Water

The articles are the basis for the discussion and reading them helps give us some common ground and focus for the discussion, especially where we would otherwise be ignorant of the issues. The discussions are not intended as debates or arguments, rather they should be a chance to explore ideas and issues in a constructive forum. Feel free to bring along other stuff you've read on this, related subjects or on topics the group might be interested in for future meetings.

* Temper the urge to speak with the discipline to listen and leave space for others

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Message in a Bottle:

Despite the Hype, Bottled Water is Neither CLEANER nor GREENER Than Tap Wate
by Brian C. Howard

“You drink tap water? Are you crazy?” asks a 21-year-old radio producer from the Chicago area. “I only drink bottled water.” In a trendy nightclub in New York City, the bartender tells guests they can only be served bottled water, which costs $5 for each tiny half-pint container. One outraged clubber is stopped by the restroom attendant as she tries to refill the bottle from the tap. “You can’t do that,” says the attendant. “New York’s tap water isn’t safe.”

Whether a consumer is shopping in a supermarket or a health food store, working out in a fitness center, eating in a restaurant or grabbing some quick refreshment on the go, he or she will likely be tempted to buy bottled water. The product comes in an ever-growing variety of sizes and shapes, including one bottle that looks like a drop of water with a golden cap. Some fine hotels now offer the services of “water sommeliers” to advise diners on which water to drink with different courses.

A widening spectrum of bottled water types are crowding the market, including spring, mineral, purified, distilled, carbonated, oxygenated, caffeinated and vitamin-enriched, as well as flavors, such as lemon or strawberry, and specific brands aimed at children. Bottled water bars have sprung up in the hipper districts, from Paris to Los Angeles.

The message is clear: Bottled water is “good” water, as opposed to that nasty, unsafe stuff that comes out of the tap. But in most cases tap water adheres to stricter purity standards than bottled water, whose source—far from a mountain spring—can be wells underneath industrial facilities. Indeed, 40 percent of bottled water began life as, well, tap water.

A 2001 World Wildlife Fund (WWF) study confirmed the widespread belief that consumers associate bottled water with social status and healthy living. Their perceptions trump their objectivity, because even some people who claim to have switched to bottled water “for the taste” can’t tell the difference: When Good Morning America conducted a taste test of its studio audience, New York City tap water was chosen as the heavy favorite over the oxygenated water 02, Poland Spring and Evian. Many of the “facts” that bottled water drinkers swear by are erroneous. Rachele Kuzma, a Rutgers student, says she drinks bottled water at school because “it’s healthier” and “doesn’t have fluoride,” although much of it does have fluoride.

Bottled water is so ubiquitous that people can hardly ask for water anywhere without being handed a bottle. But what is the cost to society and the environment?

The bottled water industry has exploded in recent years, and enjoys annual sales of more than $35 billion worldwide. In 2002, almost six billion gallons of bottled water were sold in the U.S., representing an increase of nearly 11 percent over 2001. Americans paid $7.7 billion for bottled water in 2002, according to the consulting and research firm Beverage Marketing Corporation. Bottled water is the fastest-growing segment of the beverage industry, and the product is expected to pass both coffee and milk to become the second-most-consumed beverage (behind soft drinks) by 2004. According to the Natural Resources Defense Council (NRDC), “More than half of all Americans drink bottled water; about a third of the public consumes it regularly.” While most people would argue that bottled water is healthier than convenient alternatives like sugared sodas or artificially flavored drinks, are the third of bottled water consumers who claim they are motivated by promises of purity (according to a 2000 survey) getting what they pay for?

While the Environmental Protection Agency (EPA) regulates the quality of public water supplies, the agency has no authority over bottled water. Bottled water that crosses state lines is considered a food product and is overseen by the Food and Drug Administration (FDA), which does mandate that it be bottled in sanitary conditions using food-grade equipment. According to the influential International Bottled Water Association (IBWA), “By law, the FDA Standard of Quality for bottled water must be as stringent as the EPA’s standards for public drinking water.”

However, the FDA is allowed to interpret the EPA’s regulations and apply them selectively to bottled water. As Senior Attorney Erik Olson of the NRDC explains, “Although the FDA has adopted some of the EPA’s regulatory standards, it has decided not to adopt others and has not even ruled on some points after several years of inaction.” In a 1999 report, the NRDC concludes that bottled water quality is probably not inferior to average tap water, but Olson (the report’s principal author) says that gaps in the weak regulatory framework may allow careless or unscrupulous bottlers to market substandard products. He says that may be of particular concern to those with compromised immune systems.

The IBWA urges consumers to trust bottled water in part because the FDA requires water sources to be “inspected, sampled, analyzed and approved.” However, the NRDC argues that the FDA provides no specific requirements—such as proximity to industrial facilities, underground storage tanks or dumps—for bottled water sources. That’s looser monitoring than occurs at the EPA, which requires more specific assessments of tap water sources. Olson says one brand of “spring water,” which had a graphic of mountains and a lake on the label, was actually taken from a well in Massachusetts in the parking lot of an industrial facility. The well, which is no longer used for bottled water, was near hazardous waste and had experienced contamination by industrial chemicals.

According to Olson, the FDA has no official procedure for rejecting bottled water sources once they become contaminated. He also says a 1990 government audit revealed that 25 percent of water bottlers had no record of source approval. Further, in contrast to the EPA, which employs hundreds of staffers to protect the nation’s tap water systems, the FDA doesn’t have even one full-time regulator in charge of bottled water.

Scott Hoober of the Kansas Rural Water Association says that although municipal system managers have to pay a certified lab to test samples weekly, monthly and quarterly for a long list of contaminants, water bottlers can use any lab they choose to perform tests as infrequently as once a year. Unlike utilities, which must publish their lab results in a public record, bottlers don’t have to notify anyone of their findings, including consumers who inquire. The FDA has the authority to ask for a company’s data, although test results can be destroyed after two years.

Olson adds, “Unlike tap water violations, which are directly enforceable, if a company exceeds bottled water standards, it is not necessarily a violation—they can just say so on the label, and may be insulated from enforcement.” Further, while EPA rules specify that no confirmed E. coli or fecal coliform (bacteria that indicate possible contamination by fecal matter) contamination is allowed in tap water, the FDA merely set a minimum level for E. coli and fecal coliform presence in bottled water. Tap water from a surface source must be tested for cryptosporidium, giardia and viruses, unlike bottled water, and must also be disinfected, unlike bottled water. Hoober also notes that food products such as “carbonated water,” “soda water” and “seltzer water”—in addition to most flavored waters—are held to even looser standards than “true” bottled water.

The EPA concludes, “Some bottled water is treated more than tap water, while some is treated less or not at all.” Henry Kim, consumer safety officer for the FDA, asserts, “We want bottled water to have a comparable quality to that of tap water”—which, of course, runs counter to the widely held public belief that bottled water is better. The situation is similar in the European Union and in Canada, where there are more regulations on tap than bottled water. That New York restroom attendant would be surprised to learn that her city’s tap water was tested some 560,000 times in 2002.

Environmentalists also point out that if a brand of bottled water is wholly packaged and sold within the same state, it is technically not regulated by the FDA, and is therefore only legally subject to state standards, which tend to vary widely in scope and vigor. Co-op America reports that 43 states have one or fewer staff members dedicated to bottled water regulation. On the other hand, California enforces strict regulations on bottled water contaminants, and Fort Collins, Colorado tests bottled water sold in town and posts the results online. The NRDC estimates that 60 to 70 percent of bottled water brands sold in the U.S. are single-state operations. Stephen Kay, vice president of communications of the IBWA, says he doubts the percentage is that high.

Kay is adamant that “no bottled water escapes regulation,” and he points out that all members of the IBWA (which are responsible for 80 percent of U.S. bottled water sales) must also adhere to the organization’s mandatory Model Code. This code does close some of the FDA’s regulatory gaps, including setting a zero tolerance for coliform contamination, and it requires members to follow certain standards and undergo an annual, unannounced plant inspection. However, Olson stresses that, except in a few states, this Model Code is not legally binding or enforceable. Members of the much smaller National Spring Water Association follow their own guidelines, and must get their water from free-flowing springs.

One result of such Byzantine bottled water standards has been the widespread use of disinfection to reduce possible contaminants. Although the FDA does not require it, disinfection is mandatory in several states, including New York, California and Texas. However, chemicals commonly used to disinfect water, including chlorine and ozone gas, may react unpredictably, forming potentially carcinogenic byproducts. Opponents also argue that disinfection destroys naturally beneficial bacteria, creating a blank slate. Further, Mark Johnson of bottler Trinity Springs—which taps a spring in Idaho so pure it doesn’t need any treatment—concludes, “If you don’t disinfect, you must protect the source and increase environmental awareness so the source stays protected.”

