California Water Rights and Flexibility

I’m intrigued that both defenses of our current water rights system emphasize how flexible our water rights system is.

Public Water Coalition:
“The hallmark of California water rights is flexibility.” …

“With a resource as variable as water, some flexibility in rights is by design. Appropriative water rights account for this flexibility because their holders can modify them as long as other legal users of water are not injured. This basic rule has supported a robust and growing water transfer market.”

Ms. Moon’s testimony:
“With a resource as variable as water, and with constantly changing land use patterns, some flexibility in the administration of the rights is needed and has been designed into the system. For example, appropriative water rights provide this flexibility by allowing their holders to modify the ways they are exercised (place of use, point of diversion, purpose of use) as long as other legal users of water or the environment are not injured.”

All this talk about the great flexibility of California water rights is strange to me, because, like, they aren’t. Riparian rights can only be used on land adjacent to the river; water under a riparian right can’t be stored. Appropriative rights can only be used for the permitted point of diversion, place of use and purpose of use¹. An appropriative right will have an upper limits on flow and maybe also on annual total diversion. It has permissible dates or season of diversion. Per the Constitution, only beneficial use is legal. If you stop using all or part your water right, the right is destroyed in all or part. The right can be modified for $1000, a change permit and environmental documentation, if the State Water Resources Control Board approves the change application. It is difficult if not impossible to get a new right, since most systems are overallocated; the only reallocation method between contemporary users is a full-fledged court adjudication and watermaster for the river or watershed.

I don’t think these restrictions are entirely nonsensical, although some of them are arbitrary vestiges of older laws. But this is not a flexible water rights system, nor one capable of adapting to additional users or changes in hydrology. For example, a flexible rights system might be like the markets in Portugal, where buyers purchase a daily allotment of agricultural water from centralized sellers. That system allows for daily choice of whether, how much, and when to receive water without reporting it, risk of losing a right or violating its terms. That would be flexibility.²

I’m trying to figure out why the big boys are suddenly emphasizing the flexibility in what is actually an arcane, tangled, brittle and constrained water rights system. Two theories. First, in two of the few ways that it is flexible, it lets them move and sell water³. This is, of course, extremely valuable to members of the Public Water Coalition, who are either players with big old water rights or cities who want to get water any way they can. But you do not need our particular water rights system to achieve an economically efficient allocation of water throughout the state. Other water rights systems could also achieve that⁴, if that were the goal.

I have another theory about why the Public Water Coalition is talking up flexibility, one that veers wildly into speculation, overthinking and strategery. I wonder if they aren’t laying the groundwork for a legislative change to water rights law to help them with climate change.

Berkeley professor Michael Hanemann has been pointing out the need for an overhaul of our water rights system at conferences. One of his most interesting points is that appropriative rights often include dates or seasons of diversion, April to October, for example. Here’s the interesting part. Remember how climate change means that the snowpack arrives as rain and melts faster? The bulk of water will be in rivers earlier in the year. In fact, it may flow past water districts before they are allowed to divert and store it according to the dates of use in their appropriative rights. Prof. Hanemann says this will make enough appropriative rights worth so much less water that the legislature will have to address the problem wholesale.

I am probably assigning undue cleverness to whomever decided to emphasize flexibility, but I wonder if part of the goal was to get legislators thinking ‘Whatever, man. Water rights are, like, totally flexible and shit. Dates of diversion? Let’s move ‘em. April? March? February? Whatever! They’re flexible.  We’re flexible.  It is all flexible, man.” I’m real hesitant about assigning complex levels of strategizing to any group, mostly because I don’t think anyone thinks that far ahead in the real world. But with so much at stake, perhaps someone at the PWC is setting the stage for future legislative conquest. I’M ON TO YOU, SHADOWY MASTERMIND! I have exposed your plot ON MY BLOG!!!

Summary:

California’s current water rights system?  Not actually flexible.

¹Perhaps the reason that districts perceive the current water rights system as flexible is that in the real world, they are barely enforced. About which, more later.
²There are drawbacks to a daily market mechanism as well, primarily that people might be priced out of receiving water. I’m not promoting a pure market system. I only mention it to show what flexibility looks like.
³The ability to sell water without losing the right was not part of the awesome flexible design of our water rights system. It was a relatively recent legislative change.

⁴ If the state held the water that falls over its lands for itself, it could auction it to achieve the same economically efficient allocation without first passing it out for other people to sell and keep that wealth.