great Plains region. Yet,as one observer

noted, “Clearly it would be impractical to consider the

entire Ogallala Aquifer as one common aquifei?

While users in all eight states that overlie that

resource derive water from a “common” supply, it is

not at all obvious (because of the physical characteristics of the aquifer) that withdrawals by residents of

southern South Dakota or Nebraska are contributing

materially to groundwater decline in the Texas High

Plains, or that losses and gains from the depletion of

the aquifer fall evenly across users.

As noted with reference to New Mexico’s state

engineer’sartificiallysubdividinglargegroundwater

basins, while “the lateral movement of groundwater

would render two wells 2 miles apart as pumping

from the same common aquifeer, this lateral movement may, for all practical purposes, be ignored if the

two wells are 50 miles apart.“131 Where the physical

characteristics of an interstate aquifer warrant it,

states can manage and use equitably apportioned

shares of the water supply and storage capacity

within their own legal and institutional frameworks.

These considerations suggest that neither interstate

compacts nor equitable apportionments are always a

superior institutional form of meeting the challenges of

intestate competition and coordination Different challenges will call for different resolutions

An example of the use of a federal-interstate

compact (an interstate compact to which the federal

government is also a party) is the Delaware River

Basin Commission (DRBC). DRBC and the Susquehanna River Basin Commission are the only two

interstate water management institutions with extensive groundwater management powers.132

DRBC members are the governors of New Jersey,

New York, Delaware, and Pennsylvania, plus a

presidential appointee to represent the federal government (usually the Secretary of the Interior). The

commission’s management activities proceed according to a comprehensive plan, prepared by staff

members and approved by the commission.

There is considerable interdependence of surface

and groundwaterwithin the Delaware River basin,‘%

and the commission is committed to meeting the

water supply needs of the coastal plain through

conjunctive use of surface and groundwatersupplies.

The staff has identified problems within the plain

resulting from excessively rapid depletion of parts of

the Potomac-Raritan-Magothy aquifer group. Pumping in areas of this heavily urbanized corridor has

resulted in the appearance of cones of depression in

the underground water levels. These cones attract

sources of contamination (most often organic compounds such astrihalomethanes and tetrachloroethylene) and sea water intrusion.‘34

Step One in DRBC’s conjunctive management

program, therefore, has been to attempt to relocate

some of the more concentrated areas of groundwater

extraction (such as those near Wilmington, Delaware,

and Camden, New Jersey) away from the confined

areas of the underlying aquifers, where pumping is

most likely to form depressions that lengthen pumping lifts and aggravate quality degradation problems.

Moving pumping to unconfined areas of the aquifer

groups brings it farther from the threats to water

quality and into areas that can be more readily

recharged with surface water supplies, which allows

greater advantage to be taken of the groundwater

reservoir’s capacity

Step Two is to compensate areas where groundwater withdrawals need to be curtailed with additional

surface water supplies or with groundwater pumped

farther upstream and imported.135 This is especially the

case in the areas of Camden, New Jersey where

groundwater withdrawals ate to be phased out over the

next two decades

Step Three is to increase the utilization of underground storage capacity The commission’s policy

originally restricted groundwater withdrawals to

sustainable yield. While this goal is desirable over

long periods, within a given year it fails to provide the

flexibility to use the groundwater supplies and storage capacity of the coastal plain to their fullest

potential in maximizing water supplies without

endangering resource preservation.136

The commission depends for its success on the

cooperation of the states The ability of the commission to designate “pmtected areas” within the Delaware

River basin requires that the states cooperate in enforcing pumping restrictions that are deemed necessary to

securing an adequate supply for the region.

The commission also needs states’cooperation in

meeting information requirements. For example,

New Jersey terminated an old statute that exempted

water users who held permits issued before 1947 from

reporting their groundwater withdrawals. These

grandfathered permits clouded the accuracy of estimates of total groundwater extractions in the coastal

plain. In 1980, the New Jersey Water Supply Management Act extended the reporting requirement to all

pumpers, giving the state and DRBC better information

with which to develop and implement water management 137 DRBC will need similar state assistance as

problems of water contamination are addressed.

Interlocal Coordination

The problem of groundwater resources crossing

previously established local government boundaries

is among the most commonly discussed management

challenges. Certainly, local autonomy over water

supply decisions increases costs in multijurisdictional

cooperation in source development and allocation.‘38

However, there are alternative arrangements for

U.S. Advisory Commission on Intergovernmental Relations 45
coordinating resource use that do not match existing

local jurisdictional boundaries. Special water districts, adjudications, and the designation of groundwater areas by a state agency are all possibilities for

fitting decisionmaking processes to the resource and

to diverse communities of interest.

The difference between the geographical distribution of groundwater supplies and governmental

bodies creates other challenges It is possible, for

example, that a groundwater basin with desirable

storage capabilities could underlie one community

but not another contiguous or nearby community,

even though both are located in a region where

demands for surface and groundwaters approach or

exceed supplies.‘39

Possibilities for ameliorating such disparities

include:

a ) Regulatory resource redistribution by a regional or statewide agency;

b) Physical resource redistribution through

construction and operation of a project that

conveys water from where it is to where it is

not and creates storage capacity in places

where it did not exist and

c) Interlocal coordination, whereby community interaction creates arrangements that

meet resource needs while preserving the

political independence of differently situated communities of interest, and avoiding

(or at least minimizing) the need for regulatory or physical redistribution schemes and

their attendant costs.

While considerable past stperience has focused on the

first and second of these possibilities, interlocal coon&

nation deserves attention for the benefits it can produce.

As three examples illustrate, even situations that

would appear to be characterized by strong and deep

conflicts between communities, or that seemed to

require heavy investments in public works projects,

have been ameliorated by negotiated coordination.

The Main San Gabriel Basin, the metropolitan Washington, DC, area, and the Owens Valley-Mono Lake

Basin provide cases of coordination in the use of

water supply and storage to improve overall availability and allocation and to avoid difficult problems.

The San Gabriel Valley. In the Main San Gabriel

Valley Basin in Southern California, water storage

capacity is monitored by the Main San Gabriel Basin

watermaster, a court-appointed policymaking body

composed of nine representatives of water producers

and local water districts. As the result of an adjudication of water rights, the watermaster was given

custody and control of storage and (along with

several other responsibilities) is authorized to enter

into agreements with other water supply jurisdictions to store water underground. Staff assistance is

provided by the Upper San Gabriel Valley Municipal

Water District

Parties to cyclic storage agreements with the

Main San Gabriel Basin watermaster can import

water into the basin and store it there for subsequent

recovery The watermaster has entered into such

agreements with the neighboring San Gabriel Valley

Municipal Water District (SGVMWD), which manages water supply over the territory of four cities, and

with the Metropolitan Water District of Southern

California through its local member agency the

Upper Valley district140 These are useful contractual

arrangements for the districts because they must plan

years in advance for importation of water from the

State Water Project, and the variability of climatic

conditions can result in considerable surpluses of

water at some times and deficits at other times.141

In the preparation of the judgment settling the

adjudicationof water rights in the Main San Gabriel

Basin, the users recognized that they had a valuable

resource in the underground water supply and in the

storage space. They agreed to allow the use of this

latter resource under the regulation of their own

representative policymaking body. Interlocal coordination in this case generates a mutually beneficial

outcome from a disparate geographic distribution of

water supply, storage, and demand.

Metropolitan Washington, DC. In what has been

termed the “state-of-the-art for supply managernent,“l& agencies in the Washington, DC, metropolitan area worked out an arrangement for operation of

surface reservoirs that reveals additional benefits

from interlocal coordination. Analyses and forecasts

of supply and demand had for decades predicted a

water crisis for the region by 1980. Plans for addressing that crisis included the construction and operation of several (in one plan, as many as 16) new

reservoirs.‘43 Clearly, such plans involved considerable expenses and environmental impacts.

A 1977 restudy by the U.S. Army Corps of

Engineers (authorized by the W&r Resources DeveZoy

m&Act of 1974) came to a different conclusion -that

the region was not necessarily short of water if

existing supplies and storage were used more efficiently. The solution lay in coordinating the supply

organizations’ actions rather than in technology and

concrete.‘49 Over the ensuing five years, officials of

the 25 water supply agencies in the metropolitan area

(three of which account for 95 percent of the water

treatment capacity) formed a regional task force that

worked with the Corps of Engineers on improving

management of storage capacity. In July 1982 (in a

fraction of the time needed for designing, financing,

and constructing surface storage facilities), eight

agreements were signed for maintaining flows of the

46 U.S. Advisory Commission on Intergovernmental Relations
Potomac River, for allocating water in periods of low

flow, for coordinating operation of existing storage

facilities, and for sharing the costs of any future

storage capacity expansi0ns.l”

As a result of these interlocal arrangements, only

one small new physical facility was required, and

adequate water supplies and storage are assured to

2020J46 These arrangements are estimated to have

saved between $200 million and $1 billion over the

previous plans.r47

A special concern was the potential environmental effects, especially on the tidal estuary downstream

from Washington, either from failure to act (resulting

in the eventual loss of sufficient Potomac flows to

maintain the ecosystem) or from reservoir construction. The interlocal coordination should maintain

sufficient flow in the Potomac to preserve environmental values.‘@ These benefits have been achieved

without the addition of a new regional management

institution or the elimination of community water

systems; without the construction of a great concrete

complex; and with increased emphasis on conservation, efficient use, and environmental protection.

Los Angeles and the Owens Valley. One of the most

renowned interlocal disputes concerning environmental protection and water supply management

has persisted through most of this century between

the Los Angeles Department of Water and Power and

the communities of the Owens Valley and Mono

Lake Basin on the eastern slopes of the Sierra Nevada.

Los Angeles began diverting surface and groundwater from the sparsely populated region after 1910,

extended the diversions to the streams feeding Mono

Lake in the 1940~5 and doubled its aqueduct capacity

in the 1970s. Water levels in Mono Lake (a significant

aquatic habitat for brine animals and migratory fowl)

have declined markedly and signs of vegetation stress

and decline have been noted in the Owens Valley14q

From the late 1950s to the 198Os, there was

considerable controversy over Los Angeles’ actions,

followed by several lawsuits by environmental

groups and local residents and officials, and occasional introduction of legislation to address the issues In

1983,officialsof InyoCountyandLos Angelesformed

the Inyo/Los Angeles Standing Committee “to develop a groundwater management plan that would

protect the Valley’s environment while supplying

LA with water”*50

In March 1989, negotiators for the county and the

city announced a preliminary agreement to settle

much of the dispute. After some initial local opposition, revised agreements were reached in August 1989 to

protect the native vegetation and wildlife of Owens

Valley and to preserve the city’s ability to divert water

into the Los Angeles Aqueduct and convey it to the city,

where much of it is recharged into the underground

basin of the San Fernando ValleyP

At roughly the same time, Los Angeles, the

Metropolitan Water District of Southern California,

and the Mono Lake Committee (an environmental

action group) agreed to support a legislative bill to

preserve and protect Mono Lake. The agreement

would attempt to shift some of Los Angeles’ diversions away from the streams feeding Mono Lake,

while providing financial support for waterdevelopment to help the city make up part of the resultingloss

of water supply.152

The Mono Lake and Owens Valley controversies

seem to be some of the most intractable in the

water-management field. The implementation and

outcome of the interlocal agreements cannot yet be

foreseen, but they signal the possibility that conjunctive management can emerge even in places facing

difficult issues of environmental preservation and

restoration, area-of-origin protection, and large-scale

interbasin water transfers

In fact,according to one view, it is precisely when

water management issues are complex and delicate

that interlocal arrangements are the most desirable

alternative for intergovernmental relations. It may be

the case that

. . . negotiation among directly interested parties can develop more flexible and thorough

solutions than court decisions, state agencies,

or legislatures. Water resources and their relation to the environment are complex, and

depend on local characteristics People have

well-defined preferences that vary among localities A court decision, administrative

rulemaking or a legislative committee cannot

develop water management programs based

on the integration of scientific information on

local water resources and the environment

that meet the needs of both the area-of-origin

and the water exporter efficiently153

Additional State and Local Innovations

In addition to the cases above, there are many more

cases of institutional innovation by state and local

governments Following are a few additional examples

Water Rights and Transfers. Some states aredeveloping and implementing statewide groundwater laws,

while others have targeted specific issues154 Some

states are defining surface and groundwater rights to

allow private and public suppliers to operate with

both kinds of rights or to substitute one source for the

other, while other states are strengthening their

positions as water wholesalers and regulators in

attempts to encourage conjunctive management

In Mississippi, a state heavily dependent on

groundwater, some cities have witnessed underground water level declines of up to 200 feet in this

century A broadly representative Water ManageU.S. Advisory Commission on Intergovernmental Relations 47
ment Council created in 1983 found several imminent and impendinggroundwater problems,ranging

from rapidly accelerating declines in levels to the

encroachment of sea water along the Gulf Coast The

council’s recommendations and conclusions resulted

in enactment of two statutes. The Omnibus Water Bill

of 1985 included the union of surface and groundwaters in a system with ten-year permits issued by the

state permit board. The Water Management Districts

Bill of 1985 provided statewide enabling legislation

for localities to create water management districts

with a broad range of powers for assuring water

supply and inducing conservation?56

Several states are making institutional changes to

allow, or remove impediments to, the transfer of

waterrights. There is a general trend toward reform of

state laws to allow greater opportunities for the

creation of water markets, and to enable local or

regional authorities toestablish conjunctive management. Such changes”are being established slowly, but

largely as needed on an ad hoc basis under authority

of state water 1aws.1’156 A review of state legislative

activity during 1988 and 1989 reveals a pattern of

rejection of proposals to limitwater transfers,approval of some bills designed to encourage transfers, and

approval of about half of the measures intended to

authorize state agencies to appropriate groundwater

and establish water storage rights.15’

Idaho has recently undertaken the largest river

basin adjudication of water rights in the history of the

western states,l% involving approximately 185,000

claims to the waters of the Snake River watershed. If

the adjudication results in specific quantified water

rights, Idaho’s largest water source could be made

part of a water exchange plan. Critical groundwater

areas also have been designated by the state Department of Water Resources Among the approaches is an

attempt to stop excessive withdrawals by specifying a

minimum groundwater level within critical areas In

1989, the state legislature enacted a law directing the

director of the Department of Water Resources to initiate

groundwater adjudications to limit withdrawals in

overdraft areas15g

Water transfers have been used actively in Colorado, which, in its 1969 Water Rights Determination

and Administration Act, united in the same priority

system the appropriative rights to a stream system

and its tributary groundwater? This innovation

encourages conjunctive management in watersheds

where surface and groundwaters are interrelated by

eliminating the disjuncture between the priority of

rights of holders of groundwater pumping permits

and of surface diversion permits. Altering the mix of

reliance on groundwater and surface water is made

considerably simpler under such a system.

Colorado also has chosen to take advantage of the

tendency of appropriative permit schemes to resolve

water challenges in judicial forums. The state is

divided into seven water divisions, the boundaries of

which accord with major river basins, each with its

own division engineer and water court. The water

court consists of a district court judge and a courtappointed referee. i61 This set of administrative and

legal institutions facilitates the determination of

water rights questions.

The Colorado system removed several impediments to water transfers. Since the mid-196Os, much of

the population growth of the front range cities, such

as Denver, Colorado Springs, Aurora, and Pueblo, has

been accommodated by purchases of irrigation water

rights from farmers and the conversion of those

waters from agricultural to urban uses162

Planning. A majority of the states has either mandated or authorized some form of comprehensive

water resources planning, and most of those states

have a mandate to engage in continuous planning

and review.163 Some states are exploring regional

and local water “banking” programs and other

mechanisms for taking greater advantage of underground water storage capacity. In a banking program, water is stored during periods of surplus and

sold during later periods of need.‘& Water banking

projects have been implemented on an experimental basis in California and Idaho.lfi

Water Wholesaling. States have used their position as

wholesalers as leverage to encourage local initiative in

managing water supplies Access to state water supplies

can be conditioned on efforts to reduce demand and

improve facilities Massachusetts, for example, raised

the wholesale price of water from state-owned reservoirs to local suppliers (as have several states) and

restricted access in order to induce local entities to focus

more heavily on maximizing the yield and improving

the allocation of local water supplies166

A different tactic is employed by New Jersey,

which mandates that local water suppliers in designated critical groundwater areas either develop their

own surface water supplies or purchase them from a

state-owned reservoir at wholesale rates substantially above the cost of additional pumping. Communities that do not acquire their own surface supplies to

use conjunctively with groundwater, or develop

sufficient conservation measures, may be required

“to purchase state water whether they use it or not.“16’

This provides an incentive to reduce reliance on

overtaxed groundwater supplies and begin the conjunctive use of surface water and groundwater, while

higher costs provide incentives for conservation

Institutional Capacity, Districts, and Localities.

State and local capacities for developing and implementing innovative strategies for groundwater management have developed significantly over the last

25 years. The “human capital infrastructure” of state

48 U.S. Advisory Commission on Intergovernmental Relations
and local governments, the expert professional personnel employed in water resounxs management,

especially by the states, has grown over that period.‘@’

State and local governments are assuming greater financial responsibility for water projects and

resource management initiatives.‘@ Massachusetts

began operating a grant-in-aid program in 1982,

providing funds on a matching basis to local water

supply systems. New Jersey began a loan program in

1983 to support rehabilitation of water supply facilities by their local operators.170 Similar financial

assistance programs have been established in several

other states. Utah offers an entire range of watersupply financing mechanisms, including grants,

loans, and credit enhancements.“’ In 1981, Montana

established a water development fund to make loans

and grants for water development projectsJn Many

of the funding mechanisms involve the privatesector.

States have experimented with the design of

local special districts and regional administrative

entities. Nebraska, for example, has consolidated

districts for water conservation, soil conservation,

and drainage into “natural resource districts” (irrigation districts were not included in the consolidation). lTJ Within critical “groundwater control areas”

designated by the director of the Department of Water

Resources, a natural resources district may promulgate special rules and regulations governing groundwater withdrawals and use. Such regulations may

require installation of flow meters on every well,

specify the duty of water for irrigation acreage, and

set well spacing requirements.174 Natural resources

districts also regulate, and have in the past sharply

limited, water transfers.

Florida has established five regional water management districts to conform to the state water resources

regions The districts are governed by boards appointed

by the governor and ~IY responsible for managing

water supply, water consumption, and flood control,

The districts play a vital role in facilitating and regulating (or impeding) future water transfers through their

permit authority,‘” and they also are authorized to levy

ad valorem taxes to finance local water projects

Statewide water planning and regulation of quality are

the responsibilities of the state Department of Envimnmental Regulation. A state water use plan adopted in

1985 focuses on the relationship between water resources and growth management176

Localities have tried to couple their need for

innovative approaches to waste treatment and disposal with their need to assure water supplies. Much

of the literature on water resource management over

the past four decades has advocated reuse of water

and reclamation of wastewater. Local governments

are taking steps in this direction. The use of reclaimed

water for replenishment and injection by some

special districts was noted above.

Denver has been treating wastewater into drinking water quality since 1968. A pilot plant was

developed, and a demonstration plant using ozone

and reverse-osmosis technologies went into operation in 1984. The goal of the project is to use treated

water to meet a significant share of the city’s water

needs by the close of the 1%“’

Kissimmee, Florida,used to deposit sewage effluent into a stream feeding Lakes Toho and Okeechobee. The lakes began to show effects from the

fast-growing city’s discharges, and the city in turn

outgrew its sewage treatment capacity Kissimmee

has built a new treatment plant, which will process

sewage to a level of quality where some of it can be

used for watering a nearby golf course, some sold for

irrigation, and the remainder allowed to recharge

into the groundwater strata. As a result of these

changes, Lake Toho is being returned to its previous

recreational ~~554.~~

The diversity of state approaches and innovation

in institutional design and groundwater management reflects different physical, economic, social,

cultural, and political backgrounds and character&

tics. Each state (and in many states, each community)

is developing responses to its own “unique set of

environmental parameters and economic forces.“lD

LESSONS L EARNED

These examples illustrate some of the extensive

state and local innovation and experimentation with

water resource coordination. Some of these initiatives

involve high degrees of cooperation and coordination among several actors,including federal agencies.

Other initiatives have been unilateral actions of a

state, a city, or a special district seeking to address a

perceived problem or to improve its water supply

Approaches togoverningwater resources exhibit

tremendous dive+ The examples cited above (and

others not included) have very little in common, save

for one crucial factor: each of the most efficient and

equitable management appmaches demonstrates a

high sensitivity and close tailoring to the specific

physical characteristics of the water resourceslso

Groundwater basins differ in the physical characteristics that most affect effective and equitable

management: rates of recharge, the degree to which

they are connected with surface water supplies, the

rate and amount of lateral movement within the

basin, and the susceptibility of the basin to degradation from salt water intrusion or other sources.

Conjunctive management efforts have appeared in

groundwaterareas exhibiting nearly the whole range

of these characteristics, and the list of communities

considering options and developing plans is even

more extensive.‘B1

As communities develop groundwater management schemes or seek to improve management, they

find that they have many models to consider, with

U.S. Advisory Commission on Intergovernmental Relations 49
experiences and rationales that point in different

directions. For example, does conjunctive management require a comprehensive statewide law? Arizona and New Mexico have such statutes; California

and Colorado do not Yet, conjunctive management

operations have appeared in all four of these statesfor decades in some areas in southern California and

since the early 1970s in Colorado.

It does not appear that one can plainly declare

the superiority of any state “model.” Arizona has

chosen to enact and implement statewide legislation;

New Mexico has relied strongly on a “water czar”;

and California and Colorado have relied on basin

organizations and adjudications for management

There also is a wide diversity of experiences in

creating and empowering regional and local water

management organizations. Florida has made regional districts responsible for water management,

while Nebraska has formed regional districts responsible for “natural resources.” Mississippi’s new

groundwater laws authorize the creation of broadly

empowered water management districts on a geographical scale as small as a pair of municipalities.

Half of the states designate critical groundwater

management areas, but within those areas, some

states regulate water use directly while others create

special districts for each designated basin and still

others leave it to local residents to form a special

district In Washington, groundwater management

development in designated critical areas can be

triggered either by the state or by local residentsJa

Several years ago, the National Water Commission found that groundwater management organization by the states could be grouped into two broad

organizational approaches. One was state designation and regulation of critical groundwatec The other

category of organization was the special water district

encompassing the groundwater basin. After reviewing experiences with these organizational alternatives, the commission decided to express “no strong

preference for one form of organization over the

other;” observing instead that “the form of organization should depend upon the problems encountered - hydrological, institutional,and legal.“lB Since

the commission completed its work in 1973, the range

of organizational forms and institutional arrangements for groundwater management has expanded

even further.

When innovation occurs in several locations in

several organizational guises, the course of progress

may not appear to be very orderly. It may even appear

at times to be chaotic. Nevertheless, in the words of Ira

Clark, “Despite its erratic and unpredictable course,

there has been progress. . . . Far away as the ideal

master water plan might be . . . there has been a

decided trend toward more cooperative and coordinated handling of the nation’s water problems.“184

Among the reasons for that progress is the diversity of

organizational forms and management arrangements offered by a multijurisdictional system. Given

the number and diversity of tasks involved in the

conjunctive management of groundwater resources,

“Many alternative institutional structures could be

considered for the management vehicle.“‘& In addition, “The extremely diverse hydrologic, geologic,

economic, environmental, legal, political, and social

conditions affecting the occurrence, protection, and

use of ground and surface waters in the United States

suggest that no single structure would be universally

applicable nor politically acceptable.“‘&

The diverse and multifaceted arrangements by

which groundwater supplies are managed, and

managed conjunctively with surface water,are not,as

may sometimes be supposed, reflections of the weakness of American federalism, but constitute instead

one of its strengths. A polycentric, multijurisdictional

order may in fact be well suited to the management of

complex water systems.

Notes

’ National Water Commission, Water Policiesfor tlze Future:

FinalReport fo fhe President and fo the Congress offhe United

States (Port Washington, New York Water Information

Center, 1973), p. 233.

’ Ira G. Clark, Water in New h4exico:A History of Its hfanagemerit and Use (Albuquerque: University of New Mexico

Press, 1988), p. xi. 3. Sidney?: Harding, Water in California

(Palo Alto: N-P Publications, 1960), p. 58.

3 Sidney T Harding, Wafer in California (Palo Alto: N-P

Publications, 1960), p. 58.

4 California Department of Water Resources, California’s

Ground Water. Bulletin 118 (Sacramento, 1975), p. 121; Zachary Smith, “Rewriting California Groundwater Law:

Past Attempts and Prerequisites to Reform,” California

Western law Review 20 (Winter 1984): 234; Susan M. Trager, “Emerging Forums for Groundwater Dispute Resolution: A Glimpse at the Second Generation of Groundwater Issues and How Agencies WorkTowards Resolution,”

Pacific Law journal 20 (October 1988): 42.

5 Stephen J. Burges and Reza Marnoon, A Systemafic Examination of Issues in Conjunctive hlanagement of Ground

and Surface Wafers. Water Resources Information System

Technical Bulletin 7 (Olympia: Washington Department

of Ecology, 1975), p. 1.

’ Ibid.

’ Harding, pp. 116-117.

s Erwin Cooper, Aqueduct Empire (Glendale, California;

Arthur H. Clark Co., 1968), p. 137.

9 David L. Jaquette, Ejkient Water Use in California: Conjunctive Management of Ground and Surface Reservoirs

(Santa Monica: RAND Corporation, 1978), p. 2.

lo Jurgen Schmandt,Ernest Smerdon, and Judith Clarkson,

State Wafer Policies (New York: Praeger Publishers, 1988),

p. 144.

I1 Burges and Marnoon, p, 33.

l2 Cooper, p. 137.

50 U.S. Advisory Commission on Intergovernmental Relations
13Les K. Lampe, “Recharge Saves Water for a

Not-so-Rainy Day,” American City and County 102 (June

1987): 40.

r4 Kyle Schiiing et al., 131e Nation’s Public Works: Report on

Water Resources (Washington, DC: National Council on

Public Works Improvement, 1987), p. 176.

l5 Ibid.

l6 Burges and Marnoon, p. 34; Cooper, p. 137.

I7 Thii distinction between Xconjunctive use” and #conjunctive management” derives from the work of William

Lord at the University of Arizona’s Water Resources Research Center.

l8 Stetson, Strauss and DresseIhaus, Compendium of Report

on a Supplemental Writer Supply@ UpperSan Gabriel Vally

Municipal Water District (Los Angeles, 1%2), p. VI-l.

l9 Burges and Marnoon, pp. l-2.

2 0 Lampe, p. 40.

2 1 Jaquette, p, 2.

2 2 Burges and Marnoon, p. 32.

2 3 Helen Joyce peters, “Groundwater Management,” Water

Resources Bulletin 8 (February 1972): 190. She observes

that artificial recharge to conserve waters that would

otherwise have wasted began as early as 1895 in Southern California.

z4 Lampe, p. 40.

zs See, for example, California Department of Water Resources, Bulletin 118, p. 126. See also, among others, Michael MalIery, “Groundwater: A Call for a Comprehensive Management program,” Pacific Law Journal 14 (July

1983): 1279-1307; Ian Carruthers and Roy Stoner, Economic Aspects and Policy Issues in Groundwater Deoelopmerit, Staff Working Paper 496 (Washington, DC: The

World Bank, 1981).

2 6 These arguments are reviewed in Advisory Commission

on Intergovernmental Relations (ACIR), 77te Orgunizution of Local PubIic Economies and Metropolitan Orgunization: 7be St. Louis Case (Washington, DC, 1987 and 1988).

r’ Examples of such definitions (of “groundwater management” generally), are found in Harvey 0. Banks, “Management of Interstate Aquifer Systems,“ASCEloumaloJ

Water Resources Planning and Management 107 (October

1981): 565; and California Department of Water Resources, Ground Water Basins in Culifirnia. Bulletin 118-80

(Sacramento, 1980). The definition given by Banks is:

Ground-water resources management involves

the protection, development and use of the

ground-water resources of the particular aquifer

system concerned, generally in conjunction with

available surface water resources possible induding reclaimed water, in the most effective manner

to meet water resource development and use objectives as those objectives are defined and redefined with changes over time.

The definition given in Bulletin 118-80 is:

Ground water basin management includes

planneduse of the ground water basin yield,storage space, transmission capability, and water in

storage. It includes (1) protection of natural recharge and use of artificial recharge; (2) planned

variation in amount and location of pumping

over time; (3) use of ground water storage conjunctively with surface water from local and imported sources; and (4) protection and planned

maintenance of ground water quality.

zs CaIifornia Department of Water Resources, Bulletin 118,

p, 129.

2 9 Neil S. Grigg, “Appendix: Groundwater Systems,” in

Shilling et at., p. B-2.

3 o For example, California Department of Water Resources, Bulletin 118, p, 124.

3 1 Peters, “Groundwater Management,” p. 190.

3 2 California Department of Water Resources Bulletin 118,

pp. 119-124.

ss Smith, “Rewriting Groundwater Law,” p. 234.

3 4 See, for example, John E Mann, Jr., “Concepts in Ground

Water Management,” Journnl of the Americnrr Water Works

Association 60 (December 1968): 1336-1344; also, its application to the conjunctive management of the San Fernando Valley groundwater basin in William Blomquist,

7he Perfirnmnce of Institutions for Groundwater Management, Volume 6: 7he San Fernando VIlly (Bloomington: Indiana University, Workshop in Political Theory and

Policy Analysis, 1988).

ss California Department of Water Resources, Bulletin 118,

p. 124;see&oBurgesandMarnoon, p.4: “Operationunder a traditional safe yield approach might incur large

opportunity costs because the wa ter resources cannot be

put to optimal or near optimal use.*

ss California Department of Water Resources, Bulletin 118,

p. 121.

sr Conjunctive use groundwater basin management plans

“should include control not only over groundwater

pumping, but aho over the storage space of an aquifer.”

Charles Phelps et al., Efictent Water Use in California: Execr&iue Summary (Santa Monica: RAND Corporation,

1978), p. 26.

3 8 Lampe, p. 46.

ss Such concerns are among the “second generation” of

groundwater issues identified in Trager.

‘sIndeed, this aspect of groundwater management has

been identified by at least one observer as more diificuh

to resolve successfuIIy than the supposedly intractable

common-pool or Prisoner’s Dilemma problems that accompany groundwater resources. Susan Christopher

Nunn,‘?7tePoliticul Economyoflnstitutional Innovation: Coalitions and Strategy in the Development of Groundwuter

Law. Ph.D. Dissertation, University of Wisconsin, 1986.

4 * See aho Lampe, p. 40; David Jaquette and Nancy Moore,

E&knt Water Use in California: Groundwater Use and

Management (Santa Monica: RAND Corporation, 1978),

p, 31.

&The importance of adaptability and error correction,

and the difference between them, derives from the work

of Vincent Ostrom of the Workshop in Political Theory

and policy Analysis at Indiana University.

a Banks, p. 565.

y L WiIIiam Reedy, Water for the Valley of the Sun,” ASCE

Journal of Water Resources Planning and Management 106

(July 1980): 477.

e These observations are made by NUM, p. 20.

4 6 For example, “land devoted to cotton production alone

increased from 282,ooO acres in 1948 to 678,000 acres in

1952. For the most part, the water necessary to support

U.S. Advisory Commission on Intergovernmental Relations 51
this increased production came from the ground.” Zachary Smith, me policy Environment,” in Zachary

Smith, ed., Water and the Flcture of the Southwest (AIbuquerque: University of New Mexico Press, 1989), p. 10.

47 Philip Briggs, “Ground-Water Management in Arizona,”

]ournal of Water Resources Planning and Management 109

(July 1983): 195; and John Leshy and James Belanger, “ArizonaLaw:WhereGroundandSurfaceWaterMeet,’Arizona State Law Journal 20 (FaU 1988): 691.

48 Wesley Steiner, “Public Water Policy in Arizona,” State

Government 55 (FaII 1982): 133.

49 Briggs, p. 197.

5o Reedy, p. 488.

51 Ibid., p. 489.

52 Steiner, p. 133.

53 Scott Hansen and Floyd Marsh, “Arizona Ground-Water

Reform: Innovations in State Water Policy,” Ground Water 20 (January-February 1982): 69.

54 Ibid.

56 These cases, Bristor v. Cheatum, are known as gristor I”

and “B&or II” in Arizona law.

56 Hansen and Marsh, p. 69.

?’ Ibid.

ss Tributes to Governor Babbitt’sleadershipinbringingtogether the 1980 Arizona law are to be found in virtually

every account of the process. For details, see Hansen and

Marsh, p. 70; Kathleen Ferris, “Arizona’s Groundwater

Code: Strength in Compromise,” Journal of the American

Water Works Association (October 1986): 79-84; Leshy and

Belanger; and Steiner.

59 Steiner, p. 133.

@ Schmandt et al., p. 37.

61 Hanzen and Marsh, p. 70.

g Ibid., pp. 70-71.

63 Ibid., p. 70; Ixshy and Belanger, p. 707.

64 National Research Council, Committee on Ground Water Quality Protection, Ground Water Quality Protection:

State and Local Strategies (Washington, DC: National

Academy Press, 1986), p. 83.

65 Steiner, p. 134.

66 James Corbridge, ?An Overview of the Special Water

District Workshop,” in James Corbridge, ed., Special Water Districts: Challenge@ the Future (Boulder: NaturaIResources Law Center, 1983), p. 4.

67 Briggs, p. 199.

68 Ibid., p. 201.

@ Leshy and Belanger, p. 713.

70 Ibid., p. 724.

n Ibid.

n “Legislative Update,” Water Strategist 3 (April 1989): 15.

73 Steiner, p. 135.

74 Briggs, p. 201.

75 Hansen and Marsh, p. 71.

76 Alfred W. Jorgensen,A New Approach to Solving Water Disputes: The rkrg Beach Case, Master’s Degree Thesis in

Public Administration, University of Southern CaIifornia, 1967, pp. 105-106.

R Trager, p. 53.

78 MaUery, p. 1295.

79 There are many sources for such criticisms. For a couple

of excellent examples, see Keith Knapp and H.J. Vaux,

“Barriers to Effective Grour.d-Water Management: The

California Case,” Ground Water 20 (January-February

1982): 61-66; and MaIIery, pp. 1279-1307.

8o Knapp and Vaux, p. 61.

81 MaUery, p. 1286.

az Ibid., p. 1281; Knapp and Vaux, p. 61.

83 Ibid.

04 Ibid., p. 1298 (emp hasis added).

85 Knapp and Vaux, p. 61.

86 Albert J. Lipson, Efficient Wafer Use ~JJ Cdif~~~li~ The Euohtion of Groundwater Management in Sorrfhern Caflforrria

(Santa Monica: RAND Corporation, 1978), p. 1.

s7 Elizabeth Rolph, Government Allocation of Property Rights:

WhyandFfow (Santa Monica: RAND Corporation, 1982),

p. 16.

sa Lipson, p. 18.

89 Helen J. Peters, “Ground Water Management in CaIifornia.” Presented at the American Society of Civil Engineers Conference, Las Vegas, April 1982, p. 11.

9o peters, “Groundwater Management in California,” p. 3

(emphasis added).

91 Phelps et al., p. 2.

9z Lipson, p. 21.

93 UINTEX Report to the Los Angeles District Office of the

U.S. Army Corps of Engineers on the Los Angeles

County Drainage Area, 1985, p. E-39.

941nstitute of public Administration, Special Districts and

Public Authorities in Public Works Provision (Washington,

DC: National Council on public Works Improvement,

1987), pp. 66-67. Unpublished.

% MaIIery, p. 1291.

% Lipson, p. 9.

m Phelps et al., p. 21.

98 The provisio n -p reduction distinction may be found in

ACIR, The Organization of Local Public Economies.

99 More extensive descriptions of the geology and history

of this area can be found in several sources, including

Wiiam Blomquist, ‘The PerJormance of Institutions for

Groundwater Management, Volume2: The West Coast Basin,

and Volume 3: 7’he Central Basin (Bloomington: Indiana

University, Workshop in Political Theory and Policy

Analysis, 1988).

rM Jaquette and Moore, p. 37.

lo1 Harold Rubin, ‘IIre Solano Water Story (VacaviIIe, California: Solano Irrigation District, 1988).

lo2 California Department of Water Resources, RecoIlImended Water h4anagement Plan for SO117110 Colrrrf!! Flood

Controt and Water Conservation Disf-rict (Sacrament@,

1982), p. II-l.

rM Association of California Water Agencies, iiCIZ!4’s

7%Year History (Sacramento, 1985), p. 18.

52 U.S. Advisory Commission on Intergovernmental Relations
*04 John S. Murk Engineers, Final Local Water Management

Alternatives: Newberry Groundwater Basin (Victorville,

California: Mojave Water Agency, 1984), p. m-14.

lo5 Nunn, p. 252.

lo6 Ibid., pp, 14-16.

lo7 Ibid., pp, 252-253.

lo8 Micha Gisser, “Groundwater: Focusing on the Real Issu&’ Journal of Political Economy 91 (December 1983):

*09 National Water Commission, p. 232.

*lo Gisser, p. 1012.

11* Ibid., p. 1013.

112 Ibid., p. 1014.

*I3 Ibid., p. 1024.

114 Ibid pp. 1024-lU25; and Douglas Grant, me Complexities 6f Managing Hydrologically Connected Surface Water and Groundwater Under the Appropriation Doctrine,” Land and Water Law Review 22 (1987): 88-89.

lfi City of Albuquerque v. Reynolds, 379 I?226 73 (1%3).

‘16 John S. Murk Engineers, p. m-14.

“’ Nunn, p. 253.

lls Ibid.

llg Gisser, p, 1014.

lrn Grant, p. 89.

lzl Cache Lal’oudre Water Users Associationv. Glacier View

Meadows, 550 l?2d 288 (1976).

I22 Clark, p. xiv.

l” National Water Commission, p. 245; Banks, p. 564.

‘%Smith, “Federal Intervention in the Management of

Groundwater Resources,” p. 153.

125 Morton Bittinger, “Survey of Interstate and International Aquifer Problems,” Ground Water 10 (March-April

1972): 44-54, identified 198 interstate and/or international aquifers as actual or potential problem areas, of which

almost 60 were described as “major.” This study and its

results were still being cited in the 1980s as evidence of

the extent and degree of severity of interstate groundwater management problems (see, for example, Banks;

and Smith, “Federal Intervention in the Management of

Groundwater Resources”).

Reliance on this survey should be kept in perspective, however, if not forgone altogether, in making such

characterizations. Among its difficulties are: (a) aquifer

problems were classified as to degree of severity by the

most severe ranking given to that problem by any observer (e.g., a problem was classified as “major” if anyone responding to the survey described it as “major “),

thus biasing the results toward the most severe characterizations, and (b) almost half of the problems classified

as “major” were described as such by one anonymous

observer from a university, who happened to rank as

“major” every interstate or international problem he or

she identified. Rather than assuming that interstate and

international groundwater management problems

must be even worse now than they were then, analysts

and policymakers should recognize that problems may

not have been that bad then, and that no better survey

has been done since.

126 Smith, “Federal Intervention in the Management of

Groundwater Resources, pp. 157-158. See also Larry Feazell, “Interstate Water Agencies,” ne Book of the Strifes.

1986-87 Edition (Lexington, Kentucky: Council of State

Governments, 1986), pp. 420-423.

lz7 Ibid, and National Water Commission, p. 245, both of

which recommend interstate compacts or other forms of

interstate agreements, such as administrative agreements or reciprocal legislation.

na National Water Commission, p, 245.

yg Smith, “Federal Intervention in the Management of

Groundwater Resources,” p. 158.

130 Gisser, p. 1012.

13* Ibid.

1p Banks, p. 564.

133 David Noonan, Myron Rosenberg, and Duncan Wood,

“Constraints to Managing Interstate Aquifer,” Journal of

M’atPrResolrrcePlalrrtinSalld Management 110 (April 1984):

191.

134 Ibid., pp. 194-198.

lzs Ibid., p. 202.

1x Ibid., pp. 198 and 204.

13’ Ibid., p. 199.

lss See, for example, Nancy Humphrey and Christopher

Walker, Innovative State Approaches to Community Water

Supply Problems Washington, DC: The UrbanInstitute,

1985), p. vi. For a discussion of the “coordination costs”

concept, see ACIR, The Organization of Local Pllblic Economies, p. 11.

139 James H. Krieger and Harvey 0. Banks, “Ground Water

Basin Management,” California Law Review 50 (Winter

1%2): 57.

144 ThomasStetson,“MainSanGabrielBasinGroundWater

Management.“Presentedat the82ndAnnualMeetingof

the Cordieran Section of the Geological Survey of

America. In Prem K. Saint, ed., Hydrogeolosy of Sou them

California: VoIume and Guidebook (Los Angeles: Geological

Society of America, 1986), p. 9.

14* Ibid.

142 Wade Miller Associates, 7he Nation’s Public Works: Report

on Water Supply (Washington, DC: National Council on

Public Works Improvement, 1987), p. 48.

lrw Ibid.; Frank Welsh, How to Create a Water Crisis (Boulder:

Johnson Books, 1985), p. 35; and James Crews, “Regional

Versus Local Water Supply Planning” Journal of Water

Resources Planning and Management 109 (April 1983):

179-185.

144 Crews, p, 180.

l* Welsh, p. 35; Wade Miller Associates, p. 116.

146 Ibid., p. 48.

lw Welsh, p. 35.

14n crews, p. 185.

14g There have been numerous descriptions of the Los Angeles-Owens Valley-Mono Lake water disputes, some of

which are summarized in Blomquist, The San Fernando

Valley.

150 “Coming to Terms: A Proposed Agreement for the

Owens Valley Dispute,” Water Strategist 3 @ly 1989).

U.S. Advisory Commission on Intergovernmental Relations 53
tsl Kevin Roderick, Water Rights Pact with L.A. Wins Approval in lnyo County,” Los Angeles 7imes, August 16,

1989.

152 Virginia Ellis, “L.A. Backs Legislative Plan to Cut Use of

Mono Water,” Los Angeles ‘Emes, August 11, 1989, and

“MWD May Back Bill on Mono Lake Water Dispute,” Los

Angeles Emes, August 17,1989.

153 “Coming to Terms,” p. 13.

ls4 Schmandt et al., p. 22.

lss Marvin Bond, Jimmy Palmer, and Charles Branch, “Recent Experiences with Water Legislation in Mississippi,”

Public Administration Survey 35 (Autumn 1987-Winter

1988): 1-5.

ls6 Schilling et al., p. 176.

15’ “Annual Legislative Review,” W&r Strategist 2 (October

1988) and 3 (October 1989).

lss Water Supply,” From fhe Sfafe CapifaZs 43 (January 1989):

4 .

ls9 “Annual Legislative Review,” Wafer Strategist 3 (October

1989).

160 Morton Bittinger, “Ground-Water Surface-Water Conflicts,” ASCE journal of Wafer Resources Planning and Man-

;lF7;f 106 (July 1980): 473; Leshy and Belanger, pp.

- .

161 E Lorenz Sutherland and John Knapp, “The Impacts of

Limited Water: A Colorado Case Study,” Journal of Soil

and Wafer Conservation 43 (July-August 1988): 295.

