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3 Understanding the Institutional Dimensions of an Environmental Problem The complexity of the hydrological, geological, chemical, and eco- logical factors described in Chapter 2 poses a tremendous management challenge, but, in fact, these factors are only part of the picture. They are joined and often exacerbated by an equally complex and conflicting maze of political, social, economic, legal, administrative, and other institutional factors. The technical complexities relate to defining the nature, extent, remediations, and consequences of an environmental problem and the re- sponses proposed. The institutional complexities affect problem awareness and the acceptance and effectiveness of proposed responses. They take on added significance if the level of technical understanding is uncertain. Typically, it is for institutional (e.g., social and political) reasons that some change in the environment is judged to be a problem rather than merely a change. These same institutional factors will then influence the choice of a response. Because institutional and scientific considerations are entwined, responses must be based on an understanding of the complex interactions that can occur between these two dimensions. The institutional barriers often are more difficult to overcome than the technical problems. In addition, the separation and fragmentation of institutional interests and responsibilities make it hard to develop a coordinated strategy for water use planning. The term "institutions" is used in many ways and thus can be confusing. At one level, "institutions" is used to mean agencies. However, this defini- tion is too limited. The term "institutions" encompasses much more than the few government bodies with responsibility for resource management 53

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54 IRRIGATION-INDUCED WATER QUALITY PROBLEMS and enforcement of relevant laws. The concept also includes administrative organizations, social customs, regulations, policies, and laws. Institutional analysis must consider economic arrangements such as pricing policies and constraints, subsidies, water marketing, water allocation mechanisms, and combining surface and ground water management. It must take into ac- count the potential of different tax schemes (incentives and disincentives), rules, regulations, guidelines, and administrative interpretations, as well as the creation of alternative institutional authorities. This chapter addresses how institutional factors contribute to the cre- ation and continuation of irrigation-induced water quality problems. It also discusses how these institutional dimensions sometimes impede responses. Although economic issues, social issues, organizational influences, legal issues, and political issues are covered separately, in reality these influences are intricately interrelated. ECONOMIC FACTORS Economic factors are a critical institutional issue to be considered when attempting to understand the nature and consequences of irrigation-induced water quality problems. One step in every problem-solving endeavor is to assess the proposed solutions in light of their economic viability (see Chapter 5~. However, it is equally important to understand the setting in a broader economic sense-to understand historic economic influences and current economic pressures. Perhaps the most pervasive economic issue contributing to the creation of irrigation-related water quality problems and affecting the choice and success of solutions is the cost of water. The availability of water of ade- quate quality, in sufficient amounts, and at an affordable price determines the viability of any effort to settle or to produce crops on arid and semiarid lands. Without water, such land can be almost worthless for farming (at least as measured by the market). With water it is worth thousands of dol- lars per acre. Building large reservoirs, transporting water long distances, and distributing it over large areas are costly undertakings. Thus the true costs of water supplied by large irrigation projects are generally too high for farmers to pay without subsidies. One traditional approach used to keep the price of water artificially low has been to exclude the costs of a drainage system when an irrigation project is first planned and built. Because drainage facilities are not needed at the inception of a project, the costs of building them can be delayed in the early phases of project proposal. This has the effect of making the project appear to be much more economical than it would have appeared if drainage costs had not been deferred. Ignoring the costs of environmental degradation, overestimating crop

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THE INSTITUTIONAL DIMENSIONS 55 yields and prices, and underestimating construction and operation costs- whether intentionally or not-also help reduce the apparent cost of irriga- tion projects. In the West, however, even these strategies were inadequate to ov~.roOmP. the economic realities Of irrigated agriculture. Water was still ~ ~ an, _, _~ ,^^ _ ,^ _ _ O O inordinately expensive. 1b compensate, other subsidies were adopted. One was to eliminate interest payments in computing the cost of irrigation water. Another was to impose very loose repayment terms allowing the farmers' financial condition to dictate how much they would actually pay. The net effect of these subsidies is substantial. Farmers in the North Platte Project in Nebraska and Wyoming annually pay an estimated $0.22/acre/yr for water that would carry an unsubsidized price of $8.18 (U.S. Department of the Interior, 1988~. Irrigators in the Bonneville Unit of the Central Utah Project contribute $17.84/acre/yr toward repayment; the federal government's share is $306.40. And the amount of subsidies is increasing with newer projects: irrigation waters from the Animas-LaPlata Project in southwestern Colorado will sell for $40.60/acretyr although the real cost is estimated at $673.47. Farmers in the Central Arizona Project will pay $213.40/acre/yr for water that costs an estimated $542/acre/yr (U.S. Department of the Interior, 1988~. (Table 3.1 provides other examples, although it should be noted that these figures are not directly comparable because they are calculated on a rate-per-acre-foot basis.) Figures were compiled by the U.S. Bureau of Reclamation (USER) at the request of Congress in 1988 to illustrate the range of the real costs of water in the West. (All such estimates should be approached cautiously because they can vary significantly depending on how interest is incorporated. This can greatly change the degree, but not the direction, of the subsidy.) According to these estimates, in 1986 western farmers received an irrigation subsidy of about $534 million from the federal government, for an average of $54/acre of irrigated land. The total annual subsidy of California's Central Valley Project in 1986 was $135.4 million, about one- fourth of the national total. The total value of the irrigation subsidy from 1902 through 1986 is roughly estimated to have been $9.8 billion (U.S. Department of the Interior, 1988~. Nationally over the past 10 years, an average of 38 percent of that subsidized water was used to grow crops that the government considered surplus, including cotton, rice, wheat, corn, oats, barley, sorghum, and soybeans. In 1986 alone, farmers using USER water to irrigate surplus crops received about $203 million in irrigation subsidies (U.S. Department of the Interior, 1988~. This "double subsidy"-obtained when some producers participate in commodity subsidy programs and receive subsidized irrigation water is of particular concern (Moore and McGuckin, 1988~. These subsidy policies contribute to three effects. First, they ensure

