Whoa, you're using an old browsers aren't you? This site would look better if you upgraded. We recommend Mozilla Firefox

W1190: Interfacing technological, economic, and institutional principles for managing inter-sector mobilization of water

Annual/Termination Reports (SAES-422): [09/01/2005] [12/16/2005] [12/10/2006] [12/05/2007] [01/20/2009]

Date of Annual Report: 09/01/2005

Report Information:
  • Annual Meeting Dates: 10/11/04 to 10/13/04
  • Period the Report Covers: 10/2003 to 10/2004

    • Participants:
    Brief Summary of Minutes of Annual Meeting:
    These meetings were the 1st annual meetings of the new W1190. Monday afternoon (October 11) was devoted to: (1) organizational matters; (2) presentations by Glenn Schaible (ERS) on the key research elements of the new W1190 project, LeRoy Daugherty (W1190 Administrative Advisor) on the Regional Research Committee process, and Ray Huffaker (WSU) on USDAs REE Water Security Program; and (3) State research reports.

    Glenn Schaible reviewed the W1190 regional research project objectives, products, and research agenda.

    LeRoy Daugherty emphasized several key tenets of the Western Regional Research Committee process, including: (1) the roles of the Western Experiment Station Directors and CSREES; and (2) the need for strong emphasis on linked activities across States and the need for annual reports to highlight the impact of accomplishments.

    Ray Huffaker summarized the proceedings of the USDA-sponsored Listening Session on the REE mission area Agricultural Water Security, held September 9-10, 2004, Park City, UT. Key questions the session addressed included: (1) what is agricultural water security? (2) What are USDA research needs in this area? (3) Where do knowledge gaps exist? (4) What are the likely strategies for USDA to get there? (5) Is there a need for a USDA research program in agricultural water security?

    As the first meeting of the W1190, Tuesday, October 12, was devoted to organizational-based Product Work Sessions, followed by Product Summary Sessions for each of the W1190 Proposal Products. Concurrent work group sessions were held for Products 2 & 3, and then for Product 4.

    Product 1-- Soil Measurement Methods to Rapidly Monitor the Impact of Basin-Scale Water Management Decisions. Product 2-- Farm-Size Characteristics, Economics, and Institutions are Central to the Design of Agricultural Water Conservation Programs. Product 3-- Effects of Water Policy on Agricultural Production Risks. Product 4-- Water Laws and Institutions for the American West.

    Meeting participants attended at least two Product Work Sessions and all participants attended follow-up Product Summary Sessions. [No Product 1 Work Session was held because the original product organizer (leader) moved from CSU to a job with the Utah State government. (A search will be conducted for a new Product 1 Leader following the annual meetings.)]

    Each of the Product Work Sessions held discussions on a broad range of product research issues, but with a particular focus on the following issues.

    1. Clarify the groups understanding of the products research agenda. 2. Identify conceptual and empirical research issues. 3. Identify/clarify data sources, availability, and problems. 4. Identify specific research tasks to accomplish product research milestones. 5. Flush-out specific policy analyses and desired impact assessments. 6. Identify specific and shared State research and data responsibilities.

    Product 2 Work Session discussions emphasized the need for the research to address: (1) whether small (low resource) irrigated farms have been cut out of the governments technology adoption- based conservation programs; (2) whether differences in conservation program participation can be attributed to farm tenure characteristics; (3) the integration of regional hydrology into models evaluating farm-level adjustments to conservation policy alternatives (allowing these models to account for basin-wide hydrologic effects); and (4) implications of alternative definitions of what is agricultural water conservation. The group discussed producer behavioral-adjustment characteristics of various aggregate programming and more micro econometric modeling approaches developed at ERS, CSU, KSU, and UNL. Ray Huffaker, WSU, will develop a white paper summarizing a literature review of case studies using farm-level models with and without hydrologic relationships. This literature review will help point the direction to creating a cell-type model that incorporates basin-level hydrologic relationships appropriate for capturing return-flow effects of alternative policy options. In addition, Daryl Martin, UNL, was suggested as a likely candidate to provide the project with the expertise to address how to link economic/hydrologic models in targeted case studies examining conjunctive-use linkages.