16z Ibid., pp. 295-297. It is important not to overlook the fact

that, in arid regions, the transfer of water away fromuse

on agricultural land can, if abandonment of the agricultural land ensues, result in considerable soil erosion effects. This has occurred in sections of the Arkansas River

Valley in southeastern Colorado. In response, Colorado

water courts have begun conditioning their approval of

water rights transfers on commitments to the revegetation of the land from which the water rights are being

transferred.

163 Schiiing et al., pp. ix and 133.

164 Gary Weatherford et al., Acquiring Wafer/or Energy: btsfifufionaf Aspects (Littleton, Colorado: Water Resources

Publications, 1982), p. 14.

165 Early discussions of this planning appear in California

Department of Water Resources, Bulletin 118, pp.

127-128. See also Weatherford et al.; and California Department of Water Resources, California Wafer: Looking fo

theFuture. Bulletin 160-87 (Sacramento, 1987), pp. 47-48.

166 Humphrey and Walker, p. 36.

16’ Ibid., p. 67.

*68 Schilling et al., pp. 133-134; Humphrey and Walker, pp.

9-10.

169 Schiimg et al., pp. x-xi; Schmandt et al., p. 12.

170 Humphrey and Walker, pp. 23-35.

ln Ibid., p. 84

172 Schilling et al., p. 134.

lrs Corbridge, p. 9.

174 See, for example, the description of the activities of the

Upper Republican Natural Resources District in Sporhase v. Nebraska, 458 U.S. 941(1982), 955.

175 Schmandt et al., p. 88.

176 Ibid., pp. 90-91.

lrr Wade Miller Associates, p. 9.

178 Wiiam S. Foster, Wastewater Reuse Protects Kissimmee Water Resources,” American City and Counfy 102

(June 1987): 46.

I79 Schmandt et al., p. 12.

180 Jacque Emel, “Effectiveness andEquity of Groundwater

Management Methods in the Western United States.”

Working Paper 3 (Tempe: Arizona State University, Center for Environmental Studies, 1984), p. 33.

la1 Lampe, p. 40.

lsz Humphrey and Walker, p. 68.

lss National Water Commission, p. 234.

Is4 Clark, p. 422.

a5 Banks, p. 575.

186 Ibid.

54 U.S. Advisory Commission on Intergovernmental Relations
Chapter 4

Understanding the Organization

of Water Resource Management

In previous chapters we have pointed out that

there are different types of water management

problems throughout the United States, several elements to effective groundwater management, several

types of institutional arrangements for managing

water resources (including managing groundwater

supplies conjunctively with surface water), and a

wide diversity of interjurisdictional arrangements

being used. Conjunctive management is organized

neither as an ideal legal-rational centralized administration nor as a perfectly competitive market

When analysts begin with a conceptual ideal,

they are bound to find actual patterns of intergovernmental and public-private relationships to be deficient If, for example, the ideal is the perfectly

competitive market, analysts finding governmental

involvement of any sort in decisionmaking about

resource use will describe the situation as “politicized” and therefore “inefficient” Other analysts

pmceed “from a belief that a system of government

composed of numerous, independent, specialized units

of government is necessarily fragmented and ineffective,“’ in which case their descriptions of multiple actors

in a noncentralized system will be followed by a

prescription for centralization of authority.

But there are additional possibilities for analysis

of intergovernmental relations. There is a tradition of

thought based on the idea that an understanding of

existing arrangements is an important prerequisite to

prescriptions for reform. That view, which informs

recent work on metropolitan area governmental

organization,2suggests that analysts “begin to search

for the nature of the order which exists in the complex of

relationships among governmental units and abandon

he assumption that all of these relationships are unique

x randomn3 Description of “the nature of the order

&ich exists” and “an analysis of how the system

~orks”~ can be followed by discussion of shortcomings

md recommendations for improvements The ultimate

evaluation of the performance of public officials and

governmental structures is left to citizens

Observers who despair of the organization of

gmundwater management may simply lack an organizing concept with which to look at it Instead of

measuring current arrangements against ideal types,

“What is needed is the ability to compare and contrast

very diverse sets of water management instituti~ns”~ lb

help understand the roles and relationships of the

diverse organizations involved in gmundwater management, we use the concept of a complex and

regulated water economy The idea of a complex water

economy, composed of providers, producers, importers,

wholesalers, retailers, and regulators can help to organize observation of the intergovernmental relations of

groundwater management so that the kinds of coon%-

nation that do occur can be seen

A COMPLEX WATER ECONOMY

The largest element in the complex water economy

is the water supply industry, which consists of

publicly and privately owned systems of varying

organizational forms and sizes. It is “composed of a

very large number of highly independent federal,

state, and local governmental agencies operating side

by side with large numbers of private utilitycompanies, co-operative associations, and individual proprietorships,q6 and “characterized by a long history of

self-sufficiency and local government control over

management and finances”’ According to a recent

description of intergovernmental relations in water

resource management:

These patterns of intergovernmental wlations, in turn,take on the characteristics of industry structures. Different agencies ranging

from local suburban water districts to municipal water departments, for example, may

function as retail agencies serving the ultiU.S. Advisory Commission on Intergovernmental Relations 55
mate consumer of water services. But such

water distributors may be supplied by intermediate water agencies such as county water

authorities or metropolitan water districts

that operate large-scale diversion works,

aqueducts, and reservoirs to produce water

for domestic, urban, and industrial uses.

These agencies in turn work with the

large-scale water development agencies of

the state and Federal governments Together

their coordinated efforts might be viewed as

a water industry.. . ?

Other recent reports have compiled and presented

detailed information about the industry that provides

a picture of the composition and organization of

water supply provision and production.g

There are more than 200,000 water systems

serving the public. Of these, 58,530 (about 29 percent)

are community water systems that serve primarily

residential areas with a population of some 219

million. The other 71 percent, or 144,800 public water

systems, are noncommunity systems that serve pri-

‘marily nonresident or transient populations of 36

million persons (parks and campgrounds, resort

areas, hotels and restaurants, etc.)‘O

The water supply industry uses both surface and

groundwater sources. As would be expected, reliance

on these sources differs according to theircharacteristics and geographic distribution. Noncommunity

water systems are more often reliant on groundwater

(96 percent of them use underground supplies)”

because these systems generally depend on water

that is available at or very near the point of use and do

not make large-scale investments in impoundment

and transmission facilities. Groundwater also is the

primary or only source of water for 80 percent of

community water systems. These tend to be smaller

systems that serve approximately 30 percent of the

population that uses community water systems. The

other 20 percent of community water systems rely on

surface water supplies and tend to be larger, serving

70 percent of the population.”

Ownership, organization, and size of community water systems vary greatly There are 26,424

publicly owned systems (45 percent). Of these, roughly 15,000 were municipalities directly providing

water, according to the 1982 Census of Governments.13 Other publicly owned systems were public

authorities and special districts. There are also about

15,740 privately owned systems serving municipal

communities, plus systems owned by and operated

for small communities such as homeowners’ associations, mobile home parks, and the like.‘4

Publicly owned community water systems include local government water departments as well as

autonomous and semi-autonomous providers Among

smaller systems, the mom frequentiy encountered

organizational form is the local water supply department Among the larger community water systems,

more autonomous organizational forms are found,

including special districts, water authorities, and

state-chartered public corporation~~~

Privately owned community water systems also

vary in organization. They include mutual companies owned by their customers, private proprietorships, and investor-owned utilities. The larger the

population served by a privately owned system, the

more likely it is to be an investor-owned utility?

Most community Water systems are small, serving fewer than 3,000 people each. The number of

systems classified as “very large” (i.e., serving 100,000

or more people) is 279, about 0.5 percent of all the

community water systems. Thus, almost two-thirds

(63.9 percent) of the nation’s community water systems serve a combined total of about 3 percent of the

population, while 36 percent of the systems serve

the other 97 percent of the population. The largest

0.5 percent of the systems serve over 43 percent of

the population.17 Combining the number of “large”

(10,00@100,000 people) and “very large” systems, the

majority of the nation’s population is served by

approximately 3poO community water systems, which

in turn vary by supply source, form of ownership,

form of organization, and size.

The existence of more than 50,000 community

water systems, and the involvement of more than

25,000 local governments in one aspect or another of

supply’* may still seem difficult to understand, especially if the observer presumes that water supply

involves only one type of activity But the hundreds of

thousands of water supply organizations do not all

perform the same function.

Within the complex water economy, there

exists an important distinction between the provision and the production of a service or commodity.‘9

Provision involves the decisions concerning the

amount and quality that will be provided, thecosts,

and how the costs will be distributed among

users-in sum, the decisions translating preferences for the service or commodity into demand.

Production involves the decisions for acquiring

and mixing production inputs in order to generate

production outputs (services or commodities).

Provision and production decisions may be made

and executed by the same or different organizations.

An organization may provide services or commodities that it does not produce. For example, a general

local government or a special district may provide

water to residents by acquiring all or part of the water

from a supply that is produced by some other entity

The municipal water districts in the Los Angeles

County case described in Chapter 3 are examples of

provider organizations purchasing water from much

larger producers, such as the metropolitan water

district, the California Department of Water Resources, and the county sanitation districts.

56 U.S. Advisory Commission on Intergovernmental Relations
The complex water economy may involve thousands, even hundreds of thousands, of organizations

and relationships, yet not be beyond comprehension.

Some organizations are providers of water, others are

producers of water supply, others may be both, and

there are many provider-producer relationships.

Overlaid on the provider-producer distinction is

the difference in an economy between importers,

wholesalers, and retailers. These functional differentiations and relationships are not surprising when

found in other sectors of the economy, and should not

be surprising in the water economy Some organizations import supplies to areas where water is in

sufficient demand. Others function as wholesalers,

providing water supplies to more than one retail

client organization. The retailers distribute water

directly to users. Some wholesalers may be producers

as well as providers; others may be providers only,

purchasing (for example) imported water and distrib

uting it among retailers. Similarly, water retailers may

directly produce the supplies they sell, or purchase

water from wholesalers and deliver it to residents, or

some mix of these methods.

Regulatory functions (to oversee the operation

of water suppliers and ensure safety to users) may

be performed by other organizations. In fact,

throughout various sectors of the United States

economy,theseparation of regulation fromproduction and provision has been the arrangement of

choice-quasi-independent and independent regulatory agencies and commissions, and local, state,

and federal legislative bodies and committees

typically review and mandate the safety of services

and commodities. The entire concept of the “regulated utility” is based on the idea of the separation

of regulation from production and provision.

If one looks at “water resource managemenr as

one task, then the number and degree of specialization of provision units and regulators is likely to

appear as “duplication” and “fragmentation,” with

several units “each dealing with a part of fhe prob

Ierr~“~ On the other hand, if one acknowledges that

“water resource manageme&’ consists of several

functional aspects, then one may anticipate some

functional differentiation in its organization.

Of the special local governments identified by

the 1982 Census of Governments as engaged in one or

more aspects of “water resource management,” 85

percent were single-function districts?1 These districts engaged variously in the provision of ports,

drainage, irrigation, flood control, water and land

reclamation, wastewater treatment and sewage disposal, and water supply. At one level of analysis, these

functions are all part of 44ater msource management”;

at another level, they are distinct Having different

functions performed by different specialists is a notion

that is neither alien to many sectors of the U.S. economy

nor necessarily inappropriate to the water sector

Similarly,differententitiesmayperformdifferent regulatory functions. Overseeing the costs and

the adequacy of water supply calls for different

information and expertise than overseeing and

regulating water quality. Some communities may

choose one regulatory organization; others may

choose more than one.

When the organizing concept of a complex water

economy, composed of providers and producers,

importers, wholesalers, retailers, and regulators, is

applied to the management of water supplies, patterns of organizational development and interorganizational relationships begin to emerge. It is, in

fact, an organizing concept without which much of

the activity involved in the provision and production

of all kinds of services and commodities would be

nearly incomprehensible.

The complex water economy concept, in particular,may help us understand the apparent paradox of a

large number of small water suppliers in an industry

characterized by many observers as involving large

economies of scale. Since most of the larger community systems have relied primarily on surface water,

many analyses have been based, understandably, on

the scale economies present in surface water supply

The capture, impoundment, and distribution of surface water involve large capital investments in

physical facilities (distribution systems, and dams

and reservoirs in many cases), facilities to exploit

opportunities for low-cost hydroelectric power generation, and facilities to ensure the protection of

aquatic life (e.g., fish ladders).

Some local communities and private water

suppliers have made investments in developing

surface water supplies, including the construction

and operation of water projects. But many other

surface water projects have required the scale of a

watershed, which contains several communities In

some cases, regional special districts have been

created to finance and build surface water projects, to

obtain funds from several communities that stood to

benefit,and to organize and implement the project on

the appropriate scale. In several cases, states have

designed and constructed surface water projects. Still

other large-scale surface water projects have been

financed and built by the federal government

The participation of the United States has usually

been justified on one or both of two grounds: first, that

the project, while needed for a particular community

or region, was beyond the financial resources of local,

regional, or statewide public and private entities, and

second, that benefits from economic development or

avoidance of natural disaster would inure to the

nation as a whole.=The second rationale in particular

U.S. Advisory Commission on Intergovernmental Relations 57
supported the passage of the Reclantafion Act of 1902

and the creation of the Bureau of Reclamation and the

Reclamation Fund to finance and build water projects

in the western states.

It is typically with attention to this one aspect of

water supply-construction of a surface water project

-that observers have noted economies of scale.

Surface water projects with different scales of production and of benefits have been undertaken by different producers, and several of the largest projects have

been undertaken by the federal government

However, construction and operation of a surface

water project are two different functions. Throughout

the western states, for example, while Bureau of

Reclamation projects have generated more surface

water storage capacity than U.S. Army Corps of

Engineers projects, the Corps has developed its

expertise primarily in the operation of projects for

flood control and, in several cases, the Corps may use

bureau projects for the storage and release of flood

flows to minimize flood damagesa Furthermore, the

bureau has turned over the operation of its projects to

irrigation districts or other special local governments

that represent the users,~ as is the case with the

Solano Project described in Chapter 3.

The use of project water is also subject to

decisionmaking that may be appropriately organized on a scale other than that of the construction

of the project,oreven itsoperation. Water provision

decisions (how much water of what quality to

acquire at what times and for what cost) depend on

a number of factors that tend to be local.

Therefore, a number of communities of interest

may exist within the service area of a large-scale

surface water project If they can organizerepresentative collective entities-associations, municipalities,

special water districts-that can bargain and contract

with a large-scale producer or operator, the water

project operator may wholesale water to communities needing different amounts at different times, and

the communities may function as retailers or users’

cooperatives. These arrangements can allow for

greater flexibility and efficiency in water pricing.

Project water prices may be varied according to use

patterns, so that demands for peak-period uses may

be priced higher, and off-peak surplus deliveries for

storage may be priced lowet Organizations can then

make decisions about use and delivery in response to

the incentives signaled by pricing practices.

This concept of competition among entities

representing local water users runs counter to organizational integration models, and will appear to some

analysts to be “fragmentation” of decisionmaking,

with “local parochial interests” being pursued at the

sacrifice of “the general good” of the watershed.

Nonetheless, this is how the complex water economy

operates, and this form of organization carries possibilities for efficient and equitable resource management

This form of organization also provides opportunities for adapting to change. There is a consensus in the literature that the day of the large-scale

surface water resource development project is

either passing or gone. The emphasis now is, and is

likely to remain, on improved management of

existing water supplies rather than increasing

yields through structural development?5

If the focus of water management shifts to the

demand side of the supply equation, then an economy

in which relatively large numbers of smaller local

agencies compete for resources may have benefits

that are yet to be fully realized. The efficient and

equitable allocation of any scarce resource requires

(indeed, presumes) the availability of full information about the preferences of potential claimants.

While a perfectly competitive market in water supplies does not exist,some benefits of competition may

be gained if users are required to reveal their preferences and confront more nearly the real value of

those supplies, rather than seeking to acquire abundant water for local use by persuading a larger

jurisdiction to construct a water project for their

benefit Pursuing these benefits through limited

interlocal competition has been advocated for more

than 30 years,% but their realization depends on the

existence of multiple water-users’ enterprises.

Another consequence of the shift away from

surface water development projects to meet future

needs is the increasing reliance on groundwater

supplies. Groundwater supplies tend to be relied on

more often by smaller community systems and by

noncommunity systems Groundwater development

has resulted in the proliferation of special water districts

that overlie basins Irrigation districts and conservation

districts have been especially plentifuL

As more surface water supplies were developed,

and then as the emphasis shifted from development

to management, many of these groundwater supply

organizations began to take on conjunctive management functions. Groundwater districts and associations have contracted with surface water project

operators for supplies, acquired authority to recharge

underground water storage capacity with surplus

surface flows, and in some cases acquired authority to

tax or limit groundwater withdrawals?’

Several watersheds contain multiple groundwater basins. If jurisdictions representing users are

empowered to engage in conjunctive management

and to contract with surface water suppliers, then

opportunities may exist to reap benefits from both

competition and conjunctive management. Competition and bargaining can result in pricing practices

that more nearly reflect the value of water to users

58 U.S. Advisory Commission on Intergovernmental Relations
This not only improves the efficiency of allocation by

directing water toward its higher valued uses but also

induces water users to conserve, reducing the need

for additional supplies. At the same time,conjunctive

management exploits the advantages of groundwater basins more fully. This combination of effects can

mean that surface water supplies are directed toward

higher valued uses while groundwater basins are

also more often employed for their higher valued

uses as reliable, low-cost reservoirs

In some groundwater basins, where existing

enterprises and agencies lacked the power or the

jurisdictional boundaries (or both) to engage in

conjunctive management,new agencies have been

created to provide replenishment and water storage services while spreading the costs among all

users in proportion to the benefits obtained. Special

water districts have been an especially active part

of the complex water economy.

T HE R OLE OF SPECIAL WATER DISTRKTS

Water districts are among the most numerous

special-purpose local governments The 1982 Census

of Governments recorded approximately 9,400 spe

cial districts providing one or more water management services, of which the overwhelming majority

performed a single function. About 1,000 special

water districts are engaged in supply provision, and

95 percent of these are located in the western states?8

Most of these are irrigation districts, supplying water

to lands that are not within the jurisdiction of a

municipality. Special districts (1) distribute about half

of the water used in the West, where most of the

developed water supply is devoted to irrigated agric~lture,~~ (2) constitute 9 percent of all organizations

delivering water but account for 47 percent of the

irrigated acreage (nearly all the remaining acreage

was irrigated with water supplied by mutual water

companies),30 and (3) range in size from the enormous

(covering several counties and delivering millions of

acre-feet of water per year) to the tiny (formed by a

few dozen residents to pump and distribute water

from a couple of wells).

The development of special water districts has

been encouraged to varying degrees by the states.

Generally, states have been permissive in allowing

the creation of special districts under general acts, on

the satisfaction of certain conditions designed to

establish the desire of the local residents to form a

district31 In recent decades, some state laws have

become more restrictive, and the degree of state

control over the formation of special districts of all

kinds varies considerably.

In the past, California has been the most liberal in

the creation of water districts, with 38 general acts

establishing water districts of different kinds with

different powers, and 100 special acts, each of which

creates a single district for a specified area.= California contains approximately 1,000 of all types of local

water districts engaged in all types of functions33 In

Arizona, special water districts are created by general

law or special legislation. Arizona provides for four

types of special water districts in addition to those for

flood control and soil conservation.34 New Mexico

provides for different types of special water districts,

such as conservancy districts, and some districts are

authorized to choose among alternative methods for

voting and representation and for generating revenue.% Nebraska and Florida have added the creation

of regional “super districts,” which are multipurpose

agencies under the supervision of the state.%

The Congress also contributed to the growth in

the number of special water districts, designating them

as the contacts and contractors for federal water projects

and programs during the first three decades of this

century? In 1926, the Congress amended the 1902

Reclamation Act to mquire local participation through

special water districts

Wa~rdistricts~subjecttothesameaiti~~and

challengesasarespecialdistrictgovernmentsgenerally.

In 1964, the U.S Advisory Commission on Intergovemmental Relations published a report entitled TlzePr~&Zem

of Special Districts in American Government.38The

“problem” language that has been applied to special

districts of all kinds is extended to water districts

Special districts are at the heart of the criticisms of

the struclure of American government The creation of

special water districts, especially basinwide in areas

where communities within the basin also have districts,

“results in layers of districts and a patchwork of

authority over water in the same area,” according to a

recent publication of the Institute of Public Administrati~n.~ Similar language can be found in other reportsp0

Water districts, like special districts generally, are

criticized as an additional expense for citizens, as district

boards and managers attempt to maximize their budgets and staffs in pursuit of their own professional

career goals Ye the 1982 Census of Governments

reported that, of the 9,400 special diicts it identified as

engaged in water supply and management services,

only 350 (4 percent) were cla&fied as having “major

financial activity; meaning at least $3 million in annual

expenditures or $10 million in outstanding debt This 4

percent accounted for 75 percent of the expenditures of

all special water disttick~ Among all types of special

districts, about two-thirds had less than one full-time

equivalent employee; about 6 percent had 20 or more

full-time employees42

Special water districts may be reluctant to participate in cooperative ventures that involve the use of

groundwater storage space by state agencies or other

districts, even though it may be an advantageous use

of the basin Districts tend to feel that they owe their first

U.S. Advisory Commission on Intergovernmental Relations 59
consideration to their residents and that storage programs involving “outsiders” may compromise those

interests This reluctance can be overcome, however, if

the anticipated benefits from conjunctive management

are shared with the district and the local residents@

Another criticism of special water districts is that

their voting and representation procedures can be

undemocratic. The boards of directors are often

relatively stable and, depending on the legislation

that created the district, there may be no need even to

conduct uncontested elections. But it becomes difficult to sort out the extent to which governing board

stability and uncontested elections indicate citizen

satisfaction versus lack of understandingandengagement As one observer noted, special water districts

and their functions may not be well understood by

citizens, yet a certain “lack of public understanding”

extends to the whole specialized field of water law

and administration. The 1980 Arizona Groundwater

Management Act, for instance, is so complex that few

people understand how it works; the public is aware

only that there is a law? Other measures can beused

to determine how citizens evaluate special district

officials (e.g., do they tend to support or oppose the

creation of additional districts when presented with

the choice). Survey research can ask citizens to offer

evaluations aside from the electoral process.”

In some places, voting for the board of a special

water district is based on land ownership rather than

on one vote per person. Although the constitutional

validity of such voting schemes has been upheld in

districts that provide water for irrigation, this practice

continues to be criticized, especially in the few cases

where one landowner controls a majority of the votes in

the district. The district then becomes a modern

manorial system in which the largest landholder may

tax the property or assess the water use of smaller

landowners in order to provide water services that

inure mostly to the controlling landowner’s benefit?

As the Institute of Public Administration acknowledged, the advantages of special water districts

appear primarily by comparison with local governments. Districts have the jurisdictional flexibility to

cross other governmental boundaries, cover unincorporated areas, and embrace a natural resource boundary or a community of resource users4’

Special districts create greater opportunities for

developing revenue and pricing systems that (a) link

the imposition of costs to the distribution of benefits, (b)

provide incentives for efficient mix and use of services,

and (c) can make the district and its activities self-financing? Special districts often can, and often do, employ

user fees and service charges This is a more effective

linkage of costs to benefits than are more indirect

mechanisms, such as the income tax or the property tax.

While ideal-theoretical economic efficiency

would result from pricing policies that reflect both the

cost of services and the social costs of those services in

other opportunities forgone, a move toward pricing

that reflects the full cost of provision would be a move

in the direction of greater efficiency Implementing

full-cost pricing-which was the principal recommendation made in the report on water supply forthe

National Council on Public Works Improvement in

1987-was deemed to require some degree of fiscal

autonomy The special water district is the most

frequently encountered type of autonomous organizational form. Other types are enterprise fund accounting systems and state-chartered corporations.”

When water supply and management functions

are commingled with other general government

functions, two sources of inefficiencies arise.

Decisionmaking involves multiple claims on officials’ attention, and water decisions compete with

everything from public assistance to pothole repair.

Financing water supply also becomes commingled in

most cases with other services and infrastructure

needs. The water enterprise can end up being tapped

as a source of revenue for other programs and projects

(water subsidizes other services) or vice versa. Both

situations generate inefficient pricing signals to

consumers and inefficient levels of investment “The

endemic condition which results from commingled

decisionmaking is one of ‘public choice failure.“‘%

While there are no guarantees that separate, selfsustaining special water districts will make optimal

investment and pricing decisions, at least the institutional barriers that result from commingled decisionmaking are removed.

Another advantage of the special water district is

that users relate to it and use it for innovations, rules,

and conservation measures they might be reluctant to

accept from a municipality or a jurisdictionally larger

government (e.g., state or federal government). For

example, the Soil Conservation Service of the U.S.

Department of Agriculture has been engaged in an

experimental program with a nonprofit research

organization, INFORM, and local conservation districts to encourage soil-moisture monitoring using

gypsum blocks in California’s Sacramento and San

Joaquin Valleys. The program increased farmers’

yields while reducing their consumption of water

and energy inputs. This lowered farmers’ costs and

increased their incomes with a program that conserves water by improving the efficiency of irrigation

timing and amounts. Such a program could reduce

aquifer depletion and related problems where irrigated agriculture accounts for most of the consumptive

use of water The conservation district “is a natural

home for an educational program about the gypsum

block method of irrigation management because a

district enjoys the trust of local farmers as well as the

support of technicians and government officials”51

60 U.S. Advisory Commission on Intergovernmental Relations
Properly empowered, special water districts

provide a framework for making water supply and

management decisions removed from the arrangements for other services. A district also provides a

link to the state, region, and nation, and may serve

as a representative or bargaining entity. While

water rights statutes can be produced by legislative

bodies, conflicts decided by courts, and regulations

promulgated and implemented by administrative

agencies,“it appears to have been the experience.. .

that some form of publicdistrictserves anirreplaceable function.“52

PRIVATE SUPPLIERS

IN THE WATER ECONOMY

Private suppliers play a significant role in the

complex water economy Nearly 40 million citizens

are served by privately owned community water

systems. Smaller private systems generally serve

residential developments and mobile home parks,

and are usually owned by developers or homeowners’ associations. Larger suppliers more often are

investor-owned utilities regulated by general governments or by state public utility commissions.% The

number of investor-owned systems is increasing as the

Population of the United States has grown fastest in

areas that have a history of using that mechanism such

a6 Florida, Arizona, and California.

The range of private sector activity is broad. It

includes supplying water for municipal and indus

trial uses and for irrigation,54 and, where markets for

water righk are developing in the V&t, functioning as

brokers who link purchasers with available water

righk.56Private involvement does not always replace

public involvement While private water enterprises

are growing in number and size in some areas, in

other places (especially in some growing suburban

areas) private suppliers have been taken over by

condemnation or purchased by municipalities5s

There has been some discussion and debate over

the propriety of privatization in the water economy.

Advocates cite advantages in flexibility and responsiveness, lower costs, and more efficient pricing

practices Those who are critical or skeptical of

privatization cite the broader availability of service

without regard to ability to pay that comes from

public provision, and the advantages of more direct

political accountability. As concluded in a 1987 report

to the National Council on Public Works Improvement, “Both philosophies merit consideration, but in

certain circumstances privatization does offer real

economic gains.“57 Private and public sector involvernent exist alongside each othec Neither exists as a

complete answer to water supply and management

challenges Private suppliers, financing, and brokering provide additional alternatives for citizen choice.

THE ROLE OF ASS~UATIONS

Associations of water users, officials, and professionals have played important roles in facilitating

effective water management These roles generally fit

two broad categories: (a) mobilizing and organizing

members in support of management initiatives, and (b)

providing forums for communication and disseminating information and technical assistance

Policy initiatives and coordination are sometimes facilitated by associations of public officials,

such as the Great Lakes Conference,an association of

the governors of the eight Great Lakes states Another

is the recently formed Upper Missouri River Basin

Governors’ Association, composed of the governors

of North Dakota, South Dakota,Montana, and Wyoming, which will provide a regular forum for the

discussion of water development, watershed construction, irrigation, and other issues..5B

Water quality management has been facilitated

by the American Water Works Association, which

publishes ik monthly AWA Joaumul and holds

national and regional conferences, and the Association of State and Interstate Water Pollution Control

Administrators, which has organized conferences

devoted specifically to innovations in management

and groundwater quality protection.

Associations can be especially important to

smaller water systems that do not have large enough

staffs to include a broad range of professional expertise. The National Rural Water Association (NRWA),

for instance, offers technical assistance in 34 states A

program begun by the Oklahoma Rural WaterAssociation has been adopted by NRWA to help smaller

systems retain their local organization and integrity

while complying with federal safe drinking water

requirements. Among the services provided by the

national program are: one-day training sessions in

rural areas; on-site technical assistance; monthly or

quarterly newsletters with information and advice

on compliance with federal requirements; and emergency field assistance to systems expressing difficulties The association program features contact with

small water systems throughout each state and a

full-time “circuit rider” who travels the state to

provide assistance.*

Associations of water users have played important roles in groundwater management and often

have been forerunners of conjunctive management

programs. Such associations frequently establish a

broad-based forum for the discussion of water issues by

industrial users who produce their own water, municipal and private suppliers, citizens concerned about

envimnmental quality, and others Such associations

have appeared throughout the county and can be the

fin% step toward the development of effective water

management plans, programs, and institutions

U.S. Advisory Commission on Intergovernmental Relations 61
In Colorado, the South Platte Water Users’Association helped develop means for coordinating the use

of surface and groundwater supplies. The role of

water users’ associations in developing conjunctive

use programs in southern California was summarized by a 1978 RAND Corporation report as follows:

Local producers organized themselves into

water user associations that were the driving

force behind not only the design of management plans but also efforts to garner support

for their acceptance and to create institutional arrangements and management tools to

implement them. They pushed for creation

of local water districts to import water and

aided the process of arriving at negotiated

settlements through the courts. They promoted state legislation to permit organization of [replenishment districts] and to require recordation of pumping.@

In the Tucson metropolitan area, which is entirely dependent on groundwater supplies, the Southern

Arizona Water Resources Association has played a

pivotal role. Originally formed asa broad-based local

interest group to ensure that Central Arizona Project

water would be brought to Tucson, the association

subsequently provided a vehicle for study,discussion,

and development of responses to groundwater declines and quality problems, which engaged the

whole community. The association initiated a management study in 1983 to determine the institutional

mechanisms that would help bring about a balance of

water supply and demand in the Tucson basin.

Although the Tucson area had been designated an

active management area under the Arizona Groundwater Management Act, there were no staff resources

to conduct such a study, or any broad community

membership to support such a study and act on the

results. The association also was instrumental in

supporting a water-conservation program that has

received nationwide attention for bringing percapita

water use in Tucson down to 150 gallons per day?

A DJUDICATIONS AND THE RIGHTS

OF P ROVIDERS AND P RODUCERS

Courts have been active in water rights and water

allocation for centuries. Courts in all states become

the arbiters of water rights laws and conflicts.”

Lawsuits have been customary means of asserting

and protecting rights to the use of water@ Lawsuits

between surface stream users -particularly bydownstream users against upstream users - have a longer

history in most places than those between groundwater users This reflects the fact that surface water

development preceded groundwater development

.

Adjudications of groundwater rights nonetheless go

back more than one hundred ye&.

In several cases, adjudications have been expanded to include all of the pumpers drawing water from

a common aquifer system. These basinwide adjudications have drawn considerable criticism, and have

been described as “lengthy, cumbersome, and expensive.“@ Court decisions over the allocation of rights

have differed from basin to basin, and thus have been

criticized as lacking a uniformity on which water

users could base their decisions.

Courtshavebeen criticized forproducing”atbest

. . , piecemeal problem solving.“65 The decision “of one

court as to the best, most pragmatic solution may not

be the most efficient management solution.“” Further, courts take into consideration only the rights and

interests of the parties before them, which may not be

the full set of persons affected by the outcome. Finally,

experience has shown that basinwide adjudications

generally have been initiated “only after the ground

water basins were in real trouble.“67

Despite these criticisms, groundwater users

have continued to employ courts and basinwide

adjudications. Groundwater users may compare

the costs, defects, and potential outcomes of the

judicial process with those of otherpublicdecisionmaking processes and find the judicial process

preferable or at least less undesirable.

There is no gainsaying that basinwide determinations of rights through adjudication are usually

“lengthy, cumbersome, and expensive.” However,

when users need to resolve problems resulting from

joint use of a common water supply, their choice is

between a “lengthy, cumbersome,and expensive” but

authoritative legal proceeding and a long, difficult,

and uncertain legislative or administrative process

There is no immediate, simple, and cost-free alternative. While the rules of civil procedure in the courts

may be complicated, they do not necessarily compare

unfavorably with, say, the Adminisfmfive Procedures

Act (or its equivalent in a given state) or the legislative

process.68 Similarly, while it is true that court decisions

are not necessarily the most efficient management

solutions to the problems of joint use of a groundwater basin:’ legislative or administrative decisionmaking about groundwater rights may show a greater

tendency toward inefficiencies because of the mismatches between jurisdictional boundaries and those

of the affected communities.

Similar analysis applies to other criticisms of

adjudications. The procedural rules of courts are

designed to limit those involved to “real parties in

interest” They do not guarantee that all concerned

parties will be found, included in the proceedingand

heard, although courts have a number of procedures

for finding and joining additional parties to a controversy Similarly, legislatures and administrativeagen62 U.S. Advisory Commission on Intergovernmental Relations
ties offer no guarantees that all affected interests will

be heard, or heard equally. Likewise, the charge that

adjudication is not undertaken until harmful effects

have manifested themselves applies to public

decisionmaking processes generally. People initiate

judicial proceedings or introduce legislation or undertake administrative rulemaking after problems

have arisen, not before.

Therefore, adjudications may be pursued by

water users not because they are simple, inexpensive,

and yield efficient solutions to problems before they

occur, but because they are perceived as less inaccessible, indeterminate, inefficient, and inflexible, and

more responsive than alternative forms of public

decisionmaking. In addition, some properties of

adjudications may actually be preferable from the

standpoint of water users.

Equity court proceedings offer such procedural

and remedial devices as the temporary restraining

order, the court-appointed referee, and the permanent injunction that may Be especially well-suited to

the determination of water rights. In 1973,theNational Water Commission explicitly endorsed the idea

that “the States should consider employing the

flexible powers of the equity courts to achieve

least-cost physical solutions” in groundwater basin

conflicts.‘0 Adjudications in overdrawn groundwater

basins have “stopped the clock on the acquisition of

additional water rights.“n Courts can “act quickly to

prevent irreparable damage and then take longer to

reflect on the merits. In the water resource field, no

institution can move so quickly to prevent harm so

that time to consider exists.“n

The appointment of experts to assist courts also

has been used in groundwater adjudications. The

court-appointed referee (called the special master in

some courts) can assemble information on hydrologic

characteristics and historical use of a basin that gives

all parties a common information base, which can

assist in the negotiation of a settlement, and provides

the judge with the data needed for a decision. This

tends to blunt the criticism that judges, like legislators

and administrators, lack the technical expertise to

make determinations.

Another aspect of the judicial process that users

may find beneficial is that, “Courts are deciders.

When parties call upon them for decisions, they have

very few ways to avoid making it”n Individual

parties may not agree with the outcome of the process,

“but only in the rarest of cases is the court action an

empty exercise which wastes time,“74 as may occur with

legislative and administrative processes

The outcomes of basinwide adjudications also

may be perceived as desirable by the participants.

Injunctions that limit extractions and bar additional

pumping, for example, help control overdrafting, an

essential element of improved management Basinwide determinations of rights result in the parties

acquiring something of value. These rights, if acquired through a determination separate from land

ownership, often are tradable within the basin. In

nonadjudicated basins, taxes on withdrawals may be

used to try to limit aggregate extractions, but this

alternative gives users nothing of value in their

production; they can pay taxes on their pumping but

they cannot sell the right to pump.75

Adjudications also may give users the right to

recapture water stored underground, an essential

element of conjunctive management Indeed,observers who have criticized the length and expense of

adjudications have concluded nonetheless that the

“use of underground storage for imported water

cannot be completely successful unless the natural

local water supply has been fully adjudicated so that

extractions can be controlled and the basin fully

managed.“76And,adjudications have been used often

to generate the basis for financing the conjunctive

management practices that help preserve the basin

and exploit its advantages Once firm and limited

pumping rights are allocated, it becomes possible to

impose a surcharge on overpumping to pay for

replenishment and to impose the costs of additional

surface supplies, whether locally developed or imported, on new users whose demands exceed the

available yield of the basin.

In all, the use of adjudications to establish rights,

limit withdrawals, control overdraft, provide for

regulation of water in storage, and distribute the costs

and benefits of basin management among users may

not reflect a “problem,” but a decision based on

assessment of the capacities of the process relative to

other public decisionmaking processes This possibility was recognized in a recent article on forums for

groundwater dispute resolution:

Of all of the water resources management questions that ate raised, the judicial

system is probably most effective in determining simple questions of water quantity

based on factual testimony by expert witnesses. The court system is the only forum to

determine traditional monetary damages

cases, the award of damages in inverse condemnation cases, and the issuance of injunctive relief against unlawful or harmful practices It is also the only forum which acts as

the reviewing agency for special district and

agency determinationsR

REGULATORS IN THE COMPLEX WATER ECONOMY:

THE PROTECTION OF WATER QUALITY

The complex water economy is regulated by

local,state,and federalgovernments. Local regulators

are most likely to be overseeing the operations and

U.S. Advisory Commission on Intergovernmental Relations 63
costs of private water suppliers such as utilities. When

local general governments contract for water supply

with a private producer, the local legislative body

generally retains oversight authority

Local governments also have been actively involved in protecting gmundwater quality and mmedying contamination problems. Metropolitan Dade

County, Florida, for instance, depends on the shallow

Biscayne Aquifer for its drinking water supply. This

aquifer is highly permeable and therefore very

vulnerable to contamination The location of the

aquifer along the coast also renders it susceptible to

salt water intrusion if excessive withdrawals lower

the elevation of fresh water Located in a state that has

highly developed and strong groundwater quality

protection programs, Dade County has been aggmssive in developing and integrating groundwater

management effortsm Regulation of supplies and

quality are centered in the county’s Department of

Environmental Resources Management In the 196Os,

there was salt water intrusion because of depletion

and biological contamination from leaking septic

tank systems. In the 197Os, industrial and agricultural

activities caused chemical contamination. Contamination prevention, wellhead protection, recharge

area management, wetlands protection, and growth

management are all part of the Dade County approach to groundwater managementm

Since the early 197Os, the county commission has

attempted to integrate water quality and supply

concerns with the regulation of land uses. In 1974,the

commission imposed a building moratorium in a part

of the county that is a vital recharge area for the

Biscayne Aquifer, after which the area was zoned for

minimum lot sizes of five acres. A Florida appellate

court upheld the zoning plan against a constitutional

challenge, observing that water supply protection

was a legitimate objective of a local zoning policy and

a valid exercise of local police powers in the interest of

the general welfare.so

Land use practices that create risks of groundwater contamination are closely monitored by the

county Department of Environmental Resources

Management Dade County also has established its

own broad definitions of hazardous wastes, which

are more extensive than federal or state regulations

and include more than 900 chemicals. The Department of Environmental Resources Management has

identified 8,000 generators of hazardous wastes and

closely regulates their activities through a permit

systems1 that requires use of best management practices (BMPs) to protect groundwater quality

In addition, Dade County has been a leader in

designating “wellhead protection areas,” protecting

sensitive amas around water supply wells from surface

activities that could lead to contamination. Within

protected areas, land use and zoning restrictions can be

used to prohibit underground storage tanksa The

county also has created a local hazardous waste trust

fund; has established a cleanup program forcontamination sites; and participates with two neighboring

counties in the “Biscayne Aquifer Project,# an attempt

to extend effective protection programs across the

reach of the aquifec@

Interlocal coordination also can be effective in

executing regulatory functions. In California, the

Southern California Association of Governments

(SCAG) became a vehicle for interagency and interjurisdictional coordination in response to the discovery in 1980 of the volatile organic compound trichloroethylene (ICE) above state safe drinking water

levels in one-third of the wells tested in the San

Fernando Valley groundwater basin in Los Angeles

County. This basin has been the source for about

one-fourth of the drinking water for Los Angeles,and

equally significant shares of the drinking water

supplies for Burbank, Glendale, and San Fernando.

The basin also is operated conjunctively by the Los

Angeles Department of Water and Power and a

watermaster as a direct source of supply and as a

storage reservoir for imported surface water via the

Los Angeles Aqueduct

SCAG and the Los Angeles Department of Water

and Power applied for and received a federal

areawide planning grant for a study to develop a

“Groundwater Quality Management Plan for the San

Fernando Valley Basin.” The development of the

plan engaged citizen input through a citizen advise

ry committee, and alerted the public to the contamination in a way that mobilized local opinion in favor

of remedial action but avoided panic.@

State and local agencies were involved in plan

development through a 30-member technical advise

ry committee that met bimonthly The plan, which

specified roles for the governments, included procedures for public education; regulation and eventual

elimination of private disposal systems (septic tanks);

regulation of underground storage tanks, pumps, and

pipelines; enhanced landfill regulations; a groundwater monitoring program and aquifer management

and groundwater treatment The governments and the

citizens accepted the plan, due to the inclusive process

by which it was produced, and all aspects of the plan

have been or are being implemented.@

The technical advisory committee has been

retained as an interagency advisory committee,

which continues to meet bimonthly to discuss and

oversee implementation. The plan was developed

and implemented regionally, without the creation of

a new agency or department, but with the coordination and cooperation of multiple jurisdictions. There

was no attempt to centralize groundwater supply

management, quality protection, and remediation

activities, but there was an attempt to coordinate the

64 U.S. Advisory Commission on Intergovernmental Relations
activities of the entities that had responsibility for

those functions. The presence and involvement of the

Southern California Association of Governments

facilitated this coordination.

The states and the federal government perform

regulatory and other functions in the complex water

economy. The remainder of this chapter focuses on

the role of the states and the federal government.

THE R OLE OF THE S TATES

States as Regulators

States regulate water quantity and water quality

in a variety of ways. Several states have their own

drinking water standards as well as compliance

requirements for water providers.

While most water supply provision and production are local, state governments have long been

engaged in overseeing local water supply provision,

especially in ensuring safety, often through state health

departments@ State-operated public water supply supervision programs have existed since as early as 1915.8’

Washington state regulates supply operations

and water quality. The state took several legislative

steps in the 1970s toward regulating all water utilities.