Even with widespread disinfection, consumer groups have raised numerous warnings about a host of different microorganisms and chemicals that have been found in bottled water. In a four-year scientific study, the NRDC tested more than 1,000 bottles of 103 brands of bottled water. The group concluded, “Although most bottled water tested was of good quality, some brands’ quality was spotty.” A third of the tested brands were found to contain contaminants such as arsenic and carcinogenic compounds in at least some samples at levels exceeding state or industry standards.

An earlier NRDC-commissioned study tested for hundreds of different chemicals in 38 brands of California bottled water. Two samples had arsenic contamination, six had chemical byproducts of chlorination, and six had measurable levels of the toxic chemical toluene. Several samples violated California’s bottled water standards. In a study published in the Archives of Family Medicine, researchers at Case Western Reserve University and Ohio State University compared 57 samples of bottled water to Cleveland’s tap water. While 39 of the bottled water samples were purer than the tap water, 15 of the bottles had significantly higher bacteria levels. The scientists concluded that although all of the water they tested was safe to drink, “use of bottled water on the assumption of purity can be misguided.”

Another area of potential concern is the fact that no agency calls for testing of bottled water after it leaves its initial packaging plant, leaving some to wonder what happens during months of storage and transport. To begin to examine this question, the Kansas Department of Health and Environment tested 80 samples of bottled water from retail stores and manufacturers. All 80 of the samples had detectable levels of chlorine, fluoride and sodium. Seventy-eight of the 80 contained some nitrate (which can cause methemoglobinemia, or blue-baby syndrome, in higher doses), 12 had nitrite, 53 had chloroform, 33 contained bromodichloro-methane, 25 had arsenic and 15 tested positive for lead.

Forty-six of the samples contained traces of some form of the carcinogen (and hormone disrupter) phthalate, while 12 of those exceeded federal safety levels for that chemical. According to Olson, phthalates may leach out of some plastic bottles into water. “Phthalates are not legally regulated in bottled water because of intense industry pressure,” says Olson. Although Co-op America concludes that there is little evidence of a link between phthalate exposure from bottled water and any health problems, the group suggests using glass over plastic bottles as a precaution. Similarly, if your office cooler is made of polycarbonate, it may be releasing small amounts of the potential hormone disrupter bisphenol A into the water.

Idaho’s Pure Health Solutions, a water purification company, also conducted its own study that concluded certain bacteria grow significantly in bottled water over a 12-day period. Bacteria will normally grow in tap water within a few days if it is kept bottled up at room temperature. Most municipal water managers leave a residual amount of chlorine in tap water after treatment specifically to inhibit the growth of bacteria as the water runs through pipes and sits in tanks.

The IBWA argues that the presence of benign bacteria in bottled water has no bearing on public health, since the treatment processes used by manufacturers ensure the death of any potentially harmful organisms. The group’s website claims that there have been no confirmed cases of illness in the U.S. as a result of bottled water. The IBWA does mention an instance in 1994 in the Northern Mariana Islands, in which bottled well water was linked to a disease outbreak. The NRDC argues that no U.S. government agency actively searches for incidents of illness from bottled water.

On the Internet, one can find testimonials and news reports about people who claim to have gotten sick from tainted bottled water. One man writes that he and his fiancée became ill after drinking bottled water in the Dominican Republic. The Allegheny County Health Department in Pennsylvania reports discovering high levels of coliform in bottled water samples that were taken “after a man reported that he became sick from drinking the water.”

Another complaint commonly levied against the bottled water industry is that many of the myriad product labels are misleading. Not long ago, New York-based artist Nancy Drew began collecting water bottles for a project. She concluded, “In a culture so inundated with images solely designed for promotion and profit, water is the most absurd element to see being used in this context.” Drew’s subsequent art views water labels’ ubiquitous depictions of pristine landscapes as a stark contrast to the “gluttonous consumption and sense of status that they represent.”

The IBWA states, “The labeling requirements ensure that the source and purity of the bottled water are identified and that, if the label is false or misleading, the supplier is subject to civil or criminal sanctions.” Even so, the FDA technically requires that bottled water labels disclose only three variables: the class of water (such as spring or mineral), the manufacturer, and the volume. That brand of Massachusetts “spring water” exposed by NRDC was so-named because the source occasionally bubbled up to the surface in the industrial parking lot.

As ABC News put it, “Ad campaigns touting spring-fed or glacier-born H2O are winning over a population increasingly skeptical of taps and willing to shell out big bucks for what they consider a purer, tastier and safer drink.” Water bottlers use product names such as More Precious Than Gold, Ice Mountain, Desert Quench, Pure American, Utopia and Crystal Springs. The Environmental Law Foundation has sued eight bottlers on the basis that they used words like “pure” to market water containing bacteria, arsenic and chlorine breakdown products.

Co-op America advises consumers “to be wary of words like ‘pure,’ ‘pristine,’ ‘glacial,’ ‘premium,’ ‘natural’ or ‘healthy.’ They’re basically meaningless words added to labels to emphasize the alleged purity of bottled water over tap water.” The group points out that, in one case, bottled water labeled as “Alaska Premium Glacier Drinking Water: Pure Glacier Water from the Last Unpolluted Frontier” was actually drawn from Public Water System #111241 in Juneau. The FDA now requires this bottler to add “from a municipal source” on the label. According to Co-op America, “as much as 40 percent of bottled water is actually bottled tap water, sometimes with additional treatment, sometimes not.” So-called purified water can be drawn from any source as long as it is subsequently treated, which leaves some to wonder how that differs from good old tap water.

The number one (Aquafina) and two (Dasani) top-selling brands of bottled water in the U.S. both fall in the category of purified water. Dasani is sold by Coca-Cola, while Aquafina is a Pepsi product. As U.S. News & World Report explains, “Aquafina is municipal water from spots like Wichita, Kansas.” The newsmagazine continues, “Coke’s Dasani (with minerals added) is taken from the taps of Queens, New York, Jacksonville, Florida, and elsewhere.” Everest bottled water originates from southern Texas, while Yosemite brand is drawn from the Los Angeles suburbs.

In June, a lawsuit was filed against Poland Spring, the nation’s largest bottled spring water company. Poland Spring is a brand of Nestlé Waters North America, which used to be called Perrier Group of America. Nestlé Waters is owned by the Switzerland-based Nestlé S.A., the world’s largest food company. Nestlé’s 14 other brands of U.S. bottled water include Arrowhead, Deer Park, Aberfoyle, Zephyrhills, Ozarka and Ice Mountain.

The plaintiffs charged that Nestlé duped consumers by advertising that Poland Spring water comes from “some of the most pristine and protected sources deep in the woods of Maine.” The lawsuit alleges that ever since the original Poland Spring was shut down in 1967, the company has used man-made wells, at least one of which is in a parking lot along a busy road. “Poland Spring is exactly what we say it is—natural spring water,” responded a Nestlé spokesperson.

Despite all the hype, the NRDC concludes, “While much tap water is indeed risky, having compared available data, we conclude that there is no assurance that bottled water is any safer than tap water.” Scientists at the University of Geneva arrived at the same conclusion, and add that, in 50 percent of the cases they studied, the only difference between tap and bottled water was that the latter contained added minerals and salts, “which do not actually mean the water is healthier.” In 1997, the United Nations Food and Agriculture Organization concluded that bottled water does not have greater nutritional value than tap water.

So why do so many of us trust and prefer bottled water to the liquid that is already piped directly into our homes? For the price of one bottle of Evian, a person can use 1,000 gallons of tap water in the home. Americans spend around $10,700 on bottled water every minute, reports Co-op America, and many consumers think nothing of paying three times as much per gallon of bottled H2O as they do for gasoline.
Kay says the IBWA does not intend to promote bottled water as a replacement for tap water, except maybe during emergencies. “Since bottled water is considered a food product by law, it doesn’t make sense to single it out as needing more regulations than other foods,” says Kay. He also stresses that IBWA guidelines strictly prevent members from trying to capitalize on fears over tap water, or from directly advertising that their products are more pure than municipal water.

Bottled water’s competition is soft drinks, not tap water, says Kay. Karen from Ames, Iowa posted on the 2000days web diary: “In the summer I buy bottled water more often so I’ll have something to drink that’s not loaded with syrup and stuff.”

Some critics have also found it ironic that many people who purchase bottled water end up refilling the containers from a tap. Clearly, some consumers may be more interested in buying the product for its packaging than for the water itself—or they impulsively purchased a bottle where there was no immediate access to a tap.