    Product 3 Work Session discussions emphasized the need to extend ERSs RMA-funded research addressing irrigated agriculture production risks associated with Federally-imposed water-supply restrictions to a broader set of water-supply conflicts across the Western States. This broader set of conflicts could encompass urban, recreational, Native American, and even interstate water allocation conflicts. A set of criteria would need to be established to evaluate and rank alternative conflicts, identifying the nature of the conflict, their hydrologic and geographic scope, as well as their social, political, and institutional setting. The discussion suggested a two-pronged approach to furthering this research area. One, conducting a review of study results from the ERS RMA-funded projects to help identify both research problems and solutions in addressing the myriad of potential water conflicts across the West. Two, conduct a survey of W1190 participants (and any additional notable interested Western water experts) on the characteristics of higher-priority water conflicts, with particular focus on those conflicts where production risks are largely attributable to conjunctive-use based water-supply conditions.

    Product 4 Work Session discussions addressed the need for research on Western water laws and institutions from both a broad inventory perspective, and the need for more focused analysis of a myriad of legal/institutional issues. From a broad inventory perspective, the need was identified for a systematic analysis of existing Western States water laws and institutions, their common attributes and differences, where knowledge gaps exist in addressing quantity/quality issues, the regionally-different role transaction costs play in promoting change, and the likely priority institutional changes needed to address regionally-unique water conflict issues. From a more focused issue perspective, the group highlighted the relative importance of a number of issues, including: (1) identifying regionally-unique impediments to institutional change and water reallocation; (2) addressing the legal/institutional changes required for local water-management firms to effectively manage water reallocations; (3) addressing the regionally-unique aspects of conjunctive-use issues; (4) reviewing the key institutional aspects associated with addressing TMDL-based water quality goals with an emphasis on the impediments to water quality trading; (5) reviewing the institutional issues associated with administering instream flow rights, with a particular focus on alternative enforcement mechanisms in water-short years; and (6) identifying the varied institutional aspects of water markets versus insurance policies used as risk-management mitigation tools during water-supply shortfalls. The group also highlighted the importance of identifying the necessary set of objective and subjective criteria required to assess the potential effectiveness of alternative legal/institutional changes across differing hydrologic, social, economic, and environmental conditions. The emphasis here should be on descriptive rather than prescriptive criteria. Finally, do to the wide range of potentially relevant institutional issues; Product 4 participants suggested that the group focus its research on evaluating the legal/institutional aspects of alternative conjunctive-use environments, including assessing how to empirically implement conjunctive-use institutions, i.e., link economic models with hydrologic models that account for connected surface/ground water relationships. Bob Hearne, NDSU, will develop a white paper evaluating the status and effectiveness of existing water quality institutions, emphasizing key regional differences (west versus east).

    Business Meeting Summary

    1. Marshall Frasier, CSU, and LeRoy Daugherty, W1190 Administrative Advisor, would search out how to proceed with leadership for Product 1. Both would be in contact with Grant Cardon to discuss either finding a replacement Project Leader or how Grant would continue leading this products research agenda. Ari Michelson, Texas A&M, would contribute to this effort. 2. Ray Supalla, UNL, would Chair a subcommittee charged with completing the W190 final report. 3. The 2005 W1190 meetings were set for October 17-19, 2005 in Las Cruces, NM (to precede the New Mexico Water Institutes 50th Annual Water Conference (October 19-21, 2005). 4. Brian Hurd, NMSU was selected as the 2005 W1190 Secretary.