Washington monitors suppliers’ compliance with

drinking water standards and requires local retailers

to plan for adequate treatment of supplies and for full

system metering. The state also has attempted,

through its Water Supply System Coordination Act of

1977, to “raise barriers to entry” into the industry in

order to reduce the number of smaller, undercapitalized operators that might ultimately be unable to

meet quality requirements. The law encourages using

existing producers to meet new water supply provision needs in critical areas.ffl

The states’ role in water quality regulation has

grown significantly in the past two decades.89 Many

states have adopted programs for cleaning up and

regulating major sources of groundwater contamination. Indeed, as the National Research Council’s

Committee on Ground Water Quality Protection

found, “many states have broader authority than the

federal government to prevent and control groundwater contamination. In the last several years, many

states and local areas have initiated and expanded

ground water protection programs by state mandate.“% Most state water pollution control laws apply

to groundwater as well as surface watecgl A 1988

report from the U.S. General Accounting Office

found that states “usually deal with the threat of

groundwater contamination within the framework

of an overall protection program. Many states have

organizations directly responsible for groundwater

protection, while others have placed these duties

within existing organizations.“g? The diversity reflects in part the fact that, “Although contamination

problems are similar across the states, each state has

unique problems.“93

Some states have moved toward administrative

centralization, but often this has been in environmental quality rather than water resources. In 1973, the

Final Report of the National Water Commission

coupled its nzcommendation that surface and gmundwaterwithdrawalsbemanagedtogether,withcoordinated conjunctive use, with a recommendation that

groundwater quality and surface water quality

should also be managed together. The commission

observed that “the expertise bearing on surface water

quality will also bear on ground water quality,” and

suggested that the “agency that regulates the one

should regulate the othec”%

Since then, many states have consolidated environmental quality programs, including surface and

groundwater quality, air, soil, and waste disposal.

Such consolidations have separated quality and

quantity planning and management% Furthermore,

there appears to be some regional pattern to state

choices. States in the West and Southeast have tended

toward administrative consolidation of water quantity planning and management, with a separate organization for environmental quality States in the

Northeast have more often integrated both functions.96 Connecticut and Arizona pmsent examples of

these different approaches.

Connecticut has been described by the National

Research Council’s Committee on Ground Water

Quality Protection as “a national pacesetter in statewide programs for ground water protection.“97 The

state has developed an integrated management program that is connected with local land use planning

and regulation of pesticide application. The goal is,

where possible, to restore or maintain all groundwater to drinking water quality? Impetus for the program came from rapid growth in the number of wells

shut down due to contamination.

Connecticut adopted a series of laws concerning

groundwater quality protection in 1985. One law

directed the commissioner of Environmental Protection to report to the legislature on options for

protecting underground water supplies, with a map

of areas needing protection and a strategy to protect

watersheds and recharge areas from dangerous land

use activities Another law required land use officials to

consider protection of underground drinking water

supplies in land use and zoning decisions Two other

laws authorize the restriction of general-use pesticides

and the nzgistration of pesticide application companies

Among the elements of Connecticut’s integrated

groundwater management program are:

1) State drinking water standards;

2) State groundwater quality standards;

U.S. Advisory Commission on Intergovernmenta! Relations 65
3)

4)

5)

6)

7)

8)

9)

10)

11)

12)

An ambient groundwater quality monitoring network, as well as monitoring of contamination sources and sites;

Aquifer classification;

Aquifer mapping and inventory;

Permits for all point sources of pollution;

A statewide ban on toxic septic system additives and some pesticides;

Use of best management practices (BMPs)

for nonpoint sources of pollution;

Wellhead protection and setback requirements;

Use of land use regulations along with aquifer classification, wellhead protection, and

setback regulations to protect aquifers from

contamination;

Requirement of groundwater withdrawal

permits;

Regulation of groundwater withdrawal permits to maintain minimum adequate stream

flow where water sources are connected.

Groundwater in all areas of the state has been

mapped and classified according to four categories of

use. The highest protection is for utility and municipal drinking water systems. Two middle classifications cover private drinking water supplies and

supplies that may not be potable unless treated

because of prior impacts on water quality, The fourth

classification designates areas where waste disposal

is allowed because of the poor water quality, and

because there are no future use plans.99Thisclassification system provides the highest level of protection

for 90 percent of the state’s groundwater+@’

The Connecticut program is based on the premise that, while much should be done by the state, the

principal implementation of resource protection should

be done by local authorities, and some local capacity

building wmains to be done. The gmundwater strategy

is “a partnership between the State and its 169 municipalities for the management of ,ti rrsoua”lD1

The state Department of Environmental Protection, which has been in existence since 1972, contains

a central information gathering and disseminating

unit, the Natural Resources Center, to provide data to

state and local decisionmakers. The center makes

extensive use of the cooperative investigations programs of the U.S. Geological Survey.lLa

In Arizona, as was noted in Chapter 3, after

passing the 1980 Groundwater Management Act,

officials began work on quality protection, culminating in enactment of the Environmental Quality Act of

1986. Some added pressure for this legislation came

from the 1984 discovery of trichloroethylene (TCE) in

wells in Tucson, which is wholly dependent on

gmundwatec103 The legislation was developed

through a process of negotiation by a representative

commission toward consensus and compromise

among affected interests, similar to the process for the

groundwater management law. And, as was the case

with the 1980 law, internal political divisions slowed

the adoption of strong legislation, though the political lines went drawn somewhat differently. Strong

environmental protection legislation aroused the

opposition of some influential agricultural and mining operato% weaklegislation was opposed by active

environmental groups and would have been inconsistent with the commitment of the governotlOq

Another significant political issue was what state

agency should be primarily responsible for administration. One logical choice was the Department of

Water Resources, created by the 1980 legislation. Such

an approach would have integrated groundwater

supply management and quality protection. Another

logical choice was the Department of Health Services, preferred by environmentalists, who viewed

water quality as a public health issue to be separated

from the management of supplies Thenz was some

consideration given to mating an environmental

“super agency” with jurisdiction over water resources

management, quality protection, pesticide control, and

other subjects None of these choices was adopted,

The 1986 Arizona Environmental Quality Act

created a Department of Environmental Quality,

with responsibility to protect water and air quality,

and spread environmental regulatory authority

across six existing and new state agencies. In the view

of two former directors of the Department of Water

Resources, this approach has raised coordination

costs but was an understandable resolution of the

issue of administrative responsibility and authority?

The law required all groundwater quality standards to be based on an evaluation of social, economic, and environmental costs and benefits. All aquifers

were to be inventoried and classified by June 30,1987,

and a statewide monitoring program was established

to improve the data base on groundwater quality

Aquifer protection permits have been required for all

activities that have been found to pollute gnnmdwatet

The law also directs the Commission on Agriculture and

Horticulture to regulate the use of pesticides through

licenses and permits, and bans the use of any pesticide

unless the manufacturer has shown that contamination

will not result The Arizona Attorney General is authorized to enforce water quality standards’”

Although Arizona approached groundwater

supply management and quality protection with

statutes that created new departments, this does not

mean that there is no connection or coordination. The

well registration, metering, and withdrawal reporting requirements of the management law will con66 U.S. Advisory Commission on Intergovernmental Relations
tribute to the knowledge base for quality protection,‘”

and the aquifer inventory and classification and

groundwater monitoring programs will be useful for

management officials.‘OB

These examples have been chosen to highlight

some different possibilities for the organization of

groundwater protection in relation to the management

of supplies; no attempt has been made to inventory and

describe the number and variety of state and local

programs Through the YXKls, new groundwater pmtection legislation and regulations, and new forms of

administrative organization and coordination have

been generated in vktually all stateslog

The Committee on Ground Water Quality Protection of the National Research Council concluded

from its review of state and local groundwater quality

protection activities and programs that

no single program was found to address all

aspects of ground water protection problems

comprehensively. A comprehensive program would probably incorporate elements

from a number of the state and local programs reviewed in this report as well asother

techniques not discussed here. While no

single program can be held out as a model for

others to follow, collectively they comprise a

reasonable array of alternative ground water

protection program designs being used.llO

State laws and organization of groundwater

quality protection programs doubtless will continue

to vary, reflecting emphases on different groundwater quality problems, and different institutional arrangements on which to build, as well as legal and

cultural differences Deviations from suggested statutory or administrative models do not necessarily reflect

inadequacies, but may indicate successful adaptations

to the challenges faced by states and communities

States as Water Suppliers

States also have operated in the complex water

economy as large-scale water suppliers or wholesalers. While California’s State Water Project, which

conveys water from the north to the more heavily

populated south, is perhaps the largest and best

known state water supply undertaking, state involvement is far from being a western phenomenon. For

example, Pennsylvania has long authorized and

constructed flood control projects;“’ Massachusetts

has supplied the Boston area with water from the

western part of the state for over a century; and New

Jersey has transferred water from the Delaware River

to the more heavily urbanized northeastern part of

the state since the E300s.“2

As noted in Chapter3,states that perform the role

of water supplier have opportunities to influence

user behavior through conditions on access and

through pricing mechanisms. Massachusetts and

New Jersey have used control of access to large-scale

surface water projects to encourage changes in the

behavior of local water users and their organizations,

although the tactical approaches of the two states

have been different

States as Rulemakers

One of the most important state roles in the

complex water economy is making the rules for access

to water supplies Although the federal government has

the constitutional authority to regulate navigable waterways, the states have had responsibility for making and

enforcing the laws that govern access to the withdrawal

and use of surface and groundwater supplies

As much of the emphasis in water resource

management has shifted from developing additional

supplies to managing and allocating supplies, the

historical role of the states in water rights administration isseen as enhancing their present and future role.

“[A]s priorities shift from water resource development to management, the states are the more appropriate level of government to initiate and administer

programs.1113 States have broad police powers to

make policy in health, welfare, and environmental

protection. Almost all states have health and environmental agencies, and many have separate water

resources agencies or departmentsu4 These facts,

combined with the states’ historical role and current

activity, have formed the basis for some analysts to

conclude that “the states are uniquely qualified to

address the issues spec$ic to their region, and that

many states have already developed solutions to

some of their water management problems.“115

Thisaspectofthestates’mle-thedefinitionofwho

has rights, how those rights am acquired, and in what

ways (if any) they am quantified and limited-is at the

heart of the institutional arrangements for managing

watermxnucesThestaterulesdiffer;andthisaffectsthe

patterns of water use and development The effects of

state water rights laws on use and development will be

considered at some length in the next chapter

States as Policy Innovators

States developed and modified water rights rules

and quality regulations and programs considerably

in the 1970s and 1980s. During the 1980s in particular,

it can easily be contended that the states have been

the principal sources of groundwater policy innovations, 54s in other water management categories, the

major actor in groundwater is state government”l16

From 1980 through 1989,3Ostates adopted significant new groundwater supply management and

quality protection policies.“‘These states were significantly more dependent on groundwater supplies

than those that did not adopt new policies,suggesting

U.S. Advisory Commission on Intergovernmental Relations 67
that states respond to perceived water supply management needs.

During the 198Os, 24 states adopted new water

quality protection laws, groundwater classification

systems, and/or groundwater quality standards According to 1987 testimony by the executive ditector of

the Association of State and Interstate Water Pollution

Control Administrators, two-thirds of the states had or

were developing groundwater quality standards and/or

use classification systems 118 During the 1985,19&j, and

1987 legislative sessions, 37 states enacted groundwater

quality protection legislation, either to address specific

programs (such as underground storage tanks or pesticide use) or to develop statewide strategies119

Forty states have discharge control permit

programs, and these programs frequently require a

discharger of contaminants to monitor groundwater quality.iza Forty-nine states have accepted primary enforcement responsibility under the provisions of the federal Safe Drirtkirrg WaterAct, which

involves: (1) engineering plan review, (2) compliance monitoring, (3) conducting periodic sanitary surveys, (4) certifying laboratories, and (5)

enforcement against persistent violators of drinking water quality standardsJ21

THE ROLE OF THE FEDERAL GOVERNMENT

The federal government has been involved in

water resource development and management for

much of our history Most of this involvement has been

directed toward surface water supply development

States, communities, and industries have had the

primary responsibility for water provision and management In the past, the Congress has recognized this

primary state and local role, and many federal water

laws contain policy statements that describe the

federal government’s role as limited and ancillary.‘”

This federal role has been manifested in several ways

Perhaps the most plain has been statutes directing

federal agencies and installations to comply with

state water rights laws and administrative procedures. This has included acquisition of water rights

for federal projects through appropriation permit

procedures or condemnation and payment in situations where the federal government could have

exploited its “navigation servitude” under the law.123

The Congress elected instead to defer to the states

Federal deference to state water laws, which dates back

to the acquisition of the western states during the 19th

century, has been seen by some as a missed opportunity

to impose ua uniform system of water law on the region,

though in view of the well known difficulties that

developed over the federal land policy in the area, them

is no reason to assume that Congress would have

devised an ideal system of water law.“iZ4

The Congress also has cooperated with and

supported states efforts at interstate resolutions of

water supply issues involving multistate resources

The Congress has authorized interstate water compacts, and the federal government has been a party to

federal-interstate compacts, such as the one governing the Delaware River Basin.

In addition, the federal government has encouraged and supported state and local activities and

initiatives in water resource management through

income tax laws. By exempting the interest earned by

holders of state and local securities from federal

income taxes, the Congress and the executive branch

have made it easier for governments to sell the securities

that finance state and local water resource activities

However, limits were placed on this support by the Tnw

R&m Act qf 2986. These forms of support have been

accompanied by more active involvement, such as

financing and production and dissemination of water

msoumes information, financing and production of

surface water development and impoundment projects, and regulation of water quality

A Supportive Federal Role:

Information and Technical Assistance

The federal government has contributed importantly to the production and dissemination of information and scientific knowledge about groundwater

Although management problems and responses differ from place to place, many elements of basic

hydrologic research into groundwater are conducted

in the same way and require the same sort of education

and expertise throughout the country and the benefits

of research reach beyond the boundaries of the community in which it was conducted. Thus, while states and

local communities have been interested in supporting

and participating in the promotion of research and the

development of extensive resource information, they

have been reluctant to fund most types of water

research The appropriate scale for the conduct of basic

research and the collection of scientific and technical

information on water resources is national*=

The Department of the Interior’s United States

Geological Survey (USGS) has been collecting data

on water resources since 1888. Currently, USGS

collects streamflow and discharge data at 13,212

surface water sites, water level and pumpage data at

35,621 wells, and water quality information at 4,610

surface-water sites and 7,648 wells USGS publishes

hydrologic data in the form of annual reports for each

state, and a monthly catalog of publications126

States and communities have relied strongly on

USGS reconnaissance studies and hydrologic investigations, and the “early systemic collection and interpretation of hydrological data has been important to

the development of current state groundwater programsn127 Some state geological surveys date back to the

68 U.S. Advisory Commission on Intergovernmental Relations
mid-180@ but most state efforts evolved in association

with USGS. Cooperative investigations began in 1895.

The Congress appropriated funds specifically for cooperative studies beginning in 1905, which began the

Federal-State Cooperative Program of the U.S. Geological Survey In 1928, the Congress set a 50 percent upper

limit on the federal share of the costs of any investigation under the pmgmm

The Federal-State Cooperative Program allows

states and communities to enter into agreements with

USGS for hydrologic investigations into an actual or

anticipated water-supply problem. States and communities are able to define the problems, contribute at

least half of the funds for the investigations, have

access to the expertise and experience of USGS, and

use the information in their decisionmaking processes. The cooperative program has produced much

of the information available on the nation’s water

~esourres, including information used by other federal

agencies In fiscal 1983, more than 800 “cooperators”

participated with USGS in the program. States participated in 252 projects, municipalities in 205, counties in

183, and other entities (including special districts,

interstate compact organizations, and Indian tribes) in

204 USGS publishes several series of reports based on

cooperative program projects

The federal government also has assisted states

and communities in building institutional capacity

through the development of their own expert personnel. The Wafer Resources Research Act of 1964 (most

recently reauthorized in 1984) provided matching

funds for the establishment of Water Resources

Research Centers in each state. The centers conduct

research and investigation, and serve as training

centers for water resources professionals. USGS also

operates a National Training Center in Denvec In

addition, the Wafer Resources Planning Act of 1965

created the federal Water Resources Council (WRC)

and authorized financial assistance to the states for

planning. Although WRC and the planning funds

were discontinued in the early 198Os, state water

management agencies greatly expanded in size and

expertise through the 197% and 1980sm

The U.S. Geological Survey has been publishing

estimates of water use (figures such as those used in

Chapter 2 of this report) since 1950. The first reports

issued were based on data derived from many sources

of varying degrees of accuracy, so in 1977, the

Congress acknowledged the need for uniform information and directed USGS to undertake a cooperative federal-state National Water Use Information

Program. Begun in 1978, the information program

became part of the Federal-State Cooperative Program. The states collect much of the data and then

receive state water use information and reports from

USGS. As of 1988,49 states and Puerto Rico participate

in the program. lz9 USGS directs the data collection

effort, compiles the information, and analyzes regional and national water use statistics and trends.

USGS also produces National Water Summary

reports as part of the National Water Summary

Program, begun in 1983. Each report focuses on a

single topic (groundwater resources, groundwater

quality,etc.) and presents state-by-state reports plus

national summary information. The reports have

been instituted as a way to bring together into an

annual presentation information generated through

the various USGS programs.

The Bureau of Reclamation, also part of the

Department of the Interior, conducts some groundwater studies in connection with planning for its

surface water projects -estimations of pumping requirements for projected crop demands, along with

calculations of available local supplies based on

groundwater geology, depth, movement, and rechargela-but the bureau typically does not do

long-range groundwater studies. More recently, the

bureau has been supporting research and demonstration programs on artificial recharge, which would

provide information that could feed back into state

and local conjunctive management programs.

Several other federal agencies, including the

departments of Agriculture, Energy, and Defense,

the Environmental Protection Agency (EPA) and

the National Science Foundation (NSF), have allocated funds for water research.131 With all of the

federal, state, local, academic, and industry programs

together, there is and has been a sizable water

resources research effort. Federal support from the

mid-1970s to the mid-1980s totaled over!+2 billion132 (a

small fraction of the amount spent on water project

construction and maintenance over the same period).

A 1989 report from the Office of Science and Technology Policy in the Executive Office of the President

found that federal science and technology programs

concerning groundwater expended over !$890 million

over the five fiscal years ending with fiscal year

1990:% The expenditures by federal agency and program category are shown in Figure41. Nonetheless,the

report concluded that “scientific uncertainties, lack of

adequate technologies, lack of basic data, and shortage

of skilled scientific personnel still hinder the ability of

federal, state, and !ocal governments and the private

sector to develop and implement effective gmundwater management, protection, and remediation policies and ~mgrams”‘~

In the area of research into basic hydrology and

hydraulics, the major federal participants are USGS,

the Department of Energy’s Office of Energy Research, the Department of Agriculture’s Agricultiral

Research Service and Cooperative State Research

Service (ARSKSRS), NSF, the National Aeronautics

and Space Administration (NASA), and the DepartU.S. Advisory Commission on Intergovernmental Relations 69
Figwe 4-1

Groundwater Research Expenditures, by Federal Agency and Program Category

. ..by Federa! Agency

0’

(SO6

FsaLlxAn

. ..by Ptogra~~~ Category

Source: U.S. Office of Science andTechnology Policy, Fedelnl Gloumi IV&r Scienced Technology Prognms (Washington, DC,

1989)

70 U.S. Advisory Commission on Intergovernmental Relations
ment of Commerce’s National Oceanic and Atmospheric Administration (NOAA). Over the five fiscal

years 1986 through 1990, federal mseamh program expenditures in this area totaled $123.4 million, of which

USGS spent $51 million, the Office of Energy Research

$27 million, the ARS/CSRS $21.5 million, NSF $9 million, NASA $6.7 million, and NOAA $5.2 million.

Federal research expenditures for groundwater

quantity resource assessments from fiscal year 1986

+-trough fiscal year 1990 amounted to $134.3 million;

JSGS accounted for $132 million. Federal research

expenditures for development and testing of monitoring, characterization, and assessment methods

1990 totaled $58.4 million. The major federal agencies

funding and conducting research were EPA, USGS,

and AARSKSRS. The major federal agencies supporting information storage, retrieval, and handling and

training and education are the Department of Agriculture’s Soil Conservation Service and Extension

Service,USGS,and EPA. Total federal research expenditures in these areas were $147.6 million.

Estimated federal groundwater research expenditures for fiscal 1990 were $225 million, the largest

amount yet budgeted for a single year: Of that total,

quantity assessments was budgeted for 15.1 percent,

and hydrology and hydraulics for 13.9 percent

Another 23.1 percent of the funds would support

training and education; information storage, retrieval, and indexing and the development and testing of

methods of monitoring characterization, and assessment Half (49.8 percent) of the funds were allocatedto the Department of the Interior (which includes USGS and the Bureau of Reclamation), 24.4

percent to the Department of Agriculture, 10 percent

*to EPA, and the remaining 15 percent to the other

principal federal groundwater research agencies

In 1986, the Congress appropriated funds for a

National Water-Quality Assessment Pilot Program,

to be operated by USGS. The purpose has been to

test and refine assessment approaches and methods and to evaluate the potential costs and uses of a

nationwide assessment program Four surface-water

and three groundwater pilot projects were chosen.

A full-scale national assessment program would

provide a consistent set of descriptions of water

quality, and identify long-term trends (if any).

Another possible outcome would be the identification of factors and conditions that appear to be

associated with changes in water quality, and the

identification of aquifers thatareespeciallyvulnerable to degradation and contamination.

The Federal Government as Water Supplier

Conjunctive management of water resources

often involves coordination of surface storage facilities with underground storage capacity Controlled

releases of surface waters from a flood control or

multipurpose reservoir can be coordinated with

groundwater use to maximize total available water

supply while minimizing damage to surface structures

and underground aquifers and protecting overall quality Therefore, federal involvement in the construction

and operation of surface water projects has provided a

useful tool for state and local conjunctive management

of water supplies, as well as protection from flooding136

The federal government became involved in

water resource development through navigation

improvement and flood control. Planning for navigation improvements on a significant scale began early

in the 19th century, and in 1824, the Congress charged

the United States Army Corps of Engineers with

responsibility for implementing the improvements.

Flood control was added to the Corps’ responsibility

in the middle of the century, when the Mississippi

and Missouri River basins were being ~ettled.‘~

Generally, projects built and operated by the Corps

have been planned as surface water impoundments,

with minimal consideration to groundwater supply

relationships, The Corps monitors groundwater at a

few sites, and some multipurpose projects have

included authority for spreading waters for replenishment (this usually is done by local agencies).‘37

In the decades after the Civil War, federal laws

and policies encouraged the rapid development of

the West Through the Desert Land Act of 1877, the

Congress authorized the sale of land in 64CLacre tracts

in most of the arid region of the West to persons who

would irrigate lands within three years. This marked

the official beginning of a federal policy of encouraging the development of irrigated agriculture in the

western states.‘“In 1902, the Congress backed up that

policy with the adoption of the Reclanration Act,

authorizing federal funding and construction of

water development projects

The Reclamation Act directed the Department of

the Interior to undertake examinations and surveys,

and to locate, construct, and maintain irrigation

facilities, to be paid for out of a reclamation fund. The

initial fund came from the sale of land, and was to be

reimbursed, without interest, by project beneficiaries

within ten years. The Bureau of Reclamation was

established and joined the Corps of Engineers in

constructing these surface water facilities.

While the Bureau of Reclamation has had a

crucial impact on water resources management in the

western states, the Army Corps of Engineers, which

has a nationwide reach, spends the lion’s share of

federal water resources development outlays. Of the

$3.4 billion in federal outlays for fiscal 1986, 70

percent was spent by the Corps, 21 percent by the

Bureau of Reclamation, 8 percent by the Department

of Agriculture’s Soil Conservation Service, and 1

percent by the Tennessee Valley Authorityn9

U.S. Advisory Commission on Intergovernmental Relations 7l
The Federal Government as Regulator

Federal water quality efforts were originally

directed toward surface supply protection and remediation. The Federal Wafer Pollution Control Act (Clean

Water Act) of 1972 did not address groundwater,

although some of the activities under the act have

impacts on groundwater quality and some EPA

interpretations extended the provisions to groundwateP Subsequently, through the Safe Drinking Water

Act of 1974, and in particular the Safe Drinking Water

Amendments of 1986, federal legislation has reached

groundwater as a source of drinking water

The Clean Water Act provided federal grants to

municipalities to finance up to 75 percent of the

~ design and construction costs of wastewater treatment facilities needed to meet the goal of secondary

treatment levels for all publicly owned treatment

works by 1977. Amendments to the law extended the

1977 deadline, eventually to 1988. A reauthorization

of the Clean Wafer Act in 1987 maintained the 1988

deadline for treatment compliance but made other

significant changes Amendments provided for the

phasing out of the federal construction grants program

by 1994 and offered federal assistance to the states to

capitalize state revolving loan funds to provide assistance to communities with considerable flexibility141 In

the words of the executive director of the Association of

State and Interstate Water Pollution Control Administrators, “After 1994, the federal government should be out of

the sewerage business, and it will be up to state and local

governments to meet the Congmssional challenge and

be ready by 1994 to assume full responsibility for the

Clean Water Program.n*rlz

More than half of the states have grant programs

to assist communities with wastewater treatment

projects;‘” nearly half of them have established

revolving loan funds. Progress in the construction of

wastewater treatment facilities and the continuation

of the clean water program contribute to federal,

state, and local efforts to prevent contamination and

protect groundwater quality Treated wastewater is

less likely to produce contamination and can be a

source of recharge water in groundwater basins with

artificial replenishment programs.

In the 1987 amendments to the CIeun WaterAct,

the Congress also authorized up to $400 million for

federal support of state and local nonpoint-source

pollution programs, Nonpoint sources of pollution -

such as agricultural and urban drainage and return

flows, and storm runoff -are especially likely to

affect groundwater quality. However, funds were not

appropriated during the first two years after the

amendments were enactedJM

The Safe Drinking Water Amendments of 2986

extended many federal requirements to groundwater

sources, and this act now constitutes the principal

federal legislation for groundwater quality protection. The Congress required EPA to set maximum

contaminant level goals (MCLGs) within three years

for 83 contaminants previously listed in 27te Federal

Register. Addressing this broader set of contaminants

was one of the main purposes of the amendments.l*

The amendments also require monitoring of a large

number of unregulated contaminants, and will likely

require disinfection of groundwater supplies that

were previously not disinfected, and filtration of

nearly all community surface water supplies.146

EPA has established drinking water standards for

more than 50 contaminants EPA does not issue

separate groundwater standards and has not supported the adoption of uniform national standards,

although it has recognized the appropriate use of

drinking water standards as guidelines indicating

acceptable levels of contaminants in groundwater

The subtlety of that distinction apparently has been

lost on the states. EPA drinking water standards are

adopted by most states that have numeric groundwater quality protection standards, and most state drinking water administrators told the U.S. General Accounting Office that, in their view, drinking water

standards “should” or “probably should” be used as

groundwater standards.‘* States use EPA drinking

water standards “both as an indicator of what sub

stances to regulate and as an indicator of the level at

which to set the groundwater standards.“149

The Safe Drinking Wafer Amendments also required states to submit to EPA by July 19, 1989,

programs for protecting the areas around water wells

that supply public drinking water from contamination. State programs would be considered adequate

unless rejected by EPA within nine months of submission. States are required to implement the programs

within two years of submission. State development

and implementation of wellhead protection programs is supported through the authorization of

grants meeting from 50 to 90 percent of program

development and implementation costs.

Some provisions of the amendments also recognized the special needs of small water systems.

Systems serving fewer than 150 connections, for

example, may meet the requirements for monitoring

unregulated contaminants simply by submitting a

water sample to the state or EPA. The amendments

authorized up to $10 million dollars annually for fiscal

years 1987 through 1991 to aid small water systems

complying with EPA regulations It remains to be seen

whether the authorized funds will be appmpriated;150

they were not appropriated during the first two budget

cycles after adoption of the amendments

One of the ongoing problems in implementing

the Clean WaterAct and the Safe Drinking WaterAct has

been building implementation capacity. The 1986

Safe Drillking Water Amendmenfs made the states the

72 U.S. Advisory Commission on Intergovernmental Relations
primary implementation and enforcement agents for

EPA-promulgated regulations Administrators generally believe that there is not sufficient financial

capability to implement the Act properly in many

states and public water supply systems, and that

additional financial assistance will be neededJsl

The Cleun Wafer Act and the Safe Drinking Water

Act are only two of the federal laws relating to water

quality, and EPA is only one of the federal agencies

involved in groundwater quality protection, albeit

the principal one. Depending on the definition of

“relate,” it has been estimated that from fewer than 10

to more than 40 federal statutes relate to groundwater

quality?” Other prominently involved federal agencies in addition to EPA include the U.S. Geological

Survey, which produces much of the information on

groundwater used by EPA and other regulatory

agencies, the Department of Agriculture (which has

some authority regarding pesticide use), and the

Department of Energy (which has authority regarding the disposal and handling of radioactive materials). States and local governments have observed that

the federal groundwater protection effort, coming as

it does under the authority of the Safe Drinking Water

Act, the Clean WaterAct, the Resource Conservation and

Recovery Act, the Federal Insecficide, Fungicide, and

Rodenticide Act, the Comprehensive Environmental Response, Compensation, and Liability Act, and other

statutes, has at times lacked coherence and coordination, and has subjected state and local administrators

to a plethora of obligations.

In 1984, in an attempt to provide a focal point for

federal efforts in groundwater quality protection,and

to improve program coordination and enforcement

of laws and regulations, EPA established an Office of

Groundwater Protection. EPA published its “groundwater protection strategy” in 1984, which relies

heavily on state implementation and enforcement of

laws and regulations, with technical and financial

assistance from the federal governmentls3 The EPA

groundwater protection strategy recognizes the historical and legal roles of the states in water allocation

and the localized nature of most contamination

sources and incidents; acknowledges that the states

have the principal role in protecting groundwater

quality and have developed several powerful state

and local authorities; and declares a position in favor

of strengthening. not displacing or disrupting, state

and local initiativesJs

The strategy identifies four major objectives for

EPA’s role in groundwater quality protection: (1)

strengthen the states’ institutional capacity to protect

groundwater resources (principally through financial and technical assistance), (2) give greater emphasis to regulating sources of contamination that are of

special national concern and are insufficiently addressed, (3) develop guidelines for consistency in EPA

groundwater protection and remediation decisions,

and (4) coordinate groundwater protection activities

internally as well as with other federal agencies and

the states. The EPA groundwater protection strategy

also focuses on areas where groundwater contamination would cause the greatest harm and assigns

highest priority to groundwater that is used for

drinking or to supply unique ecosystems.‘56

A key element of the EPA groundwater protection strategy has been to combine capacity-building

measures with encouraging states to develop and

implement their own strategies. Under Section 106 of

the CZeun Wuter Act, EPA has offered grants to the

states to assist them in developing statewide groundwater quality protection strategies, which the states in

turn submit to EPA for review and approval.

Summary

Through support of research and technical assistance, program development, and development of

drinking water standards in connection with the Safe

Drinking Water Amendments, EPA and other federal

agencies have been attempting to improve groundwater quality protection. At the same time that it is

committed to helping, the federal government

should ensure that its activities do not harm groundwater quality and make protection more difficult for

the states and communities that have primary implementation responsibilities.

Regardless of whether its water projects wee

east or west, single purpose or multipurpose, federal

involvement in solving water resource problems has

been organized by individual projects rather than on

the basis of some federal plan or policylM The history

of federal involvement in water resources is replete

with instances of boards, commissions, and councils

formed to articulate a national water policy and

coordinate federal programs, with each body eliminated in an executive branch reorganization or a

period of budget austerity, and of studies by commissions yielding insightful conclusions and recommendations that were never adopted.15’

The most recent commission was the National

Water Commission. Its 1973 report, W&r Policies for the

Future, advocated conjunctive management of water

xtzfmms at the scale nearest the useIs of the n5outces,

with federal suppoti for march and problem identification, diminishing federal support in planning and

financing development, and a strong federal role in

quality pmtection, along with a host of other mornmendations that have yet to be implemented. Coordination of federal water programs and ongoing analysis

of national water policy were most recently institutionalized for a time in the U.S. Water Rexnmxs Council

(formed under the auspices of the Wuter Resoltrces

Hutming Act of Z-%5), but that body was terminated in

1982 as part of federal spending reductions in the first

term of the Reagan Administration.‘5B

U.S. Advisory Commission on Intergovernmental Relations 73
The project-by-project approach and the lack of a

comprehensive federal management plan have been

criticized. The organization of federal support and

participation also is criticized. Water resource development and management are part or all of the

portfolio of about 25 federal agencies,i59 as well as the

subjects of hundreds of federal laws. Neil S. Grigg,

attempting to summarize the federal role in groundwater management, wrote “The federal government is

responsible for policy formulation, mgulation, data

collection and research. These responsibilities are fragmented between agenciesR160 The existence of multiple

federal agencies with involvement in water resource

information, development, and management has been

cited as a source of confusion and inefficiency161

Much of the literature suggests that the federal role

and participation are declining now that the emphasis

has shifted away from water development toward

management of existing supplies*62 However, other

changes during the 1980s suggest the possibility for a

greater federal role in the management of water

supplies 163 Among these changes am the federal court

decisions striking down state restrictions on gmundwater supply exports and ruling that groundwater is an

article of interstate commerce subject to direct federal

regulation; the problems surrounding federal reserved

rights and Indian water rights, especially in the western

states; and legislation introduced in the Congmss to

require the use of nondegradation standards for

groundwater quality programs nationwide, and to

require prior federal approval of state groundwater

supply management programs The following chapter

considers these and other problems and prospects in

water resource management

Notes

i Vincent Ostrom and Elinor Ostrom, “A Behavioral Approach to the Study of Intergovernmental Relations,

7he Annals of the American Academy of Political and Social

Science 359 (May 1965): 138.

* For example, U.S. Advisory Commission on Intergovernmental Relations (ACIR), 7he Organization of Local

Public Economies (Washington, DC, 1987).

3 Ostrom and Ostrom, p. 138 (emphasis added).

4 Ibid.

5 William Lord, Director, Water Resources Research Center, University of Arizona. Proposal for the Comparative

Study of Water Management Institutions. 1988.

6 Ostrom and Ostrom, p. 140.

7 Wade MiUer Associates, ‘Ike Nation’s Public Works: Report

on Water Supply (Washington, DC: National Council on

public Works Improvement, 1987), p. i.

s Vincent Ostrom, Robert Bish, and Elinor Ostrom, Local

Govermnent in We Uuited States (San Francisco: ICS Press,

1988), pp. 59-60.

9 See especially Wade MiIIer Associates, and National

Council on Public Works Improvement, Fragile Poundations: A Report on AmericaS Public Works (Washington,

DC, 1988).

lo Wade Miller Associates, p. 17.

l1 Ibid., p. 18.

l2 Ibid., pp. 17-18.

l3 Kyle Schilling et al., The Nation’s Public Works: Report on

Water Resources (Washington, DC: National Council on

Public Works Improvement, 1987), p. 134.

I4 Wade Miller Associates, p. 18.

l5 Ibid., pp. 91-92.

l6 Ibid., p. 18.

l’ Ibid.

l8 Schiing et al., p. 134.

I9 This distinction isexplained in detail in ACIR, IIre Organization of Local Public Economies.

2o James Krieger and Harvey Banks, “Ground Water Basin

Management,” CalQorm’a Law Review 50 (1962): 74 (emphasis added).

2 1 SchiUing et al., pp. 134-135.

22 Jurgen Schmandt, Ernest Smerdon, and Judith Clarkson,

State Water Policies (New York Praeger publishers, 1988),

p. 1.

zs Ostrom and Ostrom, pp. 141-142.

24 John Leshy, “Special Water Districts-The Historical

Background,” in James Corbridge, ed., SpeciaI Water Districts: Challengefor the Future (Boulder: Natural Resources

Law Center, 1983), p. 13; Sidney Harding, Water in California (Palo Alto: N-P publications, 1960), p. 215.

2 5 Warren Viessman and Claire Welty, Water Management:

Technology and Institutions (New York: Harper and Row,

1985), p. 25; SchiIIing et al., p. 7.

2 6 See for example, Lyle Craine, “Intergovernmental Relations in Water Development and Management.” Paper

presented at the Southern Political Science Association,

Gatlinburg, Tennessee, 1959, pp. 13-14:

As a theoretical proposition, should we not

conceive, and encourage, insofar as feasible, the

operation of a competitive public market among

water service enterprises as the primary basis for

allocating water services from a given river management scheme? . . . Thus, the tricky water management decision, i.e., which customers get what,

results from the relative demand as expressed by

the willingness of each customer to pay.

27 Leshy, p. 24.

2 8 Ibid., pp. 12-13.

2 9 Ibid., p. 13.

3 o Ibid.

3 1 Institute of public Administration, SpeciaZ Districts and

Public Authorities iti Public Works Provision: Report to the

National Council on PubIic Works Improvement (Washington, DC, 1987), p. 24 (unpublished); Harold Rogers and

Alan Nichols, Waterfor California: Planning, Law and Pmctice, Finance (San Francisco: Bancroft-Whitney, 1967), Vol.

2, pp. 49-50.

sz Institute of public Administration, p, 65; Leshy, pp. 22-23.

ss Charles Phelps et al., Efficiart Water Use in California: Executive Summary (Santa Monica: RAND Corporation,

1978), p. 10.

74 U.S. Advisory Commission on Intergovernmental Relations
3 4 Institute of Public Administration, p. 65; Leshy, pp. 22-23.

3 5 Institute of Public Administration, p. 65.

3 6 Ibid., p. 62.

3 7 Ibid., pp. C-5 and C-6.

3 8 ACIR, l%e Problem of Special Districts in American Government (Washington, DC, 1964).

3 9 Jnstitute of Public Administration, p. 62.

4 0 Compare, for examp le, Leshy, p. 22:

In the modern era, most states have chosen

not simply to expand the purposes of traditional

districts, but also to create wholly new categories

of speciaiwater districts to serve larger geographic areas and f&ii a variety of purposes. Sometimes these new districts overlay in whole or in

part existing districts (as weii as other water supply entities), creating multiple layers of special

water districts and a patchwork of water supply

authority in the same geographical area.

* I Schiiling et al., p. 135.

* Tim DeYoung, “Discretion Versus Accountability: The

Case of Special Water Districts,” in Corbridge, ed., p. 34.

as David Jaquette, Ejficient Water Usein California: Conjunctive Management of Ground and Surface Reservoirs (Santa

Monica: RAND Corporation, 1978), p. 3.

4 4 James Corbridge, “An Overview of the SpeciaI Water

Districts Workshop,” in Corbridge, ed., p. 5.

4 5 In California, which has by far the highest number and

percentages of water supply and management services

performed by special water districts, a telephone survey

of a stratified random sample of registeredvoters in 1978

asked them to rate the performance of their water

supplier as excellent, good, only fair, or poor Threefourths responded “good” or “excellent.” A later survey

conducted by the Association of California Water Agencies focusing on respondents served by special water districts showed slightly higher levels of satisfaction, but

must be regarded with some reluctance in light of the

fact that the latter survey was conducted by members of

the association. CharlesHobbs,IIre WaferDistricfsofCalifornia (Sacramento: Association of California Water

Agencies, 1979), p. 25.

4 6 This criticism is addressed to particular identifiedspecial

water districts in the San Joaquin Valley in Merrill Goodall and John D. Sullivan, Water System Entities in CaIifornia: Social and Environmental Effects,” in Corbridge,

ed., pp. 71-102.

4 7 Institute of Public Administration, pp. 4-5.

* Ibid

4 9 Wade Milier Associates, p. 97.

sa Ibid., p. 92.

5 1 Richardson et al., “Gypsum Blocks TelI a Water Tale’,”

Journal of Soil and Water Conservation 44 (1989): 195.

5 2 L.M. Hartman, “Economics and Ground-Water Development,” Ground Water 3 (April 1965): 7.

5 3 Wade Milier Associates, p. 18.

5 4 Wade Milier Associates, p. 22.

ss Ibid., p. 142.

5 6 From the State Capitals: Water Supply 43 (January 1989): 3.

57 A fuller description of the NRWA program can be found

in Wade Milier Associates, p. 84.

ss Albert Lipson, Eficient Water Use in Calijornia: Ike Evolution of Groundwater Management in Southern California

(Santa Monica: RAND Corporation, 1978), p. 16.

59The activities of SAWARA can be found described in

greater detail in Schmandt et al., pp. 48-53.

a Gary Weatherford et al.,Acquiring Waterfor Energy: Lnstitutional Aspecfs (Littleton, Co: Water Resources Publications, 1982), p. 19.

6 * Grant Thompson, Courts and Water: The Role of the Judicial

PYOWSS. Background Report (Washington, DC: National

Water Commission, 1972), p. 2.

6 2 Krieger and Banks, p. 66.

6 3 Michael MalIery, “Groundwater: A CaII for a Comprehensive Groundwater Management Program,” Pacific

Law Journal 14 (July 1983): 1290.

bl Ibid.

6 6 Krieger and Banks, p. 66.

66 Thompson, p, 123.

6 7 As Zachary Smith has pointed out, resolution of water

disputes in legislative forums wiii favor groups with the

resources and skilIs for success at lobbying legislators

who are motivated primarily by reelection, while resolution of water disputes in administrative forums wilI favor those with resources useful for dealing with bureaucracies. Similarly, resolution of water disputes in judicial

forums wiII favor those with resources and&i& for success at adjudication. Zachary Smith, me Policy Environment” in Zachary Smith, ed., Wafer and the Future of

the Southwest (Albuquerque: University of New Mexico

Press, 1989), p. 15.

6 8 National Water Commission, Water Policiesfor the Future:

Final Report to the President and to fhe Congress ofthe United

States (Port Washington, New York: Water Information

Center, 1973), p. 232.

69 Lipson, p. 20.

7 0 Thompson, p, 32.

n Ibid, p. 19.

* Ibid, p. 23.

n tipson, pp. 10-11.

7 4 Krieger and Banks, p. 69.

7 5 Susan M. Trager, “Emerging Forums for Groundwater

Dispute Resolution in California: A Glimpse at the Second Generation of Groundwater Issues and How Agencies Work towards Problem Resolution,” Pacijic LawJournal20 (October 1988): 58.

7 6 Ibid., p. 52.

R Ibid., p. 53.

7 6 JamesTB.Tripp andAdamB.Jaffe,‘TreventingGroundwater Pollution: Towards a Coordinated Strategy to Protect Critical Recharge Zones,” Harvard Environmental

Law Review 3 (January 1979): No. 1, pp. 41-42.

7 9 National Research Council, Committee on Ground Water Quality Protection, Ground Water Qualify Protection:

State and Local Strategies (Washington, DC: National

Academy Press, 1986), p. 53; Metropolitan Dade County

Department of Environmental Resources Management,

State of the Environment, 1987-88 (Miami, 1988), pp. 2-6.

ffl National Research Council, p. 52.

U.S. Advisory Commission on Intergovernmental Relations 75
‘ * Ibid.

8 2 Ibid., p. 78.

8 3 Ibid.

8 4 Nancy Humphrey and Christopher WaIker, Innovatiae

State Approaches to Community Wafer Supply Problems

(Washington, DC: The Urban Institute, 1985) p. 6.

8 5 Wade MiUer Associates, p. 10.

8 6 Humphrey and Waker, pp. 49-52.

s7 See especially R. Steven Brown, “Environmental and

Natural Resource Problems: The Role of the States,” ?%e

Book offhe States, 1986-87 Edition (Lexington, Kentucky:

Council of State Governments, 1986), pp. 401-419.

ea National Research Council, p. 2.

sg WiIIiam Cox, ‘Water Law Primer,“ASCE~ournal of Wafer

Resources Planning and Management 108 (March 1982):

118; also George, p. 236.