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56 IRRIGATION-INDUCED WATER QUALITY PROBLEMS TABLE 3.1 Subsidized and Full Cost Prices per Acre-Foot of Water for 18 Reclamation Districts District Subsidized Rate ($) "Full Cost" Rate ($) Black Canyon, ID 1.4115.77 Coachella, CA 7.0026.27 Columbia Basin East, WA 4.1941.16 Elephant Butte, Not 6.4524.43 Farwell, NE 10.50135.50 Glenn-Colusa, CA 1.4617.85 Goleta, CA 59.24263.12 Goshen, WY 4.2222.96 Grand Valley, CO 1.1831.10 Imperial, CA 4.7511.00 Lower Yellowstone, MT 5.2834.62 Lugert-Altus, OK 18.58143.19 Milk River, MT 7.79119.13 Moon Lake, UT 1.757.04 Orov~lle-Tonasket, WA 11.4721.33 Truckee-Carson, NV 2.1933.46 Wellton Mohawk,AZ 4.8029.58 Westlands, CA 15.8067.56 NOTE: Subsidized rates and full cost rates were calculated according to section 203(a) of the Reclamation Reform Act of 1982. These calculations do not include opportunity costs and thus are conservative. SOURCE: U.S. Department of tl~e Interior, 1980. that the projects are rarely paid for by farmers, because the USER sets annual charges too low to recover the capital costs. In a given year it often costs more just to operate most systems than the farmers pay for the water. Second, they create an economy based on subsidized water, one that may lack the financial resources and incentives to deal with the inevitable problems that irrigated agriculture creates. The West has many marginal irrigation projects supporting farmers whose economic existence is depen- dent on water subsidies. Over time the dependency becomes fundamental to local lifestyles, and there is an expectation of unending support. Such expectations are capitalized in land values, and any change in the status quo will inflict large costs on the farming community. Third, they reduce the incentives that encourage farmers to use water efficiently. The economic and legal factors determining water use in the West have created an immense irony. Water is in many ways the most valuable commodity in the arid West and the basis of much of its wealth. Yet because it is sold at artificially low prices, farmers often treat water

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THE INSTITUTIONAL DIMENSIONS 57 as if it were a free commodity. Crops are overirrigated because that is easier than managing the water carefully, and canals leak because it is not economical to line or fix them. Thus, the subsidization of irrigation water appears to be a major culprit contributing to irrigation-induced water quality problems. The low cost of water results in more water being used, it encourages farmers to cultivate less desirable lands, and it leads to increased leaching from subsurface flow. Current water use patterns also diminish the amount of fresh water left in streams to dilute contaminants and carry them out to sea, and they have stimulated the drainage of wetlands, with a concomitant loss of their ecological functions and diversity. Water subsidies do bring well-known benefits, particularly in the social realm, but it is increasingly important to recognize the full scope of disadvantages as well. A final economic reality that should be mentioned is the problem of tight budgets. Federal, state, and local governments all are facing serious financial constraints. Proposals to undertake expensive activities to build new water development projects or to correct problems caused by existing projects receive greater scrutiny now than in the past. The difficult and important question of who will pay for whatever actions are adopted also arises. Will it be the farmers, many of whom have limited capability to pay for major new undertakings? Should they pay, for instance, for new wildlife habitats or in-stream flows? Or will some (or perhaps all) of the costs be underwritten by the state's and/or the nation's taxpayers? It is not likely or reasonable that these regional costs be assumed totally on a national scale. Technical solutions for irrigation- induced problems may exist, but it will prove difficult to resolve who is to pay for those solutions. SOCIAL FACTORS Social acceptability has proved to be an increasingly visible criterion for addressing environmental concerns such as irrigation-induced water quality problems. It is particularly important to recognize the fundamental role that social issues play in setting the stage for both the creation of irrigation-related problems and the choice of solutions. The United States has used laws, policies, and economics to establish an agricultural society in the West that depends on subsidized water. Any change in rights will change the distribution of income, and the people who have benefited from the original system will resist any attempts to change it. This social dimension is well reflected by the political powers it creates and the agencies that serve it. Together these forces create the laws and regulations that preserve, reinforce, and expand the reliance on economic subsidies.

