Arroyo Volume 2, Number 1 Winter 1988 |
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Water Transfer:
a Water Source,
a Debate
That
water, so common, essential
and basic, should be a corn-modity
to be bought and sold,
marketed and transferred, may seem
odd. Yet social and economic conditions
in Arizona, and throughout the West,
have evolved in such a way that water
transfers appear as an attractive option
to soma And a controversial issue to
others.
Simply stated, water transfer means
a change of ownership of the right to
use water, usually through a sale. As a
result, the water may be transported to
another place to satisfy a need of its
new owner. More specifically, the water
transfer issue in Arizona involves the
purchase of agricultural land for its
water by urban areas, to support muni-cipal
and industrial development.
Arizona municipalities are expand-ing,
especially the Phoenix and Thcson
areas Meanwhile Arizona agriculture,
which uses about 80 percent of the
state's water, shows declining profits. Is
it fair and reasonable to satisfy new
and growing water demands by moving
water from low-value to high-value
uses or, in other words, from agricul-turaI
to urban areas? In 1987 '75 percent
of water transfers in the Southwest
involved moving water from agricultural
to municipal and industrial uses.
Additional sources of water may be
unavailable or insufficient. Large-scale,
federal-supported water reclamation
projects are out of favor, with opposi-tion
mounting to the environmental
and economic costs. And water conser-vation
and reuse may not yield enough
to meet the growing demand. With the
lack of available options for new water
sources, some people view water trans-fers
as an idea whose time has come.
Other developments also seem to
encourage water transfers. The 1980
Arizona Groundwater Management Act,
which was passed chiefly to control and
manage groundwater overdraft, estab-lished
four Active Management Areas
to help achieve its goal. Safe yield or
the balance of groundwater with-drawals
with total recharge is the goal
of three of the AMAs, with growth and
development carefully managed to
avoid excessive groundwater with-drawal.
As a result, new projects are
encouraged to contract for water
outside their AMAs, often in rural,
agricultural areas.
Further, water transfers become
more feasible with the development of
the CAP system, which could provide a
method to effectively transport water
between locations. Along with deliver-ing
Colorado River water, the canals
could be used to transport water
between points inside and outside
the AMAs; from rural areas to
municipalities.
Because of the above considerations,
municipalities are willing buyers in the
water transfer transaction. Rural and
agricultural interests, however, are
often reluctant sellers. They are con-cerned
that, if they sell their water
rights, the sale will also be to their
advantage, not just to the benefit of
municipalities. They perceive certain
negative effects of water transfers on
the areas of origin, which is the loca-tion
of their homes, properties and
businesses.
Water farm acreage bought by muni-cipalities
is removed from the county
tax rolls because municipally owned
property is tax-exempt. This places a
heavier burden on the remaining tax-payers.
Also, economic development
may be affected because counties
would have lost the tax revenues to
support the public services that attract
new enterprises.
Economic development may be
further affected if a county no longer
controls an adequate supply of water to
attract new businesses and industries.
WATER RESOURCES RESEARCH CENTER UNIVERSITY OF ARIZONA
y AR ROYO y
Vol. 2 No. i Winter 1988
Water, a county's most basic resource,
may have been sold to a municipality
that will make decisions about its uses
without regard to local community
interests.
Further, the loss of farm income due
to retired farmlands may affect existing
businesses in the community. Less
agricultural monies earned and spent
means less business for seed suppliers,
tractor mechanics, accountants and
even the local coffee shop. Also, a
decline in agricultural employment
could cause people to move out of
the community.
Also environmental concerns exist.
When land is no longer irrigated,
revegetation begins with turnbleweeds
often quickly taking over the land.
Dust and tumbleweeds can become a
nuisance to adjacent lands which may
include cultivated farmland.
This edition of Arroyo discusses
water transfers. A current and contro-versial
issue, water transfers affect the
growth and development of urban and
rural lands, and the well-being of all
who live there.v
INVITE D
COMMENT
Water Transfer: an
Urban and Rural
Perspective
Water transfer is an issue with an
urban and a rural perspective.
Invited Gomment includes state-ments
from each point of view.
Water Transfers: a Rural Perspective,
Gordon G. Henne
President, Arizona Rural Water
Association
Since
the West was settled, water
has been more precious than gold,
and it seems that it still is. Over the
years, the use of water has primarily
centered around agriculture, and we
have gone to great lengths to provide
for that use. Recently, however,
increased amounts of water have been
required for expanding municipal and
industrial uses. As a result, we have
come to realize that all needs cannot
be met with everyone having all the
water they want.
The 1980 Groundwater Management
Act protects water users in active man-agement
areas, but unprotected areas
outside the AMAs will be affected by
change. For example, agriculture is
impacted when water outside an AMA
is transferred to enable an area within
an AMA to reach its safe-yield goal.
The AMA water table remains at a level
to allow farmers to pump and profitably
farm, but no such protection is available
outside the AMA. Eventually its lower-ing
water table will render farming
totally unprofitable. This is of particular
interest if we consider agriculture pres-ently
uses approximately 85 percent of
the water used in Arizona
By protecting AMA water, the
Groundwater Management Act has
made it necessary for large and grow-ing
cities to look outside their AMAs for
supplementary water. This has led to
"water farming or ranching" which may
appear to be a solution to the cities'
problems. A deeper investigation,
however, reveals many serious and long
lasting problems. For example, water
farm properties are removed from a
county's tax rolls. This reduces reve-nues
and shifts tax burdens to the
remaining private citizens. Bonding
capacity is also reduced making it dif-ficult
to build capital improvements
needed to provide public services.
Serious long-term questions also
need to be considered. How will future
farming or industrial development
occur if water is unavailable? How will
2
development be affected if there is even
a fear that sufficient water may not be
available to sustain growth in the area?
These questions are difficult to answer
because we do not know what the
future will bring. We do know, however,
that 50 years ago Phoenix was not a
thriving metropolis. Possibly other
areas may have the same potential. We
cannot use trial and error to answer
the questions. Once water is transferred
to the metropolitan areas and people
become dependent on it, it will never
be stopped.
Today's water transfer
issue is only a tool to allow
continued growth as we
know it today.
Other methods exist to acquire
water. More could be done with
conservation. Water reuse and recharg-ing
water into the aquifer in abundant
years would help. Increasing reservoir
storage to retain flood waters and
weather modification are valid efforts
and should be investigated. We need to
see water transfers and its implications
as an Arizona problemnot a rural or
urban problem.
Many decisions face Arizona citizens
at this time. The main one is "What
lifestyle do we want in our state?"
Arizona's growth has been rapid and
impressive, but are we squandering the
richness of our environment, including
our most precious resource, water, to
support reckless development? The
Wall Street Journal gave national
attention to this Arizona issue in a
feature on November 2.
We face a dilemma Unequaled
growth provides today's profits, but
creates future debts. Today's water
transfer issue is only a tool to allow
continued growth as we know it today.
However, no matter what laws are
enacted within the next two or three
years, in thirty years, under our present
growth pattern that supports the
expansion of two major metropolitan
areas, rural water will have to be trans-ferred.
Wouldn't Arizona and its quality
of life be better served if today's growth
momentum were channeled through a
cooperative state effort to plan and pro-mote
the development of six or eight
population centers in Arizona? This
would mitigate the waste, expense and
ecological destruction that goes with
supporting just two. y
Water Transfers: An Urban
Perspective
Roger S. Manning
Executive Director Arizona Munici-pal
Water Users Association
Qnce
again Arizona water users are
embroiled in a dispute over the
transfer or transportation of water from
an area of origin to an area of use.
Indeed, from an historical perspective
nearly every groundwater conflict has
revolved around this isssue. Of particu-lar
significance for the current conflict
was the 1977 FICO decision of the
Arizona Supreme Court.
The FICO decision created an
atmosphere of crisis among many
groundwater users in the state. Since
certain transfers or transportations
could be enjoined as a result of this
decision, the potential consequences
of the decision were considerable,
especially for the mining industry in
Pima County and the cities of Thcson
and Prescott. In response, the Legisla-ture
enacted the 1977 Transportation
Amendments to the 1948 Critical
Groundwater Code which allowed
certain transportations to continue
pending enactment of a comprehensive
groundwater management code.