9 o U.S. General Accounting Office, Groundwafer Qulify:

State Activities to Guard against Confaminanfs (Washiigton, DC, 1988), p. 3.

9 1 Ibid., p. 4.

9 2 National Water Commission, p, 244.

9 3 Henry C. Hart, “Toward a Political Science of Water Resources Decisions,” in L. Douglas James, ed., Man and WR-

&(E7ington: University Press of Kentucky, 1974), pp.

- .

9 4 SchiIIinget al., p. 133; David HoweIIs and James Warman,

“Groundwater Management in the Southeast,” ASCE

Journal of Wafer Resources Planning and Management 108

(October 1982): 325.

9 5 National Research Council, p. 46.

9 6 Ibid.; Robert Melvin, Hugo Thomas, and Robert Moore,

“Cooperative Efforts in Ground-Water Protection-A

Connecticut History,” U.S. GeoZogicul Survey Yearbook

1987 (Washington, DC: US. Geological Survey, 1988), p.

8 .

9 7 National Research Council, p, 46.

9 8 Melvin et al., p. 11.

9 9 Ibid., p. 8.

loo Ibid., p. 15.

lo1 Schmandt et al., p. 41.

loL Ibid.

lo3 Testimony of Wesley Steiner and Kathleen Ferris before

the Subcommittee on Water and Power Resources, Committee onlnterior andInsular Affairs, U.S. House of Representatives, 1OOth Congress, First Session, on H.R. 2320.

Series 100-23, Part 1, pp. 87-88.

lo4 Schmandt et al., p. 42; p resentation by Ronald MiIIer, Arizona Office of Waste and Water Quality Management, in

7’he States’ Groundwater Management Conference, Associationof State andInterstate Water Pollution ControlAdministrators, November 1986, San Diego, p. 3.

lo5 National Research Council, p. 83.

lo6 Prospects for greater coordination of groundwater supply management and quality protection functions are

explored in Susanna Eden, Integrated Water Mnnagemenf

in Arkona (Tucson: University of Arizona, Water Resources Research Center, 1990).

lo7 Alabama Florida, Hawaii, Illinois, Indiana, Iowa, Maine,

Marylanb, Massachusetts, Minnesota, New Jersey, New

York, North Carolina, Rhode Island, Vermont, Virginia,

Washington, Wisconsin, and Wyoming have developed

new laws, regulations, strategies, agencies, or coordination procedures for groundwater quality protection

during the last decade. Several other states began even

earlier, and others have enacted legislation within this

decade directed specifically toward agricuIturaI chemical use or underground storage tanks.

lo8 National Research Council, p, 9.

‘09 Ibid., p. 127.

no Humphrey and Waker, p. 6.

11* Schmandt et al., p. vii.

112 Robert Ehrhardt and Stephen Lemont, Institutional AYrangemenfs for lnfrastfife Groundwofer h$nnngement: A

Comparative Assessment Using Virginia as a Case Sfudy

(Arlington, Virginia: JBF Scientific Corporation, 1979),

pp. 23-24.

113 Schmandt et al., p. 202.

‘14NeiI S. Grigg, *Appendix: Groundwater Systems,” in

Kyle SchiIIing et al., 7he Nation’s Public Works: Report on

Water Resollrces (Washington, DC: National Council on

Public Works Improvement, 1987), p. B-3.

1’S With respect to groundwater quality protection, this

represents activity in addition to the adoption of underground storage tank legislation or regulations (which

nearly all states adopted), or the development and submission of state groundwater quality protection strategies under EPA’s Section 106 program (which also was

done by nearly aII states). Wiiiam Blomquist, “Exploring

State Differences in Groundwater Laws and Policy Innovations, 1980-1989,” Publius - The Journal of Federalism 21

(Spring 1991): 101-115.

116 Testimony of Roberta Savage on H.R. 2253 and H.R. 791

before the Subcommittee on Natural Resources, Agriculture Research, and Environment, Committee on Science, Space, andTechnology, U.S. House of Representatives, 100th Congress, First Session, p. 244.

11’ U.S. Environmental Protection Agency, Survey of State

Ground Water Quality Protection Legislation Enactedfrom

298.5 through 1987 (Washington, DC, 1988), p. vii.

118 U.S. General Accounting Office, Groundwafer Qu~~lity, p.

5 .

n9 Wade MiIIer Associates, p. 10.

l”) Ibid, pp. 9-10.

lzl Frank J. Trelease, “States’ Rights Versus National Powers

for Water Development,” in Ernest Engelbert, ed., Strnfegiesfor Western Regional Wafer Development (Los Angeles:

Western Interstate Water Conference, 1966), p. 107.

lzz NorrisHundIey, Wrrterand the West (Berkeley:University

of California Press, 1975), p. 64.

I23 Schmandt et al., p. 25.

m United States Geological Survey, Water-Data Program.

Water Fact Sheet (Reston, Virginia, 1984).

lz5 HoweIIs and Warman, p. 321.

lz6 David Moreau, “New Federalism and Social and Environmental Goals,“Journ~Z of Water Resources Planningand

Management 115 (January 1989): p. 28.

lnWayne SoIIey, Charles Merk, and Robert Pierce, Esfimated Useof Wafer in the United Stntes, 2985 (Washington,

DC: U.S. Geological Survey, 1988), p. 3.

76 U.S. Advisory Commission on Intergovernmental Relations
128 David Jaquette and Nancy Moore, Efficient w&r Use in

California: Groundwater Use and Management @antaM*

nica: RAND Corporation, 1978), p. 32.

lzg Schmandt et al., p. 25.

130 Schiing et al., p. 116.

131U.S. Office of Science and Technology Policy, FederaI

Ground-Water Science and Technology Programs (Washington, DC, June 1989).

132 Ibid., p. i.

133 James H. Jensen, “Governmental Responsibilities for

Water Development,” in Engelbert, ed, p. 116.

134 Viessman and Welty, pp. 30-31.

I35 Jaquette and Moore, p. 32.

1X Viessman and Welty, p. 31.

137 Henry I? Caulfield, “The Future of Local Water Districts

and Agencies in Historical, Political Context,” in Corbridge, ed., pp. 104-106.

138 Viessman and Welty, pp. 38-39; PaulTaylor, “The 160-Acre

Law,” in David SeckIer, ed, California Water: A Study in

Resource Management (Berkeley: University of California

Press, 197l), p. 251.

13’ Schiiing et aL, p. 8.

‘40 Wiiiam Cox and William Waker, “Ground-Water Implications of Recent Federal Law,” Ground Water 11 (September-October 1973): 15.

141 Robbi Savage, “National Clean Water Act Program

Turned Into State Revolving Loan Funds,” County News

19 (August 17, 1987): 16; Anthony J. Celebrezze, Jr.,

“Ohio’s Required Enforcement of the clean Water Act,”

Cities and VUZages 36 (February 1988): 8.

142 Savage, p. 18.

143 Ibid., p. 16.

144 “NACD Announces Water Quality Strategy,” Journal of

Soil and Water Conservation 44 (May-June 1989): 217.

145 Wade MiIIer Associates, p. 204.

146 Ibid., pp. 5 and 205.

147 U.S. General Accounting Office, Groundwater Protection:

‘Tk Use of Drinking Water Standards by the States (washington, DC, 1988), p. 3.

la Ibid., pp. 2-3.

14g Ibid., p. 5.

150 Wade Miller Associates, p. 84.

lsl Ibid., p. 205.

ls2 George, p. 235; Zachary Smith, “Federal Intervention in

the Management of Groundwater Resources: Past Efforts and Future Prospects,” Publilts - 7heJoumniof Eederaiism 15 (Winter 1985): 1.51; Environmental and Enerm

Study I&itute,A Con$ressionalAgenda to Prevent Grou&

water Contamination: Building Capacity to Meet Protection

Needs (Washington, DC, 1986), p. 1.

153 Smith, p. 151; National Research Council, p. 3.

‘%U.S. Environmental Protection Agency, Office of

Ground-Water Protection, Ground-Water Protection

Strategy (Washington, DC, 1984), p. 3.

ls5 Ibid., p. 4.

ls6 Viessman and Welty, p. 2; William Lord, “Conflict in Federal Water Resources Planning,” Water Resources Bulletin

15 (October 1979): 1224%.

ls7 Viessman and Welty, pp. 41-53.

ss Ibid, p. 7.

159 SchiIIing et al., p. 130.

160 Grigg, p. B-3.

M Ibid.; also Schiing et al., p. ix.

I8 See, for example, Schmandt et al., p. 2:

Whereas the federal government was a major player when water development projects

were the preferred approach to water management, now that the emphasis has changed from

development to better management of existing

resources, its role is declining, and state governments are assuming a more active role.

I63 Smith, p. 146.

U.S. Advisory Commission on Intergovernmental Relations 77
78 U.S. Advisory Commission on Intergovernmental Relations
Chapter 5

i

!

Water Resource Management:

Problems and Barriers

Despite the initiatives described in Chapters 3

and 4, there still are important institutional barriers to

effective coordination of surface and groundwater

supplies having to do with the rules governing

allocation,valuation, and information It is possible to

“create a crisis” through the application of inappro

priate rules: “When institutional mechanisms do not

reflect reality a crisis o~curs.“~ Recognition of this fact

has led to calls for more “institutional analysis” of

water resource management and for institutional

reform.2 However, as others have pointed out, “institutional analysis” is easier said than done,3 and

“institutional reform” is no simpler than designing

institutions originally (indeed, it is likely to be tougher, as problems of design are compounded by inertia).

Moreover, important and useful recommendations

for institutional reform that have been offered have

generally been ignored!

Acceptance of the idea that institutional arrangements and physical realities in the water resources

field are mismatched is not enough; there must be an

I understanding of how they are mismatched if reform

is to make the situation better There appear to be three

broad views of the nature of the mismatch:

11, 1) Water supplies are insufficient, and institutional arrangements fail to force us to conserve those supplies

2) Institutional arrangements of the past are inI

adequate, and their continued use is the

cause of the problem.

I

3) The principal problem with the institutional

arrangements is that they distort the valuation of water supplies, making it difficult to

know whether supplies are sufficient because users have several incentives to misstate preferences for water and virtually no

incentives to be accurate.

When the water situation is described as if the

supply were a fixed and limited known quantity, less

than can meet all needs and desires, the problem is

perceived to be that laws and institutions have

perpetuated a false sense of water abundance As one

author stated, water laws and institutions have “maintained the ‘water-rich’ illusions of this country” when in

fact the “challenge of the future will be learning to live

with less”5 The proper course for institutional reform,

then, is to curtail use so as to balance the limited

available supply with aggregate demand

As the objectives of water resource management

have shifted from development to the more effective

management of existing supplies, part of the difficulty is that “we have inherited a structure of politics,

organizations and intergovernmental relations which

is derived from the initial objective” of water development6 In the words of the director of Arizona’s Water

Resources Research Center, our

society is, and has long been, a technologically

oriented one. We have been successful in

technological innovation and we have come

to look first for the ‘technological fix’ when

we confront a new problem. At the same

time, we are institutionally backward. We

shrink from institutional change, except as a

last resort . . . In our own field of water resources management there are abundant

and obvious examples of the tendency to resort to extravagant and unwarranted technological solutions. Massive reservoirs, controversial water transfers, costly desalination,

and uncertain weather modification schemes

are all examples of a resort to technology to

solve problems which are more easily and

cheaply addmssed by institutional innovation,

Indeed, most of these ‘solutions’ are aimed at

problems which exist only because we have

failed to modify institutions which were responsive to problems of an earlier day, but

which have long since been rendered obsolete

by changing conditions’

U.S. Advisory Commission on Intergovernmental Relations 79
The problem is not merely that our water laws and

institutions are old, but the arrangements that were

beneficial for water development may have detrimental results when the purpose of management has

changed to efficient and equitable allocation of

supplies. The laws and institutions governingallocation have distorted users’ sense of the value of water

supplies Therefore, it is virtually impossible to draw

simple conclusions, such as “water demand equals x

and water supply equals x,and y is greaterthan x.” We

operate in an institutional environment in which

users’ claims are undefined, rights to use groundwater basins for storage are undefined, barriers exist to

water being transferred from one user to another or

reclaimed by a user who employs water conservatively, and some persons pay unnecessarily high taxes

or electrical power rates so others can have water

supplied at prices less than the cost of production.

Under those circumstances, making any claims about

the relationship between the demand for water and the

supply is a dubious exercise.

What remains to be done is some real institutional analysis. Past analyses have usually treated water

laws and institutions as fixed elements, and predicted

crises based on projections of supply and demand

that were also deemed unchangeable.8 Institutional

analysis treats water laws and institutions as variables, subject to change, and then inquires as to the

possible effects of changed laws and institutions on

the relationship between supply and demand? Thus,

while we acknowledge that it may be possible to

“create a water crisis” through poorly adapted institutional arrangements, we must acknowledge that it may

be possible to avert or lessen the likelihood of a water

crisis through appropriate institutional adaptations

What, then, are the barriers to more effective

conjunctive management of gmundwater supplies?

They are the institutional factors that distort decisionmaking in such a way that the adoIs in the complex

water economy respond to incentives and constraints

by “creating a water crisis” or simply by failing to take

full advantage of available resources These institutional factors include lack of definition and transferability of

production and storage rights, distortions created by

water subsidies, and lack of information distribution.*0

LACK OF D EFINITION AND T RANSFERABILITY

OF PRODUCTION AND STORAGE RIGHTS

State Water Rights Laws

State laws govern rights to the use of groundwater and water resources generally Some states tie

those rights to the ownership of land; others tie the

rights to actual water use. Although the laws vary in

their details, there are four general categories of water

rights laws absolute ownership, reasonable use,

correlative rights, and appropriation.

Some laws follow old common-law property rules

and confer absolute ownership of groundwater on the

riparian or overlying landowner The absolute ownership doctrine places no restriction on the amount of

water withdrawn or on its place of use (the owner may

export the water). Such a system provides no quantification of an owner’s right to the use of waterll

Under this system, an owner of water rights is

unrestricted in withdrawing water and is protected

by law in doing so. Water users bear only their own costs

of withdrawal. There are no charges for use of the

common supply or for losses imposed on fellow user5

The absolute ownership system creates incentives for overlying owners to produce as much water

as desired given the production cost, and creates no

incentive to conserve water or make sure that it is not

wasted. The system also renders management of the

common supply highly problematic because there is

no quantification of users’rights and no legal basis for

restraining use. It is a system that promotes overuse.

The absolute ownership doctrine is a recipe for water

shortages in any area that is not blessed with an

abundance of water

Because water is not unlimited in most of the

country, most states have moved away from the

principle of absolute ownership. Many states

adopted a policy that limited withdrawal rights to

those amounts that could be applied to a “reasonable

use” or a “beneficial use” on the owner’s land.12 The

reasonable use doctrine also takes away the entitlement to export the water: The prohibition against

groundwater withdrawals for any “unreasonable” or

“nonbeneficial” use has been essentially meaningless in

practice, as virtually any use on an owner’s overlying

land has been construed to be reasonable or beneficial

Under the reasonable use doctrine, rights to

water withdrawals remain unquantified and essentially unlimited. For instance, there is nothing to

prohibit an owner from withdrawing groundwaterto

the detriment of a neighbor as long as the water

withdrawn is put to a “reasonable” or “beneficial”

~se.‘~ There also is no mechanism for taking into

account the costs one pumper imposes on others. As

with the absolute ownership rule, the only costs for

the owner are the production costs

The reasonable use doctrine creates incentives

for users to use as much water as they desire given

their production costs, and no incentives to conserve

water or avoid waste. The lack of quantification of

water rights also poses obstacles to conjunctive

management. Any possible schemes for limiting

withdrawals, inducing users to take water from

alternative sources, or in any other way controlling

overdraft are unlikely to succeed in such a legal

environment Water shortages and conflicts are likely.

80 U.S. Advisory Commission on Intergovernmental Relations
Neither the absolute ownership nor the reasonable use doctrine takes into account the interdependence of the users of a common water supply. The

doctrine of “correlative rights,” while still tying

groundwater withdrawal rights to ownership of

overlying land, was adopted by a few states in an

attempt to redress this shortcoming. Under the corn+

alive rights rule, overlying ownem share the common

supply in proportion to their ownership of the

overlying land.14 However, this is a rule that acquim

“bite” only after a shortage has occurred, when a

determination of the amount of water available in a

groundwater basin is made and that amount is

apportioned among the owners.

The correlative rights rule, which reached its

greatest development in California and Florida,

suffers from problems similar to absolute ownership

and reasonable use. First, the rule also leaves groundwater rights unquantified, which presents obstacles

to conjunctive management (except in Oklahoma,

where the state Water Resources Board is directed by

statute to survey each basin, make a determination of

its maximum annual yield, and allocate a share ofthat

yield to each acre of overlying land, thus giving each

overlying landowner a quantified right to a specific

amdunt of groundwater15).

Second, like the absolute ownership and reasonable use doctrines, the correlative rights rule ties

acquisition of groundwater rights to ownership of

overlying land. In fact, it makes that tie even closer by

apportioning the water proportionately with land

ownership. The main problem this presents is that a

water purveyos whether a private company or a

public agency,may own a relatively small share of the

land overlying a groundwater supply but may require significant quantities of water in order to serve

its customers or residenti and may value that water

more highly than other owners of more extensive

land areas. Nevertheless, doctrines that tie water

rights to land ownership -especially the reasonable

use doctrine and the correlative rights doctrine-may

not provide for such needs, and water may not be

avai\able for higher valued uses, both of which result

in inefficiency and inequity.

The allocation of water has been addressed in

most of the western states, where water is generally

less naturally abundant, through the adoption of a

system of appropriative rights. Under an awor-+

ation system, users acquire rights to specific quantities of water based on actual use rather than on land

ownership. Water can be diverted for use out of the

stream and on nonadjacent lands (in the case of

surface waters) or on nonoverlying lands (in the case

of underground waters).

Rights to the use of water under appropriation

systems can be acquired as long as “surplus” (i.e., not

already appropriated) waters remain, and as long as

the appropriator will put the water to a “beneficial

use.” In times of shortage, however, there must be

some allocation of obligations to reduce withdrawals.

Thus, the pure appropriation doctrine employs a

Shpk rule of seniority: “first in time, first in right"

Junior appropriators must yield to senior appropriators during times when there is not enough water to

satisfy all claims. Some states have added other

restraints to this rule, classifying uses by priority in

times of reduction of withdrawals. To keep track ofthe

amounts of water to which holders of appropriative

rights are entitled, and the priority (i.e., seniority) of

those rights, states typically have issued permi& to

pump or dhwters (by a state engineer, for examp\e\.

One desirable feature of the appropriation dottine was that it quantified rights. This makes possible

some beginning steps toward effective management,

In a groundwater basin, it is possible to know at a

given time in a given groundwater basin the maximum amount of legal pumping. It is also possible to

limit the amount; if the office that issues appropriation permits is aware of the total available water

yield of the basin, the off ice can stop issuing permits

when there is no more “surplus” water available.

And, as noted above, the appropriation doctrine

comes with a rule for allocating water in times of

shortage-junior appropriators cut back first

The appropriation doctrine, with its priority

principle, also encouraged the development of westem lands by offering secure water rights to those who

put the water to ~se.1~ Water rights were not tied to

land ownenhip, so a landowner could not “sleep on

his rights” The telationship between the appropriation system for the acquisition of groundwater rights

and the development of regions, however, is a vehicle

that is all accelerator and no brake. Appropriation law

has combined with other economic and political

pressures to promote the premature overdevelopment of land and other resources.”

In an area where there may not be enough water

to satisfy all claims (i.e., where water is “scarce” in the

economic sense), anyone who waits to use water until

it is genuinely needed for some profitable purpose

may find that all available water has been appropfiated OT thatthe remaining appropriative right that

can& acquired is so junior as to stand highly exposed

to any period of shortage. Water is to be put to a

“benefiCial use; but reserving water for future use does

not so qualify under most appropriation laws Therefore, “fist in time, first in right” becomes “get it now,

wh&er you need it or not” Each entity mceS against all

&a “to establish use rights ahead of need.“” The

mult an be almost comic water waste: industrial

enterp& in desert a=% grow fields of alfalfa hay

witi irrigation water in order the preserve their fight to

he water if they need it for future expansion.

Once begun, the process feeds on itself Any

entity - from individual farmer to metropolis -seekU.S. Advisory Commission on Intergovernmental Relations 81
ing water to appropriate as “surplus” induces others

to try to be sure that they do not lose out. The only way

to be sure that water for future use is not defined as

present “surplus” and lost is to put that water to use.i9

Moreover, in some states, unused water rights may be

lost by adverse use or prescription. Thus, “first in time,

first in right!’ becomes”use it or lose it.” Both offensive

and defensive strategies under pure appropriation

law work toward the same end: the premature and

excessive exploitation of water resources

Under the appropriation system, individual incentives are placed in opposition to collective goals And

collective efforts, instead of being directed toward

reshaping the legal institutions that create this incompatibility, are dim&d at trying to fix its effects:

At a time when real competition for scarce

water supplies is forcing conservation policies,weathermodification,desalination,and

expensive transbasin diversion projects

upon some water users, it is unthinkable that

state water laws should be simultaneously

encouraging other water users to use as

much as possible and speculators to claim

now water rights in the hope of somedaybecoming rich by so doing.. . . z”

Regardless of how “unthinkable” it may seem,

these perverse incentives are created by water rights

laws that reward users who employ as much water as

fast as possible, and penalize those who wait and

those who reduce their use. Water “shortages” that

appear under such situations are often attributed to

natural conditions (the notion that “there simply isn’t

enough water to go around”) or to wasteful water

users, as though their wastefulness were a personality

trait rather than a response to a system of water law

that seems to be designed to eliminate surplus waters

wherever and whenever they are found.

Because the use of water in irrigated agriculture,

and especially in the appropriation states, is often

singled out for attention, the point should be made

that these water rights laws encourage waste and

discourage conservation, the opposite of our collective goals Irrigated agriculture accounts for approximately 90 percent of water consumption in the western

states Since farming and ranching are among the oldest

activities in the developed West, irrigated agriculture

also holds most of the senior appmpnative rights in the

western states that use that system As demands for

urban uses have grown in the West, and as urban water

managers have viewed the water rights of farmers

jealously, the use of terms such as “waste” has become

part of the political battle over entitlement, fueling

animosities between farmen and city dwelleIs21

Yet there is no reason to believe that western

farmers are somehow “wasteful” or that irrigated

agriculture must necessarily be a “wasteful” practice.

Those engaged in agriculture under an appropriative

rights system may be perfectly rational, responding to

almost perfectly irrational incentives If an individual’s

right to use a specified amount of water is based on the

amount of water diverted or withdrawn, and if acquiring the right costs virtually nothing (usually there is a

filing fee for a pen&but the cost of the water right does

not vary with the amount), given some uncertainty

about the future, the understandable response is to stake

a claim to as large a water right as feasible by diverting

or withdrawing and using as much as possible. That is

not being “wasteful”; under the circumstances- and

given the incentives-it is being prudent

Water rights laws that provide for the acquisition

of rights to groundwater based either on ownership

of overlying land or on actual use at a specific place

and for a specified purpose encourage inefficient

use?2 Production rights are either undefined, defined

but connected to land ownership, or defined in such a

way as to encourage maximum use and minimum

conservation. Although the appropriation system does

at least provide for specific and quantified water rights,

it does so in a way that leaves claimed water rights

bearing only a questionable relation to needed water

rights Without modifications, each of these water rights

systems constitutes a barrier to more effective conjunctive management of water supplies

Legal Separation

of Surface and Groundwater Rights

Although we have become increasingly knowledgeable about hydrologic interrelationships between

groundwater and surface water in stream-aquifer

systems, water rights laws often do not recognize the

connection. In many states, there is a distinction

between the laws governing groundwater rights and

surface water rights, even where the two sources are

physically interconnected. The extent of the difference between the two systems of rights varies from

state to state.23

Separate legal systems governing the acquisition, retention, and transfer of rights to surface water

and groundwater in stream-aquifer systems where

the two sources are physically interrelated “impose

an added difficulty forwater managers.“x Separation

can leave appropriators of the two sources “on a

collision course.“25 Groundwater appropriators may

have perfected senior appropriative rights to pump

from an aquifer that is hydrologically connected to a

stream system wherein surface water diverters have

perfected senior appropriative rights to that water

In these cases,which are not rare,the law protects

both appropriators absolutely; yet, pumping groundwater reduces the surface stream flow, or diverting

surface water reduces the water available to the

groundwater aquifer While it is one thing to say that

such conflicts could be resolved as would other

82 U.S. Advisory Commission on Intergovernmental Relations
conflicts between users of a common resource-i.e.,

through some adjudicative or administrative pmcessit is another thing altogether to have such conflicts

created needlessly by the failure to adjust water rights

laws to reflect known characteristics of the supply those

laws are supposed to allocate and govern

An example of the problems this can create can be

seen in the recent experience of the Platte River in

Nebraska. Nebraska has a “reasonable use” doctrine for

the allocation of groundwater and an appropriation

system for surface water As thousands of wells have

been drilled and put to use, some of those have pumped

water that would have contributed to the flow of the

Platte River, and flows in the river have declined.

Towns, irrigation companies, and districts with appropriation permits along the river have faced reductions

in stream flows, from which they can claim a right to be

pm&ted. On the other hand, groundwater pumpers

can argue that they have invested in wells and drilling

equipment and have put the water to a masonable use,

and therefore have an equally unassailable right to

the water they use. Nebraska law does not provide a

way of making these users’ rights fungible so that

water supplies can be allocated among them when

shortages occur Similar problems have appeared in

other river basins”

Some states in the West have attempted to bridge

the legal separation of connected waters. In Colorado,

separate legal treatment is given to groundwater that

is tributary to surface water, and this groundwater is

subject to the laws governing the use of the surface

water to which it contributes?7 This allows at least a

chance for conjunctive management in a basin

where the two sources are interrelated by unifying

the priorities of the appropriative rights. In the 13

western states that apply the doctrine of prior appropriation, six apply a single appropriation system to

hydrologically connected surface water and groundwater, and five provide by a separate statute for the

integration of rights where surface and underground

waters are connected. In two states, the courts have

upheld actions of the state engineer (as in New

Mexico) in administering rights to the joint use of

connected surface and underground water?

States attempting to consolidate water rights after a

stream system has been “fully appropriated” have faced

a political problem of some intensity when the priorities

of rights of groundwater pumpers come up against the

older rights of surface water diverters% Nevertheless,

failure to integrate the two sets of rights makes cootdinated use quite difficult State water rights laws need “to

respond to a realistic view of the physical occurrence

and distribution of ground water including the interrelationship between ground and surface water”=

Rights to Store and Recapture Water

Lack of definition of rights to the storage of water

in underground basins and to its subsequent recapture discourages systematic conjunctive management31 Moreover, other aspects of state laws and

policies governing groundwater and surface water

rights and basin management may impede effective

conjunctive management

Water rights may be undefined for entities wishing to undertake artificial recharge of groundwater

supplies in order to capture temporary water surpluses for later use. First, the right to use surface water

supplies for recharge must be assured. Under the

appropriation doctrine, diverting and capturing surface waters for use at some later time may not qualify

as a “reasonable” or a “beneficial” use. Appropriation

rules often stipulate that the water diverted must be

put to beneficial use within a certain period or the

right to its use is forfeited. This places in question the

rights to store water that might not be recaptured and

used for years32 While most western states have

modified their procedures to recognize groundwater

recharge as a qualifying “beneficial use,” other states

do not make this definition explicit

Rights to store and recapture water supplies

underground also depend on the availability of

storage capacity Rights to the use of the storage

capacity in an underground basin often are not

defined in state laws, which were likely devised to

address rights to production. As a result, any private

operator or public entity attempting to use an underground basin for storage runs some exposure of being

unable to sustain a subsequent claim to the storage

space; this discourages such use of a basin before the

fact On the other hand, assuring a right to use

underground storage space provides an incentive to

capture, store, and recapture waters and to alternate

between water sources

Of course, for there to be storage space to use,

there must be space available. Optimal basin management may require lowering underground water

tables in order to increase the effectiveness of the

basin in capturing flows for recharge when surplus

waters are available.33 As noted in Chapter 3, in states

where “safe yield” operation of groundwater basins

is mandated, there will be a conflict between having

available underground storage capacity and complying with the “safe yield” requirementM “Safe yield”

policies affect planning of surface water reservoirs

and distribution systems because underground storage capacity cannot be figured into plans for conveyance, storage, and distribution of surface water supplies, resulting in overinvestment in above-ground

facilities This inefficiency hampered the State Water

Project in California, which was planned when “safe

yield” was the prevailing requirement for managing

groundwater supplies.35

Where groundwater and surface water rights are

separated but the supplies are physically connected,

legal protection afforded to surface water rights may

U.S. Advisory Commission on Intergovernmental Relations 83
require keeping a contributing groundwater basin as

full as possible. This would have the same effect as a

“safe yield” requirement in presenting an obstacle to

effective basin management.%

The right to recapture the stored water requires

that the storing entity also be entitled to pump the

water from underground. Priorities may have to be

established for the retrieval of stored water during

periods of shortage.n Procedures are needed to account for the water stored and the right to remove it

In the groundwater basins in the Southwest, where

effective conjunctive use has been developed, this

typically has been facilitated by the appointment of a

“watermaster” or the acceptance of these accounting

duties by the office of the state engineer

Finally, consideration should be given to two

related issues. First, the interests of overlying landowners should be protected from any unreasonable

harm from raising and lowering underground water

levels as part of a conjunctive management program.

Any entity storing water should assume some liability

and the overlying landowners should receive some

compensation if their pumping lifts are unreasonably lengthened or if the quality of their water supply

is affected adversely? Second, communities contemplating conjunctive management of groundwater

and surface water supplies should do some planning

to ensure that potential recharge areas overlying

aquifers in which they may wish to store water are

not developed beforehand. One potential institutional mechanism for addressing both of these issues is

the idea of “water zoning” ordinances that set aside

recharge areas and condition development in areas

overlying an aquifer that will be used for water

storage on recognition of the likely variability of

water levels in that area.39

In all, a legal structure “has to be developed

which permits raising and lowering of water levels,

defines the authority to use empty storage space,

defines individual rights, provides for physical solutions when individual rights conflict with the management plan, and protects individuals from the

economic inequities which may be created locally”40

Institutional arrangements that fail to provide for

these elements of conjunctive management present

continuing barriers to more effective utilization of

groundwater supplies.

Authority for Conjunctive

Management Agencies

One of the most serious and persistent obstacles

to effective conjunctive management is the absence

of local or basinwide authorities that could effectively

represent water users. Organizing for groundwater

management locally has been impeded by the fact

that “states have historically been slow to turn over

comprehensive environmental responsibility to local

governments.“41

As long ago as 1973, the National Water Commission recognized that local management authorities

should have the following capacities in order to

undertake effective conjunctive management efforts:

4

b)

c)

4

e)

To issue revenue bonds and to levy pump

taxes and diversion charges;

To acquire water, water rights, and real property for the development and use of facilities for

water storage, recapture, and conveyance;

To buy and sell water and water rights,and to

export water from the area when it is economically beneficial to do so;

To store water in surface reservoirs or underground, to extract water, and to reclaim and

treat water;

To represent all landowners and water rights

owners in legal actions to protect water rights

and water quality within its jurisdiction.

These powers, according to the commission, were

vital in order that any locally based water management institution “be able to perform comprehensive

management functions within its jurisdiction.“”

The commission also acknowledged that few

states were willing to give such a range of powers to

water management agencies. Even powers to impose

pump taxes and diversion charges have been granted

reluctantly at best, though these powers are “vital if

the agency is to be able. to enforce rational choices

between surface and ground water use when both are

available and physically accessible to ~sers.“~ Implementing effective institutional arrangements for conjunctive management requires the ability to manipulate user charges to increase the compatibility of

individual incentives and collective goals.

Problems of Unspecified and Latent Rights

Instream Flow Protection, the “Public Trust” Doctrine, and Land Based Water Rights. Unspecified

and poorly quantified rights give rise to considerable

uncertainty on the part of water rights holders and

managers Similar problems are created by legal doctrines that leave vague and unspecified “latent”

rights in the system that might at some subsequent

date be activated and used. Even a specified, quantified permit to appropriate water, duly acquired under

state laws and procedures, is of dubious value if it is

not binding on subsequent uses.& Unspecified rights

and reservations that impede more effective management arise from four sources: protection of instream

flows; the emergence of the “public trust” doctrine;

water rights tied to land ownership; and the doctrine

of “reserved rights.”

Protecting instream flows (for scenic, wildlife,

navigation, recreational, and other purposes) is not

84 U.S. Advisory Commission on Intergovernmental Relations
normally conceived as a problem of managing

groundwater supplies, but, as we have seen, groundwater supplies frequently contribute to the base flows of

surface streams with which they are physically interconnected. In such cases, actions by the state to protect

instream flows may affect the amount of withdrawals

from a groundwater basin. Here, again, the difficulties

encountered may be less physical than institutional.

States that do not connect their groundwater and

surface water rights systems are poorly positioned to

establish reasonable trade-offs for the protection of

instream flows. Maintenance of undiverted water

flows downstream has been especially difficult in

appropriation states that require diversion and use of

water Yet, governmental action after the fact to try to

restore instream flows disrupts the production rights

of users who acquired them in good faith under the

rules of their day, and requires the owners to relinquish the rights for another purpose without compensation. Perhaps most importantly, endless speculation about possible impending governmental

action to protect instream flows has a chilling effect

on efforts to manage water supplies”

The “public trust” doctrine has been employed

recently to protect instream flows. The doctrine

originated in the Tudor period in England% to convey

the limits on private rights of ownership to tidal

lands, but has been extended to nontidal lands and to

water rights. The claim of right under the public trust

doctrine is that some natural resources “are so intrinsically valuable to the public that they cannot be

owned by any persor~“~~ As a “broad mandate to

consider public trust values,“& the doctrine could be

used to protect instream flows before allocating production and storage rights to individual ownefs On the

other hand, recent litigation has attempted to employ

the public trust doctrine after the allocation and exercise

of rights in order to subsequently “limit or destroy the

pmperty right by application of a pmviously undefined

superior claim with no compensation for the lossn49

When applied in this fashion, the public trust

doctrine becomes another source of uncertainty for

the holders of production and storage rights. This can

inhibit the development of complex basin management programs that involve allocation of water and

storage among competing users, the employment of

alternative sources of watersupplytransfers of rights,

allocation of management costs among users, and so

on While it is unclear whether and to what extent the

public trust doctrine will be employed to defeat

production and storage rights that users believed they

held with certainty and stability, it appears to have

‘almost suddenly evolved into a completely new

creature that is doing things never considered possible when the doctrine developed.*

The emergence, or threat of emergence, of “latent” rights that may be employed suddenly without

compensation for the losses imposed on holders of

other rights generally presents a barrier to more

effective conjunctive management In states that link

the acquisition of water rights to ownership of

overlying lands, this problem of the “latent” right can

affect even the most apparently complete and stable

management plans. Even after a long and complex

adjudication of the rights to native groundwaters,

imported stored waters, and return flows in California’s San Fernando Valley, forexample, the California

Supreme Court indicated in its opinion that landowners in the valley who were not exercising their

rights to the use of the groundwater beneath their

lands at the time of the entry of the judgment could

still initiate production of groundwater for reasonable use on their overlying lands. The exe&e of this

“latent” right could thus “upset the apple caf151 and

reduce or infringe on the tights of the parties to the

adjudication, simply because California water rights

law continues to give unquantified rights to the use of

underlying groundwater to anyone who owns land

Effective basin management planning requires that, at

some point, them be an end to the expansion of

pumping rights within the basin

Federal Reserved Water Rights. Reserved rights are

the most extensive of the “latenr unquantified rights,

In the western states in particular, federal reserved

water rights play an especially important role in

impeding more effective management of groundwater supplies. A series of decisions, beginning with

Winters v. United States (1908) and reaching its zenith

with the surface water diversion decision in Arizmn v.

Cnlifomia (1963) and the groundwater withdrawal

decision in C~ppuertv. United States (1976),established

reserved water rights of the federal government

These reserved rights are superior to the water rights

granted under state laws, which previously had been

thought to govern nonnavigable water resources

The concept of the reserved right is that when the

Congress acts to set aside lands for a federal reservation (e.g., military or Indian), it implicitly acquires the

right to use whatever waters are available and

needed to fulfill the purposes for which the lands

were reserved. The right dates back to the time when

the reservation of the land is made, and is superior to

any and all subsequently acquired rights.%

Reserved rights create two problems for effective basin management. First, the reserved rights

are often unquantified,and until they are put touse

by the federal government their full extent in a

basin can only be guessed at by the local users. This

presents the same problems as with all other

unquantified water rights.

Second, because many federal reservations date

back to the turn of the century and earlier, the rights of

the many users who complied with applicable state

laws would be rendered essentially worthless by the

U.S. Advisory Commission on Intergovernmental Relations 85
exercise of federal reserved water rights. Moreover,

water withdrawn under a federal reserved right can

be used without regard to state law, or even in ways

that are inconsistent with or in contradiction of state

law.53 The reserved water rights have not been used

frequently; as a matter of federal comity, federal agencies have complied with state laws and administrative

pnxedures, but there is nothing requiring them to do so.

As competition for water resources intensifies, the

temptation to employ automatic, senior reserved rights

rather than comply with state procedures for the

acquisition of junior appropriative rights may grow.

This expands the pumping rights in a basin,

thereby upsetting any management program. It also

means that the federal government has the right to

enjoin other groundwater and surface water users’

rights that interfere with the availability of water for a

federal project or reservation.%

In Cnpynert, for example, also known as “the

Pupfish Case,” the United States was upheld by the

Supreme Court in its efforts to restrict gmundwater

pumping by the Cappaert Ranch (pursuant to permits

granted by the state of Nevada) that were lowering the

water level at Devil’s Hole in Death Valley National

Monument, thereby threatening the continued existence of a rare species of desert pupfish.” The Cappnerf

decision appears to establish the authority of federal

agencies to exercise rights to the use of groundwater and

to prohibit other users’ exercise of groundwater pmduction rights that might interfere with the federal reserved

water right The potential for such a decision was

viewed with alarm by western states, some of which

filed amicus curiae briefs in the Cnppnert case. Given the

extent of federal reservations in Arizona, for example,

the state’s brief warned that interference with state

groundwater rights laws and management plans from

the extension of federal reserved rights would wreak

“economic havoc” on the state.%

In 1978, the Supreme Court clarified the federal

reserved water right issue in a way that showed

greater sensitivity to the concerns of states In United

St&s v. New Mexico, the Court restricted federal reserved rights to water for specific needs essential to the

planned use of the reserved land. The Court rejected an

attempt to broaden the reserved water rights of national

fores& to protect instream flows for fish and wildlife5’

Indian water claims in particular present considerable uncertainty for the Indian tribes and the states

in which reservations are located. No one in the

reservation states “knows how much unencumbered

water will be available until the Indian claims are

settk~L”~ Furthermore, the tribes do not know what

water they have or what they will be allowed to do with

it. The Indians’ wealth position and their flexibility to

determine their own course of development would be

enhanced if their water rights were quantified and were

not restricted to use for irrigated agriculture on reserved

lands, but were available for municipal and industrial

uses, and even for transfer and exchange.59

Uncertainty in the Extent of State Authority: Sparhase and EZ Paso. The power of the federal government to regulate the waters of navigable streams has

been settled since the early days of the Republic. The

constitutional power of the federal government to

regulate groundwater supplies directly has been a

more recent question.

Two principal cases in the federal courts in the

1980s ruled on the issues of the authority of states to

restrict the use of groundwater outside their boundaries. In 1982, the United States Supreme Court ruled

on an appeal in the case of Sporhnse v. Nebmskn, and in

1983a federal districtcourtentered judgment in Cityoj

El l3rso v. Reynolds. The two decisions have changed

the view of the constitutional power of the federal

government and the states with respect to groundwater management

In Sporhnsev. Nebrasku,bo the joint owners of lands

on both sides of the Colorado-Nebraska border

applied for a Colorado permit to appropriate groundwater for use on their Colorado lands. Their application was denied because the groundwater withdrawals would have constituted groundwater mining,

which is prohibited by Colorado. The landowners

then pumped groundwater from a well located a few

feet over on the Nebraska side and used the water on

their lands in both states.

Under Nebraska law, a permit must be obtained

to export groundwater from the state. One of the

conditions for granting such a permit (along with the

conditions that the withdrawals be reasonable, not

contrary to the conservation or use of groundwater, or

otherwise detrimental to the public welfare) is that the

state to which the water is exported grants reciprocal

rights to Nebraska, which Colorado does not Nebraska

sought an injunction to restrain the landowners from

exporting groundwater pumped in Nebraska to their

lands in Colorado. Nebraska prevailed in the trial court

and in the state supreme court The landowners

appealed to the United States Supreme Court The case

generated amicus curiae briefs from the states of

California, Colorado, Kansas, Missouri, Nevada, New

Mexico, North Dakota, South Dakota, Utah, and Wyoming as well as the City of El Paso, the Elephant Butte

Irrigation District, the National Agricultural Lands

Center, and the National Wildlife Federation

The United States Supreme Court, by a 7-2 vote,

held for the landowners, ruling the Nebraska law

unconstitutional. The principal constitutional challenge was that the Nebraska law presented an

impermissible state burden to interstate commerce.

Nebraska replied that groundwater, which is not a

freely tradeable item under state law, is not an article

of interstate commerce. The majority opinion for the

Court, by Justice John Paul Stevens, observed that the

86 U.S. Advisory Commission on Intergovernmental Relations
agricultural products of the western states, supported

by groundwater irrigation, are part of markets that are

not only interstate but international in scope and

“provide the archetypal example of commerce for

which the Framers of our Constitution intended to

authorize federal regulation.“61 The opinion observed that the multistate extent of the Ogallala

Aquifer “confirms the view that there is a significant

federal interest in conservation as well as in fair

allocation of this diminishing resource.“62 The Court

majority defined groundwater to be an article of

interstate commerce, subject to federal regulation

under the Commerce Clause, declaring that further

“Ground wafer overdraft is a national problem, and

Congress has the power to deaf with it on a national scale. “63

The constitutional inquiry then turns to the

extent to which Nebraska may regulate groundwater

withdrawal and use in the absence of congressional

action on the subject In this regard, some of the

conditions the state placed on the export of groundwater were clearly constitutional, according to the

Court Requirements that withdrawals be reasonable,

consistent with conservation, and not detrimental to the

public welfare are not unreasonable restraints on the

free movement of groundwater in interstate commerce.

