Key Legal Issues in Western Water Management and Climate Adaptation

Authored by: Denise D. Fort

Water Policy and Planning

Print publication date:  June  2016
Online publication date:  June  2016

Print ISBN: 9781482227970
eBook ISBN: 9781482227987
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Western water law and the institutional framework for water management control the distribution and use of western water. After presenting an overview of the law and institutions, key topics are explored. Climate change is affecting every aspect of the hydrologic cycle, and the future holds more extremes of drought, flooding, and warmer temperatures, imposed on already strained water resources. The critical questions are how well the existing management regime serves the vast population, economy, and environment of the contemporary West and the choices that the nation and region face in water management as climate change takes effect. This chapter covers a lot of ground, so this discussion is intended to provide a taste of critical questions and an incentive to explore these questions more thoroughly in the wealth of water literature.

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Key Legal Issues in Western Water Management and Climate Adaptation

3.1  Introduction

What we see around us when we look at the engineering of water in our lives—the plumbing in our homes, dams, irrigated fields, power plants, and businesses—was created over generations and by a complex web of institutions. These institutions include not only agencies but also the legal system under which water distributions were established and the contemporary geography of water was created.

The story of water institutions in the West can be traced back to the Pueblo and Spanish canals used for irrigation in arid regions, to the canals built by the early Mormon settlers, and to disputes over water in the gold rush. Large-scale irrigation is often dated back to the federal government’s support of agricultural projects for immigrants from the eastern United States, the so-called reclamation of the arid West, carried out by what would become the Bureau of Reclamation (BOR). The Corps of Engineers built reservoirs for power and flood storage. States created systems to protect existing uses of water and to provide for new uses. Much later, the nation became concerned about water pollution and the loss of habitat for species. Federal agencies played a prominent role in establishing and enforcing these laws, but often under programs that delegated authority to states. Tribes, long ignored by state and federal water development programs, asserted their water rights in litigation and created agencies to administer water on their lands. The legal and policy framework to manage groundwater has been slow to evolve, but it is receiving new attention because of the recognition of its connection to surface water, declining aquifer levels, and the intense use of groundwater during drought periods. It is now generally recognized as an essential element of state water management.

None of the institutional structure is settled, of course. Much of the West is in severe drought, and depleted reservoirs, aquifers, and rivers are pressed to meet the water expectations of growing populations, agricultural uses, species protection, and recreational uses. Climate projections indicate that the future will bring continued challenges in many regions of the West: reduced summer streamflows due to earlier snowmelt and increased potential evapotranspiration, changing precipitation patterns that may cause increased flooding, and greater demand for water for crops due to increased evapotranspiration. Thus, we need to understand the structures and practices that currently govern water, but we also need to think critically about what is needed to serve future generations. Water laws and institutions do change, albeit slowly, and informed citizens can help bring about needed reforms.

3.2  Federal, State, and Other Agencies

3.2.1  Federal Agencies

A complex web of players affects the management and control of water, including state and federal agencies, legislative bodies, the courts, water users, nongovernmental organizations (NGOs), and tribes. This brief overview begins with the major federal agencies, the Departments of the Interior and Agriculture, the Corps of Engineers, and the Environmental Protection Agency (EPA). The constitutional basis for the federal role is founded in the federal government’s ownership of land (Forest Service and Bureau of Land Management lands, for example); the Commerce Clause, which permits congressional action on matters affecting commerce among the states (much regulation of pollution falls within this clause); and federal control over navigation (the original basis of Corps of Engineers’ jurisdiction). Many constitutional questions are settled in this area, but as we discuss below, there are contentious exceptions, such as the definition of navigable waters and the question of when water users must be compensated by the government for environmental restrictions (the Takings Clause). But the burning question about the federal role is what it will be in the future. The federal investment in infrastructure has been large (dams, power plants, irrigation works) and has shaped water resources for much of the West. Will the federal government provide funding to rescue the West from its current crises? Will federal environmental regulations increase in scope or be drastically reduced?

The BOR is prominent in the western states and has expanded from its original mission of delivering irrigation water from reservoirs to an agency that also provides a loosely linked set of services to the region. Reclamation manages storage and water delivery for irrigators, generates power at its reservoirs, and is involved in other water supply projects, such as supporting water reuse projects.

The Corps of Engineers, perhaps surprisingly, is present on some of the West’s largest rivers, with the Columbia River heading the list. The Corps’ mission was originally established for the protection of commerce through the construction of canals in the East but expanded to flood control, building dams and levees, and hydropower facilities.

Both agencies were sharply criticized by environmentalists for their destructive effects on western waters. They have evolved to include environmental goals in their missions and consider a wider range of alternatives in project planning. The Corps has an established program under which it undertakes environmental restoration, with a favorable cost share for project proponents. The bureau is involved in restoration efforts on a number of western rivers, although there is no broad authorizing statute for restoration.

The EPA sets technology-based effluent limits for discharges of pollutants into water and regulates a few other types of water pollution, such as runoff from concentrated animal feeding operations. Water quality regulations are generally based on standards established by states, in conjunction with technology-based standards. Pollution regulation affects direct discharges of pollutants, but so-called nonpoint sources such as runoff from agriculture are exempted from regulation.