The 1977 Amendments also estab-lished
the Groundwater Management
Study Commission to develop a com-prehensive
groundwater management
code. After over two years of study
and with the added incentive that
continued federal funding of the CAI
especially to Pinal and Pima Counties,
was in jeopardy unless Arizona got its
groundwater act together, the Commis-sion's
recommendations were adopted
by the Legislature and signed into law
by Governor Babbitt on June 12, 1980.
The 1980 Groundwater Management
ACT (1980 GMA) dealt directly with
the subject of transportation of ground-water.
The 1980 GMA implicitly
recognizes that transportation of
groundwater will be necessary to meet
changing water demands, effectively
carry out future groundwater manage-ment
plans and provide for future
economic growth and development.
Significantly, and some think most
importantly, it establishes the principle
that any rules for the transportation of
water must be based on hydrological
boundaries, not political.
The 1980 GMA implicitly
recognizes that
transportation of
groundwater will be
necessary to meet
changing water demands...
The driver behind the transfer and
transportation of water is the 1980
Groundwater Management Act (1980
GMA). While the 1980 GMA does not
specifically require importation, it
clearly leaves the cities little choice but
to import water to meet the require-ments
of safe yield and an assured
water supply (AWS).
Safe Yield is a goal which seeks to
achieve by the year 2025 a balance
between the amount of groundwater
withdrawn and the amount naturally
and incidently recharged. Under safe
yield, groundwater in excess of
recharge may be withdrawn only dur-ing
shortages. Thus, the achievement of
safe yield requires that future growth
be independent of groundwater with-drawn
from the Safe Yield Active
Management Areas (AMA). In the
future, AMA groundwater will be for
emergency, not routine use.
The AWS test also necessitates
importing water. An AWS means a 100-
year water supply for the needs of the
proposed development. In addition, the
water use must be consistent with
achievement of the AMA manage-ment
goal. Thus the groundwater of a
safe yield AMA cannot be used to dem-
3
onstrate an AWS. It is inconceivable
how a proposed use dependent on
groundwater mining can be consistent
with the achievement of the manage-ment
goal when the goal demands a
cessation of groundwater mining.
Even though driven by the law, the
purchase of land by several cities cre-ated
a firestorm. As a result, the state
hired a consultant to conduct a study
of the hydrologic, economic and fiscal
impacts of water exportation. While the
study is incomplete, the preliminary
results indicate that the growth poten-tial
of the rural counties will not be
unalterably damaged as a consequence
of water exports. Nevertheless, the
prevailing perception is still one of
rural pillage.
Consequently, political reality neces-sitates
that the importing cities attempt
to correct the perception of rural
plunder by participation in the devel-opment
and implementation of realistic
and mutually agreeable mitigative
measures or standards that recognize
the legitimate economic and social
needs of the exporting and importing
areas of our state. We are all obliged to
be good citizens and good neighbors.
Only then will the search for mutually
beneficial solutions bear fruit. y
LEGISLATIVE
NEWS
Legislators Work on
Water Transfer Strategy
The water transfer issue is to poli-tics
what subsidence is to the
landunsettlirìg and divisive. As a
result, water transfer could be a lively
political topic during this legislative
session. The issue sparks special inter-est
for two reasons. First, it has to do
with a perennially important Arizona
topic: water and development. Also, the
issue attracts added political attention
because of the urban/rural rivalry that
is often seen as part of the water trans-fer
movement. This rivalry raises an
important political question: Will urban
and rural interests conflict or cooperate
to achieve efficient and equitable water
transfer?
Perceptions vary about how rural
and urban water transfer interests will
get along in the Legislature. A senate
staff member sees a political battle
brewing and describes water transfers
as a "David and Goliath" issue. However,
Sen. Alan Stephens, member of the
Joint Committee on Groundwater and
Surface Water Exportation, is more
optimistic. He feels the situation is
changing. "The urban legislators are
beginning to understand the issue of
equity," he said. "And rural interests
are beginning to come around." Sen.
John Hays, a co-chairman of the joint
committee, is unsure how events will
develop. "It remains to be seen what
opposition will come from the cities
with water farms," he says. "They have
a heavy voting block I won't even
venture a guess what might happen."
What is fairly certain, however, is
that whatever legislation is proposed
will be addressing rural concerns.
Under the current situation, cities that
would benefit from water transfers do
not need legislation to set up and oper-ate
water farms. Describing what this
means in the legislative process, a
house staff member said, "It is going to
be a matter of whether the rural folks,
who are the most impacted, can build
enough of a coalition with some of the
urban people to try to get some of their
ideas through."
This would indicate that any intro-duced
legislation would most likely
focus on individual issues. To attempt
to address a wide range of water trans-fer
concerns in a single bill would be
divisive, and the bill would not likely
gain wide support. "I think we will be
looking at pieces of legislation as
opposed to one big omnibus bill," a
house staff member said. "It is difficult
to handle an omnibus bill when so
many different issues are involved, with
the issues often interpreted differently
by rural and urban interests." If this is
to be the process, various organizations
that are preparing suggested com-prehensive
legislative packages will
be disappointed.
Several issues have been identified
by the joint committee for possible leg-islative
action. The chief issue is taxing
and bonding. This is an important con-cern
because rural areas are unable to
tax water farms owned by munici-palities.
This reduces their tax base
which, in turn, affects their bonding
capacity. Hays identifies the taxing and
bonding issue as the concern most
likely to be resolved during the next
session. Other concerns include the
interstate transport of water; a limita-tion
on the amount of water to be
withdrawn and transported; third party
mitigation; and the consideration of a
regulatory structure to oversee the
water transfer process.
The issue or issues most likely to
receive legislative action, however, are
those that dont pose a severe threat to
urban water interests or don't threaten
to limit the 1980 Groundwater Manage-ment
Act, which motivates municipal
water farming in rural areas. The strat-egy
of the joint committee, which has
a 70 percent rural majority, seems to
be to avoid a confrontation with the
urban-dominated Legislature. Stephens
says, "As long as we don't do anything
too radical, I think proposals (from the
joint committee) will receive general
support from most of the legislators."
The issue is defined and sides are
drawn, but the situation is not driven
by any sense of urgency. Possibly this
shows that the potential rural-urban
conflict associated with water transfers
is not acutely critical, at least to some
lawmakers. "There is really no crisis,"
Hays says. "Nobody is exporting water.
Nobody is not paying the taxes. We are
all looking down at possible scenarios
in the future. Nothing has really
happened to harm anybody yet." y
4
RESEARCH NEWS
Research on
Water Transfers
Each issue of Arroyo presents brif
descriptions qf water research proj-ects
relevant to Arizona. This issue
features several projects devoted to
water transfers.
Legstating the Water Transfers
Process in Arizona
Gary C. Woodard, Research Specialist,
Division of Economics and Business
Research, University of Arizona
Bonnie C. Saliba, Assistant
Professor, Department of Agricultural
Economics, UA
Gary W Thacker, Extension Agent,
College of Agriculture, UA
and Elizabeth Checchio, graduate
student, Department of Hydrology and
Water Resources, UA.
This research project is being
conducted in cooperation with the
Southern Arizona Water Resources
Association for the Joint Legislative
Committee on Groundwater and
Surface Water Exportation. It covers a
broad area, including the background
of the water transfer issue in Arizona,
effects of water transfers on the area of
origin and an identification of interest
groups involved with the issue. A
summary of the project follows.
Over the past few years, munici-palities,
developers and speculators
have spent well over $100 million to
acquire tens of thousands of acres of
land in rural Arizona, not for the value
of the land or any structures upon it,
but for the apurtenant water. This phe-nomenon,
termed "water farming," has
been occurring in other western states
for decades. Until recently, however,
water farming was relatively unknown
in Arizona. The state's 1980 Groundwa-ter
Management Act created a supply of
water rights that could be bought, sold
and converted from one type of use to
another; it also clarified the rights of
owners to make inter-basin transfers of
water. The demand for water farms
arose out of the continued rapid growth
of the state metropolitan areas and
the Assured Water Supply provisions
promulgated by the Department of
Water Resources. It was the CAP aque-duct
system, which appears to provide
a cheap, reliable means for moving
vast quantities of water around within
the state, that allowed the supply
and demand to meet, touching off
a modern-day land rush.
