Year Established: 2015 Start Date: 2015-03-01 End Date: 2017-02-28
Total Federal Funds: $17,250 Total Non-Federal Funds: $35,769
Principal Investigators: Laurie Fowler
Abstract: Georgia, Alabama, and Florida have been entrenched in a dispute over the waters of the ACF River Basin for decades. In recent years the debate has become ever more serious because there is insufficient water to meet environmental and public water demands during droughts. A variety of approaches have been employed in attempts to resolve this dispute, including political negotiations and litigation, but have been unsuccessful to date because they do not ensure the benefits derived from water and burdens borne by lack thereof are shared equitably amongst water users. Market-based instruments (MBIs), typically divided into four major types: instream buybacks, trading and offsets, beneficiary-pays fund, and bilateral agreements, offer a way to resolve water disputes by redistributing benefits and burdens experienced by water users, in lieu of litigation and politics. However, MBIs, found to be particularly effective for solving interstate water allocation disputes in other basins, have largely been ignored. While an irrigation reduction auction program was established in the Flint River sub-basin to meet shortfalls in environmental water during droughts by paying farmers to temporarily suspend irrigation, this program has no permanent funding source, design flaws that limit its effectiveness. The program has only been implemented twice and it is no longer active. No auction programs or other MBIs are currently employed at a basin-wide scale, which excludes several important potential beneficiaries and providers (such as the Florida seafood industry and metropolitan Atlanta water suppliers). Moreover, while a number of MBIs are used successfully in other regions, there remains scarce literature that is easily understood and readily usable by those with the authority to implement MBIs. This study explores MBIs in transboundary river basins and aims to determine their feasibility for use in the ACF River Basin. Both academic and practical benefits will result from this research project. Goals: 1. Identify all cases where MBIs were used to resolve interstate water allocation disputes. (Year 1) 2. Characterize emerging and well-established MBIs utilized in river basins of select industrialized nations. (Year 1) 3. Determine institutional and political feasibility of different MBI types and design elements in ACF River Basin. (Year 2) 4. Share our research with the three States’ governor’s offices, state water agencies, and other key stakeholders in ACF River Basin. (Years 1 & 2) Methods: Goal (1): we will utilize an assortment of research methods, including review and analysis of federal and state case law research for all 50 states, examination of secondary legal sources, and additional means as necessary. Goal (2): we will apply an analytical framework, characterizing market-based water programs based on four program types (bilateral agreements, beneficiary-pays fund, trading and offsets, and instream buybacks) and nine design elements (hydrological service goals, scale, participants and other stakeholders, buyer, intervention, driver, exchange agreement, compensation, and co-benefits). Goal (3): we will develop an analytical framework, primarily addressing consistency with existing federal, state, regional, and local legal frameworks. Goal (4): we will implement a multi-year education program targeted at key governmental and non-governmental stakeholders of ACF River Basin.