NCPA - National Center for Policy Analysis

Outdated Policies Threaten Water Rights

September 25, 2000

Americans could be running short of water in 25 years if we remain wedded to our current water policy, experts report. In the face of impending water shortages, we continue to rely on outdated bureaucratic government regulations to manage our water supply. Absent a significant change in water policy, just as in the energy crisis of the 1970s, government regulations and subsidies will likely lead to shortages.

According to a 1997 study conducted by scientists at Cornell University, the government should end irrigation subsidies that encourage inefficient use of water. While some cities pay high rates for water, farmers enjoy abundant amounts of virtually free water.

  • Santa Barbara, California, pays $1,600 per acre-foot for desalinized, potable water, while farmers in the surrounding area pay less than $100 per acre-foot.
  • In New England, where water is more plentiful, municipalities pay $194 per acre-foot, while farmers pay only $4 per acre-foot for water from the same sources.
  • Yet one-size-fits-all government regulations are applied to different regions with different water needs.

Current regulations encourage inefficient agricultural water use. For example, the "use-it-or-lose-it" rule forces appropriators to use their entire water allotment or risk forfeiting it, and the "Salvaged Water Rule" prohibits farmers from storing or selling water to which they have a right but is beyond their agricultural needs. While many cities go begging for water, these regulations discourage farmers from practicing water conservation. As a result, in many areas municipal water users suffer chronic shortages and governments enact severe water use restrictions.

Experts argue for treating water as we do other finite natural resources like lumber, coal and natural gas - as private property. Establishing full-fledged property rights (i.e., the right to use, the right to conserve or sell, the right to exclude others, etc.) for water resources would create a market for water, with its use going to those who value it most.

Source: Alex Herrgott (intern, NCPA), "Wake up, America! We're in for a fight," Arizona Republic, September 25, 2000.


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