Water farm purchases produce sev-eral
types of consequences in the areas
of origin. Some of these occur when
the purchase occurs; others when the
water is actually transported out of the
area. Fiscal impacts, including the loss
of property tax base and bonding
capacity, tighter spending limitations
and impacts on revenue sharing, occur
immediately upon the land being pur-chased
by a municipality or other tax-exempt
entity. Environmental and
direct economic impacts occur when
farmland is retired. Environmental
impacts include soil erosion, blowing
dust and tumbleweeds. Direct eco-nomic
impacts include the loss of farm
sector jobs and income. Indirect eco-nomic
impacts occur after that, as
businesses that provide goods and ser-vices
to farmers are affected. These
businesses include seed, fertilizer and
agricultural chemical suppliers; farm
equipment dealers; gins; and crop
dusters. Eventually, all businesses in
the area, including retail shops and res-taurants,
are affected by the general
economic decline. Future economic
development in the area of origin is
threatened both when the purchase
is made and when the water actually
leaves the area When the tax base
shrinks, local services decline and
when water and land are tied up in
water farms, the area of origin becomes
unattractive to businesses looking to
locate new plants. The overall effect on
the area of origin has been termed a
loss of local self-determination, as the
future of an area goes beyond the con-trol
of its residents.
The Arizona Legislature is currrently
grappling with the problem of protect-ing
areas of interest from the negative
impacts of water farming without
denying metropolitan areas necessary
water resources. The researchers have
assembled a data base of all water
farming activities in the state, exam-ined
actual and potential impacts on
areas of origin, and performed a com-parative
analysis of how other western
states regulate inter-basin transfers.
Currently, the effort is focused on com-piling
all legislative and regulatory
alternatives, soliciting views and opin-ions
from all interested parties and
evaluating the options.
See the Resources and Information
section of the newsletter for informa-tion
on ordering this research report.
Southwestern Water Markets
as Indicators of Water Values
Bonnie C. Saliba, Assistant Professor,
Department of Agricultural Economics,
University of Arizona
William E. Martin, Professor,
Department of Agricultural
Economics, UA
David B. Bush, Research
Specialist, Department of Agricultural
Economics, UA.
Water demands in the arid and
semiarid Southwest are expanding as
urban populations continue to increase
at rapid rates. While new water supplies
are becoming increasingly difficult and
expensive to develop, large quantities
of scarce water resources remain in
relatively low-valued economic uses.
Public policy makers, municipal water
resource managers and private indus-tries
alike are expressing growing
interest in developing opportunities for
mutually beneficial market transfers of
water from existing to new uses.
Continuing research on water trans-fers
in the southwestern United States
evaluates the structure and perfor-mance
of water markets, the price
formation process, and trends in market
behavior over time. Results of the first
years of this research are discussed in
5
Water Markets in Theory and Prac-tice
by Bonnie C Saliba and David B.
Bush. (See Publications section of
newsletter.)
Transactions Costs
in Regulating Transfers of Water
Bonnie C. Saliba, Assistant Professor
Department of Agricultural Economics,
University of Arizona
David B. Bush, Research
Specialist, Department of Agricultural
Economics, UA.
Wherever state laws and institutions
permit water transfers to occur, a net-work
of rules, regulations, and policies
exist to prevent these transfers from
causing uncompensated injury to other
water rights holders. This study evalu-ates
the costs of complying with state
legal and administrative procedures
for identifying, measuring, controlling,
mitigating, or preventing the injurious
effects of water transfers on third
parties.
Various stages in the transfer
application and approval process are
analyzed, including who is involved,
what is done, how much time it takes,
and expenditures involved. Wherever
possible, detailed data on transaction
costs for specific case studies of water
rights transfers are collected and ana-lyzed.
The relative efficiency of western
state administrative and judicial sys-tems
for regulating water transfers is
evaluated, and recommendations are
developed for modifying these systems
to minimize transactions costs. V
Ancient sqmbotfor a wave and running water
RESOURCES
AND
IN FORMATION
Water Transfer
Information Available
Arroyo features in each edition
resources or sources of information of
value to people interested in water
issues. Since this edition of the newslet-ter
is concerned with water transfers,
resources are described that provide
information related to the featured
topic.
No longer an emerging issue, water
transfer is an immediate concern, stim-ulating
discussion and controversy
throughout Arizona and the West. As a
result, many people seek water transfer
information to help understand recent
developments and to support positions,
policies and actions. Following are some
sources of information on this vìtal
concern.
Water Farming: The Promise and
Problems of Water Transfers in Ari-zona
is a publication from the Water
Resources Research Center at the Uni-versity
of Arizona Written by Elizabeth
Checchio, the paper presents a general
review of the issues and concerns relat-ing
to water transfers. Interpreted in
the political and economic context
of the state, water transfer is seen as
a complex development that needs
careful analysis. Information is also pre-sented
on water transfer transactions
already negotiated. Of use to profes-sionals,
the publication is also intended
for a general, nonspecialized audience,
with the material presented in a ques-tion-
and-answer format. With the issue
of water transfers gaining prominence,
the publication is useful to acquaint
people with this important current
event. (See Publications section of
newsletter for information on receiving
this report)
Legislating the Water Transfers Pro-cess
in Arizona Gary C. Woodard,
Bonrtie C. Saliba, Gary W. Thacker and
Elizabeth Checchio. This report was
produced in cooperation with the
Southern Arizona Water Resources
Association for the Joint Legislative
Committee on Groundwater and
Surface Water Exportation. The
researchers have assembled a database
of all water farming activities in the
state, examined actual and potential
impacts on areas of origin, and per-formed
a comparative analysis of how
other western states regulate interbasin
transfers. (See Research section of
newsletter for additional information on
this project.)
To be notified about the completion
and availability of this report, send a
note or business card to: Division of
Economic and Business Research, 500
Business and Public Administration
Building, University of Arizona, Thcson,
AZ 85721, Attn: Gary C. Woodard.
The Arizona Department of Water
Resources commissioned Franzoy
Corey, an architectual and engineering
firm, to prepare a report to study the
hydrological and socioeconomic
impacts of water transfers. The report
was to be submitted to the Joint Legis-lative
Committee on Groundwater and
Surface Water Exportation. Two of the
study's projected three phases were
completed. Phase I described hydro-logic
and socioeconomic conditions and
identified areas within the state for fur-ther
evalution; Phase II identified and
quantified hydrologic and economic
effects associated with water transfers.
(Due to criticisms of Phases I and II,
Franzoy Corey did not conduct a
Phase III study)
DWR has prepared a Phase III report
that identifies options available to the
Legislature when discussing water
transfers. Also, Franzoy Corey has
revised its Phase II report to address
concerns and criticisms. Franzoy
Corey's revised Phases I and II and
DWR's Phase III report are available by
contacting Dennis Sunday, Arizona
Department of Water Resources,
99 E. Virginia, Phoenix, AZ 85004;
(602) 255-1737.
6
Water Market Update is a monthly
newsletter that focuses on the promise
and problems of emerging water
markets in the western United States,
offering timely and practical informa-tion
on the forces and events shaping
this rapidly changing field. Subscription
rate is $180 per year; $135 per year
for nonprofit organizations and
government agencies. For additional
infojitiation contact: Water Market
Update Western Network, 1215 Paseo
de Paralta, Santa Fe, NM 85701;
(505) 982-9805.
Other publications that discuss water
transfers are listed in the Publications
section of this newsletter.
Water transfers are a central concern to
the associations that represent rural
and municipal water interests. Two
Arizona associations, one representing
rural interests and the other municipal,
are a source of information about water
transfers and are described below.