More and more environmentalists are beginning to question the purpose of lugging those heavy, inefficient, polluting bottles all over the Earth. The parent organization of the World Wildlife Fund, the Switzerland-based World Wide Fund for Nature, argues strongly that the product is a waste of money and is very environmentally unfriendly. Co-op America concludes: “By far the cheapest—and often the safest—option is to drink water from a tap. It’s also the most environmentally friendly option.” Friends of the Earth says, “We might as well drink water from the tap and save all this waste.”

The WWF argues that the distribution of bottled water requires substantially more fuel than delivering tap water, especially since over 22 million tons of the bottled liquid is transferred each year from country to country. Instead of relying on a mostly preexisting infrastructure of underground pipes and plumbing, delivering bottled water—often from places as far-flung as France, Iceland or Maine—burns fossil fuels and results in the release of thousands of tons of harmful emissions. Since some bottled water is also shipped or stored cold, electricity is expended for refrigeration. Energy is likewise used in bottled water processing. In filtration, an estimated two gallons of water is wasted for every gallon purified.

When most people think of bottled water, they probably envision the single-serve plastic bottle, which has exploded in popularity and is now available almost anywhere food products are sold. The WWF estimates that around 1.5 million tons of plastic are used globally each year in water bottles, leaving a sizable manufacturing footprint. Most water bottles are made of the oil-derived polyethylene terephthalate, which is known as PET. While PET is less toxic than many plastics, the Berkeley Ecology Center found that manufacturing PET generates more than 100 times the toxic emissions—in the form of nickel, ethylbenzene, ethylene oxide and benzene—compared to making the same amount of glass. The Climate Action Network concludes, “Making plastic bottles requires almost the same energy input as making glass bottles, despite transport savings that stem from plastic’s light weight.”

Andrew Swanander, owner of Mountain Town Spring Water, says, “I’m embarrassed and appalled to see my bottled water products discarded on the side of the road.” In fact, a considerable number of used water bottles end up as litter, where they can take up to 1,000 years to biodegrade. A 2002 study by Scenic Hudson reported that 18 percent by volume of recovered litter from the Hudson River (and 14 percent by weight) was comprised of beverage containers.

Pat Franklin, the executive director of the Container Recycling Institute (CRI), says nine out of 10 plastic water bottles end up as either garbage or litter—at a rate of 30 million per day. According to the Climate Action Network, when some plastic bottles are incinerated along with other trash, as is the practice in many municipalities, toxic chlorine (and potentially dioxin) is released into the air while heavy metals deposit in the ash. If plastics are buried in landfills, not only do they take up valuable space, but potentially toxic additives such as phthalates may leak into the groundwater. “It’s ironic that many people drink bottled water because they are afraid of tap water, but then the bottles they discard can result in more polluted water,” says Franklin. “It’s a crazy cycle.”

Franklin also acknowledges that although her group is a strong advocate of recycling, the very concept may encourage people to consume more plastics. Replacing used water bottles with new containers made from virgin resources consumes energy and pollutes the air, land and water. CRI estimates that supplying thirsty Americans with water bottles for one year consumes more than 1.5 million barrels of oil, which is enough to generate electricity for more than 250,000 homes for a year, or enough to fuel 100,000 cars for a year.

Despite such a sizable environmental footprint, the push to recycle plastic water bottles has not been as successful as many consumers might like to think as they faithfully toss their used containers into those blue bins. As Utne magazine recently reported, “Despite the ubiquitous arrow symbol, only five percent of plastic waste is currently recycled in America and much of that must be fortified with huge amounts of virgin plastic.” One limitation is that recycling plastic causes it to lose strength and flexibility, meaning the process can only be done a few times with any given sample.

Another problem is that different types of plastics are very difficult to sort, even though they can’t be recycled together. Common plastic additives such as phthalates or metal salts can also thwart recycling efforts as can too high a ratio of colored bottles (such as Dasani’s blue containers) to clear bottles. Because of the challenges, many recycling centers refuse to accept plastics. In fact, a fair amount of America’s plastic recycling is done in Asia, where laxer environmental laws govern polluting factories and fuel is spent in international transport.

According to a report recently released by the California Department of Conservation (CDOC), more than one billion water bottles are ending up in the state’s trash each year, representing enough plastic to make 74 million square feet of carpet or 16 million sweaters. Darryl Young, the director of CDOC, says only 16 percent of PET water bottles sold in California are being recycled, compared to much higher rates for aluminum and glass. “It’s good people are drinking water, but we need to do more outreach to promote recycling,” says Young.

Franklin says one potential deterrent to recycling may be that water bottles are often used away from home, meaning they aren’t likely to make it into curbside bins. Young advises people to ask for recycling bins in retail and public spaces.

Industry analysts point out that demand exceeds supply in the market for recycled PET plastic, which is used in a range of goods from flowerpots to plastic lumber. Franklin says deposit systems, or so-called bottle bills, would go a long way to improving the collection of used water bottles, especially since only half the country has curbside recycling available. But only a few states have bottle bills, largely because of strong opposition from the container, beverage and retail industries (and their front group, Keep America Beautiful). While Kay stresses that the IBWA urges consumers to recycle, he says his organization opposes bottle bills because “food retailers shouldn’t have to devote any money-making floor space to storing and sorting recyclables, especially as that may lead to unsanitary conditions.”

The WWF says alternatives to bottled water such as boiling and filtering are cheaper and more sustainable in areas that have contaminated tap sources. Co-op America and CRI advise consumers to fill their own bottles to take with them on the go. Glass doesn’t leach chemicals, and sturdy plastics can be repeatedly washed, so consumers don’t have to worry about breeding bacteria. For a lessened environmental impact, spring and other specialty waters can be purchased in bulk. But as BBC News concluded, “The conservationists are fighting an uphill battle. The bottled water market is booming...and shows no signs of drying up.”

Numerous environmental and social activists have recently begun to put up a fight against the expanding bottled water industry, which they claim threatens local wells, streams, wetlands and ways of life. Bottling companies may pump up to 500 gallons per minute, or even more, out of each well, and many wells run 24 hours a day, 365 days a year. Such operations have drawn intense opposition in Florida, New Hampshire, Pennsylvania, Texas, Michigan and Wisconsin. Many residents of these states depend heavily on groundwater for residential, agricultural and fishery use. In Wisconsin, for example, three out of four homes and 97 percent of municipalities obtain their water from the ground.

“Resistance against water bottlers is a classic NIMBY (not-in-my-backyard) issue,” says Kay. The IBWA claims bottlers wouldn’t pump aquifers to depletion because that wouldn’t make good business sense. But civil engineer and hydrologist Tom Ballestero of the University of New Hampshire cautions that surrounding wells and the environment can be negatively impacted before an aquifer is severely depleted. “The groundwater they are pumping and exporting was going somewhere where it had an environmental benefit,” says Ballestero. Geologist David Bainbridge of Alliant International University also points out that there are scant few penalties against users who draw down water tables or deplete aquifers. Due to the long amount of time it takes to naturally replenish aquifers, most scientists consider groundwater a nonrenewable resource.

Much of the opposition to water bottlers has been directed at Nestlé Waters North America, which taps around 75 different U.S. spring sites. A spokesperson for the corporation, Jane Lazgin, says most communities welcome the jobs and revenue brought by bottling operations. Even so, Nestlé lost several bids to set up bottling plants in the Midwest due to intense opposition. Eventually, for its Ice Mountain brand, Nestlé built a $100 million plant capable of bottling 260 million gallons of water a year from an aquifer in Michigan’s rural Mecosta County, which is about 60 miles north of Grand Rapids. Nestlé paid around $150 for permits and received substantial tax breaks.

Local activists, mobilized by the newly formed Michigan Citizens for Water Conservation, protested the plant on the grounds that the facility would take too heavy a toll on the surrounding environment and quality of life. Although Nestlé claims it conducted “exhaustive studies for nearly two years to ensure that the plant does not deplete water sources or harm the ecosystem,” the activists pointed out that the state has no authority to limit the amount of water that is actually removed.

Three Native American tribes sued the state on the basis that rivers, and ultimately, the Great Lakes, would be affected. Michigan Citizens for Water Conservation and a few local residents also filed a lawsuit, claiming that the Mecosta operations violate state and federal water rights. The controversy became a hot topic during the 2002 gubernatorial election. As Grist reported, “Both major party candidates publicly and repeatedly expressed their resolve to modernize state water policy to block other multinational corporations from privatizing, bottling and selling hundreds of millions of gallons of Michigan’s groundwater annually across state lines.” A ruling on the case is expected soon, and is believed to have far-reaching ramifications.