The Fish and Wildlife Service is an arm of the Department of the Interior. Its water-related responsibilities come with its management of wildlife habitat and fish hatcheries, but most attention recently has focused on its role in protecting threatened and endangered fishes under the federal Endangered Species Act (ESA). Some states have programs addressing aspects of biodiversity and endangered species, but the federal role predominates.

The Obama administration made its mark on water resources management through the release of Principles and Requirements for Federal Investments in Water Resources (CEQ 2013), which is supplemented by Interagency Guidelines (2014) for its implementation. These provide presidential direction to the federal agencies about how federal responsibilities should be approached. They require a rigorous evaluation of proposed water projects and other federal activities with the goal of reducing the costs and negative environmental effects of proposed actions. If followed by federal agencies, they would result in dramatic changes in standard assumptions within federal agencies, but their implementation is not a sure thing, as presidents change and agency cultures abide.

3.2.2  Other Water Management Institutions

If only it were sufficient to understand the roles of federal agencies on western rivers. In truth, there are multiple layers of state and local government agencies, water districts, tribes, and other water authorities. In some areas, there may be no visible federal presence (for example, no dams, restoration projects, or endangered fishes), and in others, the federal government may appear to be the most powerful actor. But regardless of appearances, one must look carefully to see what role might be played by any of these agencies.

State water resource and water quality agencies are on the front lines of water administration and policy, although in some states, water may be administered at a district level. As discussed below, state agencies determine water rights among water users. The Western States Water Council convenes state administrators and coordinates policy positions with the Western Governors’ Association. Water quality agencies may administer delegated federal programs, as well as state initiatives, such as groundwater protection.

Irrigation districts typically are composed of member irrigators who share common storage and conveyance, often with elected leadership. City and regional governments manage water supply for their customers. Tribes and pueblos may manage water supply and water quality within their jurisdictions.

NGOs are key institutions in environmental disputes and other areas of public interest. For example, environmental groups are often the moving actors in bringing about protection for endangered fishes, overcoming the reluctance to act by federal agencies.

The governance of water is not limited to formal institutions. Across the West, new means of bringing stakeholders together over water issues, often involving environmental disputes, have been developed. These participatory mechanisms have been heralded as providing solutions that can include sustainability and other values that are not part of existing water law. Chapter 6 (Schlager, this volume) discusses this important development.

3.3  Western Water Law: Key Topics

3.3.1  Prior Appropriation

One summarizes the thorny field of water law at one’s peril. Instead, we have highlighted several key principles that are generally applicable, with the important caveat that no generalization can be accurate. The states are responsible for administering the laws that control how a water right is created as well as other aspects of its use and protection. The legal system in use in most western states was founded on the concepts that a water right was established by putting water to use and that the earliest users should be protected against later users in times of shortfall. Administrative systems in which applications were required, reviewed by agencies, and perhaps subject to protest by other water users were created under the direction of state engineers. Indeed, the field of engineering has historically dominated water management.

The prior appropriation system made it possible for water to be acquired by those who were not directly situated on a river, and it protected investments made in reliance on a water right. But, it has been criticized for several reasons: (1) it does not provide for sharing in times of shortage, so junior appropriators may get no water in dry years; (2) it limited water rights to uses that took place out of a river, such as irrigation, so that the natural flows of rivers were not protected under the doctrine; and (3) it enshrined property rights in agricultural uses that are no longer critical to western economies.

Despite the prior appropriation doctrine’s original requirement of putting water to use outside a stream, it has been modified to allow legal protections for environmental flows in most states. But the recognition of environmental values came long after most rivers were fully appropriated, so that its legacy leaves desiccated rivers in much of the West. We present a full discussion of this in Chapter 5 (Richter et al., this volume).

3.3.2  Water Transfers and Water Banks

Water transfers and water banking have addressed some of the economic dysfunctions attributed to the prior appropriation doctrine. Both of these mechanisms preserve the concept enshrined in prior appropriation: that water can be held as a property right. Water transfers are a means of allowing water rights to be moved from the land or for the use to which they were originally put and to be purchased (or leased) by a new user. While we are familiar with markets, a famous law professor wrote, “Water is not like a pocket watch or a piece of furniture, which an owner may destroy with impunity” (Sax 1988, p. 482). There is a difference because of the inherent public interest in how water is used. Water touches on a community’s social fabric, its prospects for economic development, its ability to absorb new populations, as well as the recreation and fisheries that a river may support, and even a city’s identity (San Antonio’s River Walk, as an example). Downstream irrigators may be reliant on the return flow from agricultural lands and thus object to transfers when the return flow from a farm will be diminished. Conversely, the transfer of a water right upstream may harm aquatic ecosystems because of the earlier withdrawal of water. All of the intertwined interests in water may be invoked when an application to market water is made, although many of these interests are not protected under state laws governing transfers.

Water markets are not the only means by which water has been transferred from one use to another. Much of the West’s irrigation water is controlled by irrigation districts, or the BOR, and delivered through infrastructure owned by these entities. Significantly, the BOR has permitted water provided under its contracts to move from agricultural to municipal uses.