The Arizona Rural Water Association,
an educational and lobbying group, is
organized to enhance the rights, plan-ning
and management of rural water
resources in the state to assure present
and future rural development. Made up
of representatives from rural counties,
cities, towns, organizations and busi-nesses,
ARWA is involved in activities
that include summarizing studies, legis-lation
and agency actions affecting
rural water interests. ARWA represents
those interests before agencies, com-missions
and the Legislature and has
presented formal comments to the
Joint Legislative Committee on
Water Transfers and Surface Water
Exploitation. ARWA also conducts
programs and forums to discuss and
promote action on current issues, as
well as developing issue papers and
proposing legislation on water matters
of concern to rural residents. The asso-ciation
is currently working on an issue
paper that proposes legislation to
address water transfer issues. Speakers
are available through the association to
talk on various topics, including water
transfers. A monthly newsletter is also
available, Rural Resources Report. For
additional information on ARWA con-
tact: Doug C Nelson, Executive Vice
President, Arizona Rural Water Associa-tion,
1001 N. Central, Suite 601, Phoenix,
AZ 85004; (602) 258-8401.
Arizona Municipal Water Users
Association is a nonprofit organization
established by the cities of Phoenix,
Mesa, Glendale, Tempe, Scottsdale,
Chandler, Goodyear and Peoria for the
development of urban water policy.
Funded by the member cities, AMWUA
represents and assists them in areas of
water resource management that
require a coordinated effort by the
cities. Some of these areas include par-ticipating
in financial arrangements
needed to complete the Central Ari-zona
Project, exploring possibilities for
artificial groundwater recharge and
other water supply augmentation alter-natives
including water transfers, water
legislation; water conservation and
coordinated water resource manage-ment
planning. AMWUA lobbies for
urban interests and is active working
through the legislature to negotiate an
acceptable solution to water transfer
problems. Speakers are available to
address water transfer issues as they
affect urban areas. For additional infor-mation
about AMWUA contact: Roger
S. Manning, Executive Director, Arizona
Municipal Water Users Association,
505 N. 2nd St., UAiglon Courts, Suite
385, Phoenix, AZ 85004; (602)
256-0999.v
PUBLICATIONS
WRCC Publications
The WRRC at the University of Arizona
recently issued two publications:
Central Arizona Project
Water Qualily:
An Examination
of Management Options
by K. James DeCook
and Marvin Waterstone
This publication evaluates the rela-tive
advantages and disadvantages,
strengths and weaknesses, and costs
and benefits of various CAP water-quality
management methods available
to water managers. It is of special use
to water managers as they develop a
water-quality management approach to
prepare CAP water for various uses
municipal, agricultural and industrial.
$7.50.
Water Farming:
The Promise and Problems of
Water Transfers in Arizona
by Elizabeth Checchio
The author presents a general review of
the issues and concerns relating to
water transfer. Of use to professionals,
the publication is also intended for a
general, non-specialized audience, with
the material presented in a question-and-
answer format. $2.00.
Copies of WRRC publications are
available from: Librarian, Water
Resources Research Center, Geology
318, University of Arizona, Thcson, AZ
85721; (602) 621-164&
Arid Lands:
Today and Tomorrow
edited by Emily E. Whitehead,
Charles F Hutchinson,
Barbara N Timmermann
and Robert G. Varady
Containing papers by more than 125
experts, this book provides the most
comprehensive overview of arid lands
research today. The papers represent
research underway in 40 countries and
cover a broad range of topics on critical
arid lands issues, including desert ecol-ogy,
small-scale water management and
water policy. Westview Press, 5500 Cen-tral
Avenue, Boulder CO 80301. $85.
Water Markets
in Theory and Practice
by Bonnie Colby Saliba
and David B Bush
The authors analyze the complexities
and issues surrounding emerging water
markets in the southwestern United
States. As existing water rights become
fully appropriated, and market transfers
become more commonplace, water
7
users and legislators are faced with the
challenge of developing equitable pro-cesses
for the allocation of water and
the consideration of new public policy
for water transfers. Westview Press,
5500 Central Ave., Boulder, CO 80301.
$32.50.
Water Marketing in the Southwest-
Can Market Prices Be Used fo
Evaluate Water Supply Augmentation
Projecfs?
by Bonnie Colby Saliba,
David B Bush
and William E. Martin
Price behavior over time in selected
western water markets is observed and
assessed as a useful measure of the
economic value of water. Market
characteristics that may distort prices
include imperfect competition, third-party
effects, institutional and hydro-logic
uncertainty, and equity
considerations. Nonmarket valuation
techniques are useful in supplementing
market price information.
Copies of USDA Forest Service Gen-eral
Technical Report RM-144 are
available by writing to Rocky Mountain
Forest and Range Experiment Station,
Fort Collins, CO 80526.
CONFERENCES
AND
SEMINARS
Xeriscape Conference
February 19, 1988
Tucson
Sponsored by the Southern Arizona
Water Resources Association, this con-ference
will feature workshops on state
and county landscape regulations; the
design and use of an efficient irrigation
system; and getting started with
xeriscape. For additional information
contact the SAWRA office in Thcson,
(602) 881-3939.
Conference on
Southwestern Groundwater Issues
March 23-25, 1988
A1buq'wrque, New Mexico
For information contact: FOCUS South-west
Conference, Program Coordinator,
National Water Well Association, 6375
Riverside Drive, Dublin, OH 43017
32nd Annual Meeting of
the Arizona-Nevada
Academy of Science
April 16, 1987
University of Arizona
Tucson, Arizona
Research results from various academic
areas, including hydrology, will be pre-sented
at the meeting: For additional
information contact: Bud Ellis, Depart-ment
of Biology, Glendale Community
College, Glendale, AZ 85302.
The Sixiti World Congress
on Water Resources
May 29-June 3, 1988
Ottawa, Ontario
The International Water Resources
Association was established as an
international forum to promote inter-disciplinary
communication and
cooperation among industries, business
and social groups, and professionals of
diverse backgrounds. The conference
carries on this mission with papers
devoted to three major themes: policies
and strategies, planning, and operation.
For additional information contact:
The Secretariat, Sixth IWRA World
Water Congress on Water Resources,
University of Ottawa. 631 King Edward
Avenue, Ottawa, Ontario KiN 6N5, Can-ada;
(613) 564-3902; telex 053-3338.
ARROYO
UNIVERSITY OF ARIZONA
Water Resources Research Center
Thcson, Arizona 85721 AWRR(
Water Resources Research Center
International Conference
on Dryland Farming
August 15-19, 1988
Amarillo/Bushland, Texas
The purpose of the conference is to
evaluate past progress in dryland agri-culture,
identify constraints, propose
methods and technologies needed to
alleviate those constraints, propose pol-icies
and programs for more effective
technology transfer, and identify
research needs and priorities for dry-land
agriculture.
For additional information contact:
International Conference on Dryland
Rtrming, USDA Conservation and
Production, Research Laboratory, PO.
Drawer 10, Bushland, Tx 79012.
Arroyo, a quarterly publiCation,
is published cooperatively 1)y:
Arizona 1)epartment of
Environmental Quality
2005 North Central
Phoenix, AZ 85004
(602) 257-2306
Arizona Department. of Water
Resources
99 East Virginia
Ploenix, AZ 85004
(602) 255-1554
Arizona State Land Departineiìt
1624 West Adams
Phoenix, AZ 85007
(602) 255-4629
Symposium on Water-Use Data
For Water Resources Management
August 28-31, 1988
Tucson, Arizona
This symposium is planned as an
opportunity for water professionals,
lawyers, managers, economists, biolo-gists
and others to learn about and
observe state-of-the-art measurement
and estimation techniques and equip-ment,
as well as a chance to discuss
water-use management strategies and
trends.
For additional information contact:
Marvin Waterstone, University of
Arizona, Water Resources Research
Center, Geology Building, Room 318,
Thcson, AZ 85721; (602) 621-7607.