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58 IRRIGATION-INDUCED WATER QUALITY PROBLEMS The U.S. Bureau of Reclamation system was originally established with the intention of promoting the small family farm. The Reclamation Act of 1902 originally limited the water available so that no farm could receive water for more than 160 acres. This figure was revised to 320 acres, 160 acres each for husband and wife. The intent was to promote an equitable distribution of social and economic benefits, but this limitation was never rigorously enforced. More often than not, reclamation projects and the economics of scale led to large farm holdings, and the wealth created was concentrated in a small percentage of the population (Goodall and Sullivan, 1985~. As agricultural practices changed, many irrigators avoided the 160-acre limit through complicated trusts and rental agreements, and by registering land in the names of different family members. Because of the complicated mechanisms used to avoid the limit in many areas, it is difficult to say with certainty what the average farm size is in many reclamation projects. But the concept that the benefits of subsidized water are accruing largely to small family farms is a myth. In California, for instance, corporate farms owned by firms such as Southern Pacific, Chevron USA, Getty Oil, Shell Oil, and Prudential Insurance are estimated to use more than two-thirds of the state's agricultural water (Martin, 1989~. The net effect of this situation is that, politically and socially, the recla- mation system has created many farms throughout the West that probably could not survive without the substantial subsidies they receive. This cadre of farmers adds to the political pressures that resist changing the existing system. And they have limited capacity to take on additional financial burdens required to correct irrigation-induced water quality problems. At the same time, a large portion of the subsidies goes not to small farmers but to larger enterprises that probably could afford to pay more realistic prices for their water supplies as well as the costs associated with water quality improvement. This subsidy system does not exist in a vacuum. The subsidies have to be paid by someone. Some are financed from within the region; for instance, municipalities and industries pay higher rates and end up supporting the costs of new state or regional water projects so that farmers can continue to receive low-cost supplies. The state taxpayer picks up other expenses. Taxpayers outside the region also pay many of the subsidies. As the nation adds other subsidies principally in the form of commodity price supports the problems are exacerbated and become even more difficult to solve. The dilemma created is that short-term benefits accrue primarily to the agricultural sector (and perhaps to the public in the form of lower food costs, although this has not been clearly demonstrated), while in the long run the costs with respect to tax outlays and environmental degradation are borne by those who may not have experienced the benefits.

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THE INS TI7IJTIONAL DIMENSIONS 59 High subsidy levels increasingly are being questioned. It is not only the subsidies that people are questioning, but also the very use that is being made of the water. For the population served by public supplies, the average domestic per capita water use in western states is 143 gallons per person per day, compared to 105 gallons in the rest of the country (Solley et al., 1988~. Many of the West's new residents have brought with them not only additional demands for the region's limited water supplies, but also different perceptions about how the water can be used most beneficially and treasured as a valuable commodity. Historically, most of the West's water has gone to rural economic uses such as farming, ranching, and mining. But the West- long romanticized for its rural frontiers is becoming increasingly urban, and these urban residents often have different ideas about water use. Nationally, 73.7 percent of the population lives in urban areas, but in California the percentage is 91.3 and in Arizona, 83.8 (Statistical Abstract, 1988~. Urban residents bring different values and priorities. They may be more interested in using water to sustain their urban jobs, water their lawns, and provide recreational opportunities than to irrigate crops (E1- Ashry and Gibbons, 1986~. And to the extent that the existing water allocation system allows water markets to determine how the water is used, these urban users can often pay much more than rural users pay. Industries and municipalities have indicated a willingness to pay hundreds and, in some cases, thousands of dollars for water that costs farmers tens of dollars. On a smaller scale, the increasing wealth of some segments of society creates an increased demand for recreation, including wildlife habitats, wild rivers, and streams for fishing. The shift from a rural to an increasingly urban population is not the only reason for the change in values that is occurring. There is a greater recognition now of the costs to society in terms of ecological change. Diminishing wildlife and waterfowl populations, the extinction of plant and animal species, and the ever-shrinking availability of clean water supplies are viewed as indicators of undesirable ecological changes. Many citizens now place more emphasis on environmental protection, clean up, and enhancement. For example, leaving water in the stream was once considered tantamount to wasting it; most states did not consider in-stream flow to be a beneficial water use. That is no longer the case. Keeping water in the stream is seen as having a high value by many westerners, and all western states now recognize some form of in-stream flow rights. The increased growth in population and economic activity has affected not only the quantity of water in the region's rivers but the quality of that water as well. As the West has grown, so have waste-producing human activities. The expansion of cropland and livestock operations, the growth in industrial output, the increased amount of land cleared for residential

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60 IRRIGATION-INDUCED WATER QUALITY PROBLEMS .-, Society's values have changed with time, and many citizens now place more emphasis on environmental protection. Although irrigation remains the largest water user in the West, there is an increased demand for water for other, less tangible uses such as wildlife habitat, wild rivers, and recreation. CREDIT: Soil Conservation Service, D. Schuhart. and commercial purposes-indeed almost all the activities associated with this growth increase the amount of pollutants entering streams and rivers. Society traditionally has used rivers and streams as pipelines to carry its wastes, but this approach is increasingly inadequate as the amount of water in the rivers and streams diminishes or where the waterways are rendered unfit for human and other uses by uncontrolled pollution or incomplete treatment. Arid regions face an inherent dilemma-development consumes the water needed to carry away resulting wastes, at the same time increasing the amount of wastes it produces. Some of this pollution can be controlled, but much cannot. The increasing loads of pollution will inevitably hasten the deterioration of the region's scarce water resources. The changing demographics, increasing income, and shift in values that have caused these changes are likely to continue. And the resulting changes in priorities, combined with a relatively inflexible water allocation

