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New PERC Research Offers Path Forward for Arizona Water Reform

Water is a basic need for humans, animals, and plants alike. But, as basic as the substance is, managing water supply creates complex problems. Arizona can testify to this as it faces one of the worst droughts in the state’s history. But new solutions from the Property and Environmental Research Center (PERC) offer a better path forward for solving the state’s water woes. 

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Dwindling water supply is a major concern, and state lawmakers have committed $1 billion to solve the problem. Arizona’s efforts to date are commendable, and the state has become a leader of sorts in water management. Reusing treated wastewater, operating groundwater pumping systems, and building water storage infrastructure are all positive steps state leaders have taken. But Arizona still faces supply problems. According to PERC

“Surface water from rivers accounts for a little more than half of all water used in the state, with the Colorado River alone providing about one-third of that state’s total supply. Groundwater accounts for about 40 percent of supply, while reclaimed water makes up five percent. These sources are facing increasing threats due to drought and the state’s arid climate. Arizona has junior rights to the Colorado River compared to other states in the basin, which means that it is disproportionately impacted by cuts to water supplies. As the state’s climate becomes hotter and drier, it will be increasingly difficult for Arizona’s water systems, which are already overallocated in many cases, to meet demand.” 

Thankfully, there are practical steps forward. The new PERC report, co-released with Goldwater Institute, has outlined four key areas of reform with tangible suggestions that could set Arizona up for better water supply in the future. 

1. Improve legal and policy institutions so the markets for surface water flourish

In order to properly allocate water, there must be no uncertainty around water rights. PERC suggests expediting legal judgments to help property owners clarify and secure water rights. The establishment of a dedicated water court is one potential path to speeding up the process. Other legal improvements Arizona could include are establishing a state water trust to facilitate market trading, empowering farmers to engage in water transfers (including those outside of irrigation districts), and using ‘reverse auctions’ to collect bids so that the state can pick winners that offer the most conservation value at the lowest price. 

2. Clarify rights to groundwater and use markets to ensure the sustainability of groundwater basins

A couple of decades ago, individuals were pumping enough groundwater in Arizona to dry up aquifers. Prior to 1980, groundwater management was not prevalent, and the simplest way to get water to fast-growing agricultural and urban areas was to pump it. Groundwater management has become very important since that point, but there is still room to grow. 

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PERC suggests that some of the dedicated water management funding should be allocated to fund groundwater monitoring devices. Reform should also allow groundwater users to develop local Active Management Areas (AMAs) and form management plans. These AMAs will help clarify exactly who may pump groundwater from any given area, establishing clear rights and resisting the tragedy of the commons that once led to overpumping decades earlier. 

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Perhaps the most unique groundwater management reform suggested by PERC is allowing for ‘banking’ of surface water rights

“An agreement with Nevada allowed Arizona to bank water on behalf of that state; when Nevada needs additional supply, it is permitted to take a portion of Arizona’s Colorado River allotment, and users in Arizona then pump an equivalent amount of stored water. Storage and recovery of appropriative water in local aquifers throughout the state could yield similar benefits to those realized through the banking of Colorado River water.”

This partnership helps manage water scarcity. When resources are adequate in Arizona, Nevada benefits. When Arizona is going through a drought, like what is currently happening, the system is in place to account for extra groundwater pumping across the state without mismanagement of aquifers.

3. Explore strategies to augment water supplies while weighing costs and benefits

Arizona must expand its water supply while properly managing its current supply. To that extent, the removal of regulatory barriers could allow for greater direct reuse of cleaned potable water by municipalities across the state. Arizona could also pursue increased collaboration with neighboring states to create water-sharing agreements. But as the state pursues an increased water supply, PERC notes that state leaders should be careful to avoid endeavors that are not cost-effective, such as long transport pipelines. 

4. Support voluntary water conservation in urban areas

Arizona can also support and encourage urban conservation efforts. Some examples of this may include growing voluntary, incentive-based xeriscaping programs across more of Arizona’s municipalities. Xeriscaping is a way of landscaping that requires very little water use in comparison to traditional landscaping. Championing increased indoor water reuse is another way Arizona’s cities are encouraging urban water conservation. 

“Easy” will never be a word to describe water management. But with solid reform, as suggested in the PERC report, Arizona could set the state up for a future with a more sustainable water supply. 

The full report can be viewed here. 

The views and opinions expressed are those of the author’s and do not necessarily reflect the official policy or position of C3.

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