The culmination of an effort by the Natural Resources Law Center to explore law and policy issues pertaining to water and the Law Center’s conference in 2000 on Water and Growth in the West, this report documents the Center’s findings.
A number of dynamics within the state necessitated this report. The increase in population, making Colorado in 2000 the third fastest growing state with eight counties that ranked in the top twenty, forced an examination of the ramification of population on water supply. Population growth occurs in areas of the state with no replenishable water supply, such as in the Front Range. The authors observed, “In the modern West, water policy does not appear to be a useful tool for growth management” (p. ix). Current patterns have shown that people will migrate to areas with water shortages.
The water divide, of the water-rich West slope and the population concentration of the West slope, caused the authors of the report to isolate four themes: trans-basin diversions, environmental protection, water quality, and interstate obligations. In response, the authors discussed three options: new development, reallocation, and conservation and efficiency. Complications that the authors cited that adds complexity to the state's water issues include the ownership of water rights outside the county of origin, the market forces that the agricultural community faces valuing alternatives to irrigating acres, and the environmental needs to maintain viable aquatic ecologies.
The authors attribute to the failure of Two Forks the event that "changed the direction of Colorado water management" (p. 1). The proponents of Two Forks proposed a water storage project. It was conceived in the 1940s and defeated for environmental reasons by the Environmental Protection Agency on November 23, 1990.
The forces of population and economics in Colorado, however, accelerated the pace of water management in the state. According to the authors, the West realized "a higher ratio of urban to rural residents than the East" (p. 5). Despite the urbanization, agriculture consumed the majority of the water resources, "well over 90 percent of the water diverted from streams and aquifers in Colorado" (p. 5). Although agriculture generated in revenue an excess of one billion dollars annually, the service sector dominated economically. These factors drive the transition from the lower value use of water, such as agriculture, to a higher value use, such as municipal water supplies. Externalities of the agricultural application of water, "salinity, selenium, or pesticide/fertilizer contamination" cause water quality concerns. As a result, the state has experienced a "rapid conversion of agricultural land to other uses" (p. 6). Colorado citizens, when polled, voice their support of agricultural, recreational, and environmental values.
Colorado exists in the semi-arid West. The authors acknowledged that "it is drought that is the primary climatic concern to water managers in Colorado" (p. 7). Written prior to the drought of 2001, the authors predicted either a wetter future for the state or a period of drought that would offset the wet decade of the 1990s.
To conclude the overview section of the report, the authors explained the concept of prior appropriation, the basic legal concept that governs water law in Colorado and other states of the West. The phrase, 'first in time, first in right' captures the essence of the doctrine. "This notion allows for the establishment of a priority system to determine the proper allocation of water amonst users on a stream when supplies are insufficient to satisfy all demands" (p. 21). The principle recognizes a system of priority, senior and junior users, based on beneficial use--domestic, agricultural, municipal, industrial, and other purposes. Therefore, "a senior water right holder may place a 'call on the river', which requires upstream junior rights holders to cease diversions until more senior users receive their full entitlements. This 'call' system is applicable to waters that are a natural part of the stream system" (p. 21). Despite what some would consider the archaic nature of the prior appropriation doctrine, vested interests in the water management community staunchly defend it.
Individuals can own the right to use water, however, water is the property of the state. The authors explain various legal concepts that relate to water rights--direct flow storage, transfers, and abandonment. The federal government, which owns land within the states, holds "federal reserve rights" over water within their boundaries, a cause of conflicts. Quoting a Supreme Court decision, the authors note "when the Federal Government withdraws its land from the public domain and reserves it for a federal purpose, the Government, by implication, reserves appurtenant water then unappropriated to the extent needed to accomplish the purpose of the reservation. In doing so the United States acquires a reserved right in unappropriated water which vests on the date of the reservation and is superior to the rights of future appropriators" (p. 23). Unfortunately, the Federal government has not quantified the water requirements of much of its reserved land. Bypass flows, typically to accommodate instream flows, wilderness water rights, recreational flows all pertain to federal rights to federal land.