However, the mcipmcity requirement (for water permits) failed to survive constitutional scrutiny under the

Commerce Clause for apparently “discriminatory” or

“protectionist!’ state regulation. Justice Stevens noted

that the reciprocity requirement would bar the transfer

of water to any nonreciprocating state, regardless of

how beneficial the transfer may be. Such transfers

would be prohibited by the Nebraska law even if there

were no detrimental effects for the state and even if the

state were sitting atop a massive groundwater surplus

Finally, the Court observed that federal deference to the

states in groundwater law and management does not

and cannot remove constitutional constraints64

The dissenting opinion by Justice William Rehnquist criticized the majority for failing to confine itself

to the issue of the relationship between the Nebraska

law and the Commerce Clause. In the view of the

dissent, the majority had “gratuitously” undertaken

and decided additional issues that were not presented

by the case, such as whether groundwater overdraft

constituted a “national problem,” the scope of congressional authority to regulate groundwater withdrawals,

and the relationship between the Nebraska statute and

federal laws that were not passed, not challenged, and

not before the Court in any but a hypothetical fashion

In addition, the dissenting opinion argued that it was

difficult to see how “commerce” could exist in groundwater since groundwater in Nebraska could not itself be

reduced to possession, and the only right conferred on

Nebraskans was the right to use the groundwater on

averlying lands owned by the pumper

The Supreme Court issued the Sporhase decision

in July 1982 In January 1983, the federal district court

for the New Mexico District decided the case of City of

El Paso v. Reynolds. El Paso, Tstas, attempted to acquire

rights to the use of 296,000 acre-feet of groundwater

from aquifers that are hydrologically connected with

the Rio Grande stream system. New Mexico State

Engineer Steve Reynolds denied the city’s application

for an appropriative permit, citing state law forbidding

the export of groundwate@ El Paso sought to have the

New Mexico export ban declared unconstitutional, and,

in light of the Supreme Court’s decision in SporIm, the

federal district court agreed with El Paso.

Criticisms weredirected to the El Paso decision on

three principal grounds. The first criticism is that in its

application of Sporhnse, the federal district court

concluded that states may discriminate in favor of

their citizens “only to the extent that water is essential

to human survival.“” This may be an excessively

restrictive interpretation of the Supreme Court’s

position in Sporhase.

A second criticism in El Paso was that the district

court failed to take into consideration the Supreme

Court decision in Colorado v. New Mexico67 handed

down in December 1982, involving the Vermejo

River, which flows from Colorado into New Mexico.

The Supreme Court upheld the doctrine of equitable

apportionment governing interstate streams, which

divides the waters of a stream so that each state is

allocated a fair share. Since the El Paso case involves

the intexstatetransferof groundwaterthat is part of an

interstate stream, the federal district court decision

has been criticized for following Sporhase instead of

Colorado v. New Mexico.68 Relying on the doctrine of

equitable apportionment rather than the Commerce

Clause to govern the case would maintain the

recognition of state interests in the management of

water resources by allowing each to regulate its fair

share of water resources that underlie or flow through

more than one state.69 Part of the problem with the El

Paso case, then, is that it

was argued under the wrong theory in the

wrong court Under the U.S. Constitution,

disputes over interstate streams are to be decided by the Supreme Court of the United

States, not by a federal district court, and under the federal common law these disputes

are governed by equitable apportionment,

not by the commerce clause.70

Finally, El kso has been criticized on policy

grounds. By deciding in favor of the Texas city seeking

additional supplies and against New Mexico, the

federal district court “penalizes a state with a progressive water law system (New Mexico) and rewards a

wasteful system (Texas).“n

The Sporlme decision, on which the federal

district court based its El Paso decision, also has drawn

U.S. Advisory Commission on Intergovernmental Relations 87
attention and scrutiny The Supreme Court’s ruling

that groundwater is an article of interstate commerce

subject to direct congressional regulation has generally been acknowledged to have substantially

weakened the basis for state and local primacy in the

management of groundwater supplies, to have

“opened the door for federal control over groundwater on nonfederal lands,“R and to have “far-reaching”

implications for water regulation.73

Much of the post-Sponhase analysis has been

addressed to the questions of what authority remains

with states to limit and control theuse of groundwater

resources. The majority opinion in Sporhase has been

interpreted by different observers to mean:

4

b)

cl

4

Narrowly tailored state restrictions on

groundwater use could be sustained if

shown to be related to the state’s legitimate

interests in conservation and preservation of

the resource.74

State restraints on groundwater exports may

be permissible if the withdrawals for export

would result in groundwater mining thus

impairing the resource.75

State restrictions on groundwater exports

may be sustainable provided that a discriminatory embargo against out-of-state residents is not their prime purp0se.7~

State restrictions on groundwater exports

might be justifiable in times of “severe shortage,” in order to protect the health and safety

interests of the state’s citizensn

From the standpoint of enhancing the marketability

of production rights to groundwater, Sporlzase may

also be seen as removing arbitrary state “resource

isolation” barriers to the interstate movement of

groundwate?’

The Sporlrase decision is seen as having left the

following questions unanswered:

4

b)

4

Can a state’s projections of a “severe shortage” that would occur if a groundwater export were allowed be used to justify restricting that export?

In so projecting, can a state take into consideration acreage that might become permanently

nonirrigable if the export were allowed?

Can states prohibit export where the health

and safety of residents might not be threatened but “instream flow” values would be?79

Nebraska and New Mexico changed their laws

governing groundwaterwithdrawal and use afterthe

Sporltase and EZ Paso decisions. Nebraska adopted a

permit system for all groundwater withdrawals.sO

New Mexico enhanced its review of permits for

groundwaterexportbyauthorizingthestateengineer

to consider the supplies available to an export

applicant in the applicant’s home state. This raises the

question of one state9 authority to restrict exports of

water into another state where water surpluses exist, or

where wasteful water practices have resulted in the

attempt to import water from elsewhere. Neither of

those issues was reached by the Sporhnse decisions1

Three years after Sporhase v. Nebraska, the Court

decided Garcia v. San Antonio Metropolitan Transit

Authority.82 The Garcia decision calls speculations

about the remaining groundwater management authority of the states into question. Garcia holds that, in

Commerce Clause cases, the limits on congressional

authority relative to the states and localities are not

imposed by any substantive concepts of “reserved

powers” under the Tenth Amendment, but by the

procedural elements of the “political safeguards of

federalism.” In the aftermath of Gnrcin, once groundwater has been ruled to be part of interstate commerce, there are no aspects of its governance that the

constitution reserves to the states, just those that the

Congress leaves to the states. Even if states retain

some authority to regulate groundwater supplies, a

key question of intergovernmental relations and

water resource policy raised by Sporlrase is whether

and to what extent the uncertain specter of direct

federal regulation, production, and transfer of

groundwater supplies may inhibit the willingness of

states to engage in innovations.

At present, there is little question that the Congress

has the constitutional authority to directly regulate

groundwater under the Commerce Clause. In a legal

confrontation between federal and state regulatory

power, the federal power would prevail. The S~&W

decision means, among other things, that the deference

of the Congmss to the primacy of state authority in the

area of the management of groundwater supplies is

based not on constitutional power but on federal comity

Summary: Certainty in Water Rights and in State

and Local Authority. Water rights should be characterized by certainty (a protected right to a specific

quantity of water for a known tenure) and flexibility

(the ability to convert the right through exchange)F3

Certainty is often lacking in state laws defining

production and storage rights

Rights to production often lack certainty because

they are unquantified and because other users may

begin to assert “latent” unspecified rights. Rights to

storage often lack certainty because they have not

been provided for or because local entities that could

store and recapture water lack either the authority to

do so or the implementing mechanisms. Further

progress in the definition of production and storage

rights and the authority of local water resource

management organizations is drawn into question

not only by the continued existence of “latent” federal

rights, but also by uncertainty about the scope of state

88 U.S. Advisory Commission on Intergovernmental Relations
and local authority relative to federal authority Each

of these attributes of the institutional arrangements

governing the use of groundwater supplies forms a

barrier to more effective coordination of water resource use. So does the lack of flexibility (i.e., marketability) of production rights.

Lack of Transferability of Production Rights

Along with increasing the certainty of water

rights, increasing their flexibility is a long-proposed

institutional reform. Local users have experimented

with transfering rights on the local, basinwide scale

when they could find ways to circumvent the obstacles in the laws. Whether or not one is inclined to

believe that the benefits of water rights transfers are

sometimes oversold by their proponents, preventing

them creates real barriers to effective management

Among the barriers are: disincentives for conservation and more efficient use of groundwater supplies;

the maintenance of relatively less valued and less

efficient water uses; and the inability to shift between

sources or to bring new uses into a basin. Institutional

reform in the direction of increased marketability is

hindered in turn by reluctance to treat water as a

commodity and by inefficient pricing practices

It is in discussions of marketability of rights that

the distinction between water shortages that result

from natural scarcity and from institutional rules

becomes most sharply drawn:

Even in the western region, the scarcity of

water to meet the demands of growth is not,

however, a problem of running out of water

It is instead a matter of allocation of a valuable economic resource among competing

demands. The current allocation has become

inefficient in meeting the demands of

growth due to market and institutional factors which discourage the transfer of water

among usesa

Lack of Marketability and Conservation. As noted in

connection with the discussion of water rights laws

above, most groundwater users face incentives to

“use it or lose it” Pumpers lack incentives to reduce

use, to use water more efficiently, and to waste less of

it Yet, the community and individual users experience

losses if aquifers are depleted to the point where

withdrawals are limited because pumping has become

uneconomicaL85 Some form of intervention before that

point is reached would be desirable. The question

becomes what form this intervention should take.

Any effective conjunctive management program

is likely to involve reductions in or limits on withdrawals in order to control overdrafting. Regulations

could be imposed on water rights ownem and enforced by monitoring and policing arrangements

This approach represents an attempt by the community to achieve its gain at the expense of individual

rights owners. However, the chances for full compliance with such an arrangement are smaller than if

institutional arrangements for limiting withdrawals

are compatible with individuals’ incentives. Owners

possess a valuable property right in the use of the

water supplies. The imposition of regulations requiring owners to forfeit some or all of their right for the

collective good isunlikely tobe received as a welcome

development The regulatory approach therefore

will likely require extensive monitoring and enforcement of individuals’compliance with a rule that runs

counter to their goals.

Water management programs stand significantly better chances of success and stability if water rights

owners benefit from it? Assuming that there are

collective gains from more efficient water resource use,

there should be no intrinsic problem in securing those

benefits through processes that distribute at least some

of the benefits to the water users and rights owners Thii

is the principal argument for making water rights

marketable to increase conservation and efficient use.

Once each owner has a quantified right to the use

of a specific amount of water (i.e., taking advantage of

the principal benefit of the appropriative rights system),

allowing exchange of rights creates an incentive structure that pmduces a positive+um situation from what

appeared to be a zero-sum situation. A water rights

owner who can improve efficiency will be able to

reap the same benefits while using less water If the

owner can transfer the difference to another user for

some consideration, then the original water rights

owner has benefited by increasing efficiency and

reducing water use rather than being penalized for it In

addition, new uses have been accommodated without

increasing the total amount of water withdrawn from

the system The water rights owner gains by acquiring

something of value for increasing efficiency the new

user gains a valuable water right, and water resoumes

an2 used more efficiently

Institutional arrangements encouraging conservation could even be applied across water basins.

Communities able to generate surplus waters could

transfer them to water-short communities, and both

groups could gain by the transaction. Communities

unable to make conservation improvements mightbe

assisted by communities seeking additional sources

of supply This has occurred in southern California,

where the Metropolitan Water District of Southern

California will pay for water conservation investments in the Imperial Irrigation District in exchange

for the rights to the surplus water yielded by those

conservation practices8’

Impediments to water conservation and water

transfers are numerous and primarily institutionaLsB

Moreover, appearances can be deceiving water laws

U.S. Advisory Commission on Intergovernmental Relations 89
and policies that seem to encourage conservation and

water marketing may in fact discourage both. For

example, “recent Massachusetts legislation allows

inter-basin water transfers only as a last resort, after all

local leak reduction and conservation efforts have

been exhausted.“*9 While on the surface this appears

reasonable, this qualification actually discourages

water transfers If user A wastes 20 percent of KS water

supplies, and user B wastes 10 percent of B’s water

supplies, any transfer of water from A to B would

improve efficiency of use. Under the Massachusetts

condition, however, B must reduce waste from 10

percent to zero before acquiring water through transfer

from A, who may continue to waste 20 percent of its

water supplies until then. In the meantime, the costs B is

likely to incur in squeezing out the last drop of water

waste, finding and sealing the last leak, may be several

times the cost of purchasing equivalent amounts of

additional water from the moTe wasteful A Neither

efficiency nor conservation is facilitated by such a

requirement, which undoubtedly was intended to

facilitate both The connection between water marketing and conservation is not always obvious In water

resources management, as in other areas, our institutions do not always comport with our intuitions

Lack of Marketability and Inefficient Water Uses.

The remarkable abundance of water resources relative to population, even in the relatively arid western

regions, was noted in ChapterZ Some estimates of the

water-sustainable population of the Colorado River

Basin states indicated that those states have not run up

against the water supply limits of development, but

have considerable water supplies to use if they weR

allocated differently. In particular, in the western states,

most of the water rights are held by, and most of the

water consumption occurs in, irrigated agriculture.

Even in the less abundantly water endowed

western states, crops that are highly water consumptive are grown in great quantities. The most highly

water consumptive crop, alfalfa, which requires5 to 6

feet of water per acre, accounts for millions of acres of

land use and millions of acre-feet of watet According

to 1988 estimates, the acreage of alfalfa grown with

mined groundwater (i.e., nonrenewable supplies)

was as follows: California, 196,000 acres; Tstas,

103,000 acres; Kansas,88,000 acres; Idaho, 51,000 acres;

Arizona, 38,000 acres; New Mexico, 31,000 acres;

Nebraska, 27,000 acres; and Colorado, 20,000 acres.%

To gain a sense of perspective on the magnitude of this

acreage, the United States’ entire lettuce crop occupied

about 200,Oo acres; the California avocado crop occupied about 75,000 acres, and the California lemon crop

occupied about 50,000 acreSgl Total alfalfa acreage in

Arizona was estimated in 1985 to be 200,CK)O am,

irrigated with renewable and nonrenewable water

supplies: at 6 acrefeet of water per year, the alfalfa crop

alone would have consumed 1,2&lm acre-feet of

water that yeas which is equivalent to the entire

planned yield of the Central Arizona Project (CAP).

Why is so much thirsty alfalfa hay grown in these

climates? It is surely not because it is a high-valued

crop, producing a vital share of the nation’s or the

region’s economic abundance. Its primary use is for

feeding livestock In the words of Natural Resources

Defense Council analyst Marc Reisner,

In California, the single biggest consumer of water is not Los Angeles.. . . It is irrigated

pasture. . . . In 1986, irrigated pasture used

about 5.3 million acre-feet of water-as

much as all 27 million people in the state consumed, including for swimming pools and

lawns. Its contribution to California’s $500

billion economy, on the other hand, was an

invisible $94 million. One five-thousandth

of the economy; one-seventh of the water.

If you entirely eliminated pasture, alfalfa, cotton, and rice (not everyone’s idea of an

appropriate desert crop, since it grows only

in standing water) and substituted nothing

else, you would merely reduce agricultural

income from $14 billion to $12.3 million. But

you would free up enough water for, God forbid, some 70 million new Californians.

Is California atypical?

Only in the sense that agriculture in California, despite all the desert grass and irrigated

rice, accounts for proportionately Iess water

use than in most of the other western states.=

Alfalfa and other low-valued, highly water consumptive crops are grown with western water resources for three primary reasons. First, alfalfa in

particular is easily mechanized and grown with very

little labor. Second, outside of the Pacific Northwest’s

humid climes or the warmth of California and

Arizona, much of the rest of the West’s climate is not

receptive to many other crops; alfalfa and pasturage

grasses are hardy and help keep “blow sand” and soil

erosion down. The third (and perhaps most important) primary reason is the laws governing water

rights in the western states. As John Wesley Powell

noted a hundred years ago, the greatest source of value

in arid lands is access to watecg3 Whether that access is

allocated on the basis of actual use under appropriation

or beneficial use on overlying lands, maximizing this

vital asset is secured by maximizing use.

The crop that consumes the maximum amount of

water per acre would secure the maximum possible

right to the use of water. Western farmers understandably do not want to relinquish their rights to the use of

water and receive nothing in return. There is no

incentive for an individual farmer to grow anything

else or irrigate fields more efficiently except where it

90 U.S. Advisory Commission on Intergovernmental Relations
might be possible to transfer water rights to a city, a

water district, a suburban community, a manufacturer, or another farmer, in exchange for something of

value. (This would also explain the fact that even

municipalities and manufacturers maintain alfalfa

fields in the desett Southwest They are not maintaining

the nation’s livestock supply or perpetuating rural

agrarian traditions, or maximizing profit through inigation to yield high-valued crops They are making sum

that they have the largest possible share of water rights)

Laws that would simply shut down enough

irrigated agriculture to generate water to supply

municipal and industrial needs miss the point, and

would go too far Those who have properly acquired,

held, and used water rights-in other words, who have

played by the past and present rules of the gameshould receive an agreed-on compensation for mlinquishing those rights

Those who object that water rights transfers from

the agricultural sector to the municipal and industrial

sector would threaten the future of irrigated agticulture and the nation’s food supply also miss the point

Bearing in mind that agriculture accounts for about 80

percent of water use in the west while urban water

use is about 7 percent, a reduction of only 10 percent

in agricultural water use could double the amount of

water available for urban ~ses.~ This is hardly a

wrenching dislocation of irrigated agriculture, and it

would produce more water availability than needed

by the urban sector in the most arid and fastest

growing region. Indeed, the comparison in Chapter 2

of the populations of the more arid western states

with what those states could support if all irrigated

agriculture were eliminated shows how little change

would have to occur in the water use practices of

irrigated agriculture in order to accommodate current

and projected populations.

Lack of Marketability and the Problem of New

Users. Lack of transferability also has complicated

the problem of accommodating new users. In appropriation states,for example,the total quantity of water

in many stream and aquifer systems has reached or is

approaching “full appropriation.” Yet, because production rights often are nontransferable, this situation “leads some analysts to conclude erroneously

that all the available water is being consumed or that

no new water uses can be accommodated.“95 In fact,

accumulated claims on the water supply may not

reflect accurately the needs of users who retain their

claims because their only other option is to abandon

them without compensation.

If owners could transfer their rights to new users,

many claims (some of which are a century old) to

water in the appropriation states probably would

become available for purchase. New uses of limited

groundwater supplies, for example, could be met

without increasing pumping rights if state legislatures

will adjust the laws to permit it With transferable water

rights, an allocation of water rights based on past use is

not locked into the same uses or the same owner3 as

conditions change?6

In the absence of transferability, one must either

assume that the original allocation of water rights

was perfect or accept the possibility that the original

allocation is likely to have been somewhat imperfect

and to become increasingly so over time.97 Accepting

the latter conclusion, an important issue becomes

how to adjust the original allocation. Marketability of

water rights would allow new users to “buy in” to

acquire water rights. When combined with the ability

of the original owners to enter into exchanges,

adjustments to the original allocation of water rights

could be made on the basis of terms of exchange

arrived at by willing sellers and potential buyers,

moving water at the margin from those who value it

less to those who value it more.

In the absence of the ability to make relatively

continuous marginal transfers of water rights, those

seeking water under conditions of scarcity tend either

to undertake large-scale water transfer projects or to

bring political pressure on some larger jurisdiction to

undertake transfer projects on their behalf.” 7’he

notion that marketability of water rights means a bidding

wal; transfers of water from one location to another and

escalation of costs, and that these problems are avoided by

nonmarketability, is simply false. Without marketability,

the bidding war is simply shiftedfrom the economic arena to

the poli tical arena, water is transferredfrom one location to

another by means of massive structural projects, and the

costs of water transfers by those means (while hidden) are

higher than the costs of transfers of water rights negotiated

between potential buyerandpotential seller Yet most state

lawsmakeitdifficulttotransferwaterrights from one

use to another and practically impossible to transfer

rights from one place to another.

There is evidence that when they are allowed to

do so water users will transfer rights from agricultural

to municipal and industrial uses,and reallocate water

from irrigation to higher priority uses. Private capital

markets are being developed to facilitate acquisitions

of water rights for growing municipal and industrial

demands, complete with water “brokers” who connect sellers with buyers and help negotiate transactions.% Water rights transfers and water markets are

prospering especially in Colorado, but also in California and New Mexico, in Utah’s Lower Sevier Basin,

and between agricultural and urban water users in

the Tucson area.‘@’

In the adjudicated groundwater basins of southern

California, where groundwater pumpers fashioned

their own management programs through court judgments, the water rights allocated to existing pumpers

were fixed and quantified, but they were also made

exchangeable. Lively intrabasin lease and sale exU.S. Advisory Commission on Intergovernmental Relations 91
changes have characterized those basins since the entry

of judgments Though the courts, water users in those

basins found a way around the lack of quantification

and marketability of rights inherent in the law.

Laws and policies are all that stand in the way of

these water rights transfers. For example, an attempt

in the 1980s by the City of San Diego to enter into an

agreement with Wyoming ranchers on the upper

reaches of the Colorado River was aborted because it

would have violated terms of the Colorado River

Compact and the international treaty with Mexico.

San Diego wanted to compensate the upstream

ranchers for using less water, which would have

allowed greater amounts of flow to descend to the lower

reaches of the Colorado Rivel; where it could be

diverted by the city The agreement would have

benefited both parties and moved water away from less

valuable uses, but it was blocked by the existing rules

governing the allocation of Colorado River waterslo

United States Representative George Miller of

California, who chairs the Subcommittee on Water,

Power, and Offshore Energy Resources of the Committee on Interior and Insular Affairs in the U.S.

House of Representatives (and who is not an advocate of unfettered water marketing), introduced legislation in the 99th Congress that would have established a “water exchange” in central California. The

exchange would have allowed San Joaquin Valley

farmers to sell their water rights to southern California cities rather than use the water on lands tainted by

agricultural drainage water high in selenium, and

would have applied part of the profits to alleviating

the polluted drainage problem. Representative Miller’s bill was not acted on by the Congress.lm A few

states have attempted to revise their groundwater

laws and policies to facilitate the voluntary transferof

rights and to further the lease and sale of water

Amongthe promising institutional reforms of the last

decade are:

a ) Oregon and California have tied to eliminate the disincentive to conserve water byallowing rights owners to retain water conserved by efficiency and a 1980 ruling of the

Idaho Supreme Court held that an appropriator retains the right to water salvaged by reducing seepage from transmission systemslm

b ) During the 198Os, California enacted legislation providing that water transfer does not

constitute wasteful or unreasonable use and

directing the state’s Department of Water Resources to implement state laws regarding

transfers and encourage the voluntary transfer and exchange of water?

c) Idaho has experimented with the transfer

of water impounded by federal water project reservoirs so that contractors with surplus water can “bank” it for rental to contractors (though a low ceiling has been

placed on the rental price).‘a5

Efficiency in resource use should be and ostensibly is a goal of public policy. Efficiency requires

shifting resource use from lesser toward higher

valued uses, just as it involves the reduction of

wasteful useslOd If transfers of water rights are

blocked or impeded by laws and other institutional

arrangements, then the tools of public policy are

defeating the goals of public policy

Objections to Water Marketing: Agricultural and

Other Third-Party Effects, and the “Water Is Different” Objection. Objections to water marketing arise

on the ground that it will wantonly destroy the

agricultural sector of the economy Yet, the percentages of water rights that would need to be shifted away

from western irrigated agriculture are small. Also,

w&rkting amounts of water transferred to amounts

consumptively used, as discussed in connection with

the practices of the New Mexico state engineer in

Chapter 3, can protect neighboring water uselsiw

Relatively continuous, marginal adjustments in

the distribution of consumptive water rights should

not produce massive displacements in the agricultural sector As water rights are transferred from agricultural to municipal and industrial uses, labor opportunities axe likely to increase in the graying urban areasI@

Some in farm communities might experience difficulty

with significant capital investments at risk, many of

whom have been encouraged to make those investments by decades of governmental policies It is not

necessary to dismiss these potential problems simply by

pointing to the “rough justice” of the “free market”

Instead, these third parties might be compensated by

the beneficiaries of the transaction. Having enforced a

misallocation of water rights for so long states and local

communities should be able to ease the transition to a

more reasonable allocation, especially since water

rights transfers can save money that might otherwise

have been invested in large-scale water projectslOg

Other objections to water marketing arise from

reluctance to view water as a commodity. Water

supply has been seen traditionally as a service

delivery function, to be regulated and subsidized, but

not priced or traded. This distinction between “commodity” and “service” stems in part from the perception that, as a necessity of life, water should not be

subject to the coarse rigors of the marketplace, and its

provision to consumers should not reflect such harsh

economic factors as the cost of production or consumer demand. “Freshwater is too important to be given

over to free market forces,” argues Williamson B.C.

Chang.‘lO This reasoning begs the question of why

consumers are not similarly provided with food,

clothing, orshelter “services” without regard to cost or

demand, and of why such other “utility” services as

92 U.S. Advisory Commission on Intergovernmental Relations
electricity and telephone cost the average household

much more and are priced according to use. What

stands to CO.9 citizens more in the long run is the

continuing misallocation of water resou~es that would

result from an illusion that water ought somehow to be

exempt from treatment as a commodit$ll

Another objection to treatingwateras a commodity and allowing its price to reflect its valuation by

users is that demand is inelastic-the quantity of water

demanded does not vary with price. The reasoning of

this objection is that necessary uses of water are

rdativeiy fixed for each person, and, theEfore, increm

in price will only capture economic nznts and will not

materially affect the demand

Yet there is considerable evidence that water

demand is price sensitive, even if it is not fully

elastic.112 A comparison of the 12 hydrologic study

areas in California shows that 1984 water use varied

from approximately 300 gallons per person per day in

the two regions where water costs were less than 20

cents per 100 cubic feet down to about 175 gallons per

person per day in three regions where water costs

exceeded 70 cents per 100 cubic feet, and the overall

correlation between water use and marginal price

was -0.62113 Similarly, in Arizona, water use per person

per day is approximately twice as great in Phoenix as in

Tucson, and water rates are approximately twice as high

in Tucson as in Phoenix114 According to Lawnznce

Masher, studies of one electric power plant showed that

an innease in the price of water from 1 cent per

thousand gallons to 5 cents per thousand gallons

resulted in a drop in water use from 50 gallons per

kilowatt-hour of electricity generated to 0.8 gallons of

water per kilowatt-hour generated: “A five-fold price

increase thus led to a 5Gfold reduction in water use.“‘15

A good such as water has multiple attributes and

uses. Some of those uses are highly price sensitive

while others are not As the price of water increases,

least valued uses are curtailed first while higher

valued uses are not curtailed at all, but overall water

use declines?16 Outdoor summer water uses, for

example, tend to be curtailed to a greater degree in

response to a water rate increase than indoor

year-round water uses -in fact, outdoor water uses

may show an elasticity of demand of greater than

one.117 There is no evidence that increases in the price

of water workany particular hardship on individuals

or households in that they are unable to afford

enough water for need, but there is evidence that

users become more attentive to water waste and

reduce lower valued uses.

Water rates have long borne no apparent relation

to the natural scarcity of the good. The combination of

generally plentiful supply through most of the

country and inefficient pricing practices has produced underpricing of watec Water is by far the least

-pensiveof the utilities for which households pay

As Figure 5-l shows, the average family’s annual

water bill in 1984 was $143. The average family’s

telephone bill was more than three times as high, the

natural gas outlay four times as high, and the annual

electric bill five times as high. The annual outlay of

the average U.S. family in 1984 for water constituted

0.5 percent of median family income.

While rates charged by water supply systems may

range from 10 cents to $5.50 per $000 gallon,s,“8 the vast

majority of the population is nearer the low end of this

range than the high end Water supply systems chargkg rates Of 1esS than $1.00 per lpo0 gallons serve 88.8

percent Of the population. While 11.1 percent of water

q@y systems charge $3.00 or more per 1,000 gallons,

they serve only 0.01 percent of the population.1*9

Among the difficulties to be faced during the next

few years are that any increases in water prices to

make up for past undervaluation will be compounded by the increasing costs of meeting water

quality standards and of needed investments in

repair and improvement of facilities. Long-needed

reform in the direction of full-cost pricing of water

supplies is coming at the same time as the impact on

rates from these other sources. In the first half of the

198Os, water rates in 20 large cities increased by 90

percent at the 1,000 cubic-feet use level and 55 percent

at the lO,ONl cubic-feet use level, while the general

Consumer Price Index rose 21 percentlm Rate increases in excess of the general inflation rate are

expected through the first half of the 1990s.

Of course, comparisons of what customers are

charged per thousand gallons or per hundred or

thousand cubic feet of water presume that suppliers

charge according to the amount used. This implies

being able to account for the amount used, an ability

that suppliers in some of the largest population

centers have not had. Even the practice of metering

has not been used in some places; residents with

connections to water supplies are charged a flat

monthly fee regardless of the amount of water they

use. The marginal cost of the water used then?fO~

de- every time the tap is turned on. The incentive

toward overuse is cleat; and the implications for

management are substantial. Charging prices for water

that moR accurately reflect its value is impossible if use

is not measured.

Sacramento County, California, has embarked on

a Isyear, $135 million program to install residential

meters. In the populous and prosperous California

capital, where some of the most active opponents of

water diversions to the San Joaquin Valley and

southern California reside, water use has not been

mete-d. Average per capita daily water use in the

county has been estimated to be 300 gallons, and the

flat monthly residential fee is $7.61.“l (By contrast, in

notoriously thirsty Los Angeles, where the average

household monthly water bill was recently increased

U.S. Advisory Commission on Intergovernmental Relations 93
FigfIre 5-z

Comparison of Annual Utility Bills, 1950-1984

6 -i

5A

i

4 i

i

3 -,

2 i

lI

w-a-- Electric

. . . . . . . . . phone

- - - Noturol cos

- Water (ond Sewer)

-i

1.w-

---i-I----

!E% 1960 197G

Year

Source: WadeMiJler Associates,~fe~[7tioa’sP~~blicIl’orks: Rqwtoa 12TllterSupply (Washington, DC: NationalCouncilon F’ublit Works Improvement, 1987).

94 U.S. Advisory Commission on Intergovernmental Relations
to about $22.50, per capita daily water use is about 190

gallons.) The installation of water meters in Sacramento County will take time and represents a substantial financial investment When completed, it

will allow water rates to be charged on the basis of

use, which represents a tremendous step toward masonableness in water pricing.

New York City also has begun a program to

install 630,000 water meters in all five boroughs over

the next 10 years at a cost of $290 million. New water

revenues are expected to repay much of the capital

cost of the installation, and to defray some of the

expense of needed improvements to the quantity and

reliability of the city’s water supplym

Expectations of widespread public outcry over

increased water rates may be exaggerated; the fact

that water prices have been distorted and kept

artificially low does not necessarily say anything

about customers’ willingness to pay’” In fact, there

are strong indications of willingness to pay higher

prices for reliable water supplies. From the mid-1970s

to the present, there has been rapid growth in the

markets for bottled water and home water treatment

systems, despite the fact that the water is hundreds of

times more expensive per gallon basis than water from

a public systemlz4 with customers paying premium

prices for substitute goods, local officials and water

purveyors should be able to implement the changes

needed to establish mom realistic water rates’”

How water pricing and marketing interact and

relate to more effective management may not be

immediately clear Before discussing distortions in

decisionmaking caused by water subsidies, it is worth

pausing here to make the connection more explicit

There is a direct interaction between prices and

rights transfers. Once pricing is viewed as a dynamic

rather than static process, the relationships between

the prices at which consumers receive water, the

amount consumers will want to receive, and the

amount suppliers are willingto offer begin to emerge.

For example, if 1988 population projections for the

western states are used along with an assumption

that urban water rates will remain constant, then

agricultural use would have to decline by 6% pement,

or 5,149,tMO acre-feet per year, to ensure stable supplies

for the West through 2OM. Howevel; a doubling of

urban water rates reduces projected urban use sufficiently to reduce the projected reallocation from agricultural to urban use to only 208 percent, or 1537poO

acre-feet per year? As municipal and industrial water

prices rise, consumption declines, as does the amount of

additional supplies that need to be secured, whether

through water projects or rights transfers

Consider the following observation of trends

toward decreasing per capita water use in the more

heavily urbanized portions of California, where

water rates have risen considerably over the past

three decades:

Several significant trends ate developing in relation to urban per capita water use in California. Construction of more multiunit housing

the general reduction in residential lot sizes,

the inaeasing number of residences built since

enactment of legislation requiring low water-use fixtums, and the multitude of local

agency water conservation programs in effect

are all tending to reduce per capita water consumption. Other conservation trends include

plantings of low water-using landscapes and

more efficient wateringln

Of course, none of this conservation happens if

water is artificially cheap. Calling for better water

management without recognizing the need for mote

realistic prices misses a fundamental point Water that is

not valuable enough for producers and consumers to

pay attention to or monitor is not valuable enough to

manage or conserve Artificially low prices do not just

encourage consumption and waste, they contribute to

the persistence of the illusion that water is endlessly

abundant, that it is not an economically scarce good.

DISTORTIONS C REATED BY WATER SUBSIDIES

It has been said that the United States is not

“running out of water/l but is “running out of cheap

water”12B Rational pricing practices are impeded by

subsidies When supplies are subsidized, inaccurate

price signals to users result in m&allocations of resources Both efficiency and equity in the allocation of

water resources are negatively affected by subsidies

Subsidization of water supplies occurs in several

ways In some communities, commingling of water

supply and electrical power provision results in the

use of power rates to finance water operations, so a

share of the costs of water supply is borne by power

users. The Salt River Project, a special district in

central Arizona, has been cited as an example of

subsidizing water supplies with electrical power

rates According to a 1985 publication, electrical

power sales generated 98 percent of Salt River Project

revenues,r29 a fact partially explained by the fact that

voting for project directors is based on land ownership, so power rate subsidies are a means for farmers

(who hold most of the votes) to shift project costs to

urban dwellers (who would hold the most votes if

voting were per capita). As a result, the price of water

delivered to lands within the Salt River Project has

worked out to less than 1 cent per ton.lm

Another means of subsidizing water supplies is

through local property taxes or other unrelated

revenue sources, and the commingling of water

U.S. Advisory Commission on Intergovernmental Relations 95
supply with other general fund operations. Investments in water supply or treatment often are financed by bonds that are repaid out of the local

property tax or other general fund revenues Because

these revenue sources are not tied directly to water

use, some residents will pay for more water than they

use while others will pay for less, and direct water

charges will be artificially low. In addition, keeping

water rates artificially low may have been a deliberate

choice as part of a local or state strategy to encourage

economic development or by deferring maintenance

and repairs Such decisions are more likely when water

supply competes for attention with a host of other

concerns in a local government that mingles water and

other revenues and expenditures131

Often, assistance in water supply project construction, operations, and maintenance has been

provided by the state or national government This

provides local water users with the opportunity to

spread the costs of investments from which they will

benefit to a broader set of taxpayers The federal

government has financed a major portion of water

resources development from general taxes and borrowing as well as the reclamation fund.‘32 The costs of

those essentially local development projects have

been spread across all federal taxpayers. Federal

financing of project construction was originally

justified as an interest-free loan to be repaid by the

water users within ten years On this theory, the only

“subsidy” would be that the local users would not face

interest charges when they repaid the capital costs and

paid for the operations of a federal water project The

subsidy was justified on the ground of the federal

interest in promoting the settlement and development

of the western lands

As the federal reclamation program developed,

however,“it became clear that the irrigators wouldbe

unable to reimburse the federal investments within

ten years.N133 The Congress had to prop up the

reclamation fund with direct appropriations. In 1926,

the period for repayment of the costs (without

interest) of Bureau of Reclamation water projects was

extended from the original 10 years to 40 years In

1939, the law was amended again, placing repayment

on an “ability to pay” basis.‘% Continuing the development of the West was deemed more important

politically than securing reimbursements for water

projects. 135 Moreover, repayment obligations were

suspended in any year when insufficient flows were

available from the federal reservoirs, and subsidies

from the sale of hydroelectric power are allowed to

make up the difference between farmers’ ability to

pay and amounts owed.

With the extension of time for repayment, no

interest, and the ability to shift the costs of project

construction and operation to hydroelectric power

consumers, the amount of the federal subsidy to

irrigators has increased to rates approaching 90

percent. 136 “In California’s Central Valley Project,

only 5 percent of the total $931 million spent on the

project’s irrigation facilities over the last 40 years

has been repaid to date.“lY

What happens when 85-95 percent of the costs of

a federal water project are paid by powerusers and by

taxpayers across the country, while 5-15 percent of the

costs are paid by local water users? Water from federal

projects is so inexpensive that local users have no

incentive to conserve or manage local or supplemental supplies.138 To the extent that the price of a good

communicates information about its relative scarcity,

the prices from federal project water have been

communicating for decades that water supplies, even

in the arid West, are more abundant than the soil that

is irrigated with the water In fact, water from some

federal projects in the West has been sold to local users

at rates that work out to pennies per ton, which makes

water in this near-desert climate cheaper than sand.13g

Estimates of the cost of water for irrigation in the

West vary from !§3.50-$5.00 per acre-foot to $1~$15 per

acre-foot In either case, the subsidized price is several

times less than the full cost of provision. A 1981 report

from a San Francisco Federal Reserve Bank economist estimated that the average price for federal

Central Valley Project water paid by California

farmers was $5 per acre-foot, compared with $48 per

acre-foot average replacement cost, and $325 as the

estimated marginal cost of developing an additional

acre-foot of wateP Five years later, while the

estimated average replacement cost per acre-foot had

risen to $73, the average price paid by Central Valley

Project irrigators had risen to $6.15.141 At 1985 rates, the

total annual federal subsidy to irrigators in areas

covered by Bureau of Reclamation projects was

estimated to be $1 billion.‘42

Urban water users in the West typically pay 20

times the irrigators’ $5$15 per acre-foot of water. In

Los Angeles, for example, the average household’s

monthly water bill is about $22.50, which works out to

about $270 per acre-foot, using the normal assumption

that an acre-foot represents the average household’s

water use for a year. If urban water rates for an acie-foot

of water were $5$15 instead of $1@$300, the average

household’s monthly bill in semi-arid Los Angeles

would be somewhere between $0.42 and $1.25.

At rates that low, there is little incentive to

conserve water or even to keep track of it, much less

engage in vigorous local management For example,

a RAND Corporation report compared the local

management of water supplies in southern California, where natural water supplies are more scarce but

water is more expensive (including imported water

from locally financed projects such as the Colorado

River and Owens Valley Aqueducts), with the “management” of water supplies in the San Joaquin Valley,

96 U.S. Advisory Commission on Intergovernmental Relations
which is served by the federal Central Valley Project

and California’s State Water Project Among the

observations concerning the valley were:

Those who have received relatively inexpensive Central Valley Project water have

seen no need to control pumping. They take

the water when it is available and pump

when it is not . . . In general, pumping is not

monitored or controlled as it is in southern

California.. . .

In general, it appears that most valley

water users prefer either localized recharge

projects or groundwater mining to adjudication or basinwide regulation imposed by the

state. Some still anticipate that future federal

and/or state rescue projects will bail them out

with inexpensive subsidized surface water,

despite rising opposition to such projects on

economic grounds Others suggest that their

problems would be solved by construction of

additional facilities to meet State Water Project contractual commitments. If surface water cannot be brought in, then many favor

pumping until this is constrained economically by increased pumping costs’”

In light of the availability of groundwater from

underground storage and cheap subsidized water

from surface reservoirs, two statistics that would

otherwise appear puzzling given the distribution of

natural water supplies in California make sense. The

first is that 75 percent of the total amount of groundwater overdraft in the state occurs in the southern San

Joaquin Valley.144 The second is that 8 of the 11

groundwater basins in California identified as being

in “critical overdraft” condition in the 198Osare in the

Sacramento-San Joaquin Valley, and none of the 11 is

in the more heavily populated arid southern counties

of Los Angeles, Orange, San Diego, Riverside, and

San Bernardino, where 15 million of the state’s 29

million residents live.

The objectives of federal policy were to encourage western settlement and development and the

growth of the agricultural sector, as well as to satisfy

certain ideological objectives of the “conservation

movement,” and the promotion of a “rural democracy” composed of yeoman farmers with small,self-sufficient family farms. These benign objectives led to

the building of water projects, the sale of the developed water at subsidized rates, the watering down of

repayment requirements, the muting of incentives

for sta te and local water management, and, over time,

the creation of organized political constituencies in

favor of maintaining and extending the status quo.

In a curious sense, in the political arena, the

federal financing of water projects has been a situation in which “supply creates its own demand.” The

more water projects the federal government assists

with, the more intense become the demands of the

remaining localities that have not yet received a&-

tance. Agricultural interests correctly perceive access

to a reliable supply of water as essential to their

survival; obtaining that supply at lowest cost makes

economic sense. Over time, cost-benefit formulas

approved by the Congress for analyzing water projects have become distorted to yield the results that

will justify building the project’&

The policy of federal subsidization of water

supplies has been driven not by economic criteria of

total benefits versus total costs but by political criteria

of distribution, i.e., who benefits and who pays. There

is considerable evidence that the principal beneficiaries of federal water subsidies are large landholders in

the western states146 This is true despite the original

limitation on water availability from projects built by

the federal Buwau of Reclamation. Water from reclamation projects was supposed to be delivered to irrigators

for use only on up to 160 acres of land.

The 160-acre limitation has been honored principally in the breach. A 1980 bureau report on 18

projects indicated that half of the land supplied from

bureau projects was in the hands of 9 percent of the

landowners:*’ and one third of the land was owned

by 3percent.‘* The largest 5 percent of irrigators, each

with 1,280 acres or more, received 50 percent of the

total water subsidy, and the largest 1 percent received

21 percent of the subsidy. Farmers with 160 acres or

less represented 60 percent of all recipients of bureau

water; they received 11 percent of the water subsidy?