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THE INSTITUTIONAL DIMENSIONS 61 system and continually diminishing supplies of available water, will generate increasing conflicts. There is no additional water, just more demand on the limited supplies available. AGENCIES AND ORGANIZATIONS Another critical area to be considered in any problem-solving endeavor is the influence of agencies and organizations, including both governmental and nongovernmental bodies. Organizational influences change over time to reflect the nation's changes in priorities and values. Two decades ago, the USER was the primary federal agency concerned with irrigated agriculture, and it was primarily concerned with only one objective: assuring an abundant supply of inexpensive water for farmers. Questions of environmental degradation and the values of wildlife and in-stream flows generally were rarely considered because society did not give these issues the high priority it does today. Since then, however, agencies such as the U.S. Environmental Protec- tion Agency have been created, and others like the U.S. Fish and Wildlife Service (USFWS) have become much more involved in the health of the environment on which wildlife depend. Similar changes have taken place at the state and local level, and in most cases, this proliferation of regulatory and management agencies has been matched by a proliferation of relevant laws (Box 3.A), regulations, treaties, and court decisions. A similar proliferation of organizations has taken place in the non- governmental sector. Numerous public groups interested in some part of the problem have come into existence, and their membership has grown rapidly. Small and large associations also exist at the producer and business level to attempt to protect their interests. Many examples of overlapping agency jurisdictions exist, as do ex- amples of areas where there are significant gaps in responsibilities. Water delivery organizations are often separate from water drainage organizations. The upper and lower reaches of the same stream may be the responsibility of different institutions. There may be a dozen or more irrigation dis- tricts within one county. Agencies and regulators concerned about public health differ from those responsible for wildlife or water quality. Political and agency boundaries often cross hydrological boundaries, making the coordinated planning of water resources difficult. Most often, the agencies responsible for the activities that caused a problem have no responsibilities, or incentives, for considering or solving the dilemmas they have helped create. In fact, it may be in the agency's best interest, or that of its clients, to deny that the problem exists. Again, the result is often a conflict between agencies with different mandates.

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62 IRRIGATION-INDUCED WATER QUALITY PROBLEMS BOX 3.A Some Important Laws and Statutes Relevant to Activities in California's San Josquin Valley Federal Statutes: Migratory Bird Treaty Act. This act prohibits the unlawful taking or possession of any migratory bird in accordance with treaties signed by the United States and the USSR (1976), Japan (1972), Mexico (1936), and Great Britain (1916~. "joking" is defined as the act or attempt to "pursue, hunt, shoot, capture, collect, or kill . . ." (16 USC Section 715n). Exceptions require a permit from the secretary of the interior. This act traditionally has been viewed as a hunting violations law, but recent cases have used a broader interpretation of unintentional nonhunting takings. The USFWS has primary responsibility for enforcing this statute. Endangered Species Act. This act is an attempt to address the global problem of the increasing number of species faced with extinction. It requires all U.S. agency actions to be carried out in a manner that will not jeopardize the continued existence of an endangered species. It also requires the secretary of the interior to consult with other federal agencies with jurisdiction over an endangered species. In recent years, the process for listing critical habitats for endangered species has become more complex. Federal Water Pollution Control Act. This 1972 legislation attempts to ensure clean water (the "swimmable, fishable" goal) for the nation. The Clean Water Act (CWA) of 1977 is a revision of this legislation. The act greatly broadened the role of the Environmental Protection Agency by directing it to set effluent standards and regulate the amount of a pollutant that can be discharged based on its environmental effects. Although the CWA is the strongest federal water pollution control act on record, it is not directly applicable to the situation in the San Joaquin Valley because irrigation return flows from agriculture are classified as nonpoint pollution, which was consciously excluded from the act. However, this does not prevent individual states from instituting stricter agricultural effluent standards. The Environmental Protection Agency has primary responsibility for this statute. California Statutes: Porter-Colo~e Water Quality Control Act. This major legislation, effec- tive since 1970, lays out California's enforcement and remedies for state water law. Its goal is fo protect the health, safety, and welfare of state residents and to protect water quality for the use and enjoyment of the State's people. The act established the State Water Resources Control Board |and nine regional boards that are responsible for achieving these goals. It granted them broad authority to regulate hazardous waste discharges and to formulate and implement water quality control plans. These plans must consider a variety of beneficial uses of water, regional economic factors, and Environmental characteristics. Regional boards are empowered to confer Continued