Water banks have been established in some states to allow water rights holders to reduce their use (in an agricultural context, this might mean fallowing fields for a growing season) and to lease the foregone water through a water bank. Because most water in the West is used by agriculture, typically, these transfers would be agricultural to municipal, or to another agricultural user. Water banks vary in their structure; some are private arrangements between groups of farmers, for example. Others are operated by districts or other public entities, and may provide opportunities for protection of third-party interests, such as community employment or environmental concerns (Miller 2000). In a well-publicized transaction between the Palo Verde Irrigation District and the Metropolitan Water District in Southern California, individual farmers were paid for fallowing lands on a rotating basis, but the buyer also donated money to a community trust to benefit other stakeholders in the community (Waterworld 2002).

Because most water in the West is fully appropriated, water transfers have been a means of procuring water for environmental purposes. Many states have programs under which water rights can be purchased for these purposes, and occasionally, environmental water is a condition for large-scale water transfers.

The term water banks is also used to refer to the practice of storing surface water in groundwater basins, for withdrawal and possible transfer at a later time. When water is purchased and stored for later use, or stored for later sale, the value of water is increased by providing supplies in times of greater need. In effect, the groundwater aquifer functions as surface reservoirs have, but with more possibilities for commercial or private operations. Groundwater storage is also used regularly by municipal governments, such as those in Orange County, California.

Whether water transfers are temporary or permanent, the institutional framework is quite varied and depends on the state, whether federal actors are involved, whether environmental protections are available under state or federal law, the nature of the water being transferred (e.g., surface water or groundwater), the uses to which it is transferred, and a variety of other factors. Data regarding these transactions may be proprietary, and the evidence of prices paid is often anecdotal. The complexity of effecting water transfers cannot be overstated, and therefore, markets are not as widespread as proponents of markets would like (Bretsen and Hill 2009). Professor Mark Squillace (2013, p. 68) put it baldly: “The story of water transfers in the western United States is largely a story of market failure.”

Nonetheless, most observers believe that significant quantities of water eventually will be moved from agriculture to cities, and from lower-valued agricultural uses to higher-value uses. A comprehensive study of California water transfers found that over 2 million acre-feet (MAF)*

1 million acre-feet (MAF) = 1.233 billion cubic meters (BCM).

of water was committed for sale or lease in the early years of this century (Public Policy Institute of California 2012). The current drought in California is leading to greater interest in facilitating these transactions.

3.3.3  Tribal Water Rights

Tribal water rights may be established by treaty or, more commonly, through the judicially recognized doctrine of reserved water rights. The quantification of tribal water rights has proceeded slowly, but tribal water rights may displace existing uses, because they are older in time. Thus, western states are motivated to determine the extent of tribal water rights, and settlement of cases has been viewed as a desirable vehicle to accelerate the slow pace of litigation. In these agreements, federal funding often is used to ensure that all parties are put in a better position than before the settlement, even though no party prevails to the full extent of their claimed water. Thus, the western New Mexico town of Gallup receives water from a new pipeline that was built to deliver Navajo water, providing federally funded water delivery to two entities with very different legal rights. Settlements are preferred by the major parties because of the control that parties retain in negotiating, as compared to asking a court to make a determination. In specific instances, there are outside entities who object to the terms of a settlement.

New questions are arising around tribal water. Should it be used in agriculture or leased to higher-paying uses? Should tribes be allowed to lease across state lines? Is the use of agriculture as a standard for determining tribal water rights outdated for economic or climate reasons? How should groundwater be treated when a tribe did not historically use it?

3.3.4  Groundwater Law and Regulation

Groundwater law is not one of the law’s shining achievements, despite the West’s heavy reliance on groundwater for municipal, industrial, and agricultural purposes. Perhaps this is because groundwater is not visible, and it is difficult to know the size, quality, and movement of aquifers. Perhaps it is because it is in the interest of water users to keep their usage close to the chest, to avoid too much scrutiny from public stakeholders. Even municipalities may not want prospective industries to know how fragile their water supplies are—no chamber of commerce has ever advertised a precipitously declining water table. California assiduously avoided state regulation of groundwater until the current calamitous drought. The increasing use of groundwater proved the catalyst for state legislation, but the legislation might be characterized as a step toward groundwater control, rather than bringing the state into a sustainable relationship with its dependence on groundwater (Miller 2014; California State Assembly 2013–2014; California State Senate 2013–2014).

Groundwater allocation is almost entirely controlled by state law and, therefore, varies from state to state. In general, a water right must be established, but in some states, the right is a benefit of surface land ownership, and in others, it is dependent on the more familiar prior appropriation model. The goals of regulation may be to protect an adjacent river from depletion through groundwater pumping, to protect other groundwater users, or to protect the life of the aquifer.

The Ogallala aquifer illustrates the implicit policy questions in groundwater law. This enormous aquifer underlies the eight states of the High Plains aquifer. The rate of mining varies across the aquifer, but the United States Geological Service (USGS) estimates an overall decline of 14.2 ft. across the High Plains aquifer (McGuire 2012). The mining of the aquifer is a matter of significant concern to the federal government; it produces a large share of the wheat, corn, cotton, and cattle of the nation, and declining groundwater levels imperil that production (USDA NRCS 2015). The United States Department of Agriculture (USDA) has established programs to conserve water and retire agricultural lands in the region, and research is underway on new crops. At the same time, federal agricultural policies drive ethanol production, increasing the pressure to grow corn (Little 2009). The time remaining for this scale of agriculture is unknown because it is not clear what public policies will prevail.