Federal water subsidies amount to a program of

wealth Edistribution from federal taxpayers and

many electric power users to holders of large tracts of

western lands who use large amounts of federal project

wateP As far as can be discerned, this was not among

the original objectives of the reclamation program

The beneficiaries of federal water subsidies have

a clear incentive to try to retain them; those who pay

for federal water subsidies have little incentive to try

to n&rain them. The principal beneficiaries are relatively &, relatively large, and politically influential in their

states and with their congressional delegations151 The

relationships at work are fairly simple:

The wider the resource base, the smaller

the per capita burden of taxes and controls

and hence the more passive the public; the

smaller the base the greater the per capita

burden and the more active the public becomes.. . . Therefore, in the field of reclamation I would expect the subsidy from federal

projects to be greater than from state projects

such as those undertaken by the state of California, and this is in fact the case>%

U.S. Advisory Commission on Intergovernmental Relations 97
When additional water can be developed

through rural-urban transfers or other transfers from

lower valued uses less expensively than via

large-scale structural water projects, this “raises the

issue of the incidence of benefits and costs implied by

different modes of water supply and related financing arrangements.“153 For example,

the federal government will pay for a large

part of the Central Arizona Project while the

people of Central Arizona [would] have to

pay the costs of purchasing agricultural water rights in any rural-urban water transfers

While the benefits are essentially the same,

the incidence of costs is much different, being placed upon the whole nation in the case

of the Central Arizona Project, but upon the

beneficiaries alone in the case of the purchase

of agricultural water rights Federal subsidies

and repayment policies thus have the power

of subverting economically rational decisions

in this vital area of water supplyP

One of the most perverse outcomes of the

expansion of irrigated agriculture is that it has placed

a strain on water resources in order to provide

additional yields of surplus crops. Over one-third of

the acreage irrigated with water from bureau projects

is growing surplus crops, some of which are highly

water consumptive.155 When surplus crops are being

grown, continuing to subsidize water for irrigated

agriculture cannot be justified on the grounds of

insufficient food supplies for domestic or export markets Nor is it possible to justify the continued subsidy on

the grounds of maintaining low food prices, or with the

argument that if water prices increased to reflect full

costs of provision, food prices would skyro&et Irrigators using more expensive water supplies use less wateq

and employ the water they do use more efficiently In

places such as California’s Central Valley, where some

irrigators purchase federal project water at $10 or less

per acre-foot while others purchase state project water

at roughly $50 per acre-foot, both manage to stay in

business and produce the same crops to sell in the same

markets for the same pri~es.‘~

The subsidy system also cannot be justified by the

need to maintain an excess capacity “irrigation

infrastructure” to provide for a sudden response to

“unforeseen circumstances.” There has long been a

large surplus of agricultural land that could be

pressed into production without need for drainage or

irrigation to grow basic crops, including low-valued

crops such as pasturage and hay that are now being

irrigated with project water. Throughout the postwar

period, millions of acres of agricultural land have

been removed from production under various programs, while additional land has been brought into

production with irrigation water In some places and for

some crops, the replacement has been nearly acre for

acm.157 In 1983, the United States paid farmers not to

grow crops on 82 million acres of land, about one-fifth

of the farmland, at a cost in excess of $4 billion.‘5B

The overall results of subsidizing water supplies

may be viewed as “irrational.” In the end, taxpayers

pay for the same food four times: for the surface water

projects that provide the cheap water, for the support

and storage programs that buy up the agricultural

surpluses and guarantee farm incomes, for the payments to other farmers to take land out of production,

and for the food purchase at the grocery store.

It also may be argued that the old persuasive

reasons for federal funding and construction of water

development projects are no longer valid.‘591f the real

objectives of federal water development assistance

were settlement of arid lands, flood control, promotion of agricultural development, and exploitation of

prime natural sites for water development, those

objectives have been fulfilled.‘60 If the real objectives

of federal water development assistance have been

provision of cheap water to politically powerful constituencies at prices far below the cost to taxpayeE while

inflicting forms of damage to the western environment

that am only now beginning to be seen and comprehended, those objectives cannot be sustained.

According to several experts, if subsidizing water

supply operations with general revenues, power

revenues, or by tapping into the treasury of a larger

jurisdiction was ever justifiable, it is justifiable no

longer M Uses of water that would not occur if water

prices reflected costs of provision are likely to be

curtailed, but this is not necessarily bad:

We can think of no circumstances under

which it would be desirable to guarantee $3

per acre-foot water forever to those water users who first entered basin pumping on the

premise that water would cost $3 per

acre-foot to pump. Indeed, to state the reverse

highlights the case: We cannot think of any

circumstances under which it is desirable to

spend $30 per acre-foot for water to support

all future use of water that is valued at only

$3 by the water user . . . To argue that all historical groundwater uses should be maintained through surface imports is tantamount to arguing that inefficient water uses

should be sustained because there will of necessity be water users within the basin who

value the water less than its full social cost

Gmundwater management will almost invariably lead to eventual cessation of some water

uses where the water is least valued.162

LACK OF I NFORMATION D ISTRIBUTION

In the words of a 1989 report of the Office of

Science and Technology Policy, “The management of

groundwater resources depends on the science of

98 U.S. Advisory Commission on Intergovernmental Relations
groundwater hydrology and information about the

particular groundwater system being managed.“163

Information requirements for rational decisionmaking within state and local groundwater management

agencies are high. Specification of water rights,

supervision of rights transfers, and the development

Of more efficient pricing practices require sound

hydrologic data in addition to sensitive awareness of

local conditions and needs’& There has been a consensus in the Water resources literature from the early half

Of this century to the 1980s that insufficient data e&,

particularly regarding groundwater supplies16

Research has been supported by the federal

government, state and local governments, and

industry associations. Research funding and activities by entities other than the federal government

have been modest, and,in aI2, waferresourcesresegrch

firllding by governments has been approximately 2

percent of the level of expenditures for water resources

development projects.16

States and local governments are “uniquely

qualified” to address water supply management

issues within their jurisdictions, and many are rising

to the task On the other hand, it is less plain whether

states and local governments will fund basic research

as extensive as sophisticated management approaches

require. 167 A study supported by the American Water

Works Association Research Foundation of barriers to

better water management found that, while states do

invest time and financial resources in water research,

“in general, states have little money for investigating

new technologies or developing solutions to local

problems.“‘@ This raises the question of whether the

research is best conducted on a state or local scale, in

which case their relatively smaller investments

would constitute a problem, or whether some other

scale is appropriate. There seems to be agreement in

the water resources research and management literature that basic research into hydrologic conditions is

appropriately organized at the national scale,

through federal agencies such as the United States

Geological Survey and the Environmental Protection

Administration, and through the academic community

and associations involved in groundwater management, such as the American Society of Civil Engineers,

the American Water Works Association, and the National Water Well Association.169

Through the Water Resources Research Centers

set up in the states with federal support since the

Water Resources Research Act of 1964, and the computerized data access and retrieval systems of the United

States Geological Survey and available through its

field offices, tremendous amounts of hydrologic data

are available to state and local water managers and

users. However, water managers need more than

hard data on the physical characteristics of aquifers,

and some managers feel that much federally SUPported hydrologic research has emphasized leading-edge technology and “state of the art” research,

rather than the appkation of existing technology

and knowledge to existing conditions?70

The information needs for groundwater management and for water resource management generally are shifting. The needs that are growing are

technology transfer and dissemination, for application of knowledge to existing problems; and information on management strategies, practices, and performance (especially for smaller systems).ln As the

emphasis has shifted from water development to

InOre effective management of existing supplies, and

as states and communities are responding with

management innovations, more information is needed about management activities.ln Research into the

effects of nontraditional solutions to problems and

the effect of different institutional arrangements on

supply conditions is of growing importance.in

There has not been much dissemination of

information about resources and management, and

states historically have been reluctant to accept

research results from each otheC174 While problems in

each community are different, there are common

elements and management challenges that may be

overlooked, as well as opportunities for beneficial

changes in institutional arrangements for managing

water resources. Scarce personnel time and effort

may be needlessly devoted to reinventing a “wheel”

that has been devised and tested elsewhere.

SUMMARY

The perceived scarcity of water in various parts of

the United States results from its geographic distribution and the scarcity created by water laws and other

institutional arrangements that distort decisionmaking about the use of water? A stronger statement of the

view that water shortages are more apparent than real

was given to the National Council for Public Works

Improvement in 1987, in a report which referred to “the

misperception that severe water shortages exist?

There appears to be sufficient water available in all regions of the country However; due

to allocation practices such as the appmpriation doctrine, water resources are not allocated efficiently thereby giving the appearance of shortages It also appears that

allocation of water is not just a problem west of

the Mississippi; water supply systems in several northeastern cities are now faced with stiff

competition for available resource~~‘~

Distortions of decisionmaking about use and

allocation create obstacles to more effective conjunctive management of groundwater supplies. The

inability of state and local water regulators and

planners to know the quantity of water rights, and

U.S. Advisory Commission on Intergovernmental Relations 99
thus the outside limits of demand, makes efficient

and equitable allocation all but impossible. As water

users receive inaccurate signals about the value of

water and of their rights, their behavior is affected in

ways that are likely to arouse opposition to the

imposition of any new rules that might limit and

define, or redefine, production rights. Water users

who pay subsidized prices are highly unlikely to

satisfy demands that they conserve water Users who

are told to conserve water but are given no incentive

to do so are being asked to comply with a rule that (as

they see it) imposes losses on them, but no benefits.

No group in society,in the United States or elsewhere,

is likely to welcome that sort of “reform.” And in

societies like the United States, where there can never be

enough “enforcers” of any rule and where voluntary

compliance is a cornetstone of social orderj rules that

impose losses without compensating benefits an2 not

likely to meet with high rates of compliance.

A primary goal of water governance should be to

devise institutions that make individual incentives

compatible with collective goals, “to create water

prices more in keeping with the supply and demand,

and to establish well defined, transferable and less

n+&ricted water rights”“’ In addition, increasing the

management information available would aid in the

development of more effective approaches

Many of these observations about the importance

of changing the institutional arrangements for managing water resources are not new Philip Metz-ger of The

Conservation Foundation reviewed more than two

dozen national water policy studies, and produced a

report in 1983. He found that while about half of the

studies’ recommendations concerning instream and

offstream uses had been implemented to some degnze,

few of the recommendations for institutional changes

had been implemented at alL In particular, recommendations for better coonlination of surface and gmundwater resources, and for improved cooperation among

agencies, had largely been left unrealiz&lB”Historical13 then, the federal government has funded assessments of water resources and has tasked those assessments to make recommendations, but has failed to

organize post-assessment efforts to address institutional

recommendations”179

The consequences of failing to develop and

implement the needed institutional reforms are

becoming increasingly evident In areas with less

abundant water supplies, water subsidies and the

distortions they cause in decisionmaking have merely delayed the day of reckoning by making it possible

for userS to put off shifting to water-saving practices

while we continue to look for the next “technological

fix” to “make the desert bloom.”

Notes

1 Christine Olsenius, “Tomorrow’s Water Manager,” JOW-

~ruZof.SoiZund W&r Conserz~ation 42 (September-October

1987): 312.

2 See for example, Wade Miller Associates, The Nution’s

Public Works: Report on Wuter Supply (Washington, D.C.:

National Council on Public Works Improvement, 1987),

pp. 115 and 206.

3 Helen M. Ingram et al,, “Guidelines for Improvedlnstitutional Analysis in Water Resources Planning,” Wuter Resours Research 20 (March 1984): 323.

4 K le Schiiing et al., 7he Nation’s Public Works: Report on

k&er Resources (Washington, D.C.:National Council on

Public Works Improvement, 1987), pp. 19-21.

5 Okenius, p. 312.

6 Lyle Craine, “Intergovernmental Relations in Water Development and Management.# Paper presented at the

Southern Political Science Association meeting, Gatlinburg, Tennessee, 1959, p. 3.

’ Wiiiam Lord, “Institutions and Technology: Keys to Better Water Management,” W&r Resources Bzrlletirr 20 (October 1984): 655.

a StephenBurges andRezaMarnoon, =1 Systenlntic Exmination of issues in Conjunctive Use of Ground and Surface

Waters. Water Resources Information System Technical

Bulletin No. 7 (Olympia: Washington Department of

Ecology, 1975), p. 8.

9 Ingram et al., p. 326.

lo For asomewhat different, overlappingcategorizationof

institutional issues of importance for resources management reform, see Warren Viessman and Claire Welty,

Water Management: Technology and Institutions (New

York Harper and Row, 1985), p. 52.

l1 Micha Gisser, #Groundwater: Focusing on the Real Issue,” JournuI of Political Economy 91 (December 1983):

1010.

l2 Wiiiam Cox, ‘Water Law Primer,” ASCE Journnl of Wuter

Resources Plunning and Munugement 108 (March 1982):

116.

l3 John W Bird, “Ground Water and Federal Reserved

Rights,“‘lorrmuZ of Water Resources Pbming and Munugement 109 (April 1982): 175.

l4 Jurgen Schmandt, Ernest Smerdon, and Judith Clarkson,

State Water Policies (New York Praeger publishers, 1988),

p. 5.

l5 Frank J Trelease, “Legal Solutions to Groundwater Problems-A General Overview,” Pucijc Lnw Journnl 11

@fly 1980): 869.

l6 Douglas Grant, “The Complexities of Managing Hydrologically Connected Surface Water and Groundwater

Under the Appropriation Doctrine,” Lund and Wuter Law

Review 22 (January 1987): 66; Frank J. Trelease, “States

Rights Versus National Powers for Water Development,” in Ernest Engelbert, ed., Strutegiesfor Western Regional Water Development (Los Angeles: Western Interstate Water Conference 1966), p. 105.

l7 Mason Gaffney, “Diseconomies Inherent in Western Water Laws.” Paper presented at the Western Agricultural

Economics Research Council, Tucson, Arizona, 1961, p.

44.

la Ibid., p. 55.

l9 Stephen Williams, me Requirement of Beneficial Use

as ‘a Cause of Waste in Water Resource Development,”

Natural Resources jmlrnnl23 (January 1983): 7.

XJ Lord, 1984, p. 654.

100 U.S. Advisory Commission on Intergovernmental Relations
” Mohamed El-Ashry and Diana Gibbons, “Managing the

West’s Water,” Journal of Soil and Wafer Conservation 42

(January-February 1987): 8.

zz Charles Phelps et al., EIficient Water Use in California: Executive Summay (Santa Monica: RAND Corporation,

1978), p. 1.

2 3 Viessman and Welty, p. 54. As these and other authors

point out, while rights to the use of groundwater and

rights to the use of surface water are legally separated in

many states even though the two sources are physically

related, the law governing rights to the use of groundwater covers both renewable and nonrenewable aquifers, even though these present very different physical

situations.

24 Ibid.

2 5 Morton W. Bittinger, “Ground-Water Surface-Water

Conflicts,” ASCE JournaZ of W&r Resources Planning and

Management 106 (July 1980): 474.

2 6 Ibid., pp. 470473.

2 7 cox, p. 115.

2 8 Grant, pp. 64-65; Trelease, “Legal Solutions to Groundwater Problems,” p. 864.

2 9 Thii was recognize d b y the National Water Commission,

WaterPoliciesfor thefuture: FinalReport to thepresidentand

to the Congress ojthe Unifed States (Port Washington, New

York Water Information Center, 1973), p. 233.

a Joseph Westphal, “The Potential for Water Management

in the West,” Ground Water 20 (January-February 1982):

p. 59.

3 1 Phelps et al., p. 5.

3 2 Les Lampe, “Recharge Saves Water for a Not-so-Rainy

Day,” American City nnd County 102 (June 1987): 46.

3 3 John E Mann, “Concepts in Ground Water Management,” Journal of the American Water Works Association 60

(December 1968): 1342.

3 4 Thelma Johnson and Helen Peters, ‘Regional Integration

of Surface and Ground Water Resources.” Paper presented at the Symposium of the International Association

of Scientific Hydrology Haifa, Israel, 1967, p. 495. This

was at issue in the celebrated Los Angeles v. San Fernando (1975) case, in which the city argued that operating a

basin at “safe yield” should not mean the same as operatingit full but should mean operating at a lower level that

allows some storage capacity for the retention of potentialsurplusesthatwouldotherwiseescape thebasin.This

argument did not prevail in the original trial, but eventually was found persuasive by the California Supreme

Court.

as Johnson and Peters, p. 495.

3 6 Lee Dutcher and Lee Peterson, “Water Zoning-Tool for

Ground-Water Basin Managers,” Ground Water 13 (September-October 1975): 397.

371n California, for example, municipalities are being

granted a “public servitude” in stored water, so that municipal withdrawals of stored water would have priority

over other withdraw& during periods of shortage, in

recognition of the public nature of most municipal uses.

se Susan M. Trager, “Emerging Forums for Groundwater

Dispute Resolution: A Glimpse at the Second Generation of Groundwater Issues and How Agencies WorkTowards Resolution,” Pacific LawJournal 20 (October 1988):

31-74; James Krieger and Harvey Banks, “Ground Water

Basin Management,” California Law Review50 (1962): 73;

Dutcher and Peterson, p. 397.

3 9 Dutcher and Peterson, pp. 396-397.

a Helen Peters, “Groundwater Management.” Wafer Resources Bulletin 8 (February 1972): 197.

4 1 Robert Ehrhardt and Stephen Lemont, Institutional Arrangements for Intrastate Groundwater Management: A

Comparative Assessment Using Virginia as a Case Study

(Arlington, Virginia: JBF Scientific Corporation, 1979),p.

24.

4 2 National Water Commission, p. 236.

4 3 Ibid.

4 1 Sidney Harding, W&rllz California (Palo Alto: N-PPublications, 1960), p. 58.

a El-Ashry and Gibbons, p. 12.

4 6 National Water Commission, p. 228.

4 7 John W. Bird, ‘Water Resources and the Public Trust Doctrine,” Journal of Water Resources Planning nnd Mnnagemerit 112 (January 1986): 66-67.

4 8 Rodney Smith, “A Reconciliation of Water Markets and

Public Trust Values in Western Water Policy,” Transactions

of the Fifty-Third North American Wildlife and Natural Resources Conference, 1988, p. 331.

a Bird, “Water Resources and the PublicTrust Doctrine,” p.

65.

so Ibid., p. 69.

5 1 Trelease, “Legal Solutions to Groundwater Problems,“p.

868.

5 2 Bird, “Ground Water and Federal Reserved Rights,” pp.

176-177.

5 3 Trelease, “States/Rights versus National Power,” p. 103.

54 John Leshy and James Belanger, “Arizona Law: Where

Ground and Surface Water Meet,” Arizona State Law

Journal 20 (Fall 1988): 729.

ss Zachary Smith, “Federal Intervention in the Management of Groundwater Resources: Past Efforts and Future Prospects,” Publius - ‘the Journal of Federuhsm (Winter 1985): 147.

5 6 Leshy and Belanger, p. 729.

57 Schmandt et al., p, 6.

sa B. Delworth Gardner, “Removing Impediments to Water

Markets,” Journal of Soil and Water Conservation 42 (November-December 1987): 386.

5 9 Ibid.; also Norris Hundley, Wafer and the West (Berkeley:

University of California Press, 1975), pp. 330-331.

6 0 Sporhase et al. v. State of Nebraska ex rel. Douglas,Attorney General, 458 U.S. 941(1982).

6 * Ibid., p. 952.

a Ibid., p. 953.

6 3 Ibid., p. 954 (emphasis added).

6 1 Ibid., p. 959.

6 5 Albert Utton, ‘The El Paso Case: Reconciling Sporhase

and Vermejo,” Natural Resources Journal 23 (January

1983): ix.

6 6 Quoted in JohnW Bird, “Implications of Sporhase in Water-Resources Planning,” Journal of Water Resources Planning and Management 112 (April 1986): 202.

U.S. Advisory Commission on Intergovernmental Relations 101

136 Schiiling et al., p. 92.

r3’ Schmandt et al., p. 3.

lss Schilling et al., p. 93.

139 Welsh. Similar comparisons have been made by Natural

Resources Defense Council analyst Marc Reisner, whose

figure is that water in the western deserts is being

supplied at prices approximately 2,000 times cheaper

than its equivalent weight in sand.

‘40 P. K Rao, “Planning and Financing Water Resource De- .

velopment in the United States: A Review and Policy

Perspective,” American Journal of Economics and Sociology

47 (January 1988): 92.

14’ El-Ashry and Gibbons, p. 11.

** Rao, p. 92.

I* Albert J. Lipson, Ejj5ienf Wafer Use in California: 7he Evolution of Groundwafer Management (Santa Monica: RAND

Corporation, 1978), pp. 22-23.

laKeith Knapp and H. J. Vawc, “Barriers to Effective

Ground-Water Management: The California Case,”

Ground Wafer 20 (January-February 1982): 62.

l6 Susan Christopher Nunn, 7he Political Economy oflnsfifufionallnnovafion: Coalitionsand Strategy in fheDevelopmenf

of Groundwafer Law. Ph.D. Dissertation. University of

Wisconsin, 1986, p. 45.

146 Thii can be true of state water projects as well. For considerable evidence and analysis of the distribution of

benefits from the combination of the federal Central

Valley Project and California’s State Water Project in the

San Joaquin Valley, see Merrill Goodall and John Suilivan, “Water System Entities in California: Social and Environmental Effects,” in Corbridge, ed., pp. 71-102.

14’ Rao, p. 91.

148 Schmandt et al., p. 11.

lg9 Rao, p, 91.

lso Ibid., p. 93.

lsl Henry C. Hart, “Toward a Political Science of Water Resources Decisions,” in L. Douglas James, ed., Man and Wa-

&(Lexington: University Press of Kentucky, 1974), p,

lS2 cuzan, p. 36.

ls3 Howe and Easter, p. 171.

ls4 Ibid.

lss Welsh, p. 38; Rao, p. 91; Howe and Easter, p. 91.

ls6 Reisner, “The Next Water War,” p. 100.

ls7 Howe and Easter, p. 173; Schmandt et al., p. 7.

lsa Welsh, pp. 38-40; Schmandt et al., p. 7.

ls9 Schilling et al., p, 94.

l”) Viessman and Welty, p. 2.

161 Wade Miller Associates, p, 12.

162 Phelps et al., p. 25.

laU.S. Office of Science and Technology Policy, Federal

Ground-Wafer Scienceand Technology Programs, June 1989,

p. 3-2.

I64 L M Hartman, “Economics and Ground-Water Development,” Ground Wafer 3 (April 1965): 6.

lfi See for example, Ira G. Clark, Wafer in New Mexico: A Hisforyof Ifs Management and Use (Albuquerque: University

of New Mexico Press, 1988), p. 422:

Since World War II intergovernmental and

interagency cooperation in resolving basic national water problems has attracted considerable

support across the entire political spectrum. A

succession of national investigations, followed by

elaborate reports, supported this approach but

with sharply divergent recommendations as to

the best means for its accomplishment. . . . Theolze

point on which they did agree was the woeful tackofbasic data regarding waft, and that fhis must be remedied. (emphasis added)

A good example of Clark’s point is the 1973 report of the

National Water Commission, which stated

it is apparent that there is a deficiency in the

amount of technical data and other information

about ground water resources, information

which is needed to make sound decisions with regard to regulation and management. (p. 247)

See also Viessman and Welty, p. 14; and National Research

Council, Committee on Ground Water Quality Protection, Ground Wafer Qualify Protection: Sfafe and Local

Strategies (Washington, DC: National Academy Press,

1986), p. 10.

166 Schilling et al., p. xii.

16’ Schmandt et al., p. 202.

168 Wade Miller Associates, p. 79.

169 National Research Council, p. lO;.Wade Miller Associates,

pp. 110-111; Schilling et al., pp. xii-xiii; Neil S. Grigg, “Appendix: Groundwater Systems,” in Schillinget al., p. B-5;

Schmandt et al., p. 2.5.

170 Wade Miller Associates, p. 79.

in National Research Council, p. 10; Wade Miller Associates,

p, 111; Schiimg et al., p. 178.

172 Grigg, “Appendix: Groundwater Systems,” p. B-5.

173 Schilling et al., pp. xii-xiii.

174 Wade Miller Associates, p. 79.

175 Ibid., p. 115.

176 Ibid p 206. A still stronger statement was made two

yea; earlier in Welsh, p. 25:

Obviously there are adequate water supplies

available in the nation, even in our most arid

states, to support populations well beyond any

reasonable projections. Thus any city in the area

that claimswatershortage must be admitting that

its laws and policies are the problem.

lR Wade Miller Associates, p. 123.

‘7~ ‘&hilling et al., pp. 19-20.

179 Schilling et al., p. 21.

U.S. Advisory Commission on Intergovernmental Relations 103
104 U.S. Advisory Commission on Intergovernmental Relations
Chnpter 6

Modifying Intergovernmental Relations

in Water Resources Management:

Whether, Why, and How

Several issues and trends with intergovernmental implications forwaterresource managementwere

noted in Chapter 1. Among the improved techniques

that have emerged in response to those issues and

trends are conjunctive management of surface and

groundwater supplies, and integrated management

of groundwater supply and quality Both of these

approaches involve considerable coordination among

the many actors in the complex water economy

There is evidence of a remarkable number of state

and local initiatives to improve water resource management using a wide variety of organizational

forms. Federal activity has focused more on groundwater quality protection, but there are signs that a

larger federal role in supply management is at least

under consideration, and it has received Supreme

Court authorization. Despite the innovation occurring in the American federal system, there remain

important institutional barriers to more effective

management, several of which have an intergovernmental dimension, and in the resolution of which all

governments have roles to play.

APPLYING CONCEPTS AND LESSONS LEARNED

This chapter attempts to bring together the

understanding of trends and issues, and progress and

innovation in water resource management, the organizing concept of a complex and regulated water

economy, and the remaining institutional barriers to

effective management Suggestions (some in the

form of pending legislation) for modifying intergovernmental roles and relations will be reviewed. Some

modifications in federal, state, and local practices to

remove impediments to improved water resource

management will be outlined.

Much of the literature discussingwater and other

common-pool resources divides into two general

recommendations for organizational and legal structure~ centralized public authority or privatization.

This report has recognized that water resources are

multifaceted, that conjunctive management of surface and groundwater supplies and integrated management of groundwater supply and quality are very

complex tasks, and that diversity of organizational

forms and jurisdictional responsibilities is part of the

American federal system and must be taken into

account The management of water resources is not

organized as a centralized public hierarchy or as a

privatized, competitive market Most successful conjunctive management situations exhibit complex

mixes of noncentralized public activity and high

levels of involvement by users. This report, therefore,

looks beyond simple organizational models.

The policy debate between advocates of

privatization and of centralized public management

will doubtless go on. However, much of that dispute is

beside the point from the perspective of those engaged coordination of water resource use. Indeed,

framing problems and solutions in terms of these

diametrically opposite concepts may itself be a

barrier to effective action. Restricting recommended

solutions “to the intervention of external authority on

the one hand and privatization of property rights on

the other [ignores] the existence and potentials of

other solutions, including user-group or local community management.“’

Furthermore, experience in conjunctive management makes it plain that neither complete centralization nor massive privatization is necessary for efficient or equitable water use. There is a body of legal,

governmental, and economic experience indicating

that, when empowered to do so, citizens have proU.S. Advisory Commission on Intergovernmental Relations 105
duced “remarkably creative achievements” in adapting a diversity of institutional forms to the demands

of coordinating the use of water resources.2

Experience from groundwater and other common-pool resource cases “illustrates a remarkable

ability on the part of nonseparably related decision

makers to develop rules to mutual benefit”3 When

groups of resource users and decisionmakers exhibit

the ability to shape rules that produce mutually

beneficial resolutions to resource dilemmas,

the devolution of authority and responsibility to make rules to such groups is a valuable

policy aim. For nonseparable decisions, neither the individual nor the nation is the appropriate decision maker. . . . The two extremes that characterize the usual models of

economic policy- individual and central decision making- are equally inappropriate!

Conjunctive management presupposes a considerable degree of activity and information but not

necessarily any particular structure. It leaves available the possibilities of coordinating the actions of

multiple individual water users; associations of water

users; water supply providers and producers; those

storing and recapturing water; and agencies controlling extractions and water levels, and determining

storage and pumping rights. In other words,conjunctive management leaves open the possibility of a

“complex and regulated water economy” composed

of many organizations.

The American federal system likewise does not

presuppose that the considerable division of responsibilities and coordination of action will assume any

particular structural or organizational form. Thus, the

American federal system also leaves open the possibility of a “complex and regulated water economy”

composed of multiple participant organizations.

The question remains whether the division of

responsibilities and the coordination of activity involved in a complex and regulated water economy

represents anything more than “satisficing,” a rationalization for falling short of some better form of

organization. Strong arguments have been made for

centralized public authority or privatization in water

supply management, but there are stronger arguments for a system of noncentralized arrangements

involving public and private entities in the coordination of the conjunctive use of groundwater and

surface water supplies.

The Concept of Scale, the Tasks of Conjunctive

Management, and Multiple Jurisdictions

Noncentralized public and private arrangements may be preferable for conjunctive management of water resources in a complex and regulated

water economy. Ira Clark of the University of New

Mexico wrote recently

Effective administration is dependent on the

existence of specialized institutions tailored to

manage water for specific purposes This involves mating state agencies to handle problems of a general nature, clothing political subdivisions with power to act on pertinent water

matters within their jurisdiction, providing for

the formation of quasi-public entities to manage local projects, and authorizing action by

private water companies. Congress has also

had to mate a wide variety of administrative

agencies relating directly or indirectly to the

management of water insofar as there is a federal responsibility.5

As Susan C. Nunn concluded, given the diversity of

values and interests involved in groundwater development and management, and the particularly difficult problems of distributing benefits and costs across

various communities of interest, an “institutionally

rich environment” with “institutions that relate

decisionmakers in ways that generate necessary

informatiorP about effects, preferences, benefits,

and costs, is more useful over the long term than the

implementation and enforcement of a particular rule

on a given community at a given moment

The Scale of Decisionmaking and the Involvement

of Diverse Communities of Interest. In the discussion of the water economy, Chapters 3 and 4 drew on

the distinction between provision and production.

There is no a priori reason to believe that organizational integration of provision and production is

consistently more efficient than arrangements

whereby providers obtain services and commodities

from producers. Interorganizational arrangements

may involve higher transaction and coordination

costs than organizational integration but reap greater

gains from functional specialization, division of label;

and appropriateness of scale The r&&ive balance of

these benefits and costs cannot be predetermined by

analysis acmss the full set of possible cases

Consideration of intergovernmental responsibility for conjunctive management of groundwater

supplies does raise some key issues. One of those

issues is the importance and effects of jurisdictional

boundaries on decisionmaking processes, as they

relate to the scale of immediate involvement of

citizens and officials. Finding an appropriate scale of

decisionmaking is challenging. Inefficiencies and

inequities result from processes that are underinclusive or overinclusive. Underinclusive boundaries

exclude persons from decisionmaking processes the

results of which affect them. Information about the

preferences of the excluded persons is not incorporated into decisions,’ reducing efficiency and equity.

106 U.S. Advisory Commission on Intergovernmental Relations
Public decisions about resource management made

on an inappropriately restrictive scale may impose

adversities on the excluded group or result in systematic underinvestment in beneficial activities.

Overinclusive jurisdictional boundaries include

persons in decisionmaking who are not affected by

the outcome. This brings their preferences to bear on

collective choices, and this, too, can produce less than

optimal results. For instance, those who are likely to

benefit from a particular resource management activity

and who can spread the costs to nonbeneficiaries have

incentives to pursue overinvestment in that activity

Appropriate scales of decisionmaking would

achieve as close a match as possible between those

benefiting from resource management and those

bearing the costs. Rules arrived at, adopted by, and

applied to those whose well-being is affected are

“built on a better information base than if they are

imposed from outside, or if unaffected parties influence the decision.“8 Generally, “it appears that there is

an advantage in a rulemakingapproach in which the

community that will be governed by the rule is the

source of the collective decision that creates the rule.“9

With particular reference to water supply operations,

appropriate boundaries are likely to yield more

efficient pricing and full cost recovery, economies of

scale, and the uniting of alternative sources of

~upply.‘~ Compliance and consent are also more

likely in communities where those affected by the

decisions have been part of the process.”

Of course, these general considerations have

assumed that there are two clearly defined sets of

people-those “affected” and those “not affected” by

resource management decisions. In actual settings,

there will be persons who are more directly affected,

indirectly affected, or unaffected. Moreover, as discussed below in defining communities of interest,

understandings may change over time as to who is

affected and to what degree by decisions about

groundwater management

While this may appear to introduce an inordinate amount of complexity into the process, all of the

considerations argue against uniting water resource

management decisionmaking in a single collective

arena. When groundwater and surface water resources are used and managed together, and when

quality protection decisions are related to supply

decisions, there are likely to be multiple communities

of interest of varying sizes involved. The existence of

and the capacity to create multiple jurisdictions provide

opportunities that would otherwise not exist for public

decisions to be taken at various appropriate scales that

relate to differing communities of interest This represents a considerable advantage of a federal system in

undertaking conjunctive management and/or integrated management of water resources

Not only multiple jurisdictions, but nested jurisdictions, are valuable to decisionmaking about the

management of a multiattribute resource with differing communities of interest Jurisdictions that encompass those most directly affected by a groundwater

basin, for example (overlying residents who produce

and consume water supplies directly from underground), are often nested within broader jurisdictions

that include other users of water from nearby or

related sources (who are affected indirectly by decisions taken within the smaller jurisdiction and, if

adversely affected, may exercise recourse). In a federal system, citizens can create and alter jurisdictions for

taking collective decisions and representing their

interests, as illustrated in Chapter 3.

Defining Diverse Communities of Interest as an

Emergent Process. Thus far, the discussion has

proceeded as though “the community” (users, beneficiaries, taxpayers) was known and specified. This is

an easy (and often a useful) assumption to make

while investigating the importance of other concepts.

What starts out as an assumption, though, can turn

into a prescription. Assuming that there is “a welldefined group that should be involved in rulemaking

over a nonseparable decision” can become a statement that “all and only the nonseparably related

decision makers are needed for a rule that exploits the

full potential for improvement.“r2

If the definition of the relevant “community of

interest” (those whose interests with respect to a

given activity or issue are sufficiently consonant to be

seen as “common”) is conceived as an act that takes

place once and for all, it presupposes a level of

knowledge of present and future preferences and

actions that is likely beyond the ken of any analyst or

policymakec The definition of communities of interest with respect to a groundwater supply (or any other

valued item) is more usefully conceived as a process.

In some cases, interests may exist but initially

may not be perceived and included in decisionmaking. In other cases, interests may emerge over time,

perhaps even as a reaction to resource uses and

management decisions taken in the pastJ3 In either

case, as new (or newly perceived) interests become

apparent, they must be included in some way or

losses will be incurred in efficiency, equity, compliance, and adaptability

The emergence of communities of interest can

take time. People may not be aware of how they are

affected by or involved in the use or management of a

groundwater resource. Groundwater basins can extend under significant land areas, and the geohydro

logic conditions of the same aquifer can differ

markedly from one location to another Therefore,

effects of activities may not be spread evenly across all

U.S. Advisory Commission on Intergovernmental Relations 107
users of a gmundwater supply: “seldom does a negative

effect on an aquifer system touch all users equally at the

same time. These effects are progressive.“14

Even within the same aquifer, interests, benefits,

and costs may not be evenly distributed. Sometimes

an aquifer is great in extent and variable in its

physical characteristics, as is the case with the Ogallala

Aquifer underlying the high plains. This aquifer

is not like a giant bathtub.. . it is more like an

enormous egg carton, deep in some areas

and shallow in others.. . . While the aquifer as

a whole was probably being exploited at an

uneconomically rapid rate, the costs of that

too-rapid exploitation did not fall evenly on

the just and the unjust alike.. . . That is to say

the user cost was unevenly distributed across

the farms of the high plains. l5

These users are not similarly situated, and artificially defining all of them as having a single and

shared set of interests because they derive their water

from the “same” source may not make as much sense

as allowing them to define their different interests

and providing institutional means for accommodating conflicts. High-plains aquifer users may not

constitute “a community of interest,” despite their

common water source. A combination of district

representation and administration with the development of an overlapping capacity for effecting regulated water transfers could allow water-poor farmers

“to make the water-rich farmers an offer they couldn’t

refuse, even after accounting for the costs of transporting the water?

Muitiple and conflicting communities of interest

can thus coincide with respect to the use of the same

water resources. “As the nation’s waters have been

more and more dedicated to specific uses, the potential for escalation in conflicts among environmentalists, ranchers, irrigators, well users, energy firms,

cities, and industries has grown.n17 A centralized

administration system drives all of the conflicts

between these interests into the decision processes of

an agency, making agency employees responsible for

resolving conflicts and designing the trade-offs between desired uses18 Complete privatization requires

that each interest with claims on resources seek to

out-bid theothers, thus skewing the outcomes in favor

of those with disposable assets to devote to the

bidding war Regulated transferability under rational

pricing may allow for the movement of water

resources among uses without the excessive presumptions that accompany the privatization literature,namely complete and perfect information and complete and

perfect independence of decisionmaking.

“Functional Fragmentation” as Functional Specialization. Multiple jurisdictions can enhance specialization as well as representation in decisionmaking

about groundwater supply management There are

efficiency advantages deriving from close information about groundwater and knowledge of the activities that comprise conjunctive management Specific

knowledge about the resource is an important aid to

effective conjunctive management, which calls for a

level of “artful administration” that is responsive to the

physical characteristics of the groundwater basin, to the

particular use patterns, and to the institutional, social,

and political characteristics of the user communityJg

The range of particular characteristics to be understood for effective management of any groundwater

resource is indicated by the following observation:

Gmundwater management demands an

understanding of the geologic history and

structure of the basin, and of its water carrying

and water storage characteristics It demands

an understanding of the hydrologic regime

under average and extreme conditions of water supply and the effects of artificial recharge

upon that regime. Groundwater management

demands sufficiently detailed data and methods to support saline water barriers, artificial

recharge, and protection from polluti~n.~

This would not be an especially demandingtask,

nor would this issue relate to the proper scale of

organization of conjunctive management, if all

groundwater basins were alike. However, each basin

has somewhat different characteristics, with variations in the effects of recharge and of overdrafting, the

likelihood of quality degradation resulting from

fluctuations in water levels,climate, drainage characteristics, overlying use patterns, irrigation practices,

and soil permeability?

There is more to this than merely observing that

no two groundwater basins are alike. Take only one of

the elements of conjunctive management listed in

Chapter 3 -the control of overdraft The variability in

physical characteristics of groundwater basins as

reservoirs is extremely significant for controlling

overdraft In a shallow aquifer along a coastline and

in hydrologic contact with the ocean, any overdrafting of the groundwater may result in salt water

intrusion that degrades the quality of the water

supply and renders it essentially useless. In a karst

aquifer underlying a sandy soil surface, overdrafting

beyond a certain point could result in sudden land

subsidence, such as sinkholes. In an alluvial basin not

in contact with a salt water or other low-quality

supply,overdraftingcouldcontinueforyearswithout

any harmful effects other than increased pumping

lifts The prospects for controlling overdraft to create

storage space for the retention of surface water flows

as part of a conjunctive management program would

be markedly different in these three types of cases

How, then, would one construct a rule for the

control of overdraft that would extend across basins?

A rule that prohibited overdrafting and required

108 U.S. Advisory Commission on Intergovernmental Relations
safe-yield operations would result in inefficient use

of two of the three types of basins described above. A

rule that required overdrafting could inflict serious

economic losses in two of the three basins described

above. The only rule that fits all three situations is a rule

stating,“owdnkwl;\err ?zid to the c!Y?eAt a basin is

capable of being overdrafted; otherwise, do not overdraft” This is essentially the same as no rule at aR

Rules for controlling overdraft,as for implementing recharge, regulating storage capacity and water

in storage, and protecting water quality from degradation as a result of management practices, must be

formulated in accord with the specific character&-s

of each groundwater reservoir. Overlying use patterns, which result from the interaction of economic,

political, and historical characteristics, affect these

decisions and need tobe taken into account, as welt. In

sum, the information requirements of conjunctive

management of groundwater supplies are intensive

and highly particular.

Furthermore, this analysis, which applies to the

conditions prevailing in a particular basin at a

particular time, applies equally strongly (if not more

strongly) to changes in those conditions. Closeknowledge of changes in the physical characteristics of a

groundwater reservoir and in the overlying use

patterns is essential to adapting and maintaining the

effectiveness of any program for coordinated use of

water resources.22

The advantages of specific knowledge do not

relate only to water resources and their associated

communities. Efficiency also can result from functional specialization that unites differentiation with

specific knowledge and experience. When decisionmaking for a variety of functions is combined,

different activities compete for attention and resources within the organization. Gaining maximum

advantage from specialized experience also cannot

be assured. Optimal decisions for each activity can no

more be assured by an integrated organization than

by coordination among several organizations. With

public jurisdictions especially, “the endemic condition which results from co-mingled (sic) decision-making is one of ‘public choice failure’.“23

Water supply and wastewater treatment functions, for example, have often been divided and

performed by different entities. This differentiation

has been criticized by some observers who have

suggested that the organizations should be combined

in order to promote “efficiency” However, efficiency

also may be promoted by the execution of these

functions by separate and specialized entities As a

recent study of water supply concluded, “there is little

evidence to support the assertion that U.S. systems in

which the water and wastewater functions m? COmbined are more efficient than those that are not.“%

Knowledge specific to efficient conjunctivemanagement may be attained through functional differentiation. What appears at one level of analysis to be

“fragmentation” standing in the way of efficiency

may at another level appear as “specialization” that

enkances efficiency. 0tcause of the impcsitanc~ of

specific knowledge and the value of functional

specialization, it has been contended that “[e]ffe&ve

administration is dependent on the existence of

specialized institutions tailored to manage water for

specific p~rposes.“~

Discussions of the appropriate scale of decisionmaking, representation and definition of communities of interest, and the advantages of specialized

knowledge and functional differentiation may not

make it clear whether groundwater management is a

national, state, or local responsibility In fact, attributes of groundwater systems are of concern to all

governments.26 Developing groundwater management information systems, implementing conjunctive use programs, adjusting programs to changing

conditions, and coordinating these activities within

the intergovernmental system all have different

appropriate scales, with roles for all jurisdictions in

the federal system. This response may be disappointing to those who prefer the simple artswets offered by

the Supreme Court and others, who apparently have

had no difficulty deciding “whose problem” and

“whose responsibility” groundwater management is.

A priori definitions of the appropriate management jurisdictions activities are unneeded, and pmbably impossible to find and defend successfully Coordinating the conflicting demands on a limited but highly

variable resource in a federal system is not easy, and

“the solution does not lie in an uncompromising grant

to either the State or the federal governmerV2’

A reasonable statement of the multijurisdictional

arrangements that optimize the use and management of water supplies is:

a) Decisions that depend strongly on close

knowledge of the water resource and its users -such as allocations of water production

and storage, and pricing - can best be made

by local specialist organizations (public and

private) that are as nearly matched as practicable to the communities of interest

b) Rules for the establishment and authority of

management organizations, and for the acquisition and transferability of production

and storage tights, can best be developed by

the states in response to their individual situations, thereby retaining and encouraging

innovation and diversity

c) Support for the information requirementsin particular, basic hydrologic research, waU.S. Advisory Commission on Intergovernmental Relations 109
ter resource inventories, technical assistance,

and the exchange of information about water resources and management practiceswould best be performed cooperatively by

the states and the national government

This description, in turn, relates to the roles of these

governments in overcoming the institutional barriers

that remain to improved management of water

resources:

a ) Local organizations should have primary responsibility for implementing water pricing

practices that more accurately signal users as

to the value of the resource, without spreading water supply development and operation costs to larger jurisdictions.

b ) States have primary responsibility for modifying their water rights laws and forempowering public organizations to conduct conjunctive management of surface and

groundwater supplies where conjunctive

management is practical and indicated.

c) The states and the federal government have

primary responsibility for overcoming remaining information barriers to the improvement of management practices

Protection of Groundwater Quality:

A Different Set of Roles and Relationships?

In Chapter 1, the distinction was drawn between

the conjunctive management of water supplies and

the integrated management of water quality and

quantity. The management of groundwater and

surface water supply may or may not be coordinated,

although the two often arerelated physically. Similarly, the protection of groundwater quality may or may

not be coordinated with the management of groundwater supplies, although the two also are related

physically

As was also stated in Chapter 1, this report does

not contain a review of local, state, and national

groundwater quality protection programs. Readers

interested in further pursuing the question of intergovernmental roles and relations in the protection of

groundwater quality are referred to the 1986 report of

the Environmental and Energy Study Institute, A

Congressional Apda for Pmenfing Groundwater Contamhafion: Building Capcity to Meet Protection Needs;

the 1986 report of the National Research Council’s

Committee on Ground Water Quality Protection,

Ground Water Qualify Protectiox Stateaml Local Stmtegies; the 1986 report of the National Groundwater

Policy Forum, Grourdwater: Savitzg the Unseen Resource, and the 1989 report of The Urban Institute,

State Mmagement of Groum-lwnfer: Assessment of Practices and Progress.