Office of Arid Lands Studies
College of Agriculture
University of Arizona
845 North Park
tflicson, AZ 85719
(602) 621-1955
Water Resources Research Center
College of Engineering and Mines
University of Arizona
Tucson, AZ 85721
(602) 621-7607
Address news items or comments tu:
Joe Gelt, Editor
14 ìi)yO
Arizona Water Resources Center
Geology Building, Room 314
University of Arizona
Tucson, AZ
(602) 621-7607
NON-PROFIT ORG.
u.s POSTAGE
PAID
PERMIT NO. 190
TUCSON, ARIZONA
Object Description
| Rating | |
| TITLE | Arroyo |
| CREATOR | University of Arizona. Water Resources Research Center. |
| SUBJECT | Water resources development--Arizona--Periodicals; Water resources development--Research--Arizona--Periodicals; Arid regions--Research--Arizona--Periodicals; Water-supply--Arizona--Periodicals; |
| Browse Topic |
Land and resources |
| DESCRIPTION | This title contains one or more publications. Published cooperatively by: Division of Environmental Health of Arizona Dept. of Health Services, the Arizona Department of Water Resources, the Arizona State Land Dept., the Office of Arid Lands Studies and the Water Resourses Research Center of the University of Arizona. |
| Language | English |
| Publisher | University of Arizona. Water Resources Research Center. |
| Material Collection |
State Documents |
| Acquisition Note | http://cals.arizona.edu/AZWATER/arroyo/aryomain.html |
| Source Identifier | WRR 1.3:A 66 |
| Location | 17547705 |
| REPOSITORY | Arizona State Library, Archives and Public Records--Law and Research Library Division. |
Description
| TITLE | Arroyo Volume 2, Number 1 Winter 1988 |
| DESCRIPTION | 8 pages (PDF version). File size: 526 KB |
| TYPE |
Text |
| RIGHTS MANAGEMENT | Copyright to this resource is held by the creating agency and is provided here for educational purposes only. It may not be downloaded, reproduced or distributed in any format without written permission of the creating agency. Any attempt to circumvent the access controls placed on this file is a violation of United States and international copyright laws, and is subject to criminal prosecution. |
| DATE ORIGINAL | 1988 |
| Time Period |
1980s (1980-1989) |
| ORIGINAL FORMAT | Paper |
| Source Identifier | WRR 1.3:A 66 |
| Location | o17547705 |
| DIGITAL IDENTIFIER | arroyo_1988_v2_n1_w.pdf |
| DIGITAL FORMAT | PDF (Portable Document Format) |
| DIGITIZATION SPECIFICATIONS | Scan done by Originating Agency. |
| REPOSITORY | Arizona State Library, Archives and Public Records--Law and Research Library. |
| File Size | 537789 Bytes |
| Full Text | Water Transfer: a Water Source, a Debate That water, so common, essential and basic, should be a corn-modity to be bought and sold, marketed and transferred, may seem odd. Yet social and economic conditions in Arizona, and throughout the West, have evolved in such a way that water transfers appear as an attractive option to soma And a controversial issue to others. Simply stated, water transfer means a change of ownership of the right to use water, usually through a sale. As a result, the water may be transported to another place to satisfy a need of its new owner. More specifically, the water transfer issue in Arizona involves the purchase of agricultural land for its water by urban areas, to support muni-cipal and industrial development. Arizona municipalities are expand-ing, especially the Phoenix and Thcson areas Meanwhile Arizona agriculture, which uses about 80 percent of the state's water, shows declining profits. Is it fair and reasonable to satisfy new and growing water demands by moving water from low-value to high-value uses or, in other words, from agricul-turaI to urban areas? In 1987 '75 percent of water transfers in the Southwest involved moving water from agricultural to municipal and industrial uses. Additional sources of water may be unavailable or insufficient. Large-scale, federal-supported water reclamation projects are out of favor, with opposi-tion mounting to the environmental and economic costs. And water conser-vation and reuse may not yield enough to meet the growing demand. With the lack of available options for new water sources, some people view water trans-fers as an idea whose time has come. Other developments also seem to encourage water transfers. The 1980 Arizona Groundwater Management Act, which was passed chiefly to control and manage groundwater overdraft, estab-lished four Active Management Areas to help achieve its goal. Safe yield or the balance of groundwater with-drawals with total recharge is the goal of three of the AMAs, with growth and development carefully managed to avoid excessive groundwater with-drawal. As a result, new projects are encouraged to contract for water outside their AMAs, often in rural, agricultural areas. Further, water transfers become more feasible with the development of the CAP system, which could provide a method to effectively transport water between locations. Along with deliver-ing Colorado River water, the canals could be used to transport water between points inside and outside the AMAs; from rural areas to municipalities. Because of the above considerations, municipalities are willing buyers in the water transfer transaction. Rural and agricultural interests, however, are often reluctant sellers. They are con-cerned that, if they sell their water rights, the sale will also be to their advantage, not just to the benefit of municipalities. They perceive certain negative effects of water transfers on the areas of origin, which is the loca-tion of their homes, properties and businesses. Water farm acreage bought by muni-cipalities is removed from the county tax rolls because municipally owned property is tax-exempt. This places a heavier burden on the remaining tax-payers. Also, economic development may be affected because counties would have lost the tax revenues to support the public services that attract new enterprises. Economic development may be further affected if a county no longer controls an adequate supply of water to attract new businesses and industries. WATER RESOURCES RESEARCH CENTER UNIVERSITY OF ARIZONA y AR ROYO y Vol. 2 No. i Winter 1988 Water, a county's most basic resource, may have been sold to a municipality that will make decisions about its uses without regard to local community interests. Further, the loss of farm income due to retired farmlands may affect existing businesses in the community. Less agricultural monies earned and spent means less business for seed suppliers, tractor mechanics, accountants and even the local coffee shop. Also, a decline in agricultural employment could cause people to move out of the community. Also environmental concerns exist. When land is no longer irrigated, revegetation begins with turnbleweeds often quickly taking over the land. Dust and tumbleweeds can become a nuisance to adjacent lands which may include cultivated farmland. This edition of Arroyo discusses water transfers. A current and contro-versial issue, water transfers affect the growth and development of urban and rural lands, and the well-being of all who live there.v INVITE D COMMENT Water Transfer: an Urban and Rural Perspective Water transfer is an issue with an urban and a rural perspective. Invited Gomment includes state-ments from each point of view. Water Transfers: a Rural Perspective, Gordon G. Henne President, Arizona Rural Water Association Since the West was settled, water has been more precious than gold, and it seems that it still is. Over the years, the use of water has primarily centered around agriculture, and we have gone to great lengths to provide for that use. Recently, however, increased amounts of water have been required for expanding municipal and industrial uses. As a result, we have come to realize that all needs cannot be met with everyone having all the water they want. The 1980 Groundwater Management Act protects water users in active man-agement areas, but unprotected areas outside the AMAs will be affected by change. For example, agriculture is impacted when water outside an AMA is transferred to enable an area within an AMA to reach its safe-yield goal. The AMA water table remains at a level to allow farmers to pump and profitably farm, but no such protection is available outside the AMA. Eventually its lower-ing water table will render farming totally unprofitable. This is of particular interest if we consider agriculture pres-ently uses approximately 85 percent of the water used in Arizona By protecting AMA water, the Groundwater Management Act has made it necessary for large and grow-ing cities to look outside their AMAs for supplementary water. This has led to "water farming or ranching" which may appear to be a solution to the cities' problems. A deeper investigation, however, reveals many serious and long lasting problems. For example, water farm properties are removed from a county's tax rolls. This reduces reve-nues and shifts tax burdens to the remaining private citizens. Bonding capacity is also reduced making it dif-ficult to build capital improvements needed to provide public services. Serious long-term questions also need to be considered. How will future farming or industrial development occur if water is unavailable? How will 2 development be affected if there is even a fear that sufficient water may not be available to sustain growth in the area? These questions are difficult to answer because we do not know what the future will bring. We do know, however, that 50 years ago Phoenix was not a thriving metropolis. Possibly other areas may have the same potential. We cannot use trial and error to answer the questions. Once water is transferred to the metropolitan areas and people become dependent on it, it will never be stopped. Today's water transfer issue is only a tool to allow continued growth as we know it today. Other methods exist to acquire water. More could be done with conservation. Water reuse and recharg-ing water into the aquifer in abundant years would help. Increasing reservoir storage to retain flood waters and