Groundwater mining is a thorny problem. Most westerners would not regard it as realistic to prohibit groundwater mining, any more than it would be to prohibit the mining of other irreplaceable resources. But most would say that aquifers should be sustainably managed, as difficult as that might be to define. Should states cooperate across state lines in its management? Should state law protect the interests of future generations in this supply? No representatives of future generations are here to defend their interests, and the status quo has been to allow the mining of aquifers, with rare exceptions, such as Arizona’s protection of key aquifers. Thus, as water levels drop, we will see irrigators abandon their farmland, to become a small data spot in the national database of water use.

The federal role in groundwater management has been very limited, in marked contrast to its role in surface waters. The USGS does provide studies and data concerning groundwater withdrawals. When groundwater levels are drawn down, states may successfully appeal for federal funds to rescue communities.

A project in New Mexico illustrates this. Eastern New Mexico is a sparsely populated region, anchored by a federal air force facility and a fast-growing dairy industry. The region relies on groundwater, primarily for alfalfa, in addition to municipal use. The prospect of a depleting aquifer led to a half-billion-dollar project in which water from the Canadian River would be used to supplement groundwater, with the project to be largely funded by the federal government. No environmental impact statement was done on the project, and reducing groundwater mining did not receive serious consideration. While the project has been authorized by Congress, only a small amount of federal and state monies have been received (Fort and McKean 2011; see also Village of Logan v. U.S. Dept. of Interior, 577 Fed. Appx. 760, 2014).

Governance issues in groundwater management are very much in flux because the field is still evolving. Groundwater pumping has led to Supreme Court litigation when surface flows in a river are affected; conflicts between states over aquifer pumping have led to calls for compacts comparable to those governing surface waters, and some communities have organized among themselves for voluntary agreements on pumping rates. Scientists have shown the importance of protecting groundwater-dependent ecosystems, such as wetlands, from groundwater pumping. Australia has pioneered legal protection for these systems, but in the United States, there is only sporadic protection. Long ignored, groundwater law and policies are moving to the forefront of water discussions in some regions.

3.3.5  Environmental Law

Volumes of law and regulations affect the protection of water quality, ranging from regulation of point-source discharges to pollution from hazardous waste. As mentioned, the framework is largely one of federal regulation, but with a substantial role for states under key regulatory schemes, such as the Clean Water Act (CWA). Ever since the nation awoke to the seriousness of water pollution (roughly 1970), there have been calls to integrate water quantity and water quality law and management. Clearly, water pollution affects the quantity of water available for use. This threat is not hypothetical, as shown by communities losing water supplies due to contamination from farm runoff, the failure of dams at mining sites leading to interruptions in municipal water supplies, and other consequences of lax pollution regulation. Greater integration of quantity and quality management has been achieved within some states; it is still a distant goal for federal agencies.

Water quantity and quality also are related to land use. Activities on federal lands, such as grazing, logging, road construction, and fires, can have implications for water quality downstream. Construction practices are now recognized to affect runoff quality. Agricultural runoff, which may contain pesticides or fertilizers, is not regulated under federal law, and attention is focused on dead zones in estuaries and other locations far from the originating farms. Wetlands are the intersections between land and water, and activities affecting them may be regulated by the EPA and the Corps of Engineers. For several decades, the courts have struggled with the language of the CWA in determining what constitutes a wetland. The control of land is traditionally a matter of state control, but the protection of water quality has been a matter of federal control. This is a charged political issue that bounces between the courts, Congress, and the executive branch.

3.3.6  Interstate Compacts and Other Water Sharing Agreements

The division of rivers among states by means of compacts is another component of the legal setting for western water. The Colorado River and its tributaries provide water for seven western states and Mexico, with California the thirstiest of them. The compact was negotiated by the states and the federal government, approved by Congress, and has been supplemented by other laws that together form the Law of the River. But the physical development of water storage and distribution among the states by means of reservoirs and other infrastructure occurred through political logrolling, in which politics met hydrology on an uneven playing field.

As drought tightens around the Colorado River Basin, the nature of the law governing the river is revealed to be far more flexible than a first reading would indicate. High-stakes diplomacy was undertaken when the lower-basin states agreed on a shortage sharing agreement, under which some certainty was given to water-short states (USBR 2007; Grant 2008). But when Lake Mead, the source of water for Las Vegas, and other giant reservoirs are drawn down, it is not clear whether negotiations between the states will be sufficient.

The United States Supreme Court is the judicial body with jurisdiction over disputes between states, and compact cases regularly reach that body. Federal courts also can play a role where there is no compact governing a river.

There is always the possibility that Congress will reopen a compact, but the political odds of that occurring have always been dismissed. In our discussion of climate change that follows, we nonetheless entertain the possibility because nothing is sure under extreme conditions.

3.3.7  Water Storage and Pipelines

The western landscape is almost entirely plumbed, as discussed in Chapter 5. The laws governing federal facilities are complicated. They can include the authorizing language for a project; the accretions to that law, including the entire corpus of federal laws that relate to the environment; federal procurement; and other laws governing federal facilities. In the controversies over how dams affect the environment, particular attention is given to the Fish and Wildlife Coordination Act, which gives federal agencies the authority to operate facilities to protect fish and wildlife (Fish and Wildlife Coordination Act 2000).