Nevertheless, the management of groundwater

supplies necessarily includes a concern for protecting

quality The adage “quality is quantity” is often

repeated by water managers. With respect to groundwater, a 1975 bulletin of the California Department of

Water Resources expressed that relationship explicitly: “A basin that may be expected to be used for

thousands of years can become unusable, perhaps

permanently, within only a few years by deliberate or

accidental pollution.“B The seriousness of groundwater contamination has multiple dimensions and is

difficult to overstate. Use of groundwater contaminated by toxic, carcinogenic, or mutagenic materials

can result in adverse health effectsz9 Groundwater

contamination can be deadly That is just one dimension of the seriousness of groundwater contamination, albeit the most acute one.

Even where public health may not be acutely

endangered, the loss of a groundwater basin has

serious economic consequences. Where local groundwater has been contaminated, suppliers may have to

develop new sources,% any one of which is likely to be

more expensive and less reliable. Costs of cleaning up

the local groundwater supply and restoring it to

usable quality are likely to be as great or greater3i

Furthermore, contamination threatens theusefulness

of a groundwater basin as a storage reservoir, with

serious consequences for conjunctive management

While it is not difficult to conceive of the serious

ness of groundwater contamination, it is difficult to

know its extent The Committee on Ground Water

Quality Protection of the National Research Council

found “no adequate data available on a national or

even regional scale to estimate the extent of ground

water contamination and the impactsof thiscontamination.“% Most authorities seem to agree that the

extent of groundwater contamination nationwide

remains relatively sma11?3 A 1988 report of the U.S.

General Accounting Office noted that “groundwater

quality in 91.8 percent of the locations we studied

surpassed drinking water standards for all substances

measured. That is a positive result”34

Nevertheless, reports from various sources indicate that problems are sufficiently widespread and

serious to be of concern. Thus far, more than 225

harmful and potentially harmful chemical, biological, and radiological substances have been found in

groundwater supplies.35 Half of the states have

discovered pesticides in groundwatet? As of 1987,

more than 2m community supply wells in 34 states

were closed due to contamination. And the possibilities

for future contamination incidents are substantial:

“There are 90,000 landfills and between 1.5 million and

25 million underground storage tanks in this country;

an estimated 20 to 30 percent of them are leaking.“37

What renders this patchwork of figures of greater

concern is that areas of contaminated groundwater

110 U.S. Advisory Commission on Intergovernmental Relations
generally coincide with areas of greater population

concentration.B Reported contamination is most extensive in the Northeast,3g but there have been cases

nationwide that have caused supply shortagesa A

1988 book reviewing state water policies concluded,

“It is becoming abundantly evident that degradation

of ground water is a major problem, especially in

specific localities.“41

Because of these important intersections between quality and water resource management generally, this section contains a discussion of some

patterns in governmental roles and relationships in

groundwater quality protection, which have been

different from those in supply management

States and local communities have demonstrated

considerable initiative in devising and implementing

groundwater quality protection and supply management programs, but the federal government has a

more extensive role in the protection of groundwater

quality. As observed by the authors of a 1985 book on

water management, “The trend in water qudity

rnnrzngerrzent in the United States has been toward

centralization and the imposition of uniform rules,“”

which can be seen as more appropriate than they

would be in the management of groundwater supplies. The reasons for the differences may be grouped

into three categories: (1) the usefulness of uniform

standards; (2) the significant needs for technical and

scientific information; and (3) the challenges faced by

small water systems in meeting quality standards

Water quality protection involves assessing risks

to human health for varying levels of contaminants

and establishing maximum levels. Some states and

communities have developed standards or guidelines to ensure safe water, but it is duplicative and

inefficient for them to do sop3 (Presumably, the health

risks from a given level of contaminant are the same

in Florida or Alaska.)

The establishment of maximum contaminant

levels by the federal government “is an efficient

intervention because the information requirements

necessary to assess subtle health risks in sufficient

depth to evaluate alternative levels of protection are

enormous.w4 Although a few states have devoted

substantial resources to health research and sophisticated standard-setting procedures, as a general matter, “the states do not usually conduct their own

research to develop information on toxicology or on

the risks of groundwater contaminants to health.

They rely instead on information from the federal

government”& Some of that information has been

forthcoming, but “much of the basic scientific knowledge needed to develop policy does not yet exist.“%

The appropriate scale for such research and development is nationaL

The National Research Council’s Committee on

Ground Water Quality Protection concluded in its

1986 report that research to develop the knowledge

base for effective groundwater quality protection

remains to be done. The committee observed:

More scientific and technical information

is needed concerning the extent of ground water contamination, its effects on health, the environment, society and the economy and strategies and technologies to prevent it Also, more

information is needed on the effectiveness of

various protection pmgrams There is a need

for understanding pmcesses, including those

in the unsaturated zone.47

The development of the information base concerning groundwater contamination supports federal, state,

and local regulatory efforts and the use of the court

system to protect groundwater quality Many individuals harmed by contamination have sought remedies

through liability litigation, but securing evidence has

been a principal obstacle to their success&

Federal and state efforts to improve the data

available could assist parties in liability cases against

polluters and help resolve competing claims concerning contamination incidents.49 Concern about

potential liability claims may complement regulatory

efforts aimed at prevention, making potential polluters weigh their actions in light of the increased risk of

incurring some future penalty

Implementation and enforcement of protection

regulations raises another issue that distinguishes

water supply from quality protection. Proper implementation of the Safe Drinking Water Arnemlmnts of

1986 and the 1987 amendments to the Clean W&r-Act

will impose significant costs on local public water

supply systems, especially medium and small systems.% The challenges faced by small systems in

protecting groundwater from a growing list of contaminants, in monitoring quality on an ongoing basis,

and in complying with federal and state regulatory

standards are daunting and are likely to grow. (Those

challenges are referred to in the literature on gmundwater quality protection as “the small system problem.“)

Small water systems do not present a problem as

providers per se; it is their capacity to perform the

range of tasks associated with protecting quality that

has been drawn into question. The two principal

obstacles are the lack of technically expert personnel

and lack of access to sufficient financial capital.5l This

is true of smaI1 local systems even in economically

prosperous regions. 52 “EPA officials have consistently

stated that small water systems deserve a higher

priority on the environmental agenda within the

Agency, and that the small water system problem is

the greatest impediment to successful implementation of the SDWA Amendments”53

Since the states are responsible for implementing

the drinking water amendments, the “small system

U.S. Advisory Commission on Intergovernmental Relations 111
problem,” which is basically one of implementation,

becomes a problem for state governments as well as

EPA. States have a number of options One is to grant

some flexibility in compliance schedules to ease the

financial burden on small systems, in exchange for

financial reforms to address their chronic undercapitalization problems.% Another option is state financial assistance to help bring small systems into

compliance with the standards. Typically, such assistance is provided directly through grants and loans or

indirectly by backing local attempts to gain access to

financial capital with the credit of the state.5s Some

states have encouraged and facilitated mergers and

takeovers of undercapitalized small systems or regionalization schemes that could facilitate “pooling” of

public water supply system reso~rces.~

The combination of groundwater quality protection tasks-development of standards or guidelines

for maximum contaminant levels, development of

the information base for regulatory and enforcement

action, and the compliance challenges faced by

smaller systems - produces a different set of intergovernmental roles and relationships than is appropriate

for managing water supplies and developing conjunctive management More of the decisionmaking,

information gathering, and financing for water quality protection, whether for groundwater or surface

water, is of state and federal scope.

During the 198Os, other groups of public officials,

water administrators, and policy analysts reached

similar conclusions about the appropriate state and

federal roles and relationships in groundwater quality protection. A policy position adopted by the

National Governors’ Association in 1981 called not so

much for new laws and regulations as for greater

emphasis on federal and state enforcement of existing laws, with more federal research on contamination sources and their associated health effects, and

increased state applications of the information and

guidelines5’ The governors called for a “new environmental partnership” between the states and the federal

government in gnnmdwater quality protection

In 1983, the National Governors’ Association

joined with the Conservation Foundation to develop

the National Groundwater Policy Forum, chaired by

former Arizona Governor Bruce Babbitt The 17-

member forum was composed of three governors,

three chairmen of major corporations, the directors of

three major environmental groups, other state officials

and a county executive, and groundwater mseaichers

The forum also endorsed the “new environmental

partnership” concept Among the forum’s conclusions

was that groundwater protection would require high

levels of federal, state, and local coordination to “take

advantage of the management capacities of different

units of government as well as engage the active

cooperation of the private sector and public interest

community”5B The forum also recommended that all

states enact groundwater quality protection legislation

incorporating the following ten components:

1)

2)

3)

4)

5)

6)

7)

8)

9)

Comprehensive aquifer mapping including

associated recharge and discharge areas;

Aquifer classification;

Ambient groundwater standards;

Source control authority;

Monitoring, and data collection and analysis

pqvw

Effective enforcement provisions;

Surface use restrictions to protect groundwater quality;

Programs to control groundwater withdrawals to protect groundwater quality;

Coordination of groundwater and surface

water management and

10) Coordination with other natural resource

programs.

The forum recommended further that federal law

condition future receipt of assistance by states in

groundwater remediation under the Superfund program on adoption of quality protection programs

containing these elements, with the first six required

as “the essential core of a comprehensive program.”

The most thorough proposals, addressing the

goals, the implementation, and the appropriate federal, state, and local roles and relations in groundwater quality protection, are to be found in the 1986

special report of the Environmental and Energy

Study Institute, titled A Congressional Agerrda to Prevent

Groundwater Contamination: Building Capacity to Meet

Protection Needs. A brief and necessarily incomplete

summary of the Institute’s findings, conclusions, and

recommendations follows:

1)

2)

3)

4)

A massive, new federal groundwater program along the lines of the Clean Air and

Clean Water programs of the 1970s is not

needed, probably could not be crafted, and

would not work

The local nature of the groundwater resource, and of contamination problems,

must be recognized, respected, and taken

into account, as should be the historical primacy of the states in the management and

protection of groundwater resources

A restrained, phased, and nontraditional response is called for, stressing federal leadership, not regulation; real state flexibility, not

rhetoric; and state and local decisions, not

deferrals.

The proper federal role involves the establishment of a national goal of contamination

112 U.S. Advisory Commission on Intergovernmental Relations
prevention, financial and technical support

to the states for the development of their own

programs, leaving the states the real flexibility and authority to do so, assisting state and local decisionmakers with the information that

could improve decisions, and getting the federal government’s own house in order through

more effective and coordinated implementation of existing authority and thmugh changes

in other activities to bring them intO line with

the national prevention goal.

5) The federal information gathering and technical assistance program should have a designated lead agency (U.S. Geological Survey), and should include a groundwater

information clearinghouse for federal, state,

local, and private decisionmakers and concerned citizens; the emphasis of federal research efforts and funding on remediation

and cleanup of contaminated sites should be

supplanted by research and demonstration

efforts directed toward prevention,

6) States should pursue the possibility of developing protection goals stronger than the federal

goal; states should be free to consider natural

groundwater quality vulnerability of various

aquifers to contamination, and uses of aquifers, but aquifer classification systems should

not be mandated; state quality protection pmgrams should be encouraged through development and implementation grants, rather

than mandated with threats of funding losses,

in order to encourage rather than disrupt the

extensive state initiatives

7) Local governments would bring the prevention of groundwater contamination to a priority status in making local land use decisions, in

order to ensure that contamination sources an2

kept away from recharge areas; planning and

zoning of land uses are among the most effective tools for the prevention of groundwater

contamination, and those tools are for the most

part in the hands of local officials

8) The private sector should be encouraged to

develop and deploy protective technologies

andpractices,especiallywith regard towaste

disposal and agricultural chemicals.

A similar position on appropriate intergovernmental roles and relationships in groundwater quality protection was adopted by the Association of State

and Interstate Water Pollution Control Administrators

in 1983 and was revised in 1987. The agenda calls for a

national goal of protecting human health and the

environment by preventing and mitigating groundwater pollution wherever possible; a federal role of

supporting research and development and providing

technical assistance; a state role of developing and

implementing groundwater protection programs,

and coordinatingorintegratinggroundwaterquantity management with groundwater quality protection; and a local role in making responsible land use

decisions that protect groundwater supplies from

further degradation.

Addressing the Issue of Nondegradation. An obvious issue that arises in connection with water

quality protection standards is where to set them. A

less obvious but equally crucial related issue is the

underlying criterion for quality protection. The issue

has come down to the following basic question:

should a nondegradation policy be adopted for

groundwater supplies?

A U.S. General Accounting Office report issued

in 1988 observed that nearly all of the states that set

numeric groundwater standards simply adopted EPA

maximum contaminant levels for drinking watec

However,because so much of the nation’s groundwater is so pure, adoption of EPKs levels “would allow

the potential for degradation of a considerable

amount of groundwater (to the level of contamination allowed by drinking water standards). That is,

contaminant levels might gradually increase to about

that allowed by the standards”59 This poses a potential problem in areas where groundwater contributes

to a surface water supply that supports sensitive

species of aquatic life, the survival of which might be

jeopardized by levels of contaminants deemed safe

for human use and consumption. The drinkingwater

standards tend not to be as stringent as EPA and

National Academy of Sciences guidelines for the

protection of aquatic life. Furthermore, EPA maximum levels have not yet been established for all

identified groundwater contaminants.

Some environmental advocacy groups, such as

the National Wildlife Federation,@ have endorsed the

concept of nondegradation as the proper goal for

gmundwater quality protection. They point out that the

proper purpose of federal and state policy should be the

protection of the resource, not the protection of certain

“uses” of the nzsource, which change over time.

Accordingly, a bill introduced by Sen. Dave Durenberger of Minnesota would requk states to adopt

nondegmdation standards for all gmundwater resources On the other hand, other environmental

advocacy groups, such as the Conservation Foundation,

recommend that states adopt aquifer classification

schemes EPA’s groundwater protection strategy,

adopted in 1984, included guidelines for the classification of groundwater, with different levels of protection for each of three classes.6l Class I is a strict

nondegradation category for irreplaceable drinking

water sources and for aquifers connected with sensitive and ecologically essential life. Class II includes

U.S. Advisory Commission on Intergovernmental Relations 113
current and potential sources of drinking water, and

waters having other beneficial uses. Class III groundwater is nondrinkable in its existing poor-quality

state, and is isolated from Class I or II aquifers.

Groundwater protection does not exist in a

vacuum, but in a policymaking context that includes

ordinary uses and waste disposal needs. Almostevery

use of water results in some change in its character,

and some form of biological, chemical, or thermal

deterioration. An advocate of a “limited degradation”

approach observed, “Pristine purity in developed

areas probably cannot be maintained. The objective is

to keep deterioration within acceptable limits.“@

In contemplating the desirability of a nondegradation standard in light of the need for waste disposal

sites, an important question is whether it is consistent

with proper groundwater management to allow

some aquifers to experience additional degradation

in quality. There also are two subsidiary, and rather

different, questions. The first is whether it is acceptable to dedicate areas containing unusable groundwater to waste disposal, thereby causing the further

deterioration of those supplies. The second question

is whether it is acceptable to dedicate areas containing usable groundwater to waste disposal that would

render those groundwater supplies unusable.63 Aquifer classification schemes can be designed to allow

these questions to be answered affirmatively, or to

allow an affirmative answer to the first and a

negative answer to the second.

Resolving the issue of nondegradation versus

limited degradation on a national scale presumes that

it is possible to be certain that one approach is

preferable. The information required to make such a

judgment is not available, but state groundwater

quality protection programs will add to the store of

knowledge and experience on this question. Mandating either nondegradation or aquifer classification

across the states forecloses avenues for innovation.

The Environmental and Energy Study Institute

concluded in its 1986 report that there was no

consensus on the issue of nondegradation versus use

protection goals, that each perspective “has distinct

advantages, and distinct disadvantages,” that each

“would be expensive and difficult to implement,” and

that the debate “over these divergent management

philosophies is likely to be long and divisive.“@ The

institute’s recommendation was a national goal of

preventing groundwater contamination “to the maximum extent possible.” Another possible resolution

was offered by the National Groundwater Policy

Forum, which supported a sort of compromise goal

“to protect the physical, chemical, and biological

integrity of the nation’s groundwater resources and

ensure that they are not degraded in any way that

may be harmful to humans or the environment”

States have been experimenting with aquifer

classification and protection limits For example,

Wisconsin’s 1984 groundwater protection law estab

lished a uniform protection standard rather than an

aquifer classification system or a nondegradation

standard. Then Governor Anthony Earl commented,

“We don’t use all of our aquifers for drinking water at

this time, but we see no mason to write any of them off

by giving some of them a different or lesser level of

protecti~n.“~ The law provides for two levels of quality

standards, a lower “preventive action limit” for each

contaminant to trigger remedial action, and a higher

“enforcement limit” to protect public health, based on

federal drinking water standards, where available.

While the Wisconsin law provides uniform standards for all aquifers, those are not nondegradation

standards. In Governor Earl’s words, “Though we

would like to adopt absolute nondegradation, we

think that is an ideal not achievable or measurable.. . .

It seemed to us, to be as practical as we could, that

some degradation will take place and our efforts

ought to be aimed at minimizing it or eliminating it to

the extent possible.“”

Wisconsin‘s response to groundwater contamination is one example of a fundamental shift that has

occurred in the states on issues of environmental

protection. The dairy industry and the brewing

industry, which are dominant contributors to the

Wisconsin economy, both rely on supplies of clean

groundwater and also contribute to contamination

problems. These industries, along with concerned

citizens, legislators, state agencies, and the governor,

participated in the development of the law. A new

Iowa groundwater protection law toughens regulations and raises fees on the use of pesticides by the

farm sector, which is the dominant sector of the state’s

economy and politics. In New York, the members of

the Long Island Association, the major business

association on the Island, ranked water quality as

their number one concern in locating and operating a

business there, even ahead of energy costs and solid

waste disposal. These and other examples from

around the country suggest that old assumptions that

state and local officials would sacrifice environmental quality and their citizens’ health for the sake of

appeasing the dominant sectors of their economies,

or attracting businesses to their states and communities, are simply no longer borne out by evidence, at

least with respect to water quality

Summary: The Limits of “Quality is Quanti&” Like

most cliches, “quality is quantity” remains in use

because at one level it is unarguably true. Yet, that old

adage is of little use in telling us whether it is

necessary or desirable to organize groundwater quality protection and supply management together,

114 U.S. Advisory Commission on Intergovernmental Relations
whether to unite the legislation and regulations that

affect both, how to go about acquiring theknowledge

needed for sound decisions, and how to connect the

information and decisions about groundwater to surface waters The management of groundwater supplies

in a well functioning federal system increases citizens’

opportunities for addressing those issues in various

combinations and learning and adjusting.

There is no reason to limit-and good reason not

to limit-the variety of organizational approaches

citizens and public officials may devise. Some states

and communities have integrated groundwater supply management and quality protection, while others

have kept the functions separate and still others have

pursued regional cooperation for quality protection

while organizing supply management principally

on a community scale.

State and local approaches to quality protection

also have varied. Wellhead protection programs,land

use restrictions, conditions on the transfer of real

estate, and a host of other methods have been part of

the arsenal of state and local assaults on groundwater

degradation. This is consistent with the conclusion of

the National Research Council’s Committee on

Ground Water Quality Protection:

It is apparent that ground water issues

and conditionsvary from state tostate and reflect differences in the states’ physical,social,

and political makeup. As a result, no single

strategy for dealing with ground water pollution problems can be recommended for all

statesorareas.Eachstateorlocalstrategywill

necessarily reflect the local situation.67

Remedies for groundwater contamination also

vary. Some contamination problems have had serious local impacts but also “exhibit a high degree of

site-specific characteristics and have required the

application of highly nonuniform remedial strategies.“@ In a federal system, this variety in the approach to specific problems is intrinsically desirable,

to be valued in and of itself; it is, indeed, one of the

principal reasons for having a federal system.

Two other important elements in fighting

groundwater contamination are the development of

information about quality and contamination, and

the use of basic and applied research into risk

assessment and health effects to develop guidelines

for specific contaminant levels. The appropriate scale

for these two functions is national, and the federal

government should maintain its leadership in research and the setting of waterquality and guidelines,

in the interest of health.

Much remains to be done. As the list of contamin~~~d~~~ve~~~g~u~~wafer suppfies increases,

so does the task for the Environmental Protection

Agency. There are several known contaminants for

which assessments have not been completed and for

which maximum levels have not been published. As

we have learned more about groundwater contamination, the list of contaminants about which citizens and

public officials are concerned has seemed to expand

mane rapidly than the research and guideline pmcess

Lack of knowledge, and of knowledge dissemination, plagues groundwater quality protection just

as it does supply management, although the needs

are not identical. Quality protection raises such

questions as: How do contaminants move through

groundwater? How can contamination be prevented? How serious is the contamination, and what

are its impacts? How has regulation fared thus far?

Local, state, and federal gnnmdwater protection activities have unfolded in the midst of these uncertainties,

and been shaped by them.

In such uncertain circumstances, policy

formulation has been groping towards a balance between strict @ation and environmental degradation. Lessons learned from earlier enthusiastic attempts to regulate air and

surface water have prompted a more cautious

approach.. . . Considering the uncertainty associated with current unde&anding of gnnmdwateq its protection, and its conservation, this

would seem an appropriate approach to take.

Such an approach could, however, degenerate

into aimless policy making often working at

-purp=@

It is vital that federal officials not allow research

and standard setting to degenerate. It is equally vital

that states and localities, regardless of whether they

combine quality protection and supply management

into a single piece of legislation or a single administrative agency, maintain coordination and not allow

program development and implementation pmcesses

to degenerate. In fact, when the policy mponse of the

federal government is to tell states and local governments what to do and have them implement and pay

for it, the quality of gmundwater protection programs

will depend as much or mow on the states and local

communities as on the federal governmentTO

Keeping policymaking from degenerating into

aimlessness and working at cross purposes is extremely difficult when citizens and public officials

are not entirely sure of what is going on; information

and coordination costs are high. Nevertheless, the

stakes for public health are even higher, and as

citizens and public officials realize, the continuation

of successful experimentation and innovation in

groundwater management depends on protecting

theirgualip “Qual~jsq~an~~”

hey must be mm3 by the sane statute or be the

responsibility of the same administrative unit (although these are options). It does mean that there is a

U.S. Advisory Commission on Intergovernmental Relations 115
contingent relationship between the two, and failure

to protect quality injures the complex water economy

that provides and produces water supplies.

ENDING SUBSIDIES, INCREASING INFORMATION,

AND S UPPORTING QUALITY P ROTECTION:

WHAT THE F EDERAL GOVERNMENT CA N Do

We have reviewed the historical and current role

of the federal government in water supply and

quality protection, and some of the institutional

barriers to more effective water resource management, including some in which the federal government is involved. In this section, we review some

suggestions for the federal role in improving water

resource management

Supporting Certainty in Water Rights and State

Authority. Certainty in rights is a component of improved water resource management that has been

endorsed for decades The federal government has a

role to play in eliminating uncertainty about federal

reserved rights, about state authority to establish and

enforce rights, and about the prospect of direct federal

management of groundwater supplies under the Commerce Clause authority granted in Sporlme v. Nebraska.

The existence of unquantified federal reserved

water rights compounds planning and management

difficulties facing states, local governments, and

water users. “In some instances, Federal officials

refused to disclose their existing uses of water and

were also claiming reserved rights to future uses of

water In any amount necessary to serve the purposes

of withdrawn Federal lands.“?l

Initially, sovereign immunity appeared to bar the

use of the courts by the states to obtain judicial

definitions of rights. The sovereign immunity of the

United States in suits involving water rights was

waived, however,under the provisions of theMcCarran Amendment to the Justice Approptiafion Acf in

1952. After the Arizona v. California and Cappaerf v.

hifed Sfafes decisions revealed the full scope of

federal reserved water rights,states have sued to force

federal agencies to disclose and quantify reserved

water rights. This approach, while effective on a

case-bycase and basin-by-basin basis, is certainly mom

costly than an act of Congress directing all federal

agencies to disclose and quantify all reserved water

rights, based on the Utrifed Sfafes v. iVm A4exico criterion

of specific needs essential to the planned use of the land

In his statement of national water policy in 1978,

former President Jimmy Carter called on federal

agencies to quantify and report their reserved water

rights as quickly as possible. Despite the passage of 12

years, uncertainties remain about the reserved rights,

and about Indian water rights in particular. The

analysis in this study supports the notion that President Carter’s proposal would have aided the cause of

improved management of water resources by removing some of the uncertainty.

Under current U.S. Supreme Court interpretation, the federal government has the constitutional

power to regulate groundwater supplies directly

through the Commerce Clause. The question of

federal exercise of that power remains open. Contemplation of confrontations between federal and state

regulatory power casts the question of power in

“winner-take-all” terms. On the other hand, “if the

question is not the existence of power but the

desirability of its exercise,compromise and accommodation are more likely to be achieved.“R Thenz have

been “several instances” where the “Conm has

chosen to use less than all of its powers, and has elected

to rpcognize statecreated rights even though it was

under no constitutional obligation to do so.“* In the

aftermath of the Spo&.se decision, it remains to be seen

whether stateaated rights and regulations regarding

groundwater supplies will be added to this category.

In the view of one observer, “the general framework for the regulation of water supplies. . . is still

intact. Interstate compacts and equitable apportionment statutes may well withstand the Sporhase decision.“74 And, at least during the Reagan administration, executive branch officials indicated that the

Sporltase decision would not alter federal agencies’

actions regarding groundwater managementE In the

aftermath of Sporl~use and Garcia, states and local

governments wilI have to rely on the continuation of

such federal fotiarance in order to maintain their

primacy in the management of gmundwater supplies

Ending the Flow of Subsidies. There has been

concern about the distribution of the costs of federal

water projects since the 1930s,76 and the attitudes of

federal policymakers have shifted. In the early decades of this century, water projects for flood control

or agricultural development were considered to be

sufficiently “in the national interest” to justify the

assumption of a large share of the costs by the federal

government In recent years, many policymakers

have embraced the notion of “user pays the costs.“R

This is due partly to a recognition of the implications

for water resource management, i.e., that federal

pricing of water “at full cost, rather than subsidizing it,

would give further incentives for efficiency”“? But a

mater share of the shift appears to be due to the

recognition of the connections between selling subsidized water and the continued overproduction of

surplus crops, with its attendant increased cost of farm

programs in a time of strained federal fiscal resources

The Congress addressed the problem in 1982

with the Recln~ntiorr Reform Act, an attempt to

implement fullcostpricingof Bureau of Reclamation

water delivered to irrigators and irrigation districts

that renegotiate their contracts in order to take

116 US. Advisory Commission on Intergovernmental Relations
advantage of the new, higher limitation of 960 acres.

Implementation, including publication of the new

full-cost pricing structure (which could raise the price

of bureau water to irrigators by fivefold or more), has

been delayed,79 and the announcement in 1989 of the

planned renewal of the Orange Cove Irrigation

District contracts offered little hope that the bureau

and the Interior Department will use water contracts

to try to improve conservation or efficiency?

The Congress revisited the issue of pricing in

1986, when a compromise allowed “what will probably be the last” major surface water supply and flood

control project, the Garrison Diversion Unit of the

Pick-Sloan Missouri River Basin Program, to proceed?* Some of the controversy concerning the

Garrison project centered on the problems of providing subsidized water for the production of more

surplus crops. When it appeared to be settled that

farmers who used Garrison water to grow surplus

crops would pay a 10 percent surcharge, an amendment offered by Representative Phil Sharp of Indiana

proposed to make those farmers pay full-cost prices

for that water. The amendment was defeated on the

House floor, but by only 4 votes (203-199).82

The Garrison project, expected to cost approximately $1 billion, has been anticipated for a long time.

Rep. George Miller, California, of the House Committee on Interior and Insular Affairs, stated that the

length and strength of pa&t commitments to the

project were primarily what had kept it moving

forward. Upper Missouri River Basin states have

acceded to many changes in the project, including its

overall scale and a shift in the primary emphasis from

irrigation to municipal, industrial,and rural domestic

uses. Whether or not it is “the last? major federal water

project in the West, the Garrison project is viewed by

the Upper Basin states as only fair, in light of their

earlier cooperation in abandoning the development

of hundreds of thousands of acres of prime farmland

for the sake of supplying water flows to Lower

Missouri River Basin areas, where federal irrigation

and flood control projects have been built.

In addition to moves to operate the projects on

something closer to a user charge basis, there is a

broader trend toward federal disengagement from

water development project financing and construction. Federal financing was at a virtual standstill from

1976 to 1986, and even the passage of the Wafer

Resources Development Act of 1986 has not reversed the

overall trend.

With the exception of the Upper Missouri River

Basin, the major developments anticipated to be part

of the reclamation program have been or are being

completed. Western rivers such as the Columbia and

the lower Colorado are now “one mrvoir after

anothet”@ The Central Arizona Project is essentially

completed, and the Central Utah Project is underway.

This should not be overinterpreted to mean the

imminent demise of the Bureau of Reclamation; as of

1987, the bureau’s agenda included 68 ongoing

building projects, which aR anticipated to keep the

bureau active into the 21st century.

Asthe198Osdrewtoaclose,itappearedtomany

observers that, “with the exception of Federal

projects now nearing completion, there will be few

if any additions to the irrigation infrastructure.“g&P

As the federal government disengages, states and

local governments that wish to develop additional

water supplies through construction of physical

facilities will have to undertake such projects on

their own.& If federal disengagement means reduced subsidization and increased attention to

managing water supplies, efficiency and equity in

water resource use may be enhanced.&

Imposing Federal Conditions on Water Subsidies:

The Reclamation States Groundwater Protection

and Management Act. There may be an effort to use

federal financing of water projects as leverage to

require states to develop federally approved groundwater supply management programs. The subsidization of water supplies is connected with the federal

government’s constitutional spending power In the

water resources field, Um?ed States v. Gerlach Livestock

C~JX@’ upheld the federal Central Valley Pmject in

California as a valid exercise of the spending poweq

which allows the federal government to condition

expenditutp of funds on beneficiaries’ compliance with

federal regulations, or; as the Supreme Court stated, “to

@te that which it subsidizes”sB

The potential scope of the spending power and

the General Welfare Clause (in addition to congressional power over navigable streams) were indicated

by the Supreme Court in Arizona v. California (1963)Fg

In that case, the Court appeared to hold that, as part of

its power “to regulate that which it subsidizes,” the

Congress could direct the Secretary of the Interior to

apportion the waters of the Colorado River not only

between the states through which it flows but among

the water users within the states Although it has not

been died on, the Arizona v. Calijinxia decision increased the “Congn3s.3 authority over the West% water

courses.. . by a quantum jump,” and was “a monumental victory for advocates of national contmL”m

There is now at issue the possibility of the

Congress conditioning funds for reclamation projects

in the western states on their adoption of federally

approved statewide groundwater management statutes. The idea apparently derives from the experience

of the 1980 Arizona Groundwater Management Act,

where threats from the Secretary of the Interior to

withhold the construction of the Central Arizona

Project contributed to the passage of the statute: “The

history of federal intervention in Arizona groundwaU.S. Advisory Commission on Intergovernmental Relations 117
ter management illustrates both the federal government’s interest in groundwater management and its

ability to pressure states to manage groundwater

resources in line with federal policies.“91

Criticisms of any federal attempt, through direct

regulation under the Commerce Clause or indirect

influence using the spending power, to write and

adopt a uniform federal groundwater code have

appeared in the literature for decades. As Charles

Corker wrote in 1957, “one can scarcely conceive of a

federal ground water code applicable to an entire

region of the United States.“% In the view of most

observers and analysts, “[florced uniformity in water

regulation is impractical in states with divergent

water resources and needs.“= Furthermore, as Norris

Hundley observed, there is some disparity between

the Congress’ power to impose a uniform system of

water law and its ability to devise an optimal system

of water law within the nation.

In 1973, the National Water Commission rejected

the idea of “a uniform national ground water law., .

because of the great variety in aquifer characteristics,

in legal regimes allocating the resource, and in the

economic and social milieu in which the uses take

place.“” The commission instead addressed recommendations to the states for improving use, particularly urging the creation of “agencies fully empowered to effectuate conjunctive use” of surface and

groundwater supplies.95

The imposition of a federal groundwater code on

the entire country, or even a particular region,

appears unlikely in the near term. What is more likely

is the use of the spending power to require states to

adopt laws that fit some model state groundwater

code, first in one region and then to each state. A

bill -“The Reclamation States Groundwater Protection and Management Act” -was introduced in the

100th and 10lst Congresses by Representative Miller

and is planned for reintroduction in the 102nd

Congress. It would condition the receipt of reclamation contracts and funds for federal water projects by

any of the 17 western “Reclamation States” on the

adoption and implementation of a statewide groundwater management program that would meet designated federal criteria. The bill focuses on the reclamation states, but questions and testimony at

subcommittee hearings indicated that the extension

of the bill to the West was seen as a first step toward

similar legislation with a national scope?6

The concept and motivation behind such a

condition are clear. The concept is to use a federal

“carrot and stick” approach to induce improved

policymaking from thestates9’The principal motivation is an understandable frustration on the part of

federal policymakels with the use of federal water

supply projects to “bail out” states and localities that

have overdrafted their local water supplies irresponsibly and excessively.

That frustration, in the Congress and the executive branch, is of long standing. The National Water

Commission’s 1973 report expressed the following

concern about extended and unregulated practices of

groundwater mining

The Federal concern here arises not so

much from the fact that the resource may be

ultimately depleted, although that is a problem, but from the fact that thedepletion is unplanned, and the future is not provided for.

As disaster approaches, the Federal Government is likely to be implored to step in with a

rescue project, commonly conceived as one

to furnish a supplementary water supply at

taxpayers‘ expense to save an established

economy, an economy that became established in the first place by imprudent overuse of ground wateP

The commission therefore recommended that federal

agencies planning water projects should “describe

and evaluate the ground water management programs in the area,“* and that the Congress “should

scrutinize closely the economic justification forwater

supply projects designed to supply supplemental

water to areas that have mined ground water . . .

including the presence or absence of ground water

management, and their operation.“100

More recently, in 1985, Zachal y Smith predicted:

It makes little sense for the federal government to rescue localities unwilling to

manage their groundwater resources efficiently . . . To the extent that federal water

projects are designed to mitigate the effects

of overdrafting, it is likely that, as a quid pro

quo for federal assistance, improved groundwater management would be required.lO*

Introducing the “Reclamation States Groundwater Protection and Management Act” in 1987, its

sponsor stated:

This is the best way to make sure that

Federal water project construction dollars

are not continually poured into States to correct ground water problems -problems that

should not or would not have occurred if

ground water programs had been in place.. . .

?gxpayers’ dollars should not be spent to

build new projects to correct ground water

problems which would never have developed in the first place if adequate protection

programs had been in place.. . .

This large infusion of money into structural solutions to ground water overdraft

118 U.S. Advisory Commission on Intergovernmental Relations
The version of the bill introduced in the 1Olst

Congress provided that within one year of its enactment, the Secretary of the Interior is to publish the

criteria for assessing groundwater protection and

management programs in the reclamation states.

Those criteria are to specify at a minimum, that states

have:

4

W

d

4

Programs to ensure that the quality of gnnmdwater will not be degraded in any way harmful to human beings or the environment;

Comprehensive mapping of aquifers and

their recharge and discharge areas;

Systems of aquifer classification;

Authority for regulatory and management

controls on sources of groundwater contamination;

e)

4

Programs for groundwater monitoring, data

collection, and data analysis;

Provisions for effective state enforcement of

groundwater protection and management

laws and regulations;

Programs to regulate or manage groundwater withdrawals so as to protect supplies and

their quality;

h) Programs to protect and enhance integrated

and conjunctive use of groundwater and surface wateI;

0

i)

Programs for public participation in program development,

Authorities for imposing surface-use restrictions in order to protect groundwater quality

and quantity;

k) Coordination of groundwater programs with

other relevant natural resource programs; and

programs for cleanup and emergency response to gmundwater contamination that

poses an environmental or health hazard

problems has not led to solutions at all.

Ground water overdrafts continue to be major and serious problems throughout the

West Ground water pollution and contamination are growing threats. We need solutions other than more dams. We need effective programs to manage and protect our

water supplies. This bill will provide the

mechanism and the assurance we need that

our ground water is protected and that we

aren’t wasting taxpayer dollars on unnecessary water projectslE

The legislation directs the Secretary of the Interiorto identify the reclamation states that have, or could

have, “significant ground water overdraft, contamination or pollution problems which should be resolved.” The secretary assesses the adequacy of those

states’ groundwater management and protection

programs in light of the criteria, with notification to

the states The Bureau of Reclamation is then prohibited from obligating or expending reclamation funds,

or entering into contracts, in any state identified as

having deficient programs.

Furthermore, the secretary will review reclamation states’groundwater protection and management

statutes and programs. The states’ programs are to be

reviewed for “substantial compliance,” although the

Act specifies that they must contain at least elements (a)

through (i) in order to be the approved. States are

required to review their approved programs at least

once every five years, with opportunity for public

comment In addition, the Secretary of the Interior is

dimted to review state programs at least once every

five years, including implementation and compliance.

Pieviously awarded approvals may be removed, subject to notice to the governor and time to bring the

pmgrams or their implementation into compliance.

The proposed legislation does not specify any

state’s groundwater management laws or programs

as a model. However, the background and motivation

of the bill, and comments made by its sponsor in the

House, make it clear that the experience of the federal

government with Arizona and the adoption of the

state’s 1980 Groundwater Management Act, are and

would be regarded as a model for the reclamation

states and the Secretary of the Interior to follow.

The first round of subcommittee hearings on the

bill featured the first two directors of the Arizona

Department of Water Resources, Wesley Steiner and

Kathleen Ferris, testifying about the adoption and the

content of the law. In addition, the sponsor of

reclamation states act made the following remarks

with its introduction:

This is not the first time this sort of approach has been used. In fact, the Interior Department threatened to stop funding the Central Arizona Pmject (CAP) because the ground

water problems in the State were severe, and

little was being done to remedy the problem -

except, of course, to build the CAP project

Arizona responded quickly and very

ably to the challenge from the Department of

the Interior. It now has a progressive and

far-reaching ground water program. I view

these actions by Arizona as a modelfor other reclamation States with ground water problems?03

Just as there would be serious problems with

applying a uniform federal groundwater law to the

states, there are problems with applying any single

model of groundwater management Furthermore,

even if one were to adopt a single model, there are

U.S. Advisory Commission on Intergovernmental Relations 119
serious questions about the appropriateness of the

Arizona approach for other states As Wesley Steiner,

the first director of the Arizona Department of Water

Resources under the 1980 law, wrote: “The water

situation in each of the westemstates is unique to that

state. The water situation in Arizona, the serious

imbalance between supply and consumption, is the

worst in the West and demnnds the hrshesf uppmd~.“~~

Requiring all states to adopt minimal groundwater

management provisions would raise substantial

enough questions of federal comity Requiring all

states to adopt legislation based on “the harshest

approach,” raises even more serious questions.

Comprehensive statewide groundwater management legislation faces considerable obstacles of

implementation and public acceptance compared

with step-by-step approaches. A 1988 review of state

water policies noted that

despite attempts by some states to enactcomprehensive water management plans, this

has not always led to the most effective and

far-reaching policies In fact, most attempts

to enact and later implement such plans may

have the opposite effect, as opposition

groups either impose compromises upon

these plans prior to enactment or subject

their provisions to judicial review during implementation . . . implementation is often

more difficult than enactment.la5

These general statements are consistent with

observations made about the first few years of

implementation of the 1980 Arizona law. The deputy

director of the Department of Water Resources noted

that deadlines for filing water rights claims, determining water rights, and developing initial rules

were missed, not by weeks or months but by years,

and that the Act generated “a swarm of proposed

legislative amendments . . . [many] intended to let a

user or group of users escape the restrictions of the

Code.“lN The Arizona approach contrasts with that of

Oklahoma, which has enacted groundwater legislation that is admittedly less comprehensive and restrictive, but where state planners have chosen to improve groundwater management incrementally,

securing acceptance for each new statutory or regulatory change before proceeding with the next.*”

Arizonans have been less than enthusiastic about

recommending the extension of the law to other

states, and have subjected it to rather severe criticism.

Arizona’s 1980 comprehensive groundwater management code has been described as “a testimony to

how wrong things can go when an inappropriate

water law is coupled to a severe case of overdraft,“‘@

and an example of how an”inefficient mechanism.. .

shaped by political arrangements” is likely to emerge

under pressure when existing institutional arrangemerits are unable to accommodate and resolve conflicts among competing users103

Arizona adopted a regulatory approach to

groundwater management, especially with respect to

the reduction in water demands imposed by irrigated

agriculture. The statute provides for the collection of

taxes on groundwater pumping to create a fund with

which the director of the state Department of Water

Resources may purchase and retire agricultural lands

after 2006. The problems with this approach are

twofold. First, the law does not allow water rights to

be transferred independently of land ownership.

This has resulted in the widespread use of the practice

known as wwater ranching,” which means that municipalities and other public water supply providers

buy up large tracts of land to capture the appurtenant

water rights This imposes a considerable inefficiency

that would be avoided by making water rights transferable apart from land ownership. It also robs agricultural

producers of any incentive to improve the efficiency of

irrigation practices in order to profit by the sale of water

rights fmd up by the conservation.

Second, the statute places all purchase and

retirement of the agricultural lands in the hands of the

director of the Department of Water Resources, and

postpones any such purchases until 2006. Presumably, owners of agricultural lands and their appurtenant water rights will have to take the offered price

for their lands, when they might have made more

beneficial sales in a more open setting.

The statute seeks to reduce water use in the

interim by imposing increasingly stringent conservation rules in active management areas, whether for

municipal, industrial, or agricultural use. If water

rights transfers were allowed in the interim, thereby

moving water from lower valued to higher valued

uses and givingusers a conservation incentive so as to

have water rights to trade, neither the stricter

across-the-board conservation regulations nor the

purchase and retirement of agricultural lands by the

state might be necessary by the 21st century,

The groundwater management act was the

choice Arizona made in response to the realities of its

water situation and the pressures from the federal

government The point of the preceding paragraphs

is not to criticize the law, which is a widely acknowledged and highly regarded innovation. However,

caution should be used in consideration of this law as

a model for other states.

The frustration of federal policymakers at being

repeatedly requested to “rescue” states and localities

with federal water supply projects is understandable.

Aresponse that requires all states to adopt groundwater management programs that meet federal criteria,

that are approved and periodically reviewed by the

federal government,and that may be disapproved by

the federal government, in order for states and

120 U.S. Advisory Commission on Intergovernmental Relations
localities to qualify for future federal water project

funds that may never be available, imposes high costs

in federal-state relations for the sake of keeping

federal officials from having to refuse state and local

requests for funding. The more direct approach of

ending federal water subsidies requires more political will from federal officials than maintaining the

(probably unrealistic) possibility of a federal “carrot”

in the form of future funding in order to use the “stick”

of federal conditions requiring pre-approved state

groundwater management programs.

