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Eco 498C : California Water Transfers!
Matt Villalobos!
W.A. Franke College of Business: ECO 498C Water in the West!
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“160-Acre” Disaster!
!Permit Trading!!
“Use-It-Or-Lose-It”!
!Acknowledgments!
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The law dubbed the “Use-it-or-lose-it” rule
forces right holders to put to use their entire
allotment of water or risk losing that
unused amount in the following growing
season. "
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Farmers with any surplus water are forced
to waste the remainder on unworthy causes
or by simply wasting it. The fear of losing the
right to the water keeps the farmer from
using his surplus water efficiently and
sustainably."
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Resulting In:!
o Systematic Waste of Water"
o Loss of potential profit for farmer"
o Misallocation of subsidized water!
o Increased Costs to farmers"
o Diverting water from beneficial projects"
o Increased efforts in Ecosystem restoration"
Conclusions!Why Water?!
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http://lbre.stanford.edu/sem/sites/all/lbre-shared/files/sem/files/shared/images/sem_Domestic
%20Water%20Consumption%20FY2000%20-%20FY2012.jpg"
Drought causes periodic demand spikes
that prove inefficient and overbearing to the
current water transfer systems."
The ability to meet this demand is critical
in protecting watershed ecosystems and
sustaining water transfers in the coming
decades."
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California cannot continue to waste water
considering its current stressed water
supply and its future population and water
demand."
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http://www.waterpolitics.com/2012/08/30/global-water-demand-by-2050/"
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Sustainable solutions are available;
however Congress, State Government,
and the Bureau of Reclamation (BOR)
must revise and improve its rules and limits
to allow for these solutions to be carried out.
In order to empower small farmers in the
Imperial Valley, California State government
must revise or enforce the “160 Acre” limit
and the “Use-It-or-Lose-It” rule to truly
encourage small farm competition and
sustainable use of limited watersheds. "
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The limitation dubbed the “160-acre” rule
refers to Cal State law § 426.5(d). This
limitation was enacted to encourage small
farm development and settlement in the
Southern California Valley.!
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The Limitation is easily avoided by large
farms who are able to increase their
shareholder or partnership base to then
proportionally increase their acreage of
Federally Irrigated land."
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This Loophole Allows for:!
o Lopsided Water Transfer voting Rights"
o Unfair competition "
o Misallocation of subsidized water!
o Fast Growth of large Agribusinesses"
o Infringements on current water rights
holders’ rights"
!The Bureau Today!
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Established in 1902 and charged with
irrigating 17 western states."
o 600 Dams"
o 10 million acres of farmland"
o 53 Hydro Power plants"
o $1 billion budget for 2013"
The problems of delivering water and
generating power are solved, spurring the
Bureau’s decision to update their mission
statement to focus on sustainability;"
“To manage, develop, and protect water
a n d r e l a t e d r e s o u r c e s i n a n
environmentally-sound manner in the
interest of the American public.” "
The department is well funded and is very
flexible in its management of the water
infrastructure. "
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Capping the Current Allowable Water
Transfer amount and distributing permits
based on historical use will allow for
efficient use, control, increased revenue.!
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http://www.mwdfacts.com/wp-content/uploads/2013/01/SoCalWaterProjectsMapFINAL2.jpg
Water Demand in Drought Areas
increasing annually!
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http://californiawaterblog.files.wordpress.com/2012/11/wm_overview_graph.jpg?w=640"
Increased volume in contract trading!
o Helps meet high demand during times of
drought"
o Any leftover permits can be sold to
prevent waste"
o Controls quality of data and monitors
projects using subsidized water"
!In Practice Already!
markets for Greenhouse Gas Emissions. "
o Company’s must purchase the right to
emit harmful greenhouse gases and the
proceeds from the purchase are used to
restore and preserve ecosystems affected
by pollution. "
o The system is very successful in
controlling emissions and incentivizing
efficiency and innovative technology. "
o California’s water transfer system is
struggling to meet demand in times of
drought"
o The Bureau of Reclamation must head
the reform of water transfers, in
conjunction with DOI, Congress, and
State Government."
o Enforcing or Revising the “160-acre” and
“Use-it-or-lose-it” regulations will increase
water efficiency and competition"
o Permit Trading offers a sustainable
solution to water demand in the west."
o Increased water allocation efficiency"
o Increased accuracy of monitoring data"
o Flexible "
o Provides revenue for restoration
projects"
o Reflects BOR’s mission and vision"
o Will alleviate drought pressure in rural
areas."
o Water is readily available to beneficial
business projects or programs"
Drought Issues!
o Permits carry
market value
a n d m a y
i n c r e a s e o r
d e c r e a s e i n
value over time."
Use a smaller font size for the references."
http://ca.water.usgs.gov/mercury/images/logoBOR.gif"
http://switchboard.nrdc.org/blogs/kgrenfell/table.JPG"
Prof. Dean Smith, the one and only"
The Franke Collge of Business for years of
life changing experiences and hospitality "
Numerous articles and studies, whose
information is reflected here"
Villalobos Family "