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TlIE INSTITUTIONAL DIMENSIONS BOX 3.A Continued civil fines, restraining orders, or injunctions to regulate any parlor discharging waste to state waters without the proper permit. Tonic Pits Cleanup Act. This act became effective in 1984 in response to the growing problem of water pollution caused by discharges of hazardous waste on land. Hazardous waste is designated by "its toxicity, mobility, or presence in a land disposal environment, or its ability to accumulate in plants or animals" (California Health and Safety Code, 25208(b)~. Ibe act prohibits discharge of any liquid hazardous waste into a surface impoundment after January 1, 1989, unless specific equipment is installed and the site is monitored carefully. Hazardous discharges are prohibited to surface impoundments after June 30, 1988, if the impoundment is within one-half mile upgradient from a potential drinking water source. Regional water quality control boards inspect all surface impoundments at least once a year and dischargers failing to meet requirements are fined. The Safe Drinking Water and Tonic Enforcement Act. This 1986 act, known as Proposition 65, is perhaps the strictest regulation of toxic substances in drinking water in the nation. It requires all consumer products containing chemicals known to cause cancer or reproductive harm to carry warnings, and prohibits businesses from knowingly discharging listed chemicals into drinking water sources. The governor is required to update and publish annually a list of chemicals known to cause cancer or reproductive tox~ciW; among the substances on the list are benzene, lead, vinyl chloride, chromium, arsenic, asbestos, DDT, and PCBs. Other substances are expected to be added in the future. The act also provides penalties for violators, with the goal of shifting the cost of hazardous waste cleanup from the taxpayer to the offending parties. This act, however, only applies to businesses with more than 10 employees, and public agencies such as irrigation districts, state and federal agencies, municipalities, and the military are exempt. Hence it does not apply to most irrigation-related water quality problems. A proposal to extend the law to cover public agencies has been proposed. SOURCE: After Letey et al., 1986. 63 As an example, the 1982 discovery of high selenium levels and de- formed waterfowl at Kesterson National Wildlife Refuge (NWR) focused attention on the conflicts in the missions of two federal agencies, both within the U.S. Department of the Interior. The USER operates from a long-standing congressional mandate to promote settlement in the West by providing water for agriculture. The USFWS has many responsibilities, including the protection and maintenance of migratory bird populations. But the Kesterson issue transcended the interests of these agencies, forcing them into an uneasy partnership. This complex organizational backdrop reflects an equally complex legal structure affecting the use of water in western states. Over the years, western states have developed a body of water law that in many

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64 IRRIGATION-INDUCED WATER QUALITY PROBLEMS The structures and functions of the nation's resource management agencies have changed over time to reflect changes in priorities and values. Agencies with sometimes conflicting missions, such as the U.S. Bureau of Reclamation and the U.S. Fish and Wildlife Service, are facing increased pressure to work cooperatively to ensure that the varied needs of society are balanced. Here, a refuge manager at the Deer Fiat National Wildlife Refuge, located within the bureau's Boise Project, monitors geese nesting on the Snake River. CREDIT: U.S. Bureau of Reclamation, J. D. Roder~ck. ways contributes to the types of problems discovered at Kesterson NWR and elsewhere. For instance, the legal system of water rights and water allocation in western states discourages water conservation, because the person saving it often is not allowed, for a complicated set of reasons, to sell any water that is saved. Thus farmers often perceive that conserving water will result in their losing the right to it, and they perceive an incentive to use as much as possible to establish a right to a larger amount. Another dilemma that involves both organizational and legal influences relates to the allocation of water. In many basins, the legal system has already allocated more water than is available in most years. For instance,

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THE INSTITUTIONAL DIMENSIONS 65 the courts have allocated 15 million acre-feet of water from the Colorado River annually to the seven basin states, and by treaty Mexico is entitled to 1.5 million acre-feet. Despite these legal demands for 16.5 million acre- feet, the river's average flow is about 14 million acre-feet (Weatherford and Jacoby, 1975~. It is becoming increasingly clear that legislatures may provide exemptions from the laws of man, but not from the laws of nature. LEGAL ISSUES The overall legal and regulatory milieu shapes both the causes of irrigation-related problems and the acceptability of solutions. It is not entirely possible to separate legal issues from other institutional issues because laws define the operating parameters of government agencies, regulate the use and transferability of water resources, and are intertwined with many other fundamental institutional issues. These issues range from rights of appropriators to water under the prior appropriation doctrine to contract rights of parties who have contracted to receive water from an irrigation district, and from rights of irrigation districts under contracts with the USBR to rights of members of the public under the public trust doctrine. The legal issues involved in solving irrigation-induced water quality problems are complex, and they are closely tied to the organization issues (Table 3.2~. All organizations are governed by sets of legal rules that confer authority to act and that may give them standing to intervene in the formulation and enforcement of any solutions aimed at addressing irrigation-related issues. One often-discussed response to the San Joaquin Valley's problem is reducing the consumptive use of water by particular irrigators. The "reasonable use" doctrine of California provides one possible vehicle for reducing water use by irrigators. The reasonable use doctrine suggests that an irrigator can only use as much water as is "reasonably" necessary to grow his crops. One unanswered question, however, is whether this device has the breadth to reach and regulate the quality of water discharged by individual irrigators. Other questions that would need to be considered are whether individuals downstream would have standing to raise the issue, whether the California Department of Water Resources could enforce the doctrine, and whether the Water Resources Control Board could enforce it by making existing permits contingent on reduced discharge. Another legal issue would be whether this approach would constitute an unconstitutional taking of property if the permit conditions in effect put farmers out of business or measurably decreased their profit. One legal obstacle to drainage reduction based on legislation that imposes across-the-board reductions is that it may have greatly disparate