Hydropower projects are regulated by the Federal Energy Regulatory Commission (FERC), in addition to other authorities. Because of the damage these dams cause to fishes and ecological functioning, FERC licensing has been a battleground between energy and environmental interests.

Pipelines and aqueducts are increasingly used to move water long distances from places of withdrawal to places of use. They are significant because their growing use indicates how many regions have exhausted nearby water supplies, such as groundwater aquifers; they have environmental impacts, including ecological effects associated with siting; and they often require large quantities of energy to move water uphill and over long distances. Southwestern water mavens voice dreams of pipelines from the Great Lakes and the Mississippi River. These projects raise questions about sustainability: How is the area of origin affected? Is a groundwater aquifer being mined, so that the project is limited by the size of the aquifer? How much energy is required to move the water? Citizens have successfully protested some of these projects, and one can safely predict that any project that moves water from one basin to another will lead to protests (Nelson 2012).

3.3.8  Water and Energy

Energy use is intimately connected to water development. A 2005 study done for the California Energy Commission found that “water-related energy use consumes 19 percent of the state’s electricity, 30 percent of its natural gas, and 88 billion gallons of diesel fuel every year” (Klein 2005, p. 1). This is discussed in Chapter 13 (Wilkinson, this volume). Energy consumption is not accounted for in water projects, although environmental attorneys have begun raising greenhouse gas concerns over new federally funded projects.

But the more familiar linkage between water and energy is the substantial quantity of water required for the development and production of energy, from water used in fracking, or the produced water in oil and gas operations, to the cooling water required for coal-fired power plants. As oil and gas development increases dramatically in the West, water availability has become a point of contention with local people and of growing concern to energy developers. The legal framework is essentially one of state law, although there is limited federal regulation of water quality effects associated with mining, milling, power generation, and other aspects of the fuel cycle.

3.3.9  Water Reuse and Desalinization

As western cities encounter the conflict between supply and demand, due to declining groundwater, unreliable surface water, or greater use by growing populations, they have turned to technological approaches to water supplies. Water reuse can include the intensive treatment of wastewater to make it suitable for domestic uses, or it can refer to reusing less treated water for outdoor irrigation, such as golf courses. The legal regime protects both property rights in water and public health in the recycled water. Desalinization is a potentially helpful approach because of the ample supplies of seawater and saline groundwater. Both technologies are expensive and can be energy intensive, but the costs may be lower for cities than any of their alternatives and may provide more reliable water supplies.

3.4  The Evolving Institutional Framework and the Response to Climate Change

3.4.1  Trends in Water Resources

States and municipalities have become more prominent in western water management as the population grows, and the traditional BOR constituency of rural agricultural users shrinks in number. State and local governments have access to bonding revenues for water projects. These governments may practice integrated water resources management and take multiple perspectives into account in decision making. They also may be more cost conscious and choose lower-cost alternatives than governments do when federal funding is involved. But the federal government remains the de facto powerhouse, as it is in the Columbia River Basin and the Rio Grande. And large-scale projects are likely to involve a federal role in environmental review or federal funding.

It is more difficult to identify a trend in water quality and species protection in state–federal relations because the lack of congressional action, in these and many other areas, means that the status quo has been unchanged for a number of years. In contrast, within civil society academic disciplines developed an understanding of aquatic ecosystems and the ecosystem services that they provide. Clean water, for example, can be a benefit of undisturbed wetlands. Clean drinking water reduces public health risks. Polluting groundwater requires expensive remediation and imperils a resource for future generations. All of these propositions would be regarded as no-brainers by water professionals. But as discussed, the EPA is under attack for its attempts to protect wetlands and to set standards for toxins in drinking water. Agricultural and other nonpoint pollution is not directly regulated by the federal CWA, nor is it likely to be in the near future. While the electorate is generally supportive of environmental protection, an expanded CWA seems unlikely.

States, tribes, and many cities are moving to fill the gap and to take on regulation of polluters. The national debate over fracking illustrates this. Congress exempted the injection of fracking fluids from the Safe Drinking Water Act, but some jurisdictions have regulated or even banned fracking. To find the cutting edge and innovation in protecting clean water, or habitat, one would look to some of the western states.

This trend, however, is unequal, and that has implications for environmental justice, important ecosystems, and even national interests. Generally, affluent states are more likely to regulate their industries than poorer states. It is argued that people in poorer states choose employment over environmental regulation. Whether this is true in any meaningful way for most of the residents of poor states, the fact is that there is a higher rate of exposure to environmental contaminants for poor people. More affluent states also are more likely to provide protection for ecosystems above that provided by the federal ESA. Ecosystems are left unprotected in states that are hostile to species protection, illustrated by the western states that successfully removed protection for wolves. Federal agencies may step forward when there are conflicts between states over pollution, when species come so close to extinction that the federal government has to take measures under the ESA, and generally when a region needs to be rescued from the effects of poor environmental management. But the proper role of the federal government in environmental and ecological protection has been hotly disputed since the passage of the major federal environmental laws.

3.4.2  Climate Change and Water Management

Climate change is bearing down upon the nation with alarming intensity. While its causes are well understood (at least within the scientific community), the policy response has been anemic, at best. Our nation and the world have not risen to the challenge of reducing greenhouse gasses and mitigating the drivers of climate change. Adaptation to the changing climate has received more attention, but no jurisdiction has the answers.