weather modification are valid efforts and should be investigated. We need to see water transfers and its implications as an Arizona problemnot a rural or urban problem. Many decisions face Arizona citizens at this time. The main one is "What lifestyle do we want in our state?" Arizona's growth has been rapid and impressive, but are we squandering the richness of our environment, including our most precious resource, water, to support reckless development? The Wall Street Journal gave national attention to this Arizona issue in a feature on November 2. We face a dilemma Unequaled growth provides today's profits, but creates future debts. Today's water transfer issue is only a tool to allow continued growth as we know it today. However, no matter what laws are enacted within the next two or three years, in thirty years, under our present growth pattern that supports the expansion of two major metropolitan areas, rural water will have to be trans-ferred. Wouldn't Arizona and its quality of life be better served if today's growth momentum were channeled through a cooperative state effort to plan and pro-mote the development of six or eight population centers in Arizona? This would mitigate the waste, expense and ecological destruction that goes with supporting just two. y Water Transfers: An Urban Perspective Roger S. Manning Executive Director Arizona Munici-pal Water Users Association Qnce again Arizona water users are embroiled in a dispute over the transfer or transportation of water from an area of origin to an area of use. Indeed, from an historical perspective nearly every groundwater conflict has revolved around this isssue. Of particu-lar significance for the current conflict was the 1977 FICO decision of the Arizona Supreme Court. The FICO decision created an atmosphere of crisis among many groundwater users in the state. Since certain transfers or transportations could be enjoined as a result of this decision, the potential consequences of the decision were considerable, especially for the mining industry in Pima County and the cities of Thcson and Prescott. In response, the Legisla-ture enacted the 1977 Transportation Amendments to the 1948 Critical Groundwater Code which allowed certain transportations to continue pending enactment of a comprehensive groundwater management code. The 1977 Amendments also estab-lished the Groundwater Management Study Commission to develop a com-prehensive groundwater management code. After over two years of study and with the added incentive that continued federal funding of the CAI especially to Pinal and Pima Counties, was in jeopardy unless Arizona got its groundwater act together, the Commis-sion's recommendations were adopted by the Legislature and signed into law by Governor Babbitt on June 12, 1980. The 1980 Groundwater Management ACT (1980 GMA) dealt directly with the subject of transportation of ground-water. The 1980 GMA implicitly recognizes that transportation of groundwater will be necessary to meet changing water demands, effectively carry out future groundwater manage-ment plans and provide for future economic growth and development. Significantly, and some think most importantly, it establishes the principle that any rules for the transportation of water must be based on hydrological boundaries, not political. The 1980 GMA implicitly recognizes that transportation of groundwater will be necessary to meet changing water demands... The driver behind the transfer and transportation of water is the 1980 Groundwater Management Act (1980 GMA). While the 1980 GMA does not specifically require importation, it clearly leaves the cities little choice but to import water to meet the require-ments of safe yield and an assured water supply (AWS). Safe Yield is a goal which seeks to achieve by the year 2025 a balance between the amount of groundwater withdrawn and the amount naturally and incidently recharged. Under safe yield, groundwater in excess of recharge may be withdrawn only dur-ing shortages. Thus, the achievement of safe yield requires that future growth be independent of groundwater with-drawn from the Safe Yield Active Management Areas (AMA). In the future, AMA groundwater will be for emergency, not routine use. The AWS test also necessitates importing water. An AWS means a 100- year water supply for the needs of the proposed development. In addition, the water use must be consistent with achievement of the AMA manage-ment goal. Thus the groundwater of a safe yield AMA cannot be used to dem- 3 onstrate an AWS. It is inconceivable how a proposed use dependent on groundwater mining can be consistent with the achievement of the manage-ment goal when the goal demands a cessation of groundwater mining. Even though driven by the law, the purchase of land by several cities cre-ated a firestorm. As a result, the state hired a consultant to conduct a study of the hydrologic, economic and fiscal impacts of water exportation. While the study is incomplete, the preliminary results indicate that the growth poten-tial of the rural counties will not be unalterably damaged as a consequence of water exports. Nevertheless, the prevailing perception is still one of rural pillage. Consequently, political reality neces-sitates that the importing cities attempt to correct the perception of rural plunder by participation in the devel-opment and implementation of realistic and mutually agreeable mitigative measures or standards that recognize the legitimate economic and social needs of the exporting and importing areas of our state. We are all obliged to be good citizens and good neighbors. Only then will the search for mutually beneficial solutions bear fruit. y LEGISLATIVE NEWS Legislators Work on Water Transfer Strategy The water transfer issue is to poli-tics what subsidence is to the landunsettlirìg and divisive. As a result, water transfer could be a lively political topic during this legislative session. The issue sparks special inter-est for two reasons. First, it has to do with a perennially important Arizona topic: water and development. Also, the issue attracts added political attention because of the urban/rural rivalry that is often seen as part of the water trans-fer movement. This rivalry raises an important political question: Will urban and rural interests conflict or cooperate to achieve efficient and equitable water transfer? Perceptions vary about how rural and urban water transfer interests will get along in the Legislature. A senate staff member sees a political battle brewing and describes water transfers as a "David and Goliath" issue. However, Sen. Alan Stephens, member of the Joint Committee on Groundwater and Surface Water Exportation, is more optimistic. He feels the situation is changing. "The urban legislators are beginning to understand the issue of equity" he said. "And rural interests are beginning to come around." Sen. John Hays, a co-chairman of the joint committee, is unsure how events will develop. "It remains to be seen what opposition will come from the cities with water farms" he says. "They have a heavy voting block I won't even venture a guess what might happen." What is fairly certain, however, is that whatever legislation is proposed will be addressing rural concerns. Under the current situation, cities that would benefit from water transfers do not need legislation to set up and oper-ate water farms. Describing what this means in the legislative process, a house staff member said, "It is going to be a matter of whether the rural folks, who are the most impacted, can build enough of a coalition with some of the urban people to try to get some of their ideas through." This would indicate that any intro-duced legislation would most likely focus on individual issues. To attempt to address a wide range of water trans-fer concerns in a single bill would be divisive, and the bill would not likely gain wide support. "I think we will be looking at pieces of legislation as opposed to one big omnibus bill" a house staff member said. "It is difficult to handle an omnibus bill when so many different issues are involved, with the issues often interpreted differently by rural and urban interests." If this is to be the process, various organizations that are preparing suggested com-prehensive legislative packages will be disappointed. Several issues have been identified by the joint committee for possible leg-islative action. The chief issue is taxing and bonding. This is an important con-cern because rural areas are unable to tax water farms owned by munici-palities. This reduces their tax base which, in turn, affects their bonding capacity. Hays identifies the taxing and bonding issue as the concern most likely to be resolved during the next session. Other concerns include the interstate transport of water; a limita-tion on the amount of water to be withdrawn and transported; third party mitigation; and the consideration of a regulatory structure to oversee the water transfer process. The issue or issues most likely to receive legislative action, however, are those that dont pose a severe threat to urban water interests or don't threaten to limit the 1980 Groundwater Manage-ment Act, which motivates municipal water farming in rural areas. The strat-egy of the joint committee, which has a 70 percent rural majority, seems to be to avoid a confrontation with the urban-dominated Legislature. Stephens says, "As long as we don't do anything too radical, I think proposals (from the joint committee) will receive general support from most of the legislators." The issue is defined and sides are drawn, but the situation is not driven by any sense of urgency. Possibly this shows that the potential rural-urban conflict associated with water transfers is not acutely critical, at least to some lawmakers. "There is really no crisis" Hays says. "Nobody is exporting water. Nobody is not paying the taxes. We are all looking down at possible scenarios in the future. Nothing has really happened to harm anybody yet." y 4 RESEARCH NEWS Research on Water