In addition to intra-state water rights and rights between the states and federal government, interstate obligations exist in the form of compacts, equitable and congressional mandated apportionment doctrines. The authors defined a compact as, "an agreement negotiated between states, then ratified by the affected state legislatures and Congress" (p. 32). Colorado has engaged in nine compacts--the 1922 La Plata River Compact, the 1922 Colorado River compact, the 1923 South Platte River compact, the 1938 Rio Grande Compact, the 1942 Republican River compact, the 1946 Costilla Creek compact, the 1948 Arkansas River compact, the 19458 Upper Colorado River compact, the 1968 Animas-La Plata Project compact. An equitable apportionment doctrine is a "doctrine developed by the Supreme Court to resolve interstate water conflicts" (p. 32). Four equitable river compacts involve Colorado--Kansas v. Colorado (1907), Wyoming v. Colorado (1922), Nebraska v. Wyoming (1945), and Colorado v. New Mexico (1982). One example illustrates the last form of obligation, "the Boulder Canyon Project Act" (p. 33). It "divided water between the Lower Basin states on the Colorado River: California, Arizona, and Nevada. This congressional act came about as a result of the Lower Basin states inability to come to an agreement on how water would be divided between them" (p. 33). The Boulder Canyon Project Act (2000) remains the only example. It "divided water between the Lower Basin states of the Colorado River: California, Arizona, and Nevada" (p. 33).
Trans-basin diversions entail "the movement of water from one river basin to another" (p. 37). A practice in Colorado for over one hundred years, trans-basin diversions normally occur to move water from the water rich West slope to the water poor and highly populated east slope and Front Range. Of the approximately thirty diversions, the Adams Tunnel, Roberts Tunnel Boustead Tunnel, Moffat Tunnel, Twin Lakes Tunnel, Homestead Tunnel move water from the west slope to either the South Platte or the Arkansas basins. Projects in the conceptual or actual stages of development include the Homestead alternatives, the Windy Gap Firming project, Denver Basin conjunctive use, Pueblo Reservoir Enlargement, and the Turquoise Reservoir enlargement. Diverted water, sometimes referred to as "foreign" can, according to Colorado law "can be sued in its entirety, that is to "extinction." (p. 39), with the exception of Big-Thompson water. Big-Thompson water conforms to the rules of "native" water, "i.e., for single use" (p. 39) . . . return flows accrue to the receiving stream . . . and are available for use by others" (p. 39).
Given the animosities that have resulted between the West and East slopes over trans-mountain diversions, the authors discern three potential changes in the approach to trans-mountain diversions. First, one approach would emphasize "utilizing existing trans-basin rights and facilities" (p. 42). Second, having "compensatory storage" as a part of the deal-making in trans-basin diversion will diminish. These facilities have served to protect endangered species rather than the residents of the basin of origin. Alternatives include "reserved water rights for future growth . . . the creation of a permanent trust fund . . . a NEPA-style impact analysis for trans-basin diversions" (pp. 42-43).
Environmental Protection
The book covers environmental protection, referring to the cases that shape water policy in the state. When itemizing beneficial use, the framers of the Colorado Constitution did not include the environment or recreation. In 1973 the Colorado legislature attempted to remedy this deficiency by enacting "a minimum stream flow program" (p. 47). The statute states that the law "empowering the Colorado water conservation board to appropriate such waters of natural streams and lakes as may be required to preserve the natural environment to a reasonable degree is not unconstitutionally vague and, therefore, not an impermissible delegation of authority" (Colo Stat 37-92-103 (IV)). Federal action encouraged this trend through the "Wilderness Act of 1964, the National Environmental Policy Act of 1969, the Clean Water Act of 1972, and of particular importance, the Endangered Species Act of 1973" (p. 47). The reader should discern whether these laws lead to restoration or preservation of the habitat of species. Colorado statute dictates the terms of the instream flow program. According to the authors, the Colorado Water Conservation Board "can acquire rights through appropriation, purchase, or donation" (p. 48). The laws pertaining to recreational use are more vague. These rights conform to governing laws and seniority rights, "subject to the same legal and administrative rules as other water rights. These rights are, however, subordinate to all undecreed uses existing at the time of appropriation, a restriction not placed on other new appropriations" (p. 48). Additional to state statute, instream flows strategies encompass the reserved water rights and bypass flows, employed by the federal government, dry-year option agreements, interruptible supply contracts, and lease-backs, water transfers, and subordination agreements between parties. At the time of publication, recreational water rights were even more restricted and vague.