In Florida, Nestlé angered many people, including the group Save Our Springs, when it took over Crystal Spring, which is near Tampa. The company fenced out the public, which had enjoyed the water for generations. After five years of bottling operations, the spring level has dropped. Some officals are worried, since the spring feeds the source of Tampa’s water. Nestlé blames the change on dry spells and local development.

Local residents have also fought Nestlé in rural northeast Texas, where they complain that a well across the street from the company’s bottling site went dry five days after Nestlé began operations. Nestlé’s Lazgin claims that well dried up because it was old and shallow, and that it was not on the same aquifer as the bottling plant. Critics counter that aquifer geology is a fairly subjective science. The Texas Supreme Court ruled in favor of Nestlé under the state’s “rule of capture.” Save Our Springs President Terri Wolfe told The Northwestern, “The poor people whose wells run dry because of [bottlers] can’t afford that water.”

A host of environmental groups are joining resource managers in the call for Americans to cut back on bottled water and instead look to tap systems to provide our daily needs. As the NRDC points out, incidents of chemical or microbial contamination in tap water are actually relatively rare. In a recent review of the nation’s public drinking water infrastructure, researchers at the Harvard School of Public Health concluded, “Reasonably reliable water is currently available to nearly all 270 million U.S. residents.”

Writing in The Kansas Lifeline, Scott Hoober expresses frustration on the part of municipal water managers, who are increasingly shackled with negative reputations despite their actual accomplishments. Hoober advises managers sarcastically, “What are you waiting for? Turn a few valves, install a bottling plant and begin to make the big bucks. You could sell your water for half of what the other bottler down the road is charging and still make a bundle. With no meters or mains to maintain, no monthly billing, lower lab bills, why, you could afford a top-dollar advertising campaign telling folks how much better your water is than the stuff that used to come out of the tap.”

It’s true that tap water does face numerous threats, including possible contamination from the potentially harmful byproducts of chlorination, the specter of pollution and a lack of adequate funding. Stresses from global warming, urban sprawl and population increase also must be factored in, as well as the looming threat of terrorism. The WWF argues that governments should focus their limited energies on repairing current tap water infrastructures and on protecting watersheds from harmful farm, industry and urban pollutants. Many public water supply advocates feel that tax dollars should be paying to deal with tap water’s challenges. We certainly need to think twice before handing off the public water trust to private companies that put it in attractive bottles at a high price.

The Politics of Water in Bolivia by JIM SHULTZ

Etched deeply into the granite walls just inside the entrance of the World Bank headquarters in Washington are the words, "Our dream, a world free of poverty." Earlier this month in Bolivia, the citizens of South America's poorest country sent the bank a message once again that the poor aren't too keen on the part of that dream that involves handing their water over to foreign corporations.

On January 10 the citizens of El Alto took to the streets en masse to demand that their water system, privatized in 1997 under World Bank pressure, be returned to public hands. Three days later Bolivia's president issued a decree canceling the water concession, led by the French water giant Suez, and an arm of the World Bank itself. The El Alto water revolt follows, by five years exactly, the now famous revolt against water privatization in Cochabamba, in which a company controlled by the Bechtel Corporation was ousted from the country.

Together, these two revolts over water should send an important message to officials at the World Bank, if they are willing to hear it.

The people of Bolivia did not choose to privatize their public water systems.That choice was forced on them, as it has been in many poor nations around the world, when the World Bank made privatization an explicit condition of aid in the mid-1990s.Poor countries such as Bolivia, which rely heavily on foreign assistance for survival, are not in much of a position to say no to such pressures.

World Bank water officials claim all the best intentions when they make the push for water privatization.The bank has argued that poor governments are often too plagued by local corruption and too ill equipped to run public water systems efficiently. Handing water over to foreign corporations, the bank has said, opens the door to needed investment and skilled management.

However, to borrow a phrase, the road to bad public policy is often paved with good intentions.Bolivia's experience with bank-forced water privatization is a striking example of the yawning gap between World Bank theory and how things actually work in the real world for the poor families who have to live with the results.

In Cochabamba five years ago, the water contract with Bechtel and the Abengoa Corporation of Spain paved the way for rate increases of double and more for poor water users.Those steep and sudden price hikes, needed in part to finance the 16 percent annual profit demanded by the companies, led to citywide protests and eventually to Bechtel's and Abengoa's ouster.The Bolivian government declared martial law in an effort to save the companies' contract, leaving one teenage boy dead and more than 100 people wounded.

In El Alto the chief complaint about the Suez/World Bank privatization is that it left tens of thousands of poor families with no access to water whatsoever.Fortunately, no one was killed or wounded in this latest water revolt, a credit to President Carlos Mesa, who agreed that the water contract was inadequate and approved its cancellation.

Observers from all sides will try to pin exotic labels on what happened this month in Bolivia--an indigenous uprising, the work of radicals secretly trying to subvert the government, etc. None of these capture the real lesson.At their essence, the water revolts in Cochabamba and El Alto were consumer rebellions.While many Bolivians are philosophically opposed to putting the country's natural resources into the hands of private corporations--and not without good reason, given the country's recent experiences with World Bank/IMF-forced reforms--most people here are simply angry at the practical result.

When Cochabamba's privatization failed, the bank blamed bad implementation, insisting that the theory still held.In 2002 the Bank declared the El Alto-La Paz water privatization as having "achieved positive results."When the people of El Alto took to the streets this month, it was a clear declaration that the bank got it wrong.

The promise of private investment has turned out to rely on market-rate pricing that the poor cannot afford.In El Alto the cost of getting a water and sewage hook-up exceeded a half-year's income at the minimum wage.The promise of skilled management turned out to be about corporate leaders willing to let the poor suffer and, in Bechtel and Abengoa's case, stand aside while they were shot. No one--not the Bolivian government, not the World Bank and certainly not the multinational corporations involved--ever asked the Bolivian people, "Do you want to privatize your water?" One of the most important policy choices a people can make--public or private?--was taken away and made by economists and theorists in a huge white stone building a hemisphere away.

Bolivia's second citizen revolt against water privatization in five years ought to give the officials working in that building a moment of pause, to ask why the theory that seems to work so well on paper seems to work out so badly once it hits the ground.

A longer piece that explores how water allocation may change in the future and has some good background on water allocation law.

Note . This and the next article were converted from PDFs hence the weird formatting in places.

Environmental and Societal Impacts Group, National Center for Atmospheric Research,

Global climate modeling experiments suggest that anthropogenic emissions of carbon dioxide and other trace gases are likely to result in global warming over the course of the next century (Houghton et al., 1990). While climate modeling efforts cannot yet provide consistent and reliable forecasts of the timing and nature of regional climatic and hydrologic changes, the available evidence suggests that global warming may have profound impacts on water resource availability. Hydro- logic analyses of plausible climate change scenarios indicate possible substantial reductions in streamflows in some areas, increased flood frequencies in other areas, and changes in the seasonal pattern of flows, with reduced summer flows likely in many mountainous and northern river basins (Schaake, 1990; Waggoner, 1990; Duell, 1992).

Rogers (1994) argues that political and economic uncertainties are often far more important than hydrologic uncertain- ties for public water supply decisions, and that the hydrologic impacts of climate change may present fewer difficulties for water planning than the growing inter- dependence among water users. He further notes that the environmental aspects of hydrologic change may be considerably more problematic than traditional water supply concerns. He urges continued “research on the nexus of climate change, water resources, and socioeconomic adaptation; not solely on the hydrology but also upon other parts of the socioeconomic system and the aquatic ecosystem” (Rogers, 1994, p. 204). This paper takes up that challenge by examining the inter- actions between institutional factors and socioeconomic adaptations to the possible hydrologic impacts of climate change.

Water is a multifaceted resource, and competing claimants to the resource value its various dimensions differently. Valuations of the quantity, reliability, quality, locationandtiming dimensions ofthe resource differ across competingusergroups, and these relative values change over time. In addition, the degree to which there is direct competition among water users varies with the type of use and across the various dimensions of the resource. Thus, decisions about water use can involve a host of competing claimants whose desires may increasingly come into conflict if climate change alters the location and timing of water availability. The increased potential for conflict warrants closer examination of the ways in which institutions may channel such competition to either facilitate or hinder adjustment to the effects of climate change.