Transfers Each issue of Arroyo presents brif descriptions qf water research proj-ects relevant to Arizona. This issue features several projects devoted to water transfers. Legstating the Water Transfers Process in Arizona Gary C. Woodard, Research Specialist, Division of Economics and Business Research, University of Arizona Bonnie C. Saliba, Assistant Professor, Department of Agricultural Economics, UA Gary W Thacker, Extension Agent, College of Agriculture, UA and Elizabeth Checchio, graduate student, Department of Hydrology and Water Resources, UA. This research project is being conducted in cooperation with the Southern Arizona Water Resources Association for the Joint Legislative Committee on Groundwater and Surface Water Exportation. It covers a broad area, including the background of the water transfer issue in Arizona, effects of water transfers on the area of origin and an identification of interest groups involved with the issue. A summary of the project follows. Over the past few years, munici-palities, developers and speculators have spent well over $100 million to acquire tens of thousands of acres of land in rural Arizona, not for the value of the land or any structures upon it, but for the apurtenant water. This phe-nomenon, termed "water farming" has been occurring in other western states for decades. Until recently, however, water farming was relatively unknown in Arizona. The state's 1980 Groundwa-ter Management Act created a supply of water rights that could be bought, sold and converted from one type of use to another; it also clarified the rights of owners to make inter-basin transfers of water. The demand for water farms arose out of the continued rapid growth of the state metropolitan areas and the Assured Water Supply provisions promulgated by the Department of Water Resources. It was the CAP aque-duct system, which appears to provide a cheap, reliable means for moving vast quantities of water around within the state, that allowed the supply and demand to meet, touching off a modern-day land rush. Water farm purchases produce sev-eral types of consequences in the areas of origin. Some of these occur when the purchase occurs; others when the water is actually transported out of the area. Fiscal impacts, including the loss of property tax base and bonding capacity, tighter spending limitations and impacts on revenue sharing, occur immediately upon the land being pur-chased by a municipality or other tax-exempt entity. Environmental and direct economic impacts occur when farmland is retired. Environmental impacts include soil erosion, blowing dust and tumbleweeds. Direct eco-nomic impacts include the loss of farm sector jobs and income. Indirect eco-nomic impacts occur after that, as businesses that provide goods and ser-vices to farmers are affected. These businesses include seed, fertilizer and agricultural chemical suppliers; farm equipment dealers; gins; and crop dusters. Eventually, all businesses in the area, including retail shops and res-taurants, are affected by the general economic decline. Future economic development in the area of origin is threatened both when the purchase is made and when the water actually leaves the area When the tax base shrinks, local services decline and when water and land are tied up in water farms, the area of origin becomes unattractive to businesses looking to locate new plants. The overall effect on the area of origin has been termed a loss of local self-determination, as the future of an area goes beyond the con-trol of its residents. The Arizona Legislature is currrently grappling with the problem of protect-ing areas of interest from the negative impacts of water farming without denying metropolitan areas necessary water resources. The researchers have assembled a data base of all water farming activities in the state, exam-ined actual and potential impacts on areas of origin, and performed a com-parative analysis of how other western states regulate inter-basin transfers. Currently, the effort is focused on com-piling all legislative and regulatory alternatives, soliciting views and opin-ions from all interested parties and evaluating the options. See the Resources and Information section of the newsletter for informa-tion on ordering this research report. Southwestern Water Markets as Indicators of Water Values Bonnie C. Saliba, Assistant Professor, Department of Agricultural Economics, University of Arizona William E. Martin, Professor, Department of Agricultural Economics, UA David B. Bush, Research Specialist, Department of Agricultural Economics, UA. Water demands in the arid and semiarid Southwest are expanding as urban populations continue to increase at rapid rates. While new water supplies are becoming increasingly difficult and expensive to develop, large quantities of scarce water resources remain in relatively low-valued economic uses. Public policy makers, municipal water resource managers and private indus-tries alike are expressing growing interest in developing opportunities for mutually beneficial market transfers of water from existing to new uses. Continuing research on water trans-fers in the southwestern United States evaluates the structure and perfor-mance of water markets, the price formation process, and trends in market behavior over time. Results of the first years of this research are discussed in 5 Water Markets in Theory and Prac-tice by Bonnie C Saliba and David B. Bush. (See Publications section of newsletter.) Transactions Costs in Regulating Transfers of Water Bonnie C. Saliba, Assistant Professor Department of Agricultural Economics, University of Arizona David B. Bush, Research Specialist, Department of Agricultural Economics, UA. Wherever state laws and institutions permit water transfers to occur, a net-work of rules, regulations, and policies exist to prevent these transfers from causing uncompensated injury to other water rights holders. This study evalu-ates the costs of complying with state legal and administrative procedures for identifying, measuring, controlling, mitigating, or preventing the injurious effects of water transfers on third parties. Various stages in the transfer application and approval process are analyzed, including who is involved, what is done, how much time it takes, and expenditures involved. Wherever possible, detailed data on transaction costs for specific case studies of water rights transfers are collected and ana-lyzed. The relative efficiency of western state administrative and judicial sys-tems for regulating water transfers is evaluated, and recommendations are developed for modifying these systems to minimize transactions costs. V Ancient sqmbotfor a wave and running water RESOURCES AND IN FORMATION Water Transfer Information Available Arroyo features in each edition resources or sources of information of value to people interested in water issues. Since this edition of the newslet-ter is concerned with water transfers, resources are described that provide information related to the featured topic. No longer an emerging issue, water transfer is an immediate concern, stim-ulating discussion and controversy throughout Arizona and the West. As a result, many people seek water transfer information to help understand recent developments and to support positions, policies and actions. Following are some sources of information on this vìtal concern. Water Farming: The Promise and Problems of Water Transfers in Ari-zona is a publication from the Water Resources Research Center at the Uni-versity of Arizona Written by Elizabeth Checchio, the paper presents a general review of the issues and concerns relat-ing to water transfers. Interpreted in the political and economic context of the state, water transfer is seen as a complex development that needs careful analysis. Information is also pre-sented on water transfer transactions already negotiated. Of use to profes-sionals, the publication is also intended for a general, nonspecialized audience, with the material presented in a ques-tion- and-answer format. With the issue of water transfers gaining prominence, the publication is useful to acquaint people with this important current event. (See Publications section of newsletter for information on receiving this report) Legislating the Water Transfers Pro-cess in Arizona Gary C. Woodard, Bonrtie C. Saliba, Gary W. Thacker and Elizabeth Checchio. This report was produced in cooperation with the Southern Arizona Water Resources Association for the Joint Legislative Committee on Groundwater and Surface Water Exportation. The researchers have assembled a database of all water farming activities in the state, examined actual and potential impacts on areas of origin, and per-formed a comparative analysis of how other western states regulate interbasin transfers. (See Research section of newsletter for additional information on this project.) To be notified about the completion and availability of this report, send a note or business card to: Division of Economic and Business Research, 500 Business and Public Administration Building, University of Arizona, Thcson, AZ 85721, Attn: Gary C. Woodard. The Arizona Department of Water Resources commissioned Franzoy Corey, an architectual and engineering firm, to prepare a report to study the hydrological and socioeconomic impacts of water transfers. The report was to be submitted to the Joint Legis-lative Committee on Groundwater and Surface Water Exportation. Two of the study's projected three phases were completed. Phase I described hydro-logic and socioeconomic conditions and identified areas within the state for fur-ther evalution; Phase II identified and quantified hydrologic and economic effects associated with water transfers. (Due to criticisms of Phases I and II, Franzoy Corey did not conduct a Phase III study) DWR has prepared a Phase III report that identifies options available to the Legislature when discussing water transfers. Also, Franzoy Corey has revised its Phase II report to address concerns and criticisms. Franzoy Corey's revised Phases I and II and DWR's Phase III report are available by contacting Dennis Sunday, Arizona Department of Water Resources, 99 E. Virginia, Phoenix, AZ 85004; (602) 255-1737. 