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66 IRRIGATION-INDUCED WATER QUALITY PROBLEMS TABLE 3.2 Agencies Active in the San Joaquin Valley Example and Their General Legal Foundations Agency* General Legal Responsibilities U.S. Bureau of Reclamation California Department of Water Resources Imgation and drainage districts in the Central Valley State of California Water Resources Control Board Department of Health Services U.S. Environmental Protection Agency Resource management agencies such as the Wildlife Service and the California Department of Fish and Game Federal reclamation law California water law State and local laws and regulations controlling the operations of irrigation districts State water quality laws State public health laws Federal environmental laws, Safe Drinking Water Act, Clean Water Act, National Environmental Policy Act State wildlife protection laws, Endangered Species Act, and Migratory Bird Treaty Act *The allocation of responsibilities for enforcement of these various laws is extremely complex. The water quality and quantity and public health laws in general are enforced by the State of California through its administrative agencies. The reclamation law is enforced by the United States or the irrigation districts depending on which party is seeking relief. impacts, giving rise to claims of denial of equal protection under the law. Existing contracts may allocate quantities of water equally among irrigators, but the exact quantum of noxious drainage per user is very difficult to determine. This raises complex legal issues such as who should bear the burden of proof as to individual impact on the system, the degree of the burden of proof required, and the power of the legislature to penalize some for the pollution of others. Another legal issue raised by existing water law doctrine is that the prevailing state law concept of "beneficial use" may work directly against programs attempting to encourage a reduction in water use. Under state law, beneficial use is the measure and limit of water rights. Those who voluntarily reduce their water consumption may be reducing the size of their contractual or property right in the water.

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THE INS TITUTION~ DIMENSIONS 67 Another basic legal issue is whether to encourage the adoption of stringent water quality standards at the downstream end of a drainage system and simply allow these standards to dictate all conservation behavior upstream. For instance, in the San Joaquin Valley, water quality standards for selenium, boron, and salinity downstream of the districts could be determined in a public forum by state and regional boards, and these standards could in effect set the farmers' use of irrigation water. If across- the-board regulations are adopted regarding quality, the application of those standards is likely to be challenged in court. Another complicating factor is that agricultural return flows do not typically fall under regulations dealing with point source pollution. In the long term, however, the irony may be that as a result of not being subject to the regulations, agricultural interests are ineligible for federal grants under the Clean Water Act, should such grants become available. An alternative to the adoption of broad regulatory standards or at- tempted enforcement of broad water law doctrines such as reasonable use would be to provide economic incentives to irrigators to use less water. However, federal, state, and local laws may contain provisions that affect this solution. First, internal district allocation rules may provide a deterrent to water conservation because water is generally contracted on a district- wide basis, and individual farmers who cut back on consumption will simply see the water made available to other users in the district without receiving any compensation for their conservation. Furthermore, the USER policy of not allowing carry-over storage from year to year would deter conservation because the water saved would be lost if not used within the irrigation season. Finally, there is the very difficult question of who actually owns the water to be sold. Is it the federal government, the district, or the farmer? Added to this, of course, is the role of the "public trust" doctrine, wherein the public at large may hold an interest, as yet not fully specified, in some quantity of water for public purposes. The answer is probably that ownership is a partnership. Constraints on water transfers also exist in federal reclamation law. However, the degree of enforcement of those constraints often changes with changes in the administration in Washington, D.C. During the years of the Carter administration, for instance, USER policy suggested that the title to water rights under federal projects, if not fully vested in the federal government, certainly bore the burden of a federal trust that limited usage to irrigation; in particular, it suggested that the use must be on appurtenant lands. More recently the view has changed to suggest more flexibility in usage. Unfortunately for the proponents of free transfers, the right to use of the water is based on long-term contracts, which are made not with individual farmers but with water districts. Such contracts would need to

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68 IRRIGATION-INDUCED WATER QUALITY PROBLEMS be reevaluated and renegotiated if individual farmers were to be given full economic incentives to transfer their water rights. In addition, state law vests substantial regulatory control in state regulatory agencies. No water transfer can be completed unless it can be demonstrated that it does not injure other water rights holders. Thus, although the water contracts are between a federal agency and a private individual, movement of water and shifts from ground to surface water may affect other rights holders, and the state therefore becomes involved. Also, this restriction against causing injury is being reinterpreted as applying to the community as a whole. Regional economic and social effects will have to be considered before some transfers will be allowed. Within a district the issue is somewhat complicated by the contractual nature of farmers' rights and the internal rules for water allocation. Nev- ertheless, the issue of impairment of other water rights inevitably arises when major water rights transfers are sought. In addition to protecting the other water users, the agency before whom a transfer is sought must evaluate the potential injury to wildlife and other entities reflecting the public trust interests inherent in water usage in California. At first glance, it would seem that the public trust would be overwhelmingly served by reducing water consumption. It is unclear, however, whether the decrease of the public trust values in one area can be balanced against benefits such as a reduction in trace element contamination. Furthermore, any transfers that reduced wetlands would have to include mitigation by creating new wetlands elsewhere. These mitigation efforts could certainly be a cost to the potential transfer. From both a legal and economic standpoint, new legal developments in California that purport to make certain water conveyance systems more akin to common carriers and to allow water consumers to use unused conveyance space are encouraging. However, it remains to be seen whether there is sufficient space for conveying transferred water. Likewise, it remains to be seen how reclamation law would permit the conveyed water to be priced. If it were made available to farmers at irrigation prices and if the farmers, after taking delivery, were to make the water available to municipal or industrial users, contracts would likely have to be written that clearly stated who was to receive the profit the USER, the water district, or individual farmers. If the transfer were to be considered to create a supplemental benefit for the district, provisions of the Reclamation Reform Act of 1982 might come into play and lead to legal entanglements. If the government were no worse off, and the transfer were from one existing contractor to another, the transition might be exempt under existing USER regulations. To attempt a transfer and to run the gauntlet of the various federal and state laws and regulations require money for attorneys' fees and experts. As experience is gained, the process of negotiating each transfer will become