The Endangered species act, according to Nichols, Murphy, and Kenney, exerts the greatest federal impact on water in the west. They cite two sections of the act, 7, Interagency Cooperations, and 9, Prohibited Acts, as the core of the legislation. Section 7 affirms that "all other Federal agencies shall, in consultation with and with the assistance of the Secretary, utilize their authorities in furtherance of the purposes of this Act by carrying out programs for the conservation of endangered species and threatened species" (Act, 1973). Section 9 details the illegality of possessing or releasing native or non-native species within a federal jurisdiction. "It is unlawful for any person subject to the jurisdiction of the United States to— (A) import any such species into, or export any such species from the United States; (B) take any such species within the United States or the territorial sea of the United States; (C) take any such species upon the high seas; (D) possess, sell, deliver, carry, transport, or ship, by any means whatsoever, any such species " (Act, 1973). Colorado, as do other states, has its own act regulating endangered species, the Nongame, Endangered, or Threatened Species Conservation Act.
Of the river basins in Colorado, the Upper Colorado and the South Platte have initiatives to protect endangered species affected by "the modifications of natural flow regimes" (p. 55). In the Upper Colorado, the pike minnow, the humpback chub, the bonytail chub, and the razorback sucker faced a diminution of numbers. After studies since 1988, joint efforts by the Bureau of Reclamation and Colorado water users, 31, 650 AF releases from the Ruedi Reservoir by the Bureau and the 10, 825 AF from Colorado water providers. A Tri-State Agreement, between Colorado, Nebraska, and Wyoming, will detail the negotiation between the parties to address the habitat recovery of the whooping crane, piping plover, lesser tern and pallid sturgeon. Finally, the Tamarack Plan focuses on streamflows of the South Platte near the Colorado and Nebraska border for wetlands and waterfowl.
The authors questioned the effectiveness of the Upper Colorado program on fish stock, "it does not appear to be accomplishing much" (p. 60). The inability to purchase senior water rights on the western slope, the absence of federal recovery goals, the complications between diversions and recovery, fear that recovery programs would prevent Colorado from using its full entitlement of water, designated in the Colorado River Compact of 1922, has stymied the process. The issue of diversions and recovery is a conundrum--"most professionals believe that population growth along the Front Range will be supplied by increased trans-basin diversions, non-tributary groundwater supplies, and agriculture to municipal transfers. Foreign (trans-basin) water will not be completely consumed, and more than offset depletions caused by the new development" (p. 61).
The authors noticed other consequences of the Endangered Species Act--"to modify patterns of growth, land-use, and thus, water use" (p. 63). The saga of the Preble's jumping mouse is a case in point. It inhabits riparian territories on the Front Range in Colorado and Southeastern Wyoming, which can temporarily thwart Front Range growth. The Act might prevent phreatophyte control by burning these water consuming plants in areas of endangered species habitats. Understandably, state governments often feel that the Act infringes on their jurisdictional control.
Water Quality
The book covers water quality and interstate obligations, referencing state and federal water laws and statutes. The issue of quality pervades all aspects of Colorado water. Reuse of water has caused concerns about water quality. The federal Clean Water Act (1972) forms the backbone of water quality legislation Reacting to the federal legislation, Colorado passed the Colorado Water Control Act (1973), with the Water Quality Control Commission of the Colorado Department of Public Health and Environment as the administrators.
Sections of the Clean Water Act to note include 404, which requires anyone to acquire a permit to discharge dredged or fill materials into U.S. waters. Section 401 reinforces Section 404 and other related regulations by mandating that a state certify compliance. Section 303(d) monitors Total Maximum Daily Load (TMDL). "Preparation of a TMLD requires a calculation of all existing pollutants (including pollutants for non-point sources . . . and an assessment of the assimilative capacity of the stream segment" (p. 66).
A regulatory program within the Clean Water Act, the National Pollution Discharge Elimination System (NPDES), "requires each discharger from a discrete 'point source' . . . to meet technology-based effluent standards nationally promulgated by EPA for each category of discharge" (p. 66).
The authors pinpoint a noteworthy paragraph of the Colorado Water Quality Control Act, which clarifies the water quality provision by declaring "no provision of this article shall be interpreted so as to supersede, abrogate, or impair rights to divert water and apply water to beneficial uses in accordance with the provisions of section 5 and 6 of article XVI of the Constitution of the State of Colorado, compacts entered into by the State of Colorado, or the provisions of articles . . . or Colorado courts determinations" (Colo Rev Stat 25-8-104). This attitude coincides with the state's organizational structure of water rights and water quality issues. Water rights equate to property rights, water quality denotes a regulatory determination. Two different departments and personnel deal with each area. Only at the federal level do these two interests converge in the EPA.
The impact on water quality from water diversions, pristine water to areas of lesser water quality is complex and case specific. Augmentation, the transfer of water from one stream to another, has similar indeterminate consequences.