6 Water Market Update is a monthly newsletter that focuses on the promise and problems of emerging water markets in the western United States, offering timely and practical informa-tion on the forces and events shaping this rapidly changing field. Subscription rate is $180 per year; $135 per year for nonprofit organizations and government agencies. For additional infojitiation contact: Water Market Update Western Network, 1215 Paseo de Paralta, Santa Fe, NM 85701; (505) 982-9805. Other publications that discuss water transfers are listed in the Publications section of this newsletter. Water transfers are a central concern to the associations that represent rural and municipal water interests. Two Arizona associations, one representing rural interests and the other municipal, are a source of information about water transfers and are described below. The Arizona Rural Water Association, an educational and lobbying group, is organized to enhance the rights, plan-ning and management of rural water resources in the state to assure present and future rural development. Made up of representatives from rural counties, cities, towns, organizations and busi-nesses, ARWA is involved in activities that include summarizing studies, legis-lation and agency actions affecting rural water interests. ARWA represents those interests before agencies, com-missions and the Legislature and has presented formal comments to the Joint Legislative Committee on Water Transfers and Surface Water Exploitation. ARWA also conducts programs and forums to discuss and promote action on current issues, as well as developing issue papers and proposing legislation on water matters of concern to rural residents. The asso-ciation is currently working on an issue paper that proposes legislation to address water transfer issues. Speakers are available through the association to talk on various topics, including water transfers. A monthly newsletter is also available, Rural Resources Report. For additional information on ARWA con- tact: Doug C Nelson, Executive Vice President, Arizona Rural Water Associa-tion, 1001 N. Central, Suite 601, Phoenix, AZ 85004; (602) 258-8401. Arizona Municipal Water Users Association is a nonprofit organization established by the cities of Phoenix, Mesa, Glendale, Tempe, Scottsdale, Chandler, Goodyear and Peoria for the development of urban water policy. Funded by the member cities, AMWUA represents and assists them in areas of water resource management that require a coordinated effort by the cities. Some of these areas include par-ticipating in financial arrangements needed to complete the Central Ari-zona Project, exploring possibilities for artificial groundwater recharge and other water supply augmentation alter-natives including water transfers, water legislation; water conservation and coordinated water resource manage-ment planning. AMWUA lobbies for urban interests and is active working through the legislature to negotiate an acceptable solution to water transfer problems. Speakers are available to address water transfer issues as they affect urban areas. For additional infor-mation about AMWUA contact: Roger S. Manning, Executive Director, Arizona Municipal Water Users Association, 505 N. 2nd St., UAiglon Courts, Suite 385, Phoenix, AZ 85004; (602) 256-0999.v PUBLICATIONS WRCC Publications The WRRC at the University of Arizona recently issued two publications: Central Arizona Project Water Qualily: An Examination of Management Options by K. James DeCook and Marvin Waterstone This publication evaluates the rela-tive advantages and disadvantages, strengths and weaknesses, and costs and benefits of various CAP water-quality management methods available to water managers. It is of special use to water managers as they develop a water-quality management approach to prepare CAP water for various uses municipal, agricultural and industrial. $7.50. Water Farming: The Promise and Problems of Water Transfers in Arizona by Elizabeth Checchio The author presents a general review of the issues and concerns relating to water transfer. Of use to professionals, the publication is also intended for a general, non-specialized audience, with the material presented in a question-and- answer format. $2.00. Copies of WRRC publications are available from: Librarian, Water Resources Research Center, Geology 318, University of Arizona, Thcson, AZ 85721; (602) 621-164& Arid Lands: Today and Tomorrow edited by Emily E. Whitehead, Charles F Hutchinson, Barbara N Timmermann and Robert G. Varady Containing papers by more than 125 experts, this book provides the most comprehensive overview of arid lands research today. The papers represent research underway in 40 countries and cover a broad range of topics on critical arid lands issues, including desert ecol-ogy, small-scale water management and water policy. Westview Press, 5500 Cen-tral Avenue, Boulder CO 80301. $85. Water Markets in Theory and Practice by Bonnie Colby Saliba and David B Bush The authors analyze the complexities and issues surrounding emerging water markets in the southwestern United States. As existing water rights become fully appropriated, and market transfers become more commonplace, water 7 users and legislators are faced with the challenge of developing equitable pro-cesses for the allocation of water and the consideration of new public policy for water transfers. Westview Press, 5500 Central Ave., Boulder, CO 80301. $32.50. Water Marketing in the Southwest- Can Market Prices Be Used fo Evaluate Water Supply Augmentation Projecfs? by Bonnie Colby Saliba, David B Bush and William E. Martin Price behavior over time in selected western water markets is observed and assessed as a useful measure of the economic value of water. Market characteristics that may distort prices include imperfect competition, third-party effects, institutional and hydro-logic uncertainty, and equity considerations. Nonmarket valuation techniques are useful in supplementing market price information. Copies of USDA Forest Service Gen-eral Technical Report RM-144 are available by writing to Rocky Mountain Forest and Range Experiment Station, Fort Collins, CO 80526. CONFERENCES AND SEMINARS Xeriscape Conference February 19, 1988 Tucson Sponsored by the Southern Arizona Water Resources Association, this con-ference will feature workshops on state and county landscape regulations; the design and use of an efficient irrigation system; and getting started with xeriscape. For additional information contact the SAWRA office in Thcson, (602) 881-3939. Conference on Southwestern Groundwater Issues March 23-25, 1988 A1buq'wrque, New Mexico For information contact: FOCUS South-west Conference, Program Coordinator, National Water Well Association, 6375 Riverside Drive, Dublin, OH 43017 32nd Annual Meeting of the Arizona-Nevada Academy of Science April 16, 1987 University of Arizona Tucson, Arizona Research results from various academic areas, including hydrology, will be pre-sented at the meeting: For additional information contact: Bud Ellis, Depart-ment of Biology, Glendale Community College, Glendale, AZ 85302. The Sixiti World Congress on Water Resources May 29-June 3, 1988 Ottawa, Ontario The International Water Resources Association was established as an international forum to promote inter-disciplinary communication and cooperation among industries, business and social groups, and professionals of diverse backgrounds. The conference carries on this mission with papers devoted to three major themes: policies and strategies, planning, and operation. For additional information contact: The Secretariat, Sixth IWRA World Water Congress on Water Resources, University of Ottawa. 631 King Edward Avenue, Ottawa, Ontario KiN 6N5, Can-ada; (613) 564-3902; telex 053-3338. ARROYO UNIVERSITY OF ARIZONA Water Resources Research Center Thcson, Arizona 85721 AWRR( Water Resources Research Center International Conference on Dryland Farming August 15-19, 1988 Amarillo/Bushland, Texas The purpose of the conference is to evaluate past progress in dryland agri-culture, identify constraints, propose methods and technologies needed to alleviate those constraints, propose pol-icies and programs for more effective technology transfer, and identify research needs and priorities for dry-land agriculture. For additional information contact: International Conference on Dryland Rtrming, USDA Conservation and Production, Research Laboratory, PO. Drawer 10, Bushland, Tx 79012. Arroyo, a quarterly publiCation, is published cooperatively 1)y: Arizona 1)epartment of Environmental Quality 2005 North Central Phoenix, AZ 85004 (602) 257-2306 Arizona Department. of Water Resources 99 East Virginia Ploenix, AZ 85004 (602) 255-1554 Arizona State Land Departineiìt 1624 West Adams Phoenix, AZ 85007 (602) 255-4629 Symposium on Water-Use Data For Water Resources Management August 28-31, 1988 Tucson, Arizona This symposium is planned as an opportunity for water professionals, lawyers, managers, economists, biolo-gists and others to learn about and observe state-of-the-art measurement and estimation techniques and equip-ment, as well as a chance to discuss water-use management strategies and trends. For additional information contact: Marvin Waterstone, University of Arizona, Water Resources Research Center, Geology Building, Room 318, Thcson, AZ 85721; (602) 621-7607. Office of Arid Lands Studies College of Agriculture University of Arizona 845 North Park tflicson, AZ 85719 (602) 621-1955 Water Resources Research Center College of Engineering and Mines University of Arizona Tucson, AZ 85721 (602) 621-7607 Address news items or comments tu: Joe Gelt, Editor 14 ìi)yO Arizona Water Resources Center Geology Building, Room 314 University of Arizona Tucson, AZ (602) 621-7607 NON-PROFIT ORG. u.s POSTAGE PAID PERMIT NO. 190 TUCSON, ARIZONA |