The existing legal framework for natural resources and environmental management, including water rights, water quality, and endangered species protection, is challenged by climate change. One example is that of the Colorado River, where some 40 million people are affected by the drying and warming West. The physical and legal infrastructure of the river was created at a time when average flows were believed to be much higher than they are now, and far higher than they are expected to be in the future. Economic losses to California’s agricultural economy from the current drought total in the billions; Las Vegas is scrambling for expensive new supplies, and experts scratch their heads over what a prolonged drought will do to the region.

When livelihoods are at stake, it is not surprising that litigation is following, along with an active interest from those congressional representatives whose districts are affected. In the sparsely populated state of New Mexico, empty reservoirs led farmers to increase groundwater pumping in the Rio Grande Basin, leading the well-populated state of Texas to march to the US Supreme Court in a case concerning the interpretation of the Rio Grande Compact. The case is unlikely to be decided soon, and both states are building new infrastructure for water storage and delivery (Texas v. New Mexico and Colorado, No. 22O141, 2013, available at

Earlier, we noted that the institutions surrounding western water are slow to change. The question we explore here is whether climate change is a disruptive force in water institutions, requiring a reorganization of the principles and institutions that have governed water thus far. Alternatively, some water managers view climate change as comparable to the familiar problems raised by droughts, repeating the mantra that the western hydrograph is notoriously unpredictable, and that droughts, flooding, and species extinction all predate climate change. Consider these perspectives as we examine the possible ways in which environmental and water law and institutions may respond to climate change.  Water Quality Regulation

Hotter temperatures, lower flows, and greater evaporation can exacerbate water quality problems. The nation has made progress in the years since 1972, when the CWA was passed, with its national goal of swimmable, fishable waters.

It will be difficult to maintain this progress. One course would be for the country to strengthen its commitment to clean water by addressing exemptions in the regulatory framework. The CWA does not address most pollution from nonpoint sources and exempts most agricultural activities from its scope. As a result, agricultural pollution is the single largest remaining source of impaired waters. Although academicians might agree about how the CWA should be improved, only a transformation in congressional attitudes toward environmental regulation will bring about national change.

Professor Robin Craig has explored these questions and points to an additional difficult problem that arises when water quality standards can no longer be met due to climate change, in some instances regardless of whether all sources are brought under controls. States set water quality standards, but it is currently difficult for states to relax these standards because of what is called the antidegradation clause. Should the CWA be revised to acknowledge that climate change will prevent maintaining water quality in some waters? This will be a difficult pill to swallow, but the physical reality may overwhelm the goals of the CWA (Craig 2013).  Water Quantity

Severe drought has brought crises to the West, affecting recreation, agriculture, and even tourism. Water shortages were addressed through the construction of water infrastructure through most of the twentieth century. Now that most dam sites have been used, western water managers are accelerating the importation of water through pipelines and aqueducts, moving it from rivers and groundwater aquifers, and some new water storage is also being built.

Most water resource managers now look for water supplies through water conservation, pricing, technologies (such as desalinization or water reuse), and water transfers. Because agriculture uses the lion’s share of the water in the West, it is logical to look to it as a water supply source for other uses. Institutional issues are key to the relatively anemic volume of water transfers thus far. Major impediments include the control of much irrigation water by irrigation districts, and the restrictions that may have been imposed on federal water when the BOR built water projects. But markets are working in response to California’s severe drought, illustrating how quickly institutional constraints can be worked through when significant amounts of money are at stake.

Australia transformed its water allocation system in response to a long-term drought in the Murray–Darling River Basin, which is a well-populated, agriculturally productive, and critical environmental resource for the country. The essence of the solution involved the protection of base flows in rivers and the creation of an active market for water leasing. Base flows for river functioning and environmental purposes were established, and further environmental water was acquired. For agricultural users, water rights were converted to shares of entitlements, which allowed use of yearly allocations. The yearly allocations reflect projected water availability. Entitlements and yearly allocations can be freely traded, with the result that a flourishing market was created. This system permits water users to respond to information about projected supply and to make sound economic decisions about agricultural practices for a given year (see McKenzie 2009; Pilz 2010; Sundareshan 2010).

Adopting the Australian model in the United States could address concerns about deficient environmental flows and the difficulty of effecting water transfers, but would be a costly and contentious undertaking. A considerable initial outlay of money would be required to acquire base flows (see Chapter 5), and questions about priority of use would need to be addressed in granting entitlements. The political ability to bring about such a fundamental transition in law is questionable, given the power of the agricultural senior water rights holders and the inherent conservatism of the water system. Incremental reforms that modify, rather than replace, prior appropriation are more likely.  Endangered Species and Protection of Biodiversity