Interstate Obligations
Legally, Colorado has water obligations to other states through nine interstate compacts. Before binding a state to a contract, the document requires congressional ratification, which "confers the status of federal law on compacts" (p. 79). A similar congressional act can amend a compact. Supreme Court judgments "help to define the state's entitlement to its interstate rivers, through equitable apportionment decrees, compact interpretations, and rulings on the states' compliance with interstate obligation" (p. 79). The authors listed the following cases of the Supreme Court: Nebraska v. Wyoming, Wyoming v. Colorado, Texas and New Mexico v. Colorado, and Kansas v. Colorado. Of the basins in Colorado, the authors designated the following as fully appropriated or over-appropriated: the Arkansas, Rio Grande, La Plata River, Republican River, Costilla Creek Basin, North Platte, and Laramie River. Ramifications of full appropriation or over-appropriated rivers include irrigated land removed from production, repayments to injured parties of over-appropriation, damage to water quality, and inter-state conflicts. Limits to growth might result in the ultimate outcome.
Colorado River and the Law of the River
All contracts, statutes, and court decision applicable to the Colorado River collectively embody the Law of the River. The Colorado Compact of 1922, the Mexican Water Treaty of 1944, and the Upper Colorado River Compact (1948) make up the works in the group. Native American claims, of as many as 25 tribes, to water in the Colorado complicate the picture. Because of the financial inability of the tribes to adjudicate or exercise their claims, which could equal the entire flow of the river. The authors designated the Colorado River Compact as a "'beneficial use' compact. Therefore, until water is used by the upper basin states, it is available for use by the lower basin states" (p. 84). The upper basin states have not consumed their full allotment. In contrast, California has exceeded its allocation. To meet its obligation, "California adopted the so-called '4.4 Plan,' which calls for California to reduce its withdrawals to its 4.4 million acre feet apportionment over a 15-year period" (p. 85). To formalize California's intention, in 2001 Secretary of Interior Babbitt signed the Record of Decision, with its incentives, sanctions, and deadline of 2016. In Colorado from the headwaters to eastern Colorado, diversions average about 419,000 AF per year. Furthermore, environmental protection and recreational interests exert growing pressures. State water stakeholders argue that the state should "use it or lose it . . . or sell" their water allocation (p. 85). The beneficial use principle prohibits the state from building storage facilities for the purpose of hording water. The authors offer a solution to this dilemma by advocating that the state "lease or sell these resources to those downstream states" (p. 85), such as California. The authors admit state resistance to this proposal, by stating that "state officials have typically demonstrated the belief that interstate marketing is not in the best interest of Colorado, and is likely a violation of Colorado water law" (p. 86).
New Development
Discussing future potential sources of water, the authors admitted that the over-appropriation of basins in highly populated areas limited further development of these basins, explored conditional, and junior water rights. The Colorado statutes define conditional rights as "a right to perfect a water right with a certain priority upon the completion with reasonable diligence of the appropriation upon which such water right is to be based" (Colo Stat 37-92-103). The authors claimed that water within this classification "total an enormous amount of water--could meet any foreseeable needs from growth if they were developed" (p. 89). Many current attempts at development have encountered legal or federal barriers. At the state level, actions to curtail manipulations of conditional rights have seen the evolution of 'legal diligence requirements' and the 'anti-speculation doctrine'. (See page 91.)
The authors acknowledge that a "mix of legal, economic, political, and environmental considerations has fundamentally changed the nature of new storage projects" (p. 94). Popular attitudes against building dams, trans-mountain diversions, and high construction costs. The Green Mountain Reservoir--a part of the Colorado Big-Thompson project--gravel and sand pits along the South Platte, potential application of undeveloped Native Indian water rights, reservoir enlargements, and off-stream reservoirs.
Aside from surface water management, groundwater supplies approximately one-sixth of the water consumed by the state. The state defines ground water multiple ways, tributary, non-tributary, designated, and not non-tributary. According to the Colorado statute, "'nontributary groundwater' means that ground water, located outside the boundaries of any designated ground water basins in existance on January 1, 1985, the withdrawal of which will not, within one hundred years, deplete the flow of a natural stream . . . (b), at an annual rate greater than one-tenth of one percent of the annual rate of withdrawal" (Colo Rev Stat 37-90-103). Within Colorado law "'designated ground water basin' means that area established by the ground water commission" (Colo Rev Stat 37-90-103). The statutes explain not nontributary ground water as "ground water located within those portions of the Dawson, Denver, Arapahoe, and Laramie-Fox Hills aquifers that are outside the boundaries of any designated ground water basin in existance on January 1, 1985, the withdrawal of which will, within one hundred years, deplete the flow of a natural stream, including a natural stream . . . at an annual rate of greater than one-tenth on one percent of the annual rate of withdrawal" (Colo Rev Stat 37-90-103).