Demographic change, increased environmental awareness and changing pat- terns of water demand have already created pressures for changes in the allocation of water amongcompeting uses.The resulting adjustmentprocesshas entailed con- flicts as well as cooperative solutions. The institutions governing water allocation sometimes appear to impede effective responses to changing circumstances (OTA, 1993), but those institutions have also evolved in response to pressures exerted by competing resource users. In some cases, climate-related uncertainties have con- tributed to costly disputes overwater resources,as occurred in the recent battle over proposed groundwater exports from Colorado’s San Luis Valley. That dispute was fueled by irrigators’ fears that the difficulty of proving impacts in the presence of climatic variability would impair their ability to secure compensation for damages.

In other instances, climatic events such as California’s recent multi-year drought have catalyzed significant institutional change (Howitt et al., 1992). The record of such cases can provide a glimpse of issues that are likely to arise as water resources are increasingly subject to the effects of global environmental change. If climate change leads to greater aridity in some regions, will that lead to increasing conflicts over water or will it inspire creative institutional approaches to resolve such disputes? Is any particular system of water law inherently better suited to resolving conflicts in the presence of uncertainty regarding both relative valuations and the future state of the resource itself? Are there reasons to take actions now to allay the future costs of adapting to climate change?To addresssuch questions,it is helpfulto considerthe nature of the relationship between institutions and individual decisions regarding the use of natural resources. Institutions can be defined as: the humanly devised constraints that structure human interaction. They are made up of formal constraints (e.g., rules, laws, constitutions), informal con- straints (e.g., norms of behavior, conventions, self-imposed codes of conduct), and their enforcement characteristics. Together they define the incentive structure of societies and specifically economies (North, 1994, p. 360).

Recent work on the economics of property rights and related institutions sug- gests that institutions shape current decisions regarding the use of resources as well as the path of adjustment to changing circumstances (Ostrom, 1990; Brom- ley, 1991). These multiple effects arise because institutions influence the costs of engaging in transactions through markets and within organizations, as well as the costs of engaging in political action (Alchian, 1965; Bromley, 1982; Barzel, 1989; North, 1994). Transaction costs, defined as: “the costs of specifying what is being exchanged and of enforcing the consequent agreements” (North, 1994, p. 361), are thus molded by institutional choices. In turn, transaction costs influence the course of institutional changeby affecting political exchangesand private contracts (Cheung, 1970; Eggertsson, 1990).

Courts and legislatures historically constructed American water law on two distinct doctrines, riparian rights and prior appropriation. Each system of law can be seen as a tool designed, within a particular climatic setting, to manage the dynamic competing efforts of individuals to control some part of the water resource. The riparian doctrine was the foundation of water laws in the water-abundant eastern states while prior appropriation developed in the more arid western section of the continental United States. While state water laws have changed significantly through the decades, the fundamental principles of the riparian doctrine and prior appropriation continue to shape the basic character of state water laws.. The permit systems are described below. Under the riparian doctrine, the owner of land adjacent to a water source has the right to make ‘reasonableuse’of the water on the riparian land. The riparian system was essentially court-made property law based on the common law of England. In both England and the eastern United States a humid environment and abundant surface water led to few conflicts over exclusive (e.g., consumptive) uses of water. In fact, the possibility of exclusive use was ignored in early statements of riparian principles that guaranteed riparians enjoyment of the full unaltered natural flow of a stream. Rather, riparian water law was designed to address conflicts that revolved around potentially competing instream uses of water, such as for the operation of mills (Rose, 1990).

Under the prior appropriation system, the party with the oldest right has first priority to the available water. Junior users may not exercise their rights until all older rights have been satisfied. This system makes it relatively clear who has the right to make use of each unit of water as flow levels fluctuate due to drought, seasonal variability, or sporadic storm flows (Chandler, 1913; Hutchins, 1971; Beck, 1990).

The prior appropriation system emphasized the private property nature of the right to use water that had been physically possessed and, in the process, succeed- ed in effectively privatizing much of the water in the western states. In contrast to the eastern states, where non-consumptive instream uses of water were historical- ly important, early economic uses of western surface waters were predominantly out-of- stream and consumptive in nature. Because prior appropriation laws were designed to promote ‘productive’ water uses, most made no provision for estab- lishment of water rights for instream uses other than for hydropower. Only very recently have western states revised their water laws to allow establishment of instream water rights for environmental, aesthetic and recreational purposes (Mac- Donnell and Rice, 1993). In most cases, only a public agency may hold such rights. In practice, with limited budgets to purchase senior rights, most instream rights have such junior status that they may be of little practical significance (Wilkin- son, 1989). In some cases, however, states allow private groups to purchase senior agricultural water rights and donate them to instream use in perpetuity (Colby, 1993).

In the western states, rapid population influx and urbanization have created new demands for water in areas where farmers and ranchers long ago appropriated the reliable supplies. Increasing environmental concerns and the elimination of federal subsidies for new water projects have simultaneously reduced the options for developing new sources of supply. While certainty of supply remains a dominant concern to water users in the western states, flexibility to move water from one type of use to another has become increasingly valuable. The value of flexibility is reflected in increasing numbers of market transfers of water rights throughout the region and in efforts to devise new mechanisms to facilitate short-term transfers of water entitlements.

Under the prior appropriation system, transfers of water from one place or type of use to another may not result in damage to any other valid water right (MacDon- nell, 1990a). Where there is no buffer of unappropriated water, any transfer could potentially impose such damages by altering the quantity, location, timing or qual- ity of return flows. Transfer proposals thus often generate significant transaction costs (MacDonnell, 1990b) in the form of legal fees, costs of hydrologic analyses, and time and effort devoted by all parties whose rights could be affected as each seeks to ensure a favorable definition of the transferable limits of the right. As transfer proposals have become more frequent, two opposing trends have become evident. On the one hand, parties interested in facilitating transfers have sought to clarify the legal definition of a transferable right (Anderson, 1983) and to improve documentation of existing rights through the adjudication process. Others have increasingly called for the protection of community values derived from the continuance of historical agricultural uses (Ingram and Oggins, 1990; NRC, 1992). The value of recreationaland environmentalusesof water has also increased.To some extent, these values are also being expressed in water markets (Colby, 1993). However, since water laws in most states do not provide for private ownership of instream water rights and since environmental, aesthetic and recreational uses tend to be non-exclusive, the role of market transfers has been limited. Instead, the expression of environmental and recreational water demands has often taken the form of efforts to change the rules of the game by which water is allocated, either through legislation or through court challenges of other proposed or ongoing water uses. With respect to legislation, environmental interests have activelysupportedimprovedtransferability ofwaterrights, becausetheyseemarket transfers as an environmentally less damaging alternative to new dams. On the other hand, they have also sought to reallocate water to environmental purposes by favoring redefinitionofwaterrights thatare currentlycontributing to environmental damage, eitherthroughthecourts or through legislation such as the 1992 Central Valley Project (CVP) Improvement Act (Title XXXIV of Public Law 102-575) which mandates the allocation of 800,000 acre-feet of Central Valley Project water supplies to implement fish and wildlife restoration.

As interest in the preservation and restoration of aquatic environments has grown, an increasing number of individuals have questioned the legitimacy of the prior appropriation system. Thus, the growth in demand for ‘common property’ aspects of western streams has led to growing pressure for more of a ‘public trust’ approach to western water law, entailing greater limits on the exercise of private rights and increased administrative control over water uses that pose a danger to instream values (Wilkinson, 1989; Butler, 1990). In the eastern states, population growth and expanding municipal water with- drawals have made specific claims to a part of the water supply a more prominent concern than had been the case in the nineteenth century. As municipal and other out-of-stream water demands have increased, the weaknesses of the reasonable use rule in allocating water among rival consumptive uses has led to increasing pressures to clarify and quantify entitlements. In response to actual or anticipated difficulties in the delineation and enforcement of competing riparian rights, the majority of the traditional riparian states have modified their water laws. Sever- al states have adopted permit systems while others have adopted only registra- tion requirements or regulations governing particular types of uses (Sherk, 1990; Abrams, 1990). The permit systems typically establish threshold use amounts, thus exempting small diversions from all or part of the permit requirements. Where required, permits are generally fixed- duration, non-transferable licenses to divert a specified quantity of water. Permitting agencies maintain administrative oversight of permitted uses and do not convey permanent property rights to permit holders. This attention to clarifying rights to withdraw water from eastern streams has not supplanted concern for preserving streamflows, but the players have changed.

A growing cadre of conservationists and recreational users, seeking to protect and restorethequalityofstreamenvironments,havereplacedmillownersastheprimary champions of instream flows. Thus, it appears that in both the eastern and western states, inherently joint, instream uses are currently increasing in importance. If this trend continues, planning for the impacts of climate change and adaptation to those impacts as they actually unfold will likely occur in the context of ongoing efforts toclarify and redefine the rights of consumptive water users as against other parties who value the maintenance of instream flows primarily for ecological, aesthetic and recreational purposes. Since these latter values are likely to be sponsored by public agencies, ongoing struggles to redefine the boundaries between private and publicdiscretionoverwaterresourcesarelikely to bepartofthe institutionalsetting within which the effects of climate change will be addressed.