The world is now experiencing a wave of extinctions that will increase under climate change. E.O. Wilson (2002) has warned that we face the loss of half of all species by the end of this century. There is no federal law that protects biodiversity as such, although the federal government does so in its administration of some of its lands and waters. Some states have programs to protect areas of high biodiversity and laws extending protection in some fashion, such as setting minimum environmental flows for rivers. The federal ESA protects threatened and endangered species, with mandates that are regarded as highly restrictive by some. But it is rapidly becoming clear that this act, passed in 1973, is not well suited for the extensive alterations that are caused by climate change. Professor J.B. Ruhl, a leading scholar of ESA, has said that “there soon may be no practical way to administer the ESA in its present form for [Endangered] species” and that “the pika is toast” (Ruhl 2008, pp. 2, 7). The nation has not put its weight behind species protection with the types of investments in staffing, science, habitat and water rights acquisitions, prohibitions of development in certain areas, and other measures that could be taken. A greater commitment to protecting biodiversity could protect species now at risk. But for some species, the writing is on the wall. Should the ESA be amended to provide for triage, or should a greater investment be made in water and land to protect fishes and other species that are dependent upon aquatic ecosystems? In both the context of water quality and species protection as well as many other areas of environmental protection, scholars are asking whether existing laws will be enforced or modified. Chapter 5 discusses biodiversity in greater detail.  Flooding

Most of the discussion about climate change in the West, which is characterized by aridity, concerns the lack of water, but new climate patterns point to an increase in flooding in many areas. The traditional approach was to channelize rivers and build levees and dams for flood control. Controlling land use is an alternative approach.

The federal Corps of Engineers is the federal agency that builds much of the flood-control infrastructure. The federal government plays an indirect role in land-use decisions by providing insurance subsidies for houses built in floodplains. The political cost of raising insurance costs on flood-prone neighborhoods proved too high for Congress. After years of policy analysis showing the negative consequences of encouraging growth in these areas, Congress toughened requirements and then shortly thereafter retracted provisions of the legislation (the Biggert-Waters Flood Insurance Reform Act of 2012, closely followed by the Homeowner Flood Insurance Affordability Act of 2014).

The economic consequences of subsidizing insurance for building in floodplains and of permitting construction in floodplains are becoming clearer, as climate modeling becomes more precise. Policy prescriptions are fairly straightforward, and there are other nations that have taken steps to prepare for more frequent flooding and rising sea levels.  Agricultural Policies

Water and agricultural policies bear directly on each other, but the linkages are rarely made explicit. The congressional committee structure, the disparate focus of NGOs and trade organizations on either water or agriculture, and the divided structure between agriculture and water in federal and state agencies do not make for a coherent dialogue on water and agriculture.

One example would be national agricultural policies that encourage corn production, which, in turn, encourages consumption of groundwater. We know that ethanol is a costly fuel in terms of water, land, and energy use. As corn production is encouraged, the Ogallala aquifer is drawn down, with no accounting in energy policy for the water that is used. Thus, federal policies are adding to a water crisis that will, in turn, be the subject of federal policy.

Irrigation is by far the largest use of water in the western United States accounting for 85% of all water withdrawn, and the West accounts for 74% of all irrigated acreage in the nation (Kenny et al. 2009). It was practiced by Native Americans and others using surface waters, and then increased dramatically with the use of groundwater and center-pivot sprinklers. Large farms account for 61% of the irrigated acreage in the West (Little 2009; McGuire 2012; USGS 2013; NRCS 2014). In fact, concentration of water use (15% of all irrigators use 66% of irrigation water) and of profits (larger farms account for 85% of sales from irrigated farms) is the rule in the West (USDA Economic Research Service 2013).

Sandra Postel (1999) sounded the alarm about the future of irrigated agriculture in her book Pillar of Sand: Can the Irrigation Miracle Last?. Schoolchildren know that salinity led to the end of great civilizations that were built on irrigation. To that, we must add declining aquifers, impaired water quality, and, of course, climate change, which can increase the requirement for water and bring about changes in precipitation patterns.

Policy discussions have focused on institutional changes, such as water pricing or subsidies for efficiency improvements, that could lead to better conservation practices by irrigators. Federal water policies led to the development of irrigated agriculture; some look to lands with rain-fed crops as the next focus of development. The search is underway for crops that can withstand higher temperatures and use less water.

The United States is a net exporter of agricultural products, adding to our trade balance sheet. A new generation of water scholars has suggested that regions also should consider the water footprint of food, in making agricultural and water decisions. An arid region would do well to import food, rather than paying exorbitant amounts to import water (Postel 2010). A recent study looked at the water footprint of some of the agricultural products exported by state and concluded the following:

The arid Southwest is a secondary recipient [of imported water through food products] at best, where New Mexico, Wyoming, Colorado, and Utah are net exporters, totaling 5.3 billion m3, and Nevada, Arizona, and California are only modest net importers. As a whole, this seven-state arid region is a net exporter of over 1 billion m3 of water per year. (Mubako and Lant 2013, p. 389)

Water footprint studies distinguish between rain-fed and irrigated crops (Hoekstra and Mekonnen 2012). Further studies are needed to distinguish between surface water and groundwater irrigation, and to determine what groundwater use is sustainable, that is, when the groundwater source is being mined.

The economic benefits of irrigation must also be taken into account. These can vary greatly depending on the crop. Because irrigation water often has a low cost (often the cost of energy for pumping, or a cost imposed by the irrigation district), low-value crops are grown with irrigation water, in addition to the fruits and nuts for which Arizona and California are well known.