The court rules based on the implications of these distinctions. Judges adjudicate tributary groundwater as they would surface water, non-tributary water according to a variation of the prior appropriation doctrine, and designated ground water they defer to the Colorado Ground Water Commission for determination. The authors concluded "the different classifications of ground water primarily are used to determine ownership and establish administrative rules" (p. 99).
Conjunctive use, the storage of surface water in aquifers, allows for the recharge of pumped aquifers and for the use of the aquifer as a storage facility. The authors contend that in the United States water managers view conjunctive use as a safeguard during drought. Conjunctive use has similar attributes as surface storage--storing seasonal flows, an additional storage option, and a potential source of water exchange. Furthermore, conjunctive use avoids permitting issues and, more importantly, evaporative losses. Within a semi-arid climate, such as Colorado, operating costs for conjunctive use exceeds surface storage, because of the lack of water. Only water imports can supply the resources necessary for recharge. Additionally, the authors observed that "many of the legal issues surround allocation of an aquifer's storage space . . . adequate rules generally do not exist for fairly tracking the complex accounting of injection versus withdrawals, or for limiting access to the newly stored water to operators of the conjunctive use project" (p. 107). The Tri-Party Alliance, composed of Douglas County, Denver Water, and the Colorado River Water Conservation District, intended to recharge the Denver Basin, a depletable asset. Douglas county obtains much of it water from the Denver basin and would benefit from an extension of supply that recharge provides. "Denver Water could benefit by selling water to the project in wet years, and using the stored water for drought protection in dry years" (p. 108).
From the perspective of water sources for conjunctive use, the authors noted that "some of the concerns surrounding this idea are reminiscent of those associated with Two Forks, . . . both projects tap the same water supplies" (p. 108).
Reallocation of Existing Supplies
Reallocation entails the transfer of water from one consumer to another. Generally, the most dominant type transfers water from agricultural to municipal users, from declining agricultural economies to a growing population base. As the dominant water user, the agricultural, livestock, and mining communities have the greatest supply. That agricultural water sells at a cheaper price than other sources, usually with more senior rights. However, agricultural reallocations might have greater ramifications to the total rural community, effecting business, social, political, and cultural organizations.
Among the broad types of transfers, permanent and temporary, municipal acquisitions and direct purchases constitute two subclasses of the permanent category. Agricultural transfers dominate in the first class and direct purchases, through water markets or other avenues make up most of the second class. The authors define water markets as "a central mechanism for buyers and sellers to exchange information about water demands, supplies, and transfer opportunities, and help to establish prices" (p. 114). Of the temporary options, leases, subordination agreements, dry year options/interruptible supply contracts, lease-back arrangements, and water banking offer a variety of choices. The authors define leases as "an agreement between a rights holder and a new user providing for a temporary water transfer of a pre-determined quantity and duration" (p. 115). Subordination agreements involve "a contract with more senior rights holders in which the senior pledges not to call out the junior municipality" (p. 115-116). Denver Water, which has a subordination agreement with the Shoshone Power Plant has never exercised its powers under the agreement. The dry year option "allow the senior rights holders to continue to use the water . . . in normal years and give the option holder . . . a cost-effective way to make its supply more reliable during dry years" (p. 116). Water users in California resort to this plan more frequently than those in Colorado, "legal complications and uncertainties explain the limited use of dry year options in Colorado" (p. 117). To circumvent this difficulty, "a so-called 'temporary substitute supply plan' might be legally sufficient to implement a dry year option agreement immediately if there was a drought and the need pressing" (p. 117). The inverse to the interruptible agreement, lease-back arrangements between a buyer and seller, the buyer "acquires ownership of the water right, makes the appropriate changes in water court, and then leases the rights back to the seller" (p. 117). This situation usually has two scenarios. In the first, the buyer exercises the right during a drought and in the second the buyer exercises the right when sufficient growth occurs, which necessitates the use of water. Finally, "a water bank is a formal mechanism to pool surplus water rights for rental to other water users" (p. 118). Colorado has formed a water bank in the Arkansas basin. Of the fifty states, California has the most innovative example, The California Drought Water Bank mitigates against drought. Considering the externalities of water reallocation, one should mention the communities affected by the transfers and environmental interests. Transfers can incur substantial transaction and legal costs.
