Efficient and Practical Approaches to Ground‐Water Right Transfers Under the Prior Appropriation Doctrine and the Snake River Example¹

Abstract

Water right transfers are one of the basic means of implementing changes in water use in the highly appropriated water resource systems of the western United States. Many of these systems are governed by the Prior Appropriation Doctrine, which was not originally intended for application to ground‐water pumping and the conjunctive management of ground water and surface water, and thus creates an administrative challenge. That challenge results from the fact that ground‐water pumping can affect all interconnected surface‐water bodies and the effects may be immeasurably small relative to surface water discharge and greatly attenuated in time. Although we may have the ability to calculate the effects of ground‐water pumping and transfers of pumping location on surface‐water bodies, mitigating for all the impacts of each individual transfer is sufficiently inefficient that it impedes the transfer process, frustrates water users, and consequently inhibits economic development. A more holistic approach to ground‐water right transfers, such as a ground‐water accounting or banking scheme, may adequately control transfer third‐party effects while reducing mitigation requirements on individual transfers. Acceptance of an accounting scheme can accelerate the transfer process, and possibly reduce the administrative burden.

A Transactions Cost Approach to the Theoretical Foundations of Water Markets1

“…Further work by the model’s authors indicates that when there are many transfers, only the net differential need be mitigated instead of requiring full mitigation for each transfer (Johnson et al. , 2008).…”

“…With the addition of an accounting system to track and assign ownership to hydrologic effects, a market in hydrologic credits becomes possible. At that point, effects are largely internalized and efficiency improved (Johnson et al. , 2008, p. 35).…”

“…Further work by the model's authors indicates that when there are many transfers, only the net differential need be mitigated instead of requiring full mitigation for each transfer (Johnson et al, 2008). With the addition of an accounting system to track and assign ownership to hydrologic effects, a market in hydrologic credits becomes possible.…”

Status of Ground Water Banking in Idaho

“…Much has been written about water‐rights transfers and water reallocation (an incomplete listing includes Brewer et al 2008, Johnson et al 2008, Kryloff 2007, Slaughter and Wiener 2007, Heaney et al 2006, Wilkins‐Wells et al 2006. Draper 2005, Johnson et al 2004, Matthews 2004, Gardner 2003, Young and McColl 2003, Howe and Goemans 2003, Yoskowitz 2001, Waterstone and Burt 1988, Grant 1987, Anderson and Johnson 1986, Johnson et al 1981).…”