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THE INSTITUTIONAL DIMENSIONS 69 cheaper, but the overall costs may still be quite high. Whether the benefits of a sale of a portion of one's water to a potential customer will justify the expense to the average farmer is not clear, nor is it clear whether smaller districts will make such an effort based on economic incentives alone. There is also a vague requirement in both federal law and in federal water contracts that defines the permissible regional limits on the use of water. To the degree that these requirements are imbedded in congressional acts, it will take an act of Congress to change them. If they are set forward in existing federal contracts, then they can be changed at the agency level. Changing a federal contract creates no serious legal concerns when the act of the federal agency is essentially nondiscretionary or makes no basic change in a federal project. However, a federal employee's decision to exercise discretion to permit major water transfers from one location to another would likely trigger the operation of the National Environmental Policy Act and would require the preparation either of a document finding no significant impact or, in some cases, of a full environmental impact statement. The development of an environmental impact statement would un- doubtedly lead to the realization that transferring major quantities of water out of one basin and into another, or even simply changing the use of water within a basin, could have substantial impacts on endangered species and many forms of wildlife, particularly waterfowl. There are also practical legal problems associated with the task of transferring water rights. One problem might arise from the lack of tech- nically competent people available to address the legal issues involved. A case that involves a transfer of any large quantity of water from one location to another also presents immense burden-of-proof issues. The burden of proof will no doubt be on the person seeking the transfer, who will face two tasks. The first is to convince the federal government, the state, the irrigation district, and fellow farmers that he or she has the legal right to sell the water. Although formidable, this is mainly a legal issue. The second, more difficult task is to prove that the actions are consistent with the public interest. What constitutes the public interest is a question of incredibly complex dimensions. No doubt, there is public interest in seeing water moved to higher-value uses, but there is also public interest in promoting rural, cultural, and environmental values. Proving that the transfer is consistent with the public interest is a substantial task if the farmer intends to decrease his surface use and increase ground water pumping. It can involve extensive use of computer models to demonstrate that the cone of depression caused by the increased use will not create problems for other wells and will not interfere with surface water drains. In addition, even if the impairment issues are resolved, there is still the issue of whether the transfer will provide benefits by reducing

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70 IRRIGATION-INDUCED WATER QUALITY PROBLEMS pollution. In many cases it will be extraordinarily difficult to show that the source of the pollution will even be affected by an individual transfer, much less abated in some way. Finally, the cadre of participants in a water transfer will be extensive. Many special interest groups will intervene to show that their proposals will be more beneficial to the public interest than the transfer will be. Persons seeking tougher downstream water quality standards may feel threatened by what they perceive as a temporary solution when what is needed to support the public interest is more rigorous river protection standards. Water quality and water quantity issues have been treated separately throughout U.S. history. California is no exception to this rule. This is perhaps best manifested in the fact that federal water allocation contracts have been found to be nondiscretionary exceptions to the National Environ- mental Policy Act (see discussion above) and note the fact that California has two distinct agencies that address these issues (see Table 3.2~. Hearings are currently pending on the relevant stream systems, and their outcome may well have a great deal of impact. Even though this section has emphasized obstacles to drainage water cleanup, there are various positive signals as well. The USER is facing a changing mission as the need for new construction diminishes and the need for more efficient management emerges. They have taken a position in favor of water marketing that bodes well for that possibility should other problems be resolved. In addition, California law has moved in the direction of allowing economic incentives for conservation practices. Finally, institutional analysis should not totally reject the possibility of "top-down standardization." In response to excessive salinity pollution in Mexico, the Colorado River basin states have been very effective in setting salinity standards for the Colorado River and, with the help of federal money, reducing salinity levels at the border between Mexico and the United States. This concept of treating drainage from a federal irrigation project as a shared federal and state responsibility may well be a model that could operate in this arena. POLITICAL FACTORS Finally, irrigation-related problems and any proposed solutions must be evaluated in terms of political realities. Although this is a difficult task because the political process is rarely clear-cut, it is essential to the process of choosing appropriate solutions. In the West, after all, water is a political issue that generates unusual passion. The political setting has played perhaps the most critical role in creating situations conducive to irrigation-related problems. The decision to irrigate the West was first and foremost a political one: policymakers decided to