As climate change intensifies and water supplies become more contested, we can expect more debate over where water is used in a state and the costs to the region of this water use. The question of why crops are grown in the desert will be revisited, more than a century after the country first committed to reclaiming the West.  Broad Shifts in Water Institutions

As the water crisis worsens in the West, Professor Robert Adler (2010) has questioned whether state sovereignty over water, which has never been the absolute rule, will continue as the national interest in water becomes more compelling. He argues that an explicit turn toward federal control will be necessary. It is clear that the nation would never tolerate state control over oil resources; we expect an open market, federal subsidies, and federal policies to control the movement and use of oil. Is it reasonable to think that Congress will step in to protect national interests that are affected by water practices? He offers the example that a future Congress might authorize national efficiency standards for agriculture.

Another example worth pondering is the persistent belief that some major body of water, for example, the Columbia or even the Great Lakes, should be piped to the arid West. The fundamental constitutional principle is that states cannot impede interstate commerce, and water has been held to be an article of interstate commerce. But Congress can control interstate commerce and currently has protected both the Columbia River and the Great Lakes against export schemes. Is it possible that Congress will permit these exports if the water crisis becomes sufficiently acute? While informed observers believe that none of these scenarios will come to fruition, the “pipe dream” of a grand water transfer periodically resurfaces.

The compacts between states governing water allocation on the great western rivers are often viewed as immutable. The arguments against controlling water use in the twenty-first century with instruments crafted 100 years earlier are becoming louder (Johnson 2014). Should extreme drought continue in western states, the unthinkable will become more of a possibility, as challenges to bans on interstate water transfers are raised (Matthews and Pease 2006) or movement grows to modify compacts (Schlager and Heikkila 2011).

The US Constitution has provided well for a booming capitalist economy and private entrepreneurial success. But this system also has created political barriers to the regulation of carbon pollution, such that the United States, with its excellent universities and scientific institutions, has yet to take action on the scientific understanding of the dangers of climate change. The Constitution has been held to create barriers to some forms of environmental regulation, and calls for its reform are growing.

For example, the Fifth Amendment requires compensation when the government “takes” private property, as when a house is condemned for a new highway. It is easy to conclude that the government should pay when it takes someone’s house. The questions in environmental regulation arise from a different sort of governmental action, such as when a lot is declared to be a wetland and the owner is unable to fill it in for a housing development, or when a beach lot owner is unable to develop because of the effects of development on coastal preservation. Water is a peculiar type of property, and access to it has traditionally been subject to institutional constraints, as well as whether nature has provided enough precipitation.

Professor Dan Tarlock (2012, p. 738) has raised three questions regarding how climate change should affect the judicial understanding of property. “Climate change increases the risk of title and enjoyment disturbance, and thus three possible climate-change impact scenarios are possible. First, the existing property doctrines can adapt to climate change. Second, climate change will produce new doctrines that limit the exclusive enjoyment of rights and mandate greater resource sharing. Third, the change will come from legislatures and the role of courts will be to assess the constitutionality of the legislation.”

He argues that there is inherent risk in property ownership, that climate change should make that risk implicit, and that there is a moral hazard associated with the improper or rash use of property. The public trust doctrine, founded on the concept that there is an abiding public trust in a shared natural heritage, is a jurisprudential articulation that may define the limits of private ownership of rivers.

Another perspective comes from Professor Robin Craig (2010), who argues that the common law doctrine of necessity may be used by the government to take action to provide water, including environmental water, without compensation to the water rights holder. Climate change is causing emergencies in water supply, including droughts, flooding, and loss of biodiversity. In general, we recognize that firefighters may destroy a structure in the course of fighting a fire; we do not expect governmental compensation for the building’s owner. Her argument could stop the beating heart of a state water official:

Within that authority, moreover, public necessity allows for prioritizing survival necessities at the expense of water luxuries—drinking water ahead of swimming pools, and water for climate-appropriate staple food crops and local food needs (including local fish) ahead of water for luxury, climate inappropriate, and/or export crops. As part of that prioritization, public necessity also allows governments, during times of shortage, to reallocate individual water rights to the aquatic ecosystems and ecosystem services that communities’ larger survival and well-being depends upon, rather than forcing the death of streams and other water bodies that climate change renders effectively over-appropriated. (Craig 2010, p. 750)

These ideas are speculative at this time, and there is a hardening of the constitutional interpretations that privilege private property in the federal courts. Congress is not likely to increase environmental protections in the near future. There is limited predictability of the local-scale impacts of climate change, and it adds to other pressures on the existing water regime.

3.5  Conclusion

The West’s response to climate change will determine whether people face unexpected restrictions on water use; whether rivers are dried up and ecosystems lost; whether irrigated agriculture dominates water and land use in the western states; and, ultimately, whether the region is resilient and sustainable. Water laws and institutions that have worked for decades will need to be reconsidered and adjusted to the exigencies of a different time. It is possible that the severity of the environmental crisis will lead to foundational changes in these familiar institutions. Many unresolved questions permeate this topic. Technology has transformed our lives in short order but, thus far, has played a smaller role in water. Are there breakthroughs that will allow greater efficiencies in water use? Government has been the driver for most water management decision making, but civil society has demanded more responsive and open decision making. Will citizen activism start to affect the big levers of water policies? Finally, food preferences and policies are drivers of water policy, but it is very difficult to predict where they will lead. Given the volume of water consumed by agriculture in the West, this sector is one to watch closely.


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