Ending the flow of subsidies may be mom difficult

politically, but it is preferable from a policy standpoint

as a way of encouraging state conservation and

management of water resources Arizona was cited as

an example of how the federal spending power has

been used to prompt state action. Yet, as other analysts

have concluded, there is also an opposite, perverse

effect of the use of the federal spending power in water

resources, and that has been to lull states and localities

into inaction in improving management

Arizona has been discussed as an example of this

phenomenon, too. As one analyst stated, “In Arizona

the federal presence was strongly felt in water

management decisions - “so strongly, perhaps, as to

provide a disincentive for local initiative.““O

Following adoption of the law, Wes Steiner, the

first director of the Arizona Department of Water

Resources, wrote:

One of the major obstacles that had to be

overcome before Arizonans could be convinced that they must deal internally with

the state’s water supply imbalance, was

widespread confidence that permeated the

water community that these problems

would be overcome in the future by effecting

interstate water transfers. We had to wean

them away from reliance on this dream and

convince the legislature and the public that the

economic, environmental, and political costs

of major interstate water transfers to the Pacific

Southwest make them completely infeasible at

this time.. . and that we had to deal with our

imbalance problem with the supplies currently available to us plus our remaining entitlement from the Colorado River”’

Along similar lines, another prominent observer of

western water law and institutions wrote:

I think the users, the nonusers, and the public

think that either the state or the federal government will bail them out After all, huge

projects have saved other areas.. . . Surely the

legislature or the Congress will come to the

rescue of other prosperous and growing

towns, groups of towns, cities, and counties

that have been created by the overuse of

groundwatec Since others have been rescued in the past, there is a feeling that people

have a right to overuse, a right to expect rescue, a right to be subsidized.“2

The problems created for more effective groundwater management by the construction of federal

water projects arise at both ends of the process. Water

users are reluctant to face up to the need to manage

and conserve local supplies as long as they think a

federal project could bail them out. Once the federal

water project is built, the water it supplies is so cheap

due to subsidies that there is no incentive to monitor and

manage use.113 For both reasons, the federal role in

improvingwater resource management should include

bringing the flow of water subsidies to an end

Improving the Flow of Information. It appears that

the nature of water supply information needs is

changing. Technical information on the location and

characteristics of aquifers is still needed, but is being

supplied by several federal agencies, as described in

Chapter 4. Information still is needed on institutional

arrangements for groundwater allocation and management of groundwater supplies, and existing information (technical or institutional) needs to be made

more accessible.

There still is a critical need for additional information concerning institutional arrangements for

the allocation and management of water supplies.

This was the only priority area identified in a 1981

National Research Council review of federal water

research

P

lans as not being addressed by one or more

agencies. l4 Although USGS has funded institutional

studies since then, the need has not been fully met,

and the area remained conspicuous by its absence in

the 1989 Office of Science and Technology Policy

review of federal groundwater research expenditures

The scientific information yielded by decades of

research needs to be made more accessible to persons

with different levels of expertise.115 As noted in

Chapters 4 and 5, much federal information collecting has stressed the advancement of the state of the art

in hydrology which is important and beneficial. On

the other hand, additional translation of the information would make it even more useful to water

management decisionmakers, who tend to be concerned citizens and public officials, as well as hydrologists and geologists.

Second, the technical information on water

supplies is insufficiently accessible physically Studies performed for and by a dozen different federal

agencies, 50 states, thousands of local governments,

industry associations, environmental groups, foundations, and others, exist all over the country Finding

something about a specific area is not difficult

finding all of the information about an area is nearly

impossible, even if one is willing to travel to state

U.S. Advisory Commission on Intergovernmental Relations 121
water research centers and USGS regional and state

offices, to send away for information, to use interlibrary loan services, and the like.l16

There are formal mechanisms for interagency

cooperation or joint information gathering. No fewer

than six Memoranda of Agreement and 11 types of

interagency committees, working groups, and advisory boards, councils, and committees (some with

subcommittees) were listed in the 1989 Office of

Science and Technology Policy review of federal

groundwater research programs. And there are some

computerized information storage, retrieval, and

exchange programs for hydrologic data. USGS operates the National Water Data Storage and Retrieval

System (WATSTORE), arranged in a Daily Values File,

a Peak Flow File, a Water Quality File, and a Ground

Water Site Inventory File. USGS also supports a

program called the National Water Data Exchange

(NAWDEX), which is monitored by the Subcommittee on Water Data and Information Exchange of the

Federal Interagency Advisory Committee on Water

Data, which is chaired by USGS. Similarly, EPA

supports a National Groundwater Information Center, under contract with the National Water Well

Association in Dublin, Ohio, with more than 54,000

references listed

We have been unable, however, to establish a

location where the whole array of groundwater

information, including management, would be available. In the 10lst Congress, a bill introduced in the

House by Rep. Sam Gejdensen and Rep. James

Scheuer, and in the Senate by Sen. Quentin Burdick,

would have attempted to address this problem by

establishing, among other things, a national groundwater information clearinghouse. Representative

Scheuer’s bill is planned for reintroduction in the

102nd Congress.

Making more information available to state and

local water managers would ease one of the barriers

to more effective conjunctive management This is a

logical lead role for the federal government, which

could couple information development and dissemination about management practices and performance with information on hydrologic data. The

growth of innovative management techniques being

employed throughout the nation could then work

more effectively to benefit all communities.

Supporting Groundwater Quality Protection. There

is another aspect to the federal role in supporting

improved groundwater quality protection. In far too

many cases, federal installations and facilities have

been among the principal polluters of local groundwater resources, which “hasserious repercussions for

the effectiveness of state and local regulations.“ii7

“State and local regulations are not very effective

when the polluter is a federal agency?** Testimony in

1987 before the Senate Committee on Energy and

Natural Resources and the House Committee on

Interior and Insular Affairs cited more than 50 federal

facilities and installations contaminating groundwater resources just in nine western states.llg

As the federal government moves in the 1990s to

close down several military installations, affected

states and communities are concerned about the

plumes of toxic wastes below the land surface

moving into and through aquifers that supply water

for drinking, domestic and industrial use, and livestock and irrigation. As the federal, state, and local

governments pursue their “new environmental partnership,” the federal governmentshould at least try to

remove itself from the list of major groundwater

polluters.120 Compliance by federal facilities with

state and local groundwater quality programs and

their implementation should be assured.

Summary: A Supportive Federal Role. A RAND

Corporation report published toward the close of the

1970s contained this summary observation: tiA1-

though the federal government through its various

departments and agencies has vast powers and

priority in the water field, the federal role in groundwater is minimal.“12* A slight modification to that

statement would allow it to fit the early 1990s: the

direct federal role in groundwater has beerr minimal.

As we have seen, the various departments and

agencies of the federal government exercising vast

powers and priority in the water field have indirect

consequences for groundwater management that are

far more than minimal, and the potential for direct

action has grown.

The federal government’s role in research and

investigations through the U.S. Geological Survey

and other agencies has given states and localities

much of the technical and scientific information

about groundwater resources. That information has

been invaluable in planning appropriate management strategies, improving programs, and designing

new ones. Water resources research exhibits scale

characteristics that suggest it is best organized nationally, giving states, local governments, and water users

basic hydrological research and data, as well as

technical expertise and training.

The other modification to the RAND description

of the federal role-that it has been minimal -

reflects the changes of the last decade in the scope of

federal authority in the management of groundwater

supplies. The direct federal role could increase as a

result of expansions in the commerce power and the

use of the spending power. The federal government

has the power to directly legislate and regulate in the

area of groundwater supply management or to require

states to adopt legislation and regulations that meet

specified federal criteria. The current question is not one

of federal power but of intergovernmental relations, of

the wisdom of the exercise of federal power, and of

122 U.S. Advisory Commission on Intergovernmental Relations
whether the federal government will continue to limit

its direct role in groundwater supply management

The appropriate federal management role was

addressed by the National Water Commission in its 1973

report The Commission reflected a sensitivity to the

important differences between an indirect and supportive federal role and a direct and regulatory role:

The Commission does not believe.. . that

the Congress should enact a comprehensive

Federal ground water law regulating withdrawal. Rather, Congress should assist States

and local regions to obtain the information

necessary to make sound decisions, it should

declare a policy of supporting water development projects only when they are economically sound, and it should implement

this policy by close scrutiny of proposed ‘rescue projects,’ examining not only the economics of project proposals but also conservation and management practices applied to

ground water and surface water by the region to benefit from the project.lZ

As the Commission’s statement suggests, there is

an indirect federal role that supports sound state and

local management decisions by states and local

governments, and an indirect federal role that can

distort the decisionmaking process. Before direct

federal authority is expanded in groundwater management, activities that have indirect, but nonminima1 and nonbeneficial, effects should be reconsidered. First (and perhaps most beneficial), the federal

government could reduce its role in contributing to

and perpetuating the barriers to more effective

management As water resources have become increasingly scarce in some locations and as the competition for those resources has intensified, policies that

promote inefficient use and impede effective management become political luxuries that all segments

of the water economy are better off without

A 1989 White Paper of the Western Governors’

Association on federal water policy coordination

suggested that if the federal government is not going

to play a leadership role in water management (in

keeping with the tradition of state and local primacy

in thisarea),it could try toavoid making management

more difficult for states and local governments.

In other words, western states understand

that they cannot depend on the federal government to meet their needs for water,

whether it be for consumptive or nonconsumptive purposes. However, if states and

localities are to shoulder greater responsibility for meetingwater needs, the statesbelieve

that they are entitled to a system of federal

water policy implementation that does not

needlessly get in their wayY

At the outset of the 19905 there is little doubt that

the federal role in water supply management and in

water resources generally is changing. Some see the

scope of federal authority expanding and anticipate

more direct action by federal officials in the groundwater field. Others see the federal role declining, with

the states and localities “shouldering more of the

burden.” By the end of the decade, the size and the

change in size of the federal role may turn out to have

been the less interesting and less important question.

The more important question is likely to be what

options federal officials chose- whether they decreased activities that impede more effective groundwater management and enhanced those that assist in

the development of innovations and improvements.

CHANGING WATER RIGHTS LAWS,

ENCOURAGING BASIN MANAGEMENT,

SETTING QUALITY PROTECTION POLICY

WHAT THE STATES CAN Do

States also face an agenda of institutional reform

in improving the management of water resources -

modifying laws to increase certainty and flexibility of

water rights, building capacity for conjunctive management of surface and groundwater supplies, and

setting policies for the protection of water quality

There does not appear to be a need for a single

uniform state groundwater code. States face different

situations, and will continue to develop and implement different policies for allocating and managing

water supplies All states can benefit from this

diversity and experimentation.

In states where surface and groundwater are

physically interrelated, writing the rules governing

the supply sources would remove a major obstacle to

their conjunctive use. Water users could be encouraged, through pricing and other measures, to adjust

their use of sources based on availability Maintaining

dual systems of rights for surface water and hydrologically related groundwater inhibits the optimal use of

both sources.

Uniting the systems of water production rights

would also make it easier to resolve some of the

conflicts concerning the protection of instream values Within a given stream-aquifer system, one set of

specified, quantified water rights could allow rights

to be exercised by some for surface water diversion; by

others for tributary groundwater withdrawal; and by

others leaving water instream for recreational, scenic,

habitat, and other benefits. At the very least, states

should declare instream flow protection sooner rather than later in order to allow effective basin management to proceed.

Another institutional reform that has received

attention in the policy literature would change the

system of acquiring rights for production of water or

U.S. Advisory Commission on Intergovernmental Relations 123
protection of instream flows. States have held that

only governments may acquire appropriative rights to

preserve instream fl0~s.l~~ This is argued to be unrrasonably limiting: if a private individual or group wishes

to increase the amount of water retained instream

beyond an agency limit, there would appear to be no

reason for refusing a permit Moreover, such rights

should be tradeable between usas for increasing

instream flows for water production The citizens

would determine the balance between instream uses

and water production, based on their valuations of each.

Dual systems of water rights effectively preclude this

alternative from even being tried.

Whether joined with surface water rights or not,

groundwater production rights systems would be

improved by building in incentives for water conservation. States choosing to retain the “beneficial use”

system, for example, could designate conservation

(including underground storage for subsequent use)

as beneficial, thereby removing at least one disincentive for conservation. States with an appropriation

system based on historical or permitted use could

provide that groundwater users do not forfeit any

portion of their production rights by agreeing to take

surface water supplies or imported water supplies

when they are available. These modifications would

remove current obstacles to conjunctive use.

The change that would be most effective in

promoting conservation and encouraging largeusers

(especially irrigators) to use water more sparingly

would be to make production rights transferable.

Water users could employ water-saving techniques

that would maintain their productivity and gain

further by selling or leasing the unused portion of

their water rights. This is not the same as suggesting

that all water production rights be privatized and left

to a “free market” Transferability of water rights can

and should be regulated, in order to protect other

users, storage, quality, and environmental concerns.

While the idea that water is different from other

commodities may be an illusion, the uncertainty

concerning groundwater may be especially high

relative to other commodities.125 For this reason,

retaining an institutional infrastructure to determine

and administer rights, to regulate transfers, and to

resolve conflicts would be wise. That is to say, what

may be different about groundwater is not that it is too

important to trust to markets, but that it is too

incompletely known to trust to unfettered markets.

As noted in Chapter 5, part of the institutional

infrastructure may be special water districts empowered to engage in conjunctive management of surface

and groundwater supplies. States could authorize

well fitted special districts to regulate water transfers;

to account for water production, production rights,

and storage; and charge for production and storage.

States could consider the 1973 recommendations of

the National Water Commission concerning the

range of authority that local water organizations need

for effective conjunctive management Finally, states

can continue to devise and improve water quality

protection policies. With respect to groundwater,

states can choose whether to classify aquifers and (in

accordance with federal criteria) where to set groundwater quality standards, can implement the protection strategies they developed during the 1980s with

support from EPA, and can review and adopt the

recommendations in the 1989 Urban Institute report

State Management of Groundwater: Assessment of Pmctices and Progress.

GETTING THE P RICES RIGHT:

WHAT L OCAL P UBLIC AND P RIVATE

WATER ORGANIZATIONS CAN Do

Local public or private water suppliers, who

determine pricing practices (in the absence of subsidies from larger jurisdictions), could contribute to

improved management by bringing prices more into

line with water’s value and cost After studying the

issue for the National Council on Public Works

Improvement, Wade Miller Associates reached the

following conclusions:

1) Urban water supply systems are, from

a physical standpoint, generally functioning successfully, and do not constitute a “national problem” - infrastructure problems, where they exist, are local

and idiosyncratic problems of planning,

financing, and maintenance of certain

individual systems.‘26

2) 7’he principal problem of water supply is the

failure to charge water prices that reji’ect the

full costs of capital construction, replacf5

ment, and operations and maintenance, and

“i’frates have been maintained at levels that

do not cover the full costs . . . this was the

choice of local elected and appointed ofJicials

and constittl tes ‘public choice failure’.“127

3) The actions primarily needed to address

the difficulties faced in water supply do

not lie in structural, supply-oriented solutions, but in the adoption of institutional arrangements that will implement full-cost pricing of water supplies

and transferability of water rights.‘%

Local water supply organizations especially

need to attend to the problems created by commingling of functions in local budgets. This practice

distorts the price signals transmitted to consumers,

and in turn distorts their decisions about the use and

consumption of water supplies. If implementation of

full-cost pricing is demonstrated to be likely to impose

124 U.S. Advisory Commission on Intergovernmental Relations
a hardship on lower income households, some of the

strategies used in the pricing of other utilities (such as

“lifeline” rates for basic service) should be explored.

Increasing the role of full-cost pricing of water

and transferability of rights will take considerable

adjustment, especially in the western states Yet there

is nothing inherently wrong with having economic

relations reflect actual climatic conditions: “This is

preferable to having an economic base artificially

reliant on under-priced supplies which cannot be

sustained.“*29 Moreoveq implementing and adjusting to

institutional arrangements that increase the marketability of water rights and make water prices more tpalistic,

is unlikely to take longer than the time for planning and

constructing the next major water and power project

SUMMARY

Flexibility of arrangements, and the ability to

adapt different solutions and employ specialized

organizations in an institutionally rich environment

are preferable in the coordinated governance of

water resources. With sufficient information and

flexibility, noncentralized systems can tend toward

efficiency and equity,n’-’ while maintaining and enhancing adaptability and self-governance.

A noncentralized, or polycentric, decisionmaking arena representing diverse communities of interest in jurisdictions that can accommodate conflicts

without including nonessential or unaffected participants-what one writer called a “community defining federalism”‘”-provides possibilities for resolving conflicts, directing resources toward their higher

valued uses, and maintaining the flexibility to adapt to

changed circumstances or correct erroneous decisions

With institutional barriers to more effective water

resource management reduced or eliminated, a multijurisdictional republic offers considerable advantages

in managing a multiattribute msoume such as water

Notes

1 Bonnie McCay and James Acheson,“Ihe Human Ecology of the Commons,” in Bonnie McCay and James Acbeson, eds., Capturing the Commons: 77le Culture and Ecology

o/ Colnmunal Resources (Tucson: University of Arizona

Press, 1987), p. 38.

2 Ibid., p. 124.

3 Susan Christopher Nunn, i?ePoliticnl Economy oflnstitutional Innovation: Coalitions and Strategy in the Development

of Groundwater Law. Ph.D. Dissertation. University of

Wisconsin, 1986, p. 299.

4 Ibid.

5 ha G. Clark, Water in New Mexico: A Hisforyoflts Management and Use (Albuquerque: University of New Mexico

Press, 1988), pp. x-xi.

b Nunn, p. 297.

7 Ibid., p. 295.

s Ibid., p. 294.

9 Ibid., p. 295.

lo Wade Miller Associates, 77re Nation’s Public Works: Report

on Water Supply (Washington, DC: National Council on

public Works Improvement, 1987), p. 286.

* * Harvey 0. Banks, manag ement of Interstate Aquifer

Systems,” ASCE Journal of Water Resources Planning and

Mumrgemenf 107 (October 1981): 566,573.

l2 NUM, p. 294.

l3 A prime example of this phenomenon can be found in

the water dispute over the use of streams feeding Mono

Lake in the eastern Sierra to supply water to Los Angeles. The use decisions, which were made by Los Angeles in the 1930s and 194Os, resulted over time in the

lowering of the lake levels to a point which is contended

to have damaged the Mono Lake ecosystem. In the 197Os,

agroup of citizens formed the Mono Lake Committee as

an organization to try to stop or reduce the water diversions by Los Angeles. Their actions have added a new

“community of interest” to the decisionmaking process

involved in determining how to use the waters that feed

Mono Lake.

l4 Banks, p. 566.

l5 Nunn, pp. 181-182.

lb Ibid., pp. 207-208.

l7 Warren Viessman and Claire Welty, Water Management:

Technology and Institutions (New York Harper and Row,

19854, p. 11.

ls Thii hasevenbeencited as a perceived advantage of centralization in a “superdepartment [that] ‘is more efficient because it allows trade-offs on natural resource issues to be made on a rational, nonpolitical basis within

the context of one department.‘” Henry C. Hart, “Toward a Political Science of Water Resources Decisions,l

in L. Douglas James, ed, Man and Water (Lexington: University Press of Kentucky, 1974), p. 136.

l9 Stephen C. Birdlebough and Alfred Wins, “Legal Aspects of Conjunctive Use in California,” in David Seckler,

ed., California Water: A Study in Resource Mnnagement

(&kz yirsity of California Press, 1971), p. 263;

m Helen J. phters, “Groundwater Management,” Water Resources Bulletin 8 (February 1972): 190.

2 1 Michael Mallery, “Groundwater: A Call for a Comprehensive Management Program,” Pacific law Journal 14,

(July 1983): 1280.

2 2 See, for example, Thelma Johnson and Helen peters, ‘Regional Integration of Surface and Ground Water Resources.” Paper presented at the Symposiumof thelnternational Association of Scientific Hydrology, Haifa,

Israel, 1967, pp. 497-498, in which they illustrate the po

tentialchangesinusepatternsresultingfrom thesuccessful implementation of a management program,

changes which may themselves then result in subsequent strains on that program.

2 3 Wade Miller Associates, p. 92.

2 4 Ibid., p. 14.

z5 Clark, p. x.

2 6 Neil S. Grigg, aAppendix: Groundwater Systems,” in

Kyle Schilling et al., 73e Nation’s Public Works: Report on

Water Resources (Washington, DC: National Council on

Public Works Improvement, 1987), p. B-2.

2 7 Sho Sato, Water Resources- Comments upon the Federal-state Relationship,* Cnlifornin LOW Review 48

(March 1960): 56.

U.S. Advisory Commission on Intergovernmental Relations 125
zs California Department of Water Resources, C&forrria’s

f;;u12dWater. Bulletin No. 118 (Sacramento, 1975), p.

2 9 Ranjit Varkki George, “Is Groundwater Regulation

Blindman’sBuff?“~orr~~~alo/Pl~~r~zilrgLiter~ture3 (Spring

1988): 233.

3 0 Wade MiIIer Associate!,, pp. 204-205; National Water

Commission, Wfer Pohres for the Futrrre: Final Reporf fo

the Presiderzf a77d to the Co77ress of the United Sfafes (Port

Washington, New York: Water Information Center,

1973), p. 243.

3 1 Wade Miller Associates, p. 205; Jurgen Schmandt, Ernest

Smerdon, and Judith Clarkson, State Water Policies (New

York: Praeger Publishers, 1988), pp. 10-11; U.S. Office of

Science and Technology Policy, Federal Ground Water

Science and Technology Programs, A Reporf by the Subcotrtllliffeeotl Gromd Writer (Washington,DC, 1989),p. 3-3.

3z National Research Council, Committee on Ground Water Quality Protection, Grorr?rd Wafer Qualify Profecfiox

State aild Local Strategies (Washington, DC: National

Academy Press, 1986), p. 3.

3 3 National Research Council, p. 3; C.H. Ward, N.N. Durham, and L.W. Canter, “Ground Water-A National Issue,” Grolrrd Wrrter 22 (March-April 1984): 140.

3 1 U.S. General Accounting Office, Groultdwaf~Profection:

‘l%e Use of Drirtking Water Stnadcrrs 6y the Stntes (Washington, DC, 1988), p. 1.

3 5 National Research Council, p. 3.

3 6 Christine OIsenius, “Tomorrow’s Water Manager,“]otlr-

~tal ofSoiZnrzd Wafer Couservrrtion 42 (September-October

1987), p. 314.

3 7 Ibid.

3 8 Wade Miller Associates, p. 68; National Research Council,

p. 3; Ward, Durham, and Canter, p. 140.

3 9 Wade MiIIer Associates, p. 68.

a National Research Council, p. 3.

* I Schmandt et al., p. 10.

B Viessman and Welty, p. 14 (emphasis added). ’

4 3 U.S. General Accounting Office, Gromdzuater Qudity:

Sfafe Actiuifies fo Guard flgainst Co??fn?ninanfs (Washing

ton, DC, 1988), p. 3.

@Wade Miller Associates, p. 111.

* U.S. General Accounting Office, Groundwnfer QnaIify, p.

3 .

4 6 Environmental and Energy Study Institute, A Co??gressiolznl Agerrda to Preve??t Groundw&r Contrrmination:

Building Copncity to Meet Protection Needs (Washington,

DC, 1986), p. 164.

*‘National Research Council, p. 10.

‘ES Cox, p. 118.

4 9 “Groundwater Contamination: Common Ground for

the Common Law,” Water Sfrategist 2 (January 1989): 1.

5 o Wade Miller Associates, p. ii.

5 1 Ibid pp. 13 and 210; Nancy Humphrey and Christopher

W&r, Imrovative Sfnfe Approaches to Comnzfnzity Idhfer

%rpply Proble??rs (Washington, DC: The Urban Institute,

1985), p. v.

5z David Moreau, “New Federalism and Social and Environmental Goals,“Journalof WnferResonrces Pla~n7ingn~7d

Abnageme??t 115 uanuary 1989): 25-26.

5 3 Wade Miller Associates, p. 210.

5 4 Ibid., p. 209.

5 5 Moreau, p. 26; Humphrey and WaIker, p. v.

5 6 Wade Miller Associates, p. 113.

57 The 1981 statement by the National Governors’ Association included the following:

The Governors believe that considerable authority exists in federal and state law to control

sources of groundwater pollution. This authority

needs to be fully exercised to assure a protection

effort that is coherent, consistent, and effective.

The Governors endorse and recommend a

new national policy to systematically accelerate

and strengthen protection of our underground

water supplies. This policy should depend primariIv on states for implementing comprehensive

groundwater management pro~arns.~Thii policy

must also be founded on a new environmental

partnership, which respects the local characteristic of groundwater, while capitalizing on the capability and expertise of each level of government, the private sector, and public interest

groups.

5 8 National Groundwater Policy Forum, A Groundwnfer

Profecfion Strategy (Washington, DC: The Conservation

Foundation, 1986), p. 1.

59 U S General Accounting Office, Groundwater Protecfion,

p:1:

a See for example, testimony of Erik D. Olson National

W&Iife Federation, before the Subcommittehon Natural Resources, Agricultural Research, and Environment,

Committee on Science, Space, and Technology, U.S.

House of Representatives, 100th Congress, First Session,

on H.R. 2253, and H.R. 791, July 21,1987, p. 93.

6 1 National Research Council, pp. 23.

6 2 John E Mann, Jr., “Concepts in Ground Water Management,” ]onrnal of&e A?nerican Wafer Works Associ’atiolz 60

(December 1968): 1336.

6 3 Ibid.

6 4 Environmental and Energy Study Institute, pp. 10-11.

6 5 Testimony of former Wisconsin Governor Anthony Earl

before the Subcommittee on Water and Power Resources, Committee on Interior and Insular Affairs, U.S.

House of Representatives, 100th Congress, First Session,

on H.R. 2320. Series No. 100-23, Part I. July 23,1987, p. 20.

6 6 Ibid.

6 7 National Research Council, p. 9.

6 8 Robert Ehrhardt and Stephen Lemont, Insfifutio??nl Arranptents for htrustnfe Groundwnfer Manf?geme??t: A

Coinparative Assessmart Usiq Virginia as a (35-e Sfudy

(Arlington, Virginia: JBF Scientific Corporation, 1979),p.

22.

6 9 George, p. 240.

‘ O Moreau, p. 29.

n National Water Commission, p. 460.

TL Frank J. Trelease, “States Rights Versus National Powers

for Water Development,” in Ernest Engelbert, ed., Stintegiesfor Westun Regionnl W&er Developmer?t (Los Angeles:

Western Interstate Water Conference, 1966), p. 101.

126 U.S. Advisory Commission on Intergovernmental Relations
n Ibid., p. 107.

7 4 Mary Ann Green, “Water Law - Sporhase v. Nebraska,”

Natural Resources ~oumal33 (October 1983): 931.

7 5 Zachary Smith, “Federal Intervention in the Management of Groundwater Resources: Past Efforts and Future Prospects,” Publius-?%e lourrral of Federalism 15

(Winter 1985): 156.

7 6 Viessman and Welty, p. 38.

n Ibid.

m Kyle Schilling et al., 7%~ Nation’s Public Works: Report on

Wafer Resources (Washington, DC: National Council on

Public Works Improvement, 1987), p. 97.

7 9 Schmandt et al., p. 64.

8 o Lawrence Mosher, Wii the Real Leaders in National

Water Policy Please Stand Up?” Journal of Soil and Water

Conservation 44 (March-April 1989): 135.

*l Lawrence Mosher, “Federal Water Development: Going,

Going . . . .” ]ournal of Soil and Water Conservation 41

(May-June 1986): 166.

8 2 Ibid.

8 3 Henry l? Caulfield, “The Future of Local Water Districts

in Historical, Political Context,” in James Corbridge, ed.,

SpeciaZ W&r Districts: Chalknge for the Fufure (Boulder:

Natural Resources Law Center, 1983), p. 107.

8 p Schilling et al., p. 94.

8 5 Schmandt et al., p. 16; Caulfield, p. 109.

8 6 Moreau, p. 25.

87 399 U.S. 725 (1949).

ea Ivanhoe Irrigation District v. McCracken et al., 357 U.S.

275 (1958).

8 9 373 U.S. 546 (1963).

9 0 Norris Hundley, Water and tlze West (Berkeley: University

of California Press, 1975), p. 306.

9 1 Smith, p. 149.

9 2 Charles Corker, “Water Rights and Federalism-The

Western Water Rights Settlement Billof 1957,” California

Law Review 45 (December 1957): 622.

9 3 Green, p. 926.

9 4 National Water Commission, p. 227.

9 5 Ibid.

9 6 Hearings before the Subcommittee on Water and Power

Resources, Committee on Interior and Insular Affairs,

House of Representatives, Series 100-23, Parts I and II.

See, for example, the testimony of the first witnesscalled

in support of the bill, Wiionsin Governor Anthony Earl,

at Part I, p. 21:

We need a national goal, a national ground

water policy, and 1 believe the seeds of such a

policy are contained in H.R. 2320. Limiting the

coverage to the 17 reclamation States ls not as ambitious as covering all the States, but I understand

you must start somewhere. . . . What begins with

171 thinkwouldultimatelyexpandtomoreStates.

Simiiar comments appear on p. 53 in the testimony

of Philip Metzger of the Conservation Foundation in

support of the bill. See also Comments of Representative

George Miller, Congressional Record, Volume 133, Number 138, September 14,1987: “Few States in the Nation

have comprehensive plans in place; yet most States need

such plans.”

9 7 Comments of Representative George Miller, Congressional Record, Volume 133, Number 73, May 7,1987:

Stateswhichchoosenot todevelop plansand

which have serious problems with ground water

will not receive funds for construction of reclamation projects. Further, the Secretary of theInterior

will be precluded from entering into water delivery contracts in such States. The bill involves a

“carrot-and-stick” approach to ensuring that

sound ground water programs are put into place

where needed.

9 8 National Water Commission, p. 232.

9 9 Ibid., p. 238.

loo Ibid., p. 242.

lo1 Smith, p. 152.

lo2 Miller, May 7,1987.

loa Ibid.

lo4 Wesley Steiner, “public Water policy in Arizona,” State

Government 55 (1982): 134.

lo5 lo6 Philip Briggs, “Gro Schmandt et ‘.’ ‘tn?iater Management In Arizona * * I)

-

Journal of Water Resources Planning and Management ids

(July 1983): 201-202.

‘07See Rebecca Roberts and Sally Gras, “The Politics of

Ground-Water Management Reform in Oklahoma,”

Ground Wafer 25 (September-October 1987): 535544.

loa Micha Gisser, “Groundwater: Focusing on the Real Issue,” Journal of Political Economy 91 (December 1983):

1001-1002.

lo9 Ibid., p. 1003.

*lo Nunn, p. 20.

111 Steiner, p. 135.

112 Frank J. Trelease, “Legal Solutions to Groundwater

Problems-A General Overview,” Pacific Lnw Journal 11

(July 1980): 874-875.

I13 Viessman and Welty, p. 16;

114 Schilling et al., pp. 116-117.

115 Ward, Durham, and Canter, p. 140.

‘I6 Ibid. This should include all institutional arrangements

for the management of groundwater resources, including court decisions as well as legislative and administrative actions.

117 George, p, 236.

118 Ibid.

119 Testimony of Craig Bell, Executive Director of the Western States Water Council, before the Subcommittee on

Water and power Resources, Committee on Interior and

Insular Affairs, U.S. House of Representatives, 100th

Congress, First Session, on H.R 2320. Series 100-23, Part

II, July 23,1987, pp. 175-178.

120 See also Environmental and Energy Study Institute, p.

10.

r2’ David L. Jaquette and Nancy Y. Moore, EfJicierrt Wafer

Usein California: Groundwater UseandManagemnt (Santa Monica: RAND Corporation, 1978), p. 31.

lzz National Water Commission, p. 242.

U.S. Advisory Commission on Intergovernmental Relations 127
lz3 Western Governors’ Association, White Paper on Federal Water Policy Coordination, May 11,1989, p. 3.

124 Terry Anderson and Ronald Johnson, “The Problem of

lnstream Flows,” Econorrzic Inqzky 24 (October 1986):

538.

lzs Victor Brajer and Wade E. Martin, ‘Nlocating a ‘Scarce’

Resource, Water in the West,” AmericnnJournal ojEconomits and Sociology 48 (July 1989): 2.59271.

lz6 Wade Miller Associates, p. 211; see also p. i:

A national water supply “infrastructuregap”

of the magnitude that would require a substantial

federalsubsidy does not exist. Water utilitiesexperiencing revenue shortfalls generally do not

charge rates which cover full costs of the utility,

lz7 Ibid., p. 211 (emphasis added).

lzs Ibid., pp. 122-123.

lz9 Ibid., pp. 115-116.

130 Ibid.

13t Hart, p. 154.

128 U.S. Advisory Commission on Intergovernmental Relations
Appendix A

Tables

U.S. Advisory Commission on Intergovernmental Relations 129
7i7ble A-l

State

Kansas

~~~;~ip,pi

Florida

Nebraska

Iowa

Texas

Missouri

Minnesota

Oklahoma

Hawaii

Arizona

Georgia

New Mexico

North Dakota

Wisconsin

California

South Dakota

Illinois

Ohio

Louisiana

North Carolina

Vermont

New Jersey

Massachusetts

Groundwater Withdrawals as a Percentage of All Water Withdrawals, 1985*

(U.S. average 2 34%)

Percent Rank

91%

;;

E

;;

;;

69 zi

z: ;;

zi ?i

ii ;z

47

Ii;

ii

38

440 ii

z 42 42

E z

29 47

29 48

2 49 50

State

New York

Connecticut

Nevada

New Hampshire

Vir ‘nia

Ida 8’o

Alabama

Kentucky

Michigan

Pennsylvania

Tennessee

Utah

Alaska

Rhode Island

Washington

West Virginia

Colorado

Indiana

Maryland

Delaware

Maine

South Carolina

Oregon

2

oming

ontana

* Excluding withdrawals for thermoelectric power,

Source: Wayne SolIey, Charles Merk, and Robert Pierce, Estimated Wufpr Use illfile Ultittlll St&es 2985 (Washington, DC: U.S.

Geological Survey, 1988).

Table A-2

Groundwater Withdrawals Per Capita Per Day, in Gallons, 1985

(U.S. average = 363)

State

Idaho

Nebraska

Kansas

Arkansas

New Mexico

Wyoming

Nevada

Arizona

Colorado

Hawaii

Mississippi

California

Utah

Texas

South Dakota

Florida

Louisiana

Washington

Montana

Oregon

Iowa

North Dakota

Oklahoma

Georgia

Minnesota

Gallons

4,790 348

1,951

1,606

1,021 994

94031

707

617

602

E

430

352

2;

273

2;

235 187

172 164

163

State

Alaska

Missouri

Delaware

Wisconsin

West Virginia

Indiana

Tennessee

New Jersey

Alabama

New Hampshire

Illinois

North Carolina

Ohio

Vermont

Pennsylvania

Michigan

South Carolina

New York

Virginia

Mame

Kentucky

Massachusetts

Maryland

Connecticut

Rhode Island

Gallons

135

126

125

119

118

115

92

iit

2

ii

68

z

63

"5"9

z

z

45

28

Source: Ralph C. Heath, ‘introduction to State Summaries of Ground-Water Resources,” Nnfiolfnl W&a Sumnmry 1984

(Washington, DC: U.S. Geological Survey, 1985).

130 U.S. Advisory Commission on Intergovernmental Relations
Rank

;

3

4

z

i

9

::

12

13

13

:z

17

18

19

20

ii

;;

25

Source:

State

Hawaii

Mi&;igpi

Idaho

Florida

New Mexico

South Dakota

Iowa

Alaska

Minnesota

Wisconsin

California

Indiana

Utah

Arizona

North Dakota

Arkansas

voming

Delaware

Kansas

North Carolina

Louisiana

Ttible A-3

Percentage of Population Served by Groundwater, 1985

(U.S. average = 51%)

Rank

New Hampshire

Vermont

Montana

State

Washington

West Virginia

Tennessee

New Jersey

Illinois

Missouri

Texas

Maine

ikz?a

Alabama

South Carolina

Pennsylvania

Nevada

Oregon

Massachusetts

Virginia

New York

Oklahoma

Michigan

Connecticut

Maryland

Kentucky

Rhode Island

Colorado

Wayne Solley, Charles Merk, and Robert Pierce, Estimated Water Use in the United States 1985 (Washington, DC: U.S.

Geological Survey, 1988).

Table A4

Percentage of Public Water Supply from Groundwater Withdrawals, 1985

State

Idaho

Florida

Mississippi

New Mexico

Hawaii

Nebraska

South Dakota

Iowa

California

Utah

Arizona

Minnesota

Alaska

Kansas

7

oming

isconsin

Indiana

Louisiana

North Dakota

Texas

Arkansas

Montana

New Jersey

Tennessee

Delaware

(U.S. average = 40%)

Percent Rank

92% 2.6

89

E

ii

29

E $i

;i ;i

70 34

ii; zi

z 37

50 ii

49 39

48

ii

43

41

39

:;

39

38

State

Washington

Nevada

Vermont

New Hampshire

Alabama

Ohio

Missouri

Illinois

Georgia

West Virginia

Massachusetts

Maine

South Carolina

Oklahoma

Oregon

New York

Connecticut

Michigan

Pennsylvania

North Carolina

Rhode Island

Virginia

Kentucky

Colorado

Maryland

Percent

35%

ii

27

26

25

25

24

8

20

20

:;

18

:;

13

ii

12

9

Wayne Solley, Charles Merk, and Robert Pierce, Es!imnfed Wafer Use in file hited Shfes 1985 (Washington, DC: US.

Geological Survey, 1988).

U.S. Advisorv Commission on Intereovernmental Relations 131
Rank

1

3”

;

5

i

1 0

11

:i

14

15

16

:‘8

19

iii

i;

23

25

Source:

Table A-5

Percentage of Withdrawals for Industrial Use from Groundwater, 1985

State

Arizona

South Dakota

Idaho

Kansas

Nebraska

Florida

Hawaii

Utah

Wyoming

Mio4iEAipi

Georgia

New Mexico

California

Missouri

Minnesota

Arkansas

Iowa

Illinois

Kentucky

New York

North Dakota

Nevada

Rhode Island

Oklahoma

State

Washington

Massachusetts

Virginia

Louisiana

New Hampshire

Connecticut

New Jersey

North Carolina

Oregon

South Carolina

Michigan

Wisconsin

Alaska

Pennsylvania

Vermont

Colorado

Maryland

Tennessee

Texas

Alabama

Delaware

Indiana

West Virginia

Maine

Ohio

Percent

19%

:;

:t

1 2

:;

:i

i

7’

7

2

i

:

:

3

2

Wayne Solley, Charles Merk, and Robert Pierce, Estimated Wafer Use in fke United Sfafes 1985 (Washington, DC: U.S.

Geological Survey, 1988).

Table A-6

Percentage of Withdrawals for Irrigation from Groundwater, 1985

State

Illinois

Wisconsin

Kansas

Missouri

Arkansas

Oklahoma

?&&ssippi

Indiana

Nebraska

Delaware

Georgia

Texas

Minnesota

South Carolina

Maryland

Florida

New York

Louisiana

Arizona

Michigan

Ohio

North Dakota

New Mexico

Hawaii

(U.S. average = 34%)

Percent Rank

100%

98 ;;

;; 28 29

E 8

EJ 32 33

77 1 if)

7068 2

2; 2

62

z;

::

:; :: 43

45

43 iz

43 47

42 48

4 137 ::

State

California

New Jersey

Tennessee

Alabama

South Dakota

Massachusetts

Nevada

Colorado

Idaho

Pennsylvania

Virginia

Washington

Utah

Maine

Rhode Island

Oregon

West Virginia

Connecticut

North Carolina

g;g;g

Montana

Alaska

New Hampshire

Vermont

Percent

34%

if

2

24

22

1 7

1 6

:“3

1 3

Source: Wayne Solley, Charles Merk, and Robert Pierce, Estimated hJater Use in the Urrited Sfates 29S.5 (Washington, DC: U.S.

Geological Survey, 1988).

132 U.S. Advisory Commission on Intergovernmental Relations
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Recent Publications of the

U.S. Advisory Commission on Intergovernmental Relations

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VolumeII,M-169-11.1990.280pp. ....................................................................

State and Local Initiatives on Productivity, Technology, and Innovation, A-114, 1990, 180 pp. ....................

Local Revenue Diversification: Rural Economies, SR-13,1990,60 pp. .........................................

State Taxation of Banks: Issues and Options, M-168, 1989,48 pp. ............................................

A Catalog of Federal Grant-in-Aid Programs to State and Local Governments: Grants Funded FV 1989,

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Local Revenue Diversification: Local Sales Taxes, SR-12, 1989,56 pp. ........................................

State Constitutions in the Federal System: Selected Issues and Opportunities for State Initiatives,

A-113.1989.128~~ ..................................................................................

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Residential Community Associations: Private Governments in the Intergovernmental System?

A-ll2,1989,128pp ..................................................................................

Readings in Federalism-Perspectives on a Decade of Change, SR-11,1989, 128 pp. ............................

Disability Rights Mandates: Federal and State Compliance with Employment Protections

and Architectural Barrier Removal, A-111, 1989,136 pp. ................................................

Hearings on Constitutional Reform of Federalism: Statements by State and Local

Government Association Representatives, M-164, 1989,60 pp. ...........................................

State and Federal Regulation of Banking: A Roundtable Discussion, M-162, 1988.36 pp. ........................

Assisting the Homeless: State and Local Responses in an Era of Limited Resources,

M-161, 1988, 160 pp. ................................................................................

Devolution of Federal Aid Highway Programs: Cases in State&cal Relations and issues in ,Q.& Law,

M-160,1988,6Opp. .................................................................................

State Regulations of Banks in an Era of Deregulation, A-110. 1988,36 pp ......................................

State Constitutional Law: Cases and Materials, M-159, 1988,480 pp. .........................................

Local Revenue Diversification: Local Income Taxes, SR-10, 1988,52 pp. .......................................

Metropolitan Organization: The St. Louis Case, M-158, 1988, 176 pp. .........................................

Interjurisdictional Competition in the Federal System: A Roundtable Discussion, M-157, 1988,32 pp. .............

State-Local Highway Consultation and Cooperation: The Perspective of State Legislators, SR-9, 1988,54 pp. .....

The Organization of Local Public Economies, A-109, 1987,64 pp. ............................................

Is Constitutional Reform Necessary to Reinvigorate Federalism? A Roundtable Discussion, M-154, 1987,39 pp. ...

Local Revenue Diversification: User Charges, SR-6, 1987,64 pp. .............................................

Devolving Selected Federal-Aid Highway Programs and Revenue Bases: A Critical Appraisal, A-108, 1987,56 pp. ..

Federalism and the Constitution: A Symposium on Garcia, M-152, 1987,88 pp. ................................

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