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THE INSTITUTIONAL DIMENSIONS 71 promote the settlement of the West and "make the deserts bloom." It was a political decision clearly designed to promote social goals, and it was translated into law via the Reclamation Act of 1902. It occurred at a time when there was great belief in the ability of technology and engineering to overcome almost any obstacle that nature might put in the way. It created in the West a social and economic system that cannot survive without substantial support, and it is politics that provide that support. In short, the political system created many of the problems now being faced, it created a structure that prevented them from being addressed effectively early on, and it will ultimately determine what solutions will be implemented (Worster, 1985~. The importance of political influences both past and present-is il- lustrated clearly in the San Joaquin Valley. There, as elsewhere in the West, agriculture flourished because political forces exerted pressure in favor of subsidized irrigation development. This, in turn, produced abundant crops, created jobs, and fostered a strong agriculturally based economy. In turn, these benefits built an even stronger political base of support. The region's political, economic, and social ties to irrigated agriculture give its people a great stake in ongoing discussions about how to solve the problems caused by the accumulation of salts and harmful trace elements. For example, agri- cultural interests were reluctant to have the San Joaquin Valley Drainage Program (SJVDP) discuss any options perceived to be against agriculture, such as the issue of retiring particularly problematic lands from farming. Political influences from another sphere environmental interests in the San Francisco Bay area-are similarly evident; this view surfaces most visi- bly in the pressures that prevented the SJVDP from seriously considering ocean disposal as a possible alternative even though many scientists argue that this is a credible option. Thus political, social, economic, institutional, and legal factors have all contributed substantially to the irrigation-induced water quality problems identified in the San Joaquin Valley and elsewhere in the West. These factors will strongly influence the choice of potential solutions. In many ways, the solutions to the problems the nation faces are hindered less by technical or scientific uncertainties than by social, economic, and legal confrontations. Thus, unless political, economic, social, and institutional means can be brought to bear on the process, it will prove impossible to solve irrigation-induced water quality problems. CONCLUSIONS Many factors affect society's ability to respond to irrigation-induced water quality problems. Often, institutional and scientific considerations are entwined, and effective programs to solve such problems require an

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72 IRRIGATION-INDUCED WATER QUALITY PROBLEMS understanding of the complex Interactions that occur between social and physical components. The physical changes and the environmental and social impacts associated with Irrigation and its return flow In arid and semiarid regions can be exacerbated or ameliorated by the institutional setting- which involves a maze of sometimes competing interest groups, agencies, laws, and mandates. It is a setting shaped by underlying societal values. However, this Institutional separation and fragmentation of interests and responsibilities have made it difficult to develop a coordinated strategr for water resources planning. Can irrigated agriculture be sustained Indefinitely or Is it always doomed to fail because of salin~zation or related problems? Certainly there are abundant examples of failure throughout history. The key to making sustainable production physically possible is maintaining a high level of management and investment to remove and dispose of accumu- lating salts. The critical difference Is the perspective of the time scale involved. As long as the goals are short term and water management Is the primary concern, irrigation is doomed to fail. However, if the planning Is truly long term and includes a focus on the management of dissolved chemicals, and if it is judged to be in the national interest to pay both the economic and environmental costs, then it should be possible to create a sustainable irrigated agriculture. The critical issue of time frame may be reflected In the choice of technology used to combat irrigation-induced water quality problems, but the underlying decision on strategy is set by political, economic, and social influences. Solutions to satisfy all the parties affected by irrigation-~nduced water quality problems will not be easy to find. Difficult trade-offs and compro- m~ses will have to be made. The protection of water and land resources provides the foundation for future growth and development. Agriculture is only one of many interests that need a dependable supply of unpolluted water. As populations grow and patterns of water use change, institutions will need to respond. The issue of Irrigation drainage water Is important, but it is only part of a broader issue: that of managing water resources for the long-term public good. Water quantity and water quality can no longer be addressed separately. REFERENCES El-Ashry, M. 1:, and D. C. Gibbons. 1986. Doubled Waters: New Policies for Managing Water in the American West. Study 6. World Resources Institute, Washington, D.C. October. Goodall, HI. R., and J. D. Sullivan. 1985. Water system entities in California: social and environmental effects. Pp. 71-102 in Special Water Districts: Challenge for the Future. J. N. Carbridge, Jr., ed. Natural Resources Law Center, University of Colorado, Boulder.

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THE INSTITUTIONAL DIMENSIONS 73 Letey, J., C. Roberts, M. Penberth, and C. Vasek. 1986. An Agricultural Dilemma: Drainage Water and Toxics Disposal in the San Joaquin Valley. Special Publication 3319. Agricultural Experiment Station. University of California, Riverside. Division of Agriculture and Natural Resources. Martin, G. 1989. At the public water trough, The World, San Francisco Sunday Examiner and Chronicle, January 29, p. 12. Moore, M. R., and C. A. McGuckin. 1988. Program Crop Production and Federal Irrigation Water. Reprinted from Agricultural Resources: Cropland, Water, and Consenration Situation and Outlook Report. AR-12. U.S. Department of Agriculture, Economic ~ Research Service, Washington, D.C. Solley, W. B., C. F. Merk, and R. R. Pierce. 1988. Estimated use of water in the United States in 1985. Circular 1004. U.S. Geological Survey, Reston, Virginia. Statistical Abstract. 1988. U.S. Government Printing Office, Washington, D.C. U.S. Department of the Interior. 1980. Draft Environmental Impact Statement (DEIS), Acreage Limitation, Westwide Report Appendix G (Full Cost Pricing Option), Table 2. U.S. Department of the Interior. 1988. H.R. 1443. Irrigation Subsidy Legislation: Questions from the Subcommittee on Water and Power Resources of the Committee on Interior and Insular Affairs. Weatherford, G. D., and G. C. Jacoby. 1975. Impact of energy development on the law of the Colorado River. Natural Resources Journal 15~1), 171-213. Worster, D. 1985. Rivers of Empire: Water, Aridity, and the Growth of the American West. Pantheon Books, New York.