Previously, the authors discussed the impacts of transfers on rural communities. Noteworthy are the consequences of transfers on specific ethnic groups. As the authors relate, "water transfers can also affect the cultural integrity of communities strongly tied to irrigation economies, including the Hispanic towns of northern New Mexico and Colorado's adjacent San Luis Valley. To the extent that poor or traditionally disenfranchised ethnic groups populate affected communities, water transfers can be viewed as an environmental justice issue demanding special attention . . . a strong case for special protection" (p. 120).
The authors explained the economic, cultural, and environmental disparities between the transferred water from agricultural to urban use. Each has a unique demand curve, the requirements of conveyance structures differ, and operating costs differ. In addition, the transition from agricultural to urban water ownership occurs gradually, resulting in an awkward coexistence of both systems within a common geographical space. "Ditches must often be buried in urban areas, canal crossings protected, and open conveyance structures fenced to prevent accidental drowning . . . urban landowners are often oblivious to ditch rights, and assume they have paramount rights simply because the ditch traverses their property" (p. 121). Lastly, the authors addressed the affect of water transfers from agriculture to urban use on water hydrology, "including the quantity, quality, temperatures, and timing of flows" (p. 122). Within Colorado, the consumptive use of agriculture exceeds 85 percent. With the transfer to urban areas, consumptive use decreases and more water remain in streams. Changes in use result in the timing of high and low stream flows. The authors observed that "modifications of flow regimes have a variety of complex ecological impacts, benefiting some species at the expense of others" (p. 122). Buyers and sellers of water rarely account for the potential alternations in water quality. Despite the disadvantages, transfers constitute the major means of municipal water augmentation.
Conservation and Efficiency
Conservation and efficiency measures range from "demand reduction, efficiency improvements, wastewater reuse, and improved system operations . . . and raise their own legal and policy issues" (p. 125). Restricting population growth or per capita consumption curb demand. Other demand management strategies include metering and price incentives, through tiered pricing or block rate systems. Economists disagree on the elasticity of price on consumption. The prior appropriation doctrine inhibits emphasis on water use efficiencies within the agricultural sector, a decline in the use of water might result in a reduction in the farmer's water right. However, agricultural water consumption has decreased due to improved irrigation practices and agriculture to urban water transfers. Municipal water managers have pursued a number of initiatives to increase efficiency: "(1) water efficient features and appliances; (2) low-water-us landscaping and irrigation efficiency improvements; (3) water-efficient industrial and commercial water-using processes; (4) water reuse systems; (5) distribution system leak detection and repair; (6) water efficiency measures: e.g., public education, customer water use audits and water-saving demonstrations; (7) tiered rate structures; (8) water efficiency incentives, e.g., rebates" (p. 131-2). The public continues to resist potable reuse.
Throughout the discussion, the authors isolated two philosophical camps regarding water, those that promote water as private property and those that view water as a common good, demanding equity considerations. Because of the emphasis in Colorado on the first perspective, the authors throughout the book explained various types of transaction costs for "buying, selling, modifying, or exercising water rights" (p. 143). Water court costs, the sole institution with the final authority to administer water decisions, rank highest of all costs. Geography determines water transaction costs; "transaction costs are further reduced in areas where water is readily available" (p. 144). Additionally, regions in which owners clearly haved defined rights, such as C-BT contracts, have lower transaction costs. As explained earlier, transaction costs of transmountain diversions depend on the acquisition date, the earlier, the cheaper the costs.
Finally, the authors compiled a list of potential strategies that might benefit the state in the future: "cooperative/joint waterdevelopment . . . small-scale and off stream water storage . . . market-based reallocation . . . temporary water transfers . . . groundwater development and conjunctive use . . . integrationand coordinated operation of water systems . . . efficiency and wastewater reuse . . . conservation and demand management . . . cooperative solutions to envrionmental problems and endangered species . . . accommodating recreational flows. . . water quality and quantity integration . . . reserved rights settlements . . . controlling interstate demands" (pp. 155-158).
Concluding that 'water flows to money', the authors of this volume concluded that "for Front Range municipalities, the issue is probably not future shortages, but rather future costs. As the price of new water development escalates, the population will bare greater costs" (p. 160).
Nichols, P. D., Murphy, Me. K., Kenney, D. S. (2001). Water and Growth in Colorado: A review of legal and policy issues. Boulder, CO: Natural Resources Law Center, University of Colorado School of Law.
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