The prior appropriation and riparian/permit systems of water law constitute the institutional foundation for water use decisions in the United States. The full institutional infrastructure also includes many other laws, programs, contracts and administrative arrangements. In some western river basins, where federal water storage projects control a large portion of the annual streamflow, the contracts and operating rules pertaining to the projects are the dominant institutional arrange- ments. Congress authorized these projects to promote rapid development of the western states, always building subsidies to irrigated agriculture into the repay- ment contracts (Wahl, 1989; Wilkinson, 1989). Projects were thus prizes, eagerly sought by western development interests. In some instances, the promise of federal water projects served as the impetus for interstate agreements on the allocation of rivers crossing state boundaries. In the case of the Colorado River, California’s desire to secure congressional authorization of the All American Canal and Boulder Canyon (Hoover) Dam propellednegotiationsfor the 1922ColoradoRiverCompact.TheCompactdivided the water between the Upper and Lower Basins, obligating the Upper Basin to deliver a moving ten-year average of 7.5 maf (million acre-feet) per year at Lee Ferry. ExceptforUpperBasin waterrights thatwereperfectedpriortotheCompact, this gives the Lower Basin priority in the event of reduced flows (MacDonnell et al., 1995). In addition, the Lower Basin has the larger right because Compact allocations were based on an assumed average flow considerably larger than the long-runaverageof13.5mafsuggestedbytree-ring evidence(StocktonandJacoby, 1976). Later, the Upper Colorado River Basin Compact clarified how the burden of meeting the obligation to the Lower Basin would be divided among the Upper Basin states, clearing the way for federal support for major storage projects in the Upper Basin. The system of reservoirs now in place in the Colorado Basin is capable of storing approximately four times the average annual flow of the River. The Compact, subsequent statutes, an international treaty, court decisions and project operating rules together comprise the ‘Law of the River’. A recent study of the potential impacts of a severe sustained drought found that this set of institutions would leave sensitive biological resources,hydropowergenerationandUpperBasin water users vulnerable to damages despite the extraordinary engineering attempts to drought-proof the River. The study team also found that certain proposed institutional changes could considerably alter the level and incidence of the damages

The past quarter century has witnessed tremendous change in federal involve- ment in the development of new water projects, operation of existing federal projects, management of water quality, and protection of aquatic environments. The so-called ‘iron triangle’ between local water development interests, the federal construction agencies, and congressional public works committees that fostered decades of pork-barrel water projects has given way to a newer pattern of greatly reduced federal funding for water projects, greater cost sharing by project bene- ficiaries and changes in the types of projects receiving federal support (Cortner and Auburg, 1988). Coalitions of environmentalists and congressional cost- cutters began to force changes in the established system of project authorization in the late 1960s and early 1970s (Ingram, 1972). The Reagan Administration further curtailed federal involvement in water resources planning by eliminating the Water Resources Council, the joint federal-state river basin commissions and federal grants for state planning, and by significantly cutting federal funding for water resources research. “By 1982, most of the institution framework for federal water resources policy had been dismantled” (

While federal financing of water projects has greatly diminished, federal reg- ulation of water use and development has become an increasingly important part of the set of institutions governing the nation’s water resources. Federal influ- ences include federal jurisdiction over navigable waters, federal laws . International treaties and interstate compacts may also constrain water allocation decisionsat the state level, if the limits imposed by such agreements are binding and enforced (Bennett, 1994). Two examples of federal control that may become increasingly important if water availability diminishes are the Endangered Species Act (P.L. 93-205) and reserved water rights for federal and Native American lands. The Endangered Species Act, which in recent years has become a forceful instrument for the pro- tection of aquatic and other water-dependent biota, may restrict future use and development of water supplies (OTA, 1993). In addition, the Supreme Court has held that when the federal government established Native American reservations, National Parks and other permanent federal land reservations, it also implicitly reserved sufficient water to serve the purposes of the reservation (Tarlock, 1989). The date on which the reservation was established determines the seniority of these reserved water rights, giving them priority over most appropriative water rights. In many cases, Native American claims have not yet been quantified or exercised, and controversy has accompanied the exercise of federal reserved water rights for purposes of environmental protection (OTA, 1993). Both federal reserved rights and Native American rights have the potential for leading to future conflicts with other water users, particularly if streamflows diminish.

Despite the importance of federal influences, most of the ongoing authority over the use and management of water resources rests at the level of the state, the local supplier and the individual irrigator. Administrative arrangements differ significantly, and contracts, bylaws and authorizing legislation often constrain the pricing, allocation and water trading options available to irrigation districts, other local suppliers and their members. In most states, a state engineer’s office or its equivalent handles the issuance of new water rights or water use permits, approval of transfers and enforcement of existing rights. The powers granted to these offices, their budgets, established procedures, and the quality of the records available to them differ considerably from one state to the next. In eastern riparian states that have not yet adopted permit systems, the resolution of any disputes is handled by the courts. In the west, Colorado uses a unique system of specialized water courts for the establishment and transfer of water rights, coupled with active ongoing enforcement by state division engineers. Such differences have a significant impact on the transaction costs incurred in transferring water rights and therefore on the nature and amount of water transfer activity (MacDonnell, 1990b). The fact that water transfers are more difficult in some jurisdictions than in others suggests that such state-level Administrative arrangementswill haveanimportantbearingonthe costsofadapting to the effects of climate change.

How might climate change affect the rights of competing users to the multiple facets of a water resource? What institutional factors will make it easy or difficult to adapt to climate change within the context of each system? The physical effects of trace gas-induced climate change on streamflows will depend on changes in temperatures, Evapotranspiration and precipitation. Smaller snowpacks may lead to reduced summer streamflows in some river basins. A study of the Sacramento Basin estimated, for example, that if temperatures increased by 2 C and precipitation patterns remained unchanged, summer streamflows (June– Aug.) would decline by 22 percent while winter runoff (Dec.–Feb.) would increase by 8 percent (Gleick, 1987). Similar results were obtained in a study of the Animas River Basin in Colorado. In basins in which there are few acceptable options for additional artificial storage, such changes in the hydrologic regime imply a significant reduction in water availability to service competing demands. Those estimates are based only on changes in temperatures.

Analyses of climate change scenarios for river basins in the eastern states also suggest the possibility of reduced summer streamflows as well as increased winter runoff in those areas where there are currently winter snowpacks. A study of the Delaware River Basin (McCabe and Ayers, 1989) estimated that large percentage increases in precipitation would be required to maintain summer soil moisture, and that annual runoff would decline by 9–14 percent with a 2 C warming and 20–25 percent with a 4C warming without offsetting increases in precipitation. Surface runoff is sensitive to changes in temperatures and precipitation, and changes in interconnected aquifers will further affect streamflows (White, 1985). For example, if warmer temperatures cause soil moisture depletion, infiltration to aquifers will diminish. As the level of an aquifer declines, groundwater discharge to surface streams will decline and seepage losses from surface water bodies to the aquifer may increase. Changes in precipitation may offset or exacerbate the hydrologic changes that are predicted on the basis of temperature changes alone – and the climate models are a long way from being able to accurately forecast how regional precipitation regimes may change in a warmer world (Tegart et al., 1990; Waggoner, 1990).

Climate change will affect not only initial surface runoff into a stream system, but also rates of evaporative loss, seepage to groundwater aquifers, recharge from those aquifers and rates of consumptive use from irrigation withdrawals along the entire stream system. Because the ultimate direction and magnitude of those Changesmayremainunpredictableuntilclimatechangeiswellunderway,estimates of the reliability of new public or private rights and of the impacts of water right transfers will be both fraught with uncertainty and increasingly open to dispute. In the case of transfer proposals, water authorities often limit the quantity of water transferred from an existing user to another place or type of use to the seller’s historic consumptive use to prevent impairment of other water rights. For example, half of the water diverted to an irrigated field might currently be lost to evapotranspiration while the remainder returns to a usable water body. If that right is transferred, the buyer’s diversion right would be established to allow expected consumption equal to half of the original diversion right. In addition, the water court or state authority may impose terms and conditions on the transfer to further protect other water users against changes in the timing or location of return flows.

The prospect of climate change makes it more difficult to forecast both future consumptive uses and the future availability of water to keep existing uses intact. For example, warmer temperatures could cause return flows from a new use to be smaller than anticipated by increasing evaporative and seepage losses. Even under the presumption of a stable climate, imprecise hydrologic informa- tion is now frequently at the heart of costly conflicts over proposed water transfers and new water developments. This suggests that uncertain changes in the climatic regime will likely enhance the basis for such disputes. Policymakers, hydrologists, administrators and the judiciary should therefore give careful attention to the ques- tion of how such climatic uncertainties might enter into decisions regarding the development or transfer of water rights and to the issue of who will bear the risk of mistaken assessments.

In the eastern states, voluntary transfers of established water rights have not yet become an issue, but the courts and water authorities are concerned with the potential impacts of new uses on other parties. Forecasting those impacts in the presence of potential climate change is likely to be difficult, particularly in states lacking reliable information on water uses. Unlike the western states where water rights, once granted, tend to be viewed as permanent property rights, rights held under permits in most of the eastern states are explicitly of limited duration. This might suggest that decisions based on hydrologic assumptions that later prove inaccurate would be easier to ‘fix’ than under the prior appropriation system’s presumption of relatively permanent rights. Eastern-state parties that have made substantial water-related investments, however, may be no more likely to quietly acquiesce to reduction of their permit rights than would be western appropriators faced with an administrator’s demand, grounded on the public trust principle, that they line their ditchesor reducetheir withdrawals to mitigate streamflowreductions caused by climate change. The uncertain hydrologic impacts of climate change may also complicate the enforcement of water rights even in the absence of proposed changes in water uses. The generally poor integration of groundwater and surface water rights in both western and eastern states may presentincreasing problems if climate changealters the entire hydrologic regime within interconnected groundwater and surface water systems. Here, measurability is important. Where hydrologic models are available, theymaybeunreliableunderconditionsdepartingsignificantlyfromthoseonwhich the models were based, and there are many watersheds and aquifers for which the hydrology is poorly understood even for the existing climate. In addition, records of actual withdrawals, consumption and instream uses are frequently lacking even in states that nominally follow the prior appropriation doctrine or that have adopted permit systems. Uncertainty about basic hydrologic relationships and inadequate water use records could make it difficult to determine responsibility for changes in water availability under climate change (i.e., is the lower water table the fault of nature or your neighbor?) Such measurement problems may lead to disputes as water authorities and users attempt to determine a fair and efficient allocation of altered supplies.

Now consider the case in which climate change is under way and water is becoming more scarce. Because interannual variability will continue as the cli- mate system changes, it may take a very long time to clearly recognize any such trend (Rogers, 1994). Transitions to drier regimes are most likely to occur as a gradual increase in the frequency of dry years, interspersed with wet periods, and gradual shifts in the timing of runoff and in the recharge/discharge interactions of groundwater and surface water systems.

Under the prior appropriation system, the impacts of increasing water scarcity would fall most heavily on the most junior water users, as well as on environmental values that have not been protected by the dedication of reliable senior rights to instream flows. Junior users would have incentives to find ways to adapt, both to individual dry periods and to mounting evidence of a shift to a drier regime. For example, they could make arrangements to buy or periodically rent more senior water rights; they could invest in storage infrastructure, engage in water conservation, develop programs for conjunctive use of groundwater and surface water; or they could decide to cease their water-using activities. Another option, of course, would be to lobby for the mandatory reduction and reallocation of the rights of their senior neighbors. Well-functioning water markets would tend to reducesuchpressuresand,in the absenceofmandatoryreallocation,thedifferential impacts of a climate change on junior and senior water users would create further opportunities for the development of water markets. Water markets are likely to be most effective where the water uses are primarily exclusive or consumptive in nature, or if non-consumptive, involve a relatively small number of parties. Because most water uses are not fully consumptive, water markets will function efficiently only if the law protects third parties against changes in return flows. Trelease (1977) notes that providing that protection can be costly and time-consuming where rights are defined on the basis of diversion rather than on the basis of consumptive use. Consumptive use determines the availability of water to downstream parties, and it is typically difficult to measure. Recall that climate change may alter the relationship between diversions and consumptive use by changing conveyance losses and evapotranspiration from irrigated fields. Privately arranged market transfers of water rights are unlikely to adequately protect environmental values accruing to a large and amorphous public against the impacts of a shift to warmer and drier conditions. This is due to the fact that voluntary collective action to provide such public goods is limited by the incentive of each individualto free-ride on the contributions of others. Government provision ofenvironmental goods maybemore efficient than private contracting in suchcases (Barzel, 1989; Eggertsson, 1990). The experience of the western states suggests that some form of action by state authorities will be required to provide appropriate levels of protection for water quality and instream flows if drier conditions become more prevalent.

The time has come for innovative thinking on the question of how our water allocation institutions should function to improve our capacity to adapt to the uncertain but potentially large impacts of global climate change on regional water supplies.Giventheclimaticuncertaintiesandtheverydifferentinstitutionalsettings that have developed in this country, there is no simple prescription for adaptation. We have identified several elements that decisionmakers should keep in mind for the design of more adaptive water institutions. By pursuing these goals as water laws and administrative procedures are updated, it should be possible to reduce the disruption, potential for disputes and resource degradation that might otherwise result if climate change significantly alters regional hydrologic regimes.

Finally a piece on water allocation and its impact on people in developing countries…

Poverty in Irrigated Agriculture: Issues, Lessons, Options and Guidelines Pro-poor Intervention Strategies in Irrigated Agriculture in Asia - Bangladesh, China, India, Indonesia, Pakistan and Vietnam

There is no doubt that the Green Revolution transformed the lives and livelihoods of millions of Asia_s people. Between 1970 and 2000, annual cereal production in the region more than doubled to nearly 800 million tons, with most countries achieving self- sufficiency in staple food grains. The threat of famine, never far away during the 1960s, receded over a period when the region_s human population increased by roughly 60 percent. Rural incomes rose, city food prices fell_and the economy prospered. But the rest is decidedly not history. Despite the achievements of the Green Revolution, poverty persists in Asia, which today contains the highest absolute numbers of poor_more poor people even than in sub-Saharan Africa. Poverty is particularly deeply entrenched in South Asia, which is home to 44 percent of the world_s poor. The Green Revolution in Asia could not have happened without massive flows of water_irrigation water_to bring the best out of the new crop varieties and other inputs that were also made available to farmers. Nor would it have been possible without massive flows of investment capital to build new irrigation schemes and expand existing ones as well as to fund the provision of other infrastructure and services to rural areas, including research and extension. Today, the use of both surface water and groundwater remains essential to Asian agriculture: 40 percent of the region_s cropland is irrigated. Hundreds of millions of rural people across the continent depend on irrigation_including large and medium-scale canal systems_to earn a living from farming. Irrigation, then, is an essential part of the package of technologies, institutions and policies that underpins increased agricultural output in Asia. Past experience shows that this package, although broadly beneficial to society, has not yet fully succeeded in banishing poverty. So, in the context of the UN millennium goal of halving world poverty by the year 2015, are there ways of making the package more pro-poor in the future?

In 2001, IWMI, in collaboration with national partners, launched a major study that set out to answer this question. Funded by the Asian Development Bank

(ADB), the study explored the links between irrigation and poverty alleviation in six Asian countries. The objective was to determine realistic options for

increasing returns to poor farmers in the low- productivity irrigated areas within the context of improving the overall performance and sustainability

of the established irrigation schemes. The study examined the evidence regarding the effects of irrigation_and particularly its interaction with other components of the package_as a basis for drawing out lessons for policymakers, donor gencies and researchers.

The six countries included in the study were deliberately selected to encompass different policy, social and economic settings. Three countries in rapidly growing but inequitable South Asia_India, Pakistan and Bangladesh_formed a contrast with two in East and Southeast Asia_China and Vietnam_ where economic development has proceeded more fairly and with a third, Indonesia, in which irrigation development has been part of a large government- funded transmigration scheme. China, in particular, is a case in which irrigation and agriculture have developed in the context of a long-term national program to eradicate poverty. The six countries also present contrasting models of the transfer of irrigation management from public agencies to farmer groups or

From the study findings and conclusions, the following broad lessons are identified for the consideration of government policymakers, representatives of donor and development agencies, and others charged with reducing poverty in irrigated agriculture.

Irrigation reduces poverty across all study systems. One of the main conclusions of the study is that irrigation does indeed significantly reduce poverty as measured by household income. Poverty outside of irrigation systems in nearby non irrigated settings is much higher (almost twice) than that within irrigation systems. However, poverty is still high in irrigation systems, averaging 34 percent. There are significant inter- and intra-country differences in poverty incidence in irrigation systems. Poverty is much higher in South Asian systems particularly in Pakistani systems) than in Southeast Asian and Chinese systems.

Inter-system differences in poverty are also much higher in the former than in the latter systems.

Indirect benefits of irrigation at the local and broader economy level can be much larger than the direct crop productivity benefits of irrigation. Canal irrigation generates a variety of direct and indirect benefits at the local and broader levels (increased crop productivity, employment, wages, household incomes and expenditures, increased food supplies/food security/ food affordability due to lower prices, increased induced investments in agricultural and non- agricultural sectors, groundwater development and recharge), but the benefits vary greatly across settings. The indirect benefits of irrigation at the local and broader levels, including multiplier benefits, can be much larger than the direct local-level productivity benefits. Further, medium- and large-scale canal irrigation systems attract private-sector investments in irrigated agriculture, including in groundwater irrigation, and other related sectors. These benefits can help reduce poverty.

Irrigation reduces more poverty under certain conditions. The pro-poor impact of irrigation differs significantly from one setting to another. The extent of benefits to the poor depends on factors such as land and water distribution, the quality of irrigation and infrastructural management, the availability of inputs and support services, and water and agricultural policies. Irrigation can also be anti-poor in situations where adverse social, health and environmental dis- benefits/costs of irrigation outweigh the benefits the poor receive from irrigation. These anti-poor outcomes of irrigation reflect failure of policy, planning and management and can be avoided or minimized through effective interventions. Irrigation investments, whether in new development or in the improvement of existing systems, should not always be assumed to reduce poverty in a significant way. In fact, irrigation can be strongly pro-poor, neutral or even anti-poor depending on the above factors. In South Asia, several influencing factors, notably land equity and irrigation governance and management arrangements, have been unfavorable. So, despite large investments in infrastructure and related inputs and services, the poverty-related impact of irrigation in that subregion has been mixed_and certainly not as good as in China and Vietnam.

Equity and security in access and rights to resources matter for larger poverty impacts. Inequity and insecurity in access and rights to land and water are bad for both productivity and poverty. Where land and water equity exists, irrigation in itself is pro-poor (as in Chinese and Vietnamese systems). As much as there is gender discrimination, there is also discrimination of minorities and groups along caste and ethnic lines in irrigation. There are strong linkages between irrigation, gender, diversity and poverty issues. In South Asian systems, poverty is generally higher among female-headed and low-caste/ethnic minority households. From a socioeconomic standpoint, they are important stakeholders. However, their participation in irrigation management is very low. Their involvement in irrigation decision making is important not only to address existing gender and diversity discrimination issues, but also to enhance benefits of irrigation investment to the poor men and women. The improved understanding of both gender and diversity issues is important for designing effective pro-poor interventions.

While irrigation management reforms of recent years in South Asia have generated some benefits, significant benefits to the poor are not visible. In South Asia,

institutional reforms in the irrigation sector are moving at snail’s pace and only on a limited scale (e.g., mostly at the tertiary _canal_ level but not much

at higher levels). In many cases, these changes are proceeding without the prior elimination of basic constraints that have so far prevented poor people

from fully enjoying the benefits of earlier irrigation investments. Irrigation reforms will help the poor only if they are carried out as part of a broader set of pro-poor changes that address issues such as fair sharing of resources and higher agricultural productivity and profitability. There are indications, though, that the irrigation-sector reforms where implemented have improved infrastructural maintenance, made water distribution fairer, and boosted agricultural production and productivity. However, measurable significant benefits to the poor are not yet visible. The overall conclusion from the country studies is that while the ongoing reforms being promoted, particularly in South Asia, such as irrigation management transfer and participatory irrigation management, have generated some benefits including for the poor, they have been implemented only partially, with no explicit pro-poor elements, and are not sufficient for improving system performance and benefits to the poor in a significant way. In South Asia, unless irrigation reforms are

sharpened with a pro-poor focus, the poor may be bypassed. Irrigation reforms are likely to generate significant benefits for the poor where land and water

are less inequitably distributed; users are socioeconomically less heterogeneous; benefits of irrigation to farmers are significant and irrigated

agriculture is profitable; there are accountability mechanisms and incentives in place for improving service delivery; cost of irrigation to users is linked to

service delivery; and irrigation performance is linked not only to broader-level growth benefits but also to benefits to the poor. In South Asian countries, where most of these conditions are only partially met, unless irrigation reforms are sharpened with a clear pro-poor focus through necessary changes in polices

" It is generally perceived that there is a trade-off between equity/poverty and productivity.This study suggests that this is not necessarily so. High level of inequities in land and water are bad for both productivity and poverty. Irrigation has larger poverty reducing impacts where land and water are more equitably distributed.

" Irrigation benefits are often seen mainly in terms of crop productivity improvements. However, the study suggests that crop productivity is only one of many direct and indirect benefits of irrigation (such as benefits related to employment, wages, prices, consumption, food security,incomes, benefits from multiple uses of water, irrigation induced investments in agricultural and nonagriucltural sectors, benefits from canal-water-induced groundwater development and recharge) classified as type 1-5 in this study. Indirect benefits of irrigation can be larger than direct benefits when these other benefits are also accounted for.

" It is often assumed that targeting of poverty and support to the poor in canal systems is difficult. The study findings suggest that poverty varies significantly across systems and locations within systems, particularly in South Asian systems, and geographical targeting of poverty across and within systems can be done.

"Low irrigation service charge policy is often justified on account of poverty and is assumed to benefit the poor. The study suggests that in settings with greater inequities in land and water distribution, as in India, Pakistan and Bangladesh, low level of irrigation charge does not necessarily benefit the poor, and it could be disadvantageous to the poor where low charges lead to under-spending on O&M works and the system performance suffers. Further, application of a single level of irrigation service charge across areas and systems could lead to situations where the poor end up subsidizing the non-poor.

Irrigation systems managed by public agencies tend to perform poorly. The underlying causes are inadequate funding, lack of incentives for good management, and weak monitoring and accountability mechanisms. Further, lack of clear and secure water rights and allocation rules and corruption-related problems adversely affect performance of irrigation systems and their poverty-reducing impacts. On the financial side, irrigation charges to users in South Asia are often too low or improperly structured, collection costs are too high, and the fees collected from users are not actually channeled back into local system operations and maintenance. Moreover, the low level of irrigation service

charges applied uniformly to all socioeconomic groups of farmers often disadvantage the poor, particularly in systems characterized by high inequity in land and water distribution. There are indications, though, that performance is improving in irrigation systems where management functions have been transferred to local user groups and private service providers.

Benefits and costs to the poor, and long-term sustainability of irrigation software and hardware should matter in the calculus of irrigation investments. Irrigation investments have typically centered on the creation of physical facilities and institutions and on their economic performance in terms of aggregate costs and benefits, with little or no attention to specific benefits and costs to the poor. In most situations in South Asia, almost no attention has been paid to the longer-term sustainability of the new infrastructure and organizations created, and to enhancing their benefits to the poor on a long-term basis. Larger poverty impacts can be realized by integrating investments in irrigation infrastructure, management and service delivery. Evidence from both other recent studies and ours shows that the poverty-reducing impacts of irrigation-related interventions are larger when they are implemented in an integrated framework (e.g., integrated approaches for managing surface water and groundwater; developing systems that allow multiple uses of irrigation water, and for new investments in improving irrigation infrastructure, irrigation management, and service provision in agriculture (provision of inputs, technologies, information, finance, marketing)).

Chinese experiences in resource distribution, institutional, management and technological interventions offer important learning opportunities for South Asia. As a whole, South Asia has much to learn from experiences in land and water distribution, institutional, management and technological interventions, in Southeast and East Asia, particularly China. In these latter regions, irrigation management and other support services are more incentive-based and relatively more equitable, and the agriculture productivity and the benefits of irrigation are higher as a result. China and Vietnam have adopted a _distribute

first_ approach to land and irrigation water, and rural development as a whole. South Asia, in contrast, has adopted a _grow first_ policy in which distributional issues have largely been ignored. As a result, irrigation

has not benefited the poor people nearly as much as it could have in this subregion. In the South Asian countries studied, there is a considerable scope for reducing poverty through land, water, productivity and related policy- and management-level interventions.

" recognize that both gender as well as diversity aspects are critical not only to addressing inequity and discrimination issues but also to enhancing benefits of irrigation investments especially to the poor. Redistribute irrigation benefits to the poor through policy and institutional reforms

“involve the poor in irrigation O&M activities, monitoring and supervisory roles and in irrigation service charge assessment, collection and spending activities.

PAN DISCUSSION GROUP

Message in a Bottle:

The Politics of Water in Bolivia by JIM SHULTZ