    New 2005 W1190 Officers are: Chair: Jeff Peterson, KSU Vice-Chair: Eric Schuck, CSU Secretary: Brian Hurd, NMSU

    Accomplishments:
    The following accomplishments were from W-190, the previous committee:

    Objective 1. Accomplishments

    Management practices for reducing water pollution from irrigated agriculture were evaluated by scientists in Colorado, Texas, Nebraska and ERS, with emphasis on salinity and nitrates. Colorado established a program to monitor and analyze the implications of soil salinization in the Lower Arkansas Basin as farm management practices change in response to the Compact settlement between Kansas and Colorado. Texas found that the amount of N in runoff was minimized using a shallow soil, low N treatment and variable rate application, and also that a banding application of atrazine was more effective at reducing atrazine runoff than conservation tillage. Nebraska found that it is economically-feasible to reduce nitrate pollution of groundwater within a 50-year time frame by decreasing nitrogen and water applied, shifting from gravity to sprinkler systems, and shifting to more alfalfa and less corn production. ERS found that there would be significant environmental spillovers from implementing livestock waste management plans as described in the US-EPA/USDA Unified Strategy for Animal Feeding Operations. Management strategies for irrigating with limited water supplies were evaluated by Kansas and Nebraska. Kansas found that pre-season irrigation was a dominant strategy for a wide range of well capacities and risk attitudes. Nebraska found that when water supplies were policy limited to about 85 percent of a full supply producers should continue to irrigate the same amount of corn and soybeans at a reduced application level rather than reducing irrigated area or shifting to more drought tolerant crops. Objective 2. Accomplishments Scientists from ERS, California, Washington, New Mexico, Colorado and Nebraska collaborated on an analysis of the production risks associated with federal water policy decisions funded by RMA, USDA. The endangered species versus irrigation tradeoffs associated with the Klamath Basin water conflict were analyzed by scientists from Oregon and California. Scientists in Idaho and Washington analyzed the economics of salmon recovery programs. Scientists in Texas, New Mexico and Arizona estimated the foregone benefits of supplying water for endangered species. Policy options for meeting the in-stream flow requirements for endangered species in the Platte River Basin were analyzed by Colorado, Nebraska and Wyoming. New Mexico scientists investigated water conservation options for households and found that the adoption of water-conserving landscapes by New Mexico residents could yield benefits of approximately 25-50 thousand acre-feet per year. ERS analyzed irrigation technology transitions in the Central Great Plains and found that crop-price effects on technology transitions are relatively small and slow to occur. Objective 3. Accomplishments Institutional options for managing water use conflict were analyzed by Arizona, Nebraska, Colorado, Idaho, New Mexico and Washington. Arizona compared the effectiveness of market transactions versus administrative or judicial water reallocation to address changing water demands in different cases. Nebraska found that game bargaining models offered some potential for resolving interstate disputes over the allocation of water in the Platte Basin. Hawaii studied the evolution, structure, and performance of water institutions in Hawaii and compared and contrasted them to experiences in other states in the western U.S. The potential for achieving water conservation through alternative institutional and water pricing options was evaluated by Washington, Texas, New Mexico, Idaho and Hawaii. Water marketing research in California, Nebraska and Arizona found that most state water marketing institutions were not yet well developed but had a great deal of potential for producing greater efficiency in the allocation of water to alternative uses. Many of the results from this institutional research on water were summarized and integrated in a special issue of the International Journal of Water Resources Development titled Institutional Innovations in Western Water Management, edited by Chennat Gopalakrishnan, University of Hawaii.

    Impact Statements:
    1. Results of research on the economics of salmon recovery conducted by scientists in Idaho and Washington State were used in formulating water allocation policy in the Pacific Northwest.
    2. In Kansas, results from irrigation technology and income-risk research were used to show producers how irrigation investments can be used to limit production risk.
    3. In Nebraska, Natural Resource Districts are using research results identifying the annualized costs of groundwater quality improvements as they revise groundwater management plans.
    4. Research conducted by Oregon and California in the Klamath Basin was used by the National Research Council Committee on the Status of Endangered Fish of the Klamath Basin and has influenced the development of reservoir operating plans by federal agencies.
    5. Research results recognizing the cumulative effects of alternative mechanisms to obtain water for instream flows helped to create the Conservation Reserve Enhancement Program (CREP) in Oregon and contributed to the development of a national program by the USDA.
    6. Nebraskas bargaining game analysis of Platte Basin water allocation conflicts has helped federal, state and private stakeholders resolve their differences and move closer to a cooperative agreement.
    7. A data product, Western Irrigated Agriculture: Characteristics by Farm-Size Class, was released by the Economic Research Service to aid policy decision makers in assessing the differential impacts of policies across farm sizes.
    8. Water allocation decisions for the Rio Grande River in New Mexico were influenced by research which found that the combined effect of a reduced total supply and an increased allocation to instream flows could result in economic losses of nearly $14 million per year.
    9. Nebraska irrigators who face policy limited water supplies are doing a better job of management using a decision support tool called Water Optimizer developed by the University of Nebraska using data from Nebraska and Kansas.
    10. Research results concerning water pricing in Hawaii have contributed to the development of new pricing policies by the Honolulu Board of Water Supply, which when coupled with water conservation measures could lead to an annual 15-20 percent reduction in Hawaiis visitor industry water demand, thereby making more water available for agricultural and in-stream uses.
    11. Colorado research on dam removal conducted in cooperation with the U.S. Army Corps of Engineers has been incorporated in the Snake River Juvenile Salmon Migration Feasibilit y Report and EIS.
    12. Colorado research on dam removal conducted in cooperation with the U.S. Army Corps of Engineers has been incorporated in the Snake River Juvenile Salmon Migration Feasibilit y Report and EIS.
    13. Research by Nebraska scientists has been used to develop and implement water planning rules and procedures which will have a major impact on how water resources are used in the future.
    Last Modified: unknown

    Date of Annual Report: 12/16/2005

    Report Information:
  • Annual Meeting Dates: 10/17/05 to 10/19/05
  • Period the Report Covers: 10/2004 to 09/2005

    • Participants:
    Brief Summary of Minutes of Annual Meeting:
    The following served as officers for the year: (Chair) Jeff Peterson, KSU, (Vice-Chair) Eric Schuck, CSU, and (Secretary) Brian H. Hurd, NMSU.

    The second annual meeting of the W-1190 regional project commenced Monday morning at 8am at the La Quinta Inn in Las Cruces, New Mexico.

    1. Welcoming words and introductions were given by Jeff Peterson and Brian Hurd.

    2. Next, Fen Hunt provided a summary of activities at CSREES, highlighting recent events and meetings and information on upcoming NRI funding opportunities. Glenn Schaible mentioned efforts underway to integrate USDA survey efforts (CEAP and ARMS) within the NRI and highlighted materials available at the website:

    http://www.usawaterquality.org/

    Brief discussion was given concerning the Domenici water science bill that could funding opportunities coordinated through selected national laboratories.

    3. LeRoy Dougherty then spoke about the activities of the Western AES directors, and emphasized the report filing requirements. Reports should identify progress against stated milestones and highlight outcomes and impacts (even if just potential). Progress reports need to be filed within 60 of the annual meeting, in our case, by December 15, 2005 and should be brief and provide summary bullets.

    4. Brief reviews of project activities and progress were given:

    Product 1-Soil Salinity Measurement Methods to Rapidly Monitor the Impact of Basin-Scale Water Management Decisions. Wyatte indicated the impact that Grant Cardons departure to Utah has had on this project and its evolution. He noted the work that had gone on in the development of salinity impacts within the EPIC model using the Bessler, McNeil, and Carter book on Saline and Sodic Soils. Eric added on the design and development of survey work on salinity problems in the Arkansas Valley and along the Uncompahgre River. Brian noted interest in joining the effort and a project just underway to examine salinity and irrigation along the Rio Grande.

    Product 2-Farm-Size Characteristics, Economics, and Institutions are Central to the Design of Agricultural Water Conservation Programs. Glenn described efforts to examine the FRIS data using SAS, modeling such things as endogeneity of land and water application rates. Development of an econometric farm structure model with CS Kim was also discussed to highlight changes in farm structure.

    Product 3-Effects of Water Policy on Agricultural Production Risks. Glenn also described the status of the RMA funded projects, in Noels absence. He indicated the results summary is completed and available from the farm foundation website. Phase 2 involves a survey of the W-1190 members for the identification and characterization of high conflict potential in water across the various represented regions. Work is needed to develop and implement the questionnaire keying on high priority conflicts, federal and state roles, the parties at risk, and the impact of federally imposed restrictions. The survey will be drafted by Bob Hearne with comments and support by other committee members. The following URL was provided for possible resources regarding funding and useful links (site is from the Northeast regional association of experiment station directors): http://www.agnr.umd.edu/users/nera

    Product 4-Water Allocation Laws and Procedures in the American West. Gopal made some comments about the possibility of a special issue on the topic of political externalities and water resource institutions. Discussion provided evidence for the groups interest and viability of such a topic, Gopal to explore possible options for developing papers and providing a forum for presentations. The committee felt that prior research on western water institutions negated the need for additional effort to provide another survey of institutions. However further collaboration with special editions and conference papers will provide ample opportunities for the committee to meet its objectives with this product.

    Business Meeting Summary

    1. Selection of Bob Hearne to the 2006 W1190 Secretary

    2. The place and dates for the 2006 annual meeting of W-1190 were selected to be:

    Fort Collins (or vicinity)

    Tentative Date: October 15-18, 2006

    3. Officers for the coming year were selected to be:

    Chair: Eric Schuck, CSU

    Vice-Chair: Brian H. Hurd, NMSU

    Secretary: Bob Hearne, NDSU

    Accomplishments:
    This report summarizes the goals and accomplishments of the above referenced regional research project as documented by members following the annual meeting in Las Cruces, New Mexico, October 17-19, 2005. The report consists of two sections. Part I discusses each of four research product areas and provides a description of product goals, present year accomplishments and impacts, and on-going activities over the coming year. Part II provides a listing of the published works over the previous year related to these product areas and related activities of the project membership.

    OBJECTIVES, ACCOMPLISHMENTS, IMPACTS, AND ON-GOING ACTIVITIES

    Water throughout the Western U.S. is central to both regional economies and environments. This collaborative research project focuses on the strategic mobilization of water across uses and sectors, in particular, those relating to irrigated agriculture-the largest water user in the West. Recent years have witnessed major changes in the technology, economics, and institutions that have a significant bearing on water, its use and its conservation. The overall research objectives are summarized as follows:

    Develop and evaluate alternative technologies to monitor environmental effects of water allocation and management

    Quantify comparative economic values of water in alternative uses

    Assess the effectiveness of alternative management institutions, laws, and policies for water allocation

    Consistent with these objectives, the project is comprised of four specific products that each contribute to one or more of the above objectives. Goals, accomplishments and impacts, and on-going activities are described for each product.

    Research Product 1. Soil Salinity Measurement Methods to Rapidly Monitor the Impact of Basin-Scale Water Management Decisions.

    Goals. Irrigation and salinity management challenges frequently coincide in Western watersheds. The goal for the product area is directed at improving the understanding of the relationships and interactions between irrigation quantity and quality, soil quality and salinity levels, land use and management, and economic productivity. At its core, this product aims to evaluate the farm and regional economic and environmental implications of alternative water-conserving management systems. Experimental data and model analysis includes sites in Texas, Colorado, and New Mexico. Because of personnel changes among the research members, the present goal reflects a slight shift in emphasis, as originally proposed, away from a specific examination of alternative farm-level technologies toward the analysis of farmer land use and management choices.

    Key Accomplishments and Impacts. Activities over the previous year have resulted in the following:

    The design and development of a farm-level survey conducted in the Arkansas Valley and along the Uncompahgre River. Analysis of data is currently underway but initial indications suggest that efforts to reduce and conserve water can have adverse effects on long-run farm-level productivity owing to the buildup of soil salinity. Long-run productivity requires an integrated approach to irrigation and salinity management.

    In Texas, Marek has identified potential sources and systems for obtaining soil salinity data; however, with the exception of test-plot data, such data are costly to obtain with suitability for modeling. Harman has used simulation methods using the CROPMAN model to develop simulated data sets which may be useful as an approximation for the subsequent modeling analysis.

    On-Going Activities. Over the coming year, collaborative efforts among researchers in Texas, Colorado, and New Mexico are focused on the following activities:

    Analysis and assessment along the Arkansas and Uncompahgre rivers of Colorado is expected to proceed led by Schuck (CSU).

    Hurd (NMSU) joined the research group this year and is evaluating potential data sites for the analysis of salinity problems along the Rio Grande of New Mexico and West Texas.

    Hurd (NMSU) and Harman (Texas A&M) will work to calibrate the CropMan model to simulate major crop yield effects associated with alternative salinity impacts for selected watersheds in New Mexico and Texas.

    Eric Schuck (CSU) and Tom Marek (Texas A&M) are researching salinity response using a watershed-based model for selected watersheds in Texas and Colorado. The research will address: a) possible mitigation strategies designed to reduce salinity build-up associated with water conservation; b) ground-truthing of salinity levels in selected watersheds; and c) linking the outcomes of mitigation strategies to ImPlan to evaluate secondary economic impacts.

    Research Product 2. Farm-Size Characteristics, Economics, and Institutions are Central to the Design of Agricultural Water Conservation Programs.

    Goals. Farm-size characteristics are an important consideration in the efficient and effective design of institutional programs. This effort provides for the empirical investigation of unique production, resource, technology, and water-management characteristics across irrigated farm-size groups for western irrigated agriculture. Using regional multi-product economic models to examine differential economic-cost structures by farm-size class, the goal is to reveal their unique resource adjustment and conservation potential under alternative water-conservation/institutional policy arrangements for western agricultural water supplies. More specifically, this product: 1) examines the influence of alternative land and water resource endowments, output and resource substitution possibilities, and farm irrigation production-technology differences on total economic-cost structures across irrigated farm-size classes; 2) examines the conservation effectiveness across farm size of acreage versus flow and information-based conservation program alternatives, and their implications for small farm versus environmental policy goals; and 3) examines the affect farm-size differences have on conservation willingness-to-accept values under alternative conservation program and institutional arrangements.

    Key Accomplishments and Impacts.

    Schaible and Gollehon (ERS) worked cooperatively with Hamilton (BoR) and NASS on: a) setting-up the 2003 FRIS both at the NASS Data Lab (in DC) and at NASS (in Denver); and b) using the 2003 FRIS to evaluate characteristics of BoR water users/use, including water values. This research will be continued by BoR-Denver.

    Schaible (ERS) and Supalla (UNL) have adapted a programming-based, multi-product restricted-equilibrium model to a multi-region area of North Platte Basin irrigated agriculture. This framework (currently in the calibration phase) incorporates crop-specific land and water, as well as crop water-application rates as endogenous variables. Water application rates are made endogenous through the use of crop-specific, nonlinear yield-ET relationships developed (and published) by Supalla and Martin, UNL. Calibration and policy analysis work will continue in 2006 on this research. Model results will eventually contribute to Objective 2 model development goals.

    Kim, et al. (2005), using a decomposed cost-function approach, developed a single-equation, decomposed negative binomial regression model of U.S. agriculture by farm-size class. Used to evaluate factors influencing structural changes in U.S. agriculture, the modeling framework is adaptable to meet Objective 2 goals.

    Schaible and Aillery (2005) examined several irrigation water-management issues, specifically: a) why irrigation water management is important to U.S. agriculture; b) the status of irrigation technology/water management use across the U.S.; c) the potential for improvement in irrigation water conservation; and d) the influence of farm size on irrigation water conservation and its policy implications.

    Schaible (along with an ERS 2004 CEAP-ARMS Team) have reviewed, edited, and established an ERS (in-house), research-usable data product for the 2004 ERS/NASS CEAP-ARMS data. CEAP-ARMS for 2004 is an integrated field/farm-level survey of 882 wheat producers across 16 States, integrating the production practice and NRI data from the USDA/NRCS Conservation Effects Assessment Project (CEAP) and the practice/cost-of-production/farm economic data from the ERS/NASS Agricultural Resource Management Survey (ARMS). ERS/NASS CEAP-ARMS data will be useful for Objective 2 research.

    Cooperative modeling research with Ray Supalla, UNL, not only allows for evaluating deficit irrigation as an endogenous optimal producer choice, but the research will contribute to development of a programming-based modeling framework for analyzing farm structure issues associated with USDAs irrigation water management/water conservation goals.

    Kim, et al. (2005) farm structure modeling provides an econometrically-based conceptual framework adaptable to evaluating farm structure issues associated with producer response to alternative water conservation programs.

    On-Going Activities.

    Cooperative research between ERS and BoR-Denver will continue to assist in the understanding of distributional issues associated with water use, and allow the BoR to improve its water allocation decisions during water-short years.

    Continued development of ERS/NASS CEAP-ARMS data, which provides a rich database for linking producer production practices, farm resource and producer characteristics, and farm economic data with field/farm-level environmental outcomes. While for 2004, the number of irrigated-wheat observations in the sample were small (62 observations out of 882), the number of irrigated-farm observations for the 2005 CEAP-ARMS corn sample will likely be larger, providing a richer dataset for analyzing irrigated agriculture farm-structure issues.

    The scope of Product 2 was agreed by committee members to be expanded beyond farm-size/conservation issues to include addressing the effectiveness of alternative conservation programs. This broader product scope enhances product participation (from North Dakota, Kansas, and Idaho), incorporating such issues as conservation/climate change issues, local conservation perspectives of the Ogallala Initiative, and water banking/reallocation as components of conservation policy. The expanded Product 2 scope will require additional effort (from all participants) to integrate this work into a white paper (for a joint product contribution).

    Research Product 3. Effects of Water Policy on Agricultural Production Risks.

    Goals. Overall, this research will examine, in a comprehensive and systematic manner, the concept and implications of the idea that irrigation water supplies can be interrupted as a result of policy decisions, which are independent of traditional runoff-based interruptions. The comprehensive nature of this research includes both the identification and examination of alternative mechanisms to manage the risk of policy-induced water supply shortfalls from a producer, State, and Federal perspective, as well as recognizing the impact of such risks on alternative water values. The specific tasks for achieving these objectives are to: 1) identify the location and scope of irrigated agriculture that would be most likely to face reduced water supplies as a result of water policy decisions; 2) quantify the likelihood of reduced water supplies from policy decisions, or determine needed data for quantification; 3) investigate alternative mitigation mechanisms to determine who acquires the risk, and who bears the cost; and 4) investigate the institutional feasibility of alternative mechanisms, given the current legal and institutional environment of western water law and policies.

    Key Accomplishments and Impacts.

    Schaible, et al. (2005) summarizes the proceedings of the May 24-25, 2004 ERS/Farm Foundation workshop on the economic impact and policy responses associated with the increasing risk of Federally-induced water-supply shortfalls that limit irrigated production during water-short years. Workshop presentations/discussion included a range of topics, including: a) estimation methods and associated values of agricultural production losses from reduced water supplies; b) alternative mechanisms to mitigate agricultural risk associated with uncertain supply and demand for water; c) institutional issues concerning law, water systems, and financial markets; d) stakeholder concerns, including environmental, water user, and state government perspectives; and e) the future Federal role in the mitigation of water supply risk for irrigated agriculture. The workshop program included presentations by W1190 participants from ERS, Nebraska, Oregon, Texas, Washington, and California.

    The workshop conducted by ERS and the Farm Foundation on agricultural risks in a water-short world provided a Washington, DC policy forum for interaction among those concerned with farm-level responses to water shortages and those concerned with policy and institutional responses to reduced water availability. The workshop summary report on the Farm Foundation website (see Schaible et al. 2005), highlights the workshop's policy impact through the programs numerous policy discussions/interactions with Federal/State and stakeholder policy decisionmakers.

    On-Going Activities.

    Phase 2 will proceed with a survey of the W-1190 members for the identification and characterization of high conflict potential in water across the various represented regions. Bob Hearne, NDSU, agreed to take leadership on this with participation from WSU, and ERS.

    Research Product 4. Water Allocation Laws and Procedures in the American West.

    Goals. The goals for this product have evolved in consideration of the committees desire to produce a more directed and focused outcome and impact, to avoid redundancy with existing documents (e.g., the survey of water institutions developed by Dr. Larry MacDonald), and the heightened utility of a cross-cutting examination of the political economy of water demands and institutions throughout the West. The current goal aims to develop a framework for the examination of political influences and consequence of water use, rights, and infrastructure. A case study approach is envisioned that will culminate in a conference session and either a book or special issue on the subject of political externalities and Western water resources. Gopalakrishnan (Hawaii) is agreed to facilitate the development of this product along with the cooperation of selected and interested committee participants for the selection of key case study examples. This effort will complement the Phase 2 efforts under Product 3 in its survey of water resource conflict potential.

    Key Accomplishments and Impacts.

    Publication of a special issue of the International Journal of Water Resources Development on the theme of Water and Disasters (co-guest edited by Gopalakrishnan -- Volume 21, Number 4 / December 2005). This thematic issue features the contributions of several members of the W-1190 and has expanded the scope of our work on water- related disasters such as floods and droughts which have been occurring fairly frequently in the participating states.

    The findings and conclusions emerging from the study of the serious water situation facing Hawaii should assist the Hawaiian Water Commission, Office of State Planning, State of Hawaii Tourism Authority and the Honolulu Board of Water Supply, among others, in developing an informed and effective water policy to address the critical residential water demand facing Hawaii.

    The 2005 American Water Resource Association meetings included presentations from several W-1190 members. A special session on water institutions in the western United States, organized and conducted by W-1190 members, provided a valuable contribution of both economic analyses and institutional review for this special conference on watershed managment.

    Research in Hawaii attempted to identify the weaknesses in Hawaiis water laws and institutions that severely limited the flexibility of water transfer from surplus agricultural water to other uses, especially residential, in terms of a case study of the Waiahole surplus water resulting from the closure of a major sugar plantation involving 27 mgd of water. The allocation of this surplus water among high-priority water users and uses, in particular residential, recreational, and in-stream uses, was fraught with difficulties and riddled with conflicts because of the lack of well-defined rules and laws governing such inter-sector water transfer. Legal and institutional changes that could facilitate the transfer process and significantly reduce such conflicts were studied and policy options to implement them were suggested.

    On-Going Activities.

    Efforts will continue to assemble summaries of existing presentations of changing water institutions (including presentations for the two meeting identified above) and comparing the results with the previous report by Larry MacDonald on water institutions. This will provide for a survey paper as a prelude for the case studies.

    Future research efforts will focus on the political externalities of water institutional change. Outputs will likely take one of two forms: 1) eight or nine papers addