X hits on this document

PDF document

IMPROVING NEW MEXICO’S WATER MANAGEMENT - page 29 / 47

87 views

0 shares

0 downloads

0 comments

29 / 47

Albuquerque is netting for its water consumers a positive net return of $900 in purchasing this

water right.

But this brings us to the central point. A farmer cannot easily sell a water right that has

not been defined or adjudicated. Past experience indicates that there are enormous transaction

costs with selling a non-adjudicated “water right”. The transaction costs completely wipe out

potential gains by both the farmer and the City of Albuquerque. Our experience is that

transaction costs of water exchange can run as high as $20,000 per aft in legal and SEO hearing

costs. The example deal above cannot be consummated even though both the farmer and

Albuquerque would clearly benefit. The current situation of undefined water rights is costing

New Mexicans an enormous price in flexibility to buy and sell water rights.

IV. Water Allocation in New Mexico

New Mexico uses appropriative water law to allocate our water resource. Appropriative

water law grants, in form of water rights, senior appropriators priority to available water relative

to junior appropriators. An appropriator is a water user who diverts surface water from a river or

pumps from groundwater and puts it to beneficial use. A water district (or a municipality for that

matter) that diverts water from a river into a distribution system is just a collection of individual

appropriators. When water is short, senior appropriators are able to satisfy their historical use.

Junior appropriators must wait until senior water rights are satisfied. (The terms of senior versus

junior appropriators are actually misconceptions; there is a continuum of seniority based on

when a user first put water to beneficial use). In water short years, water is allocated down the

priority (seniority) list until the water runs out. There is break point at which more junior users

29

Document info
Document views87
Page views87
Page last viewedSat Dec 03 00:42:33 UTC 2016
Pages47
Paragraphs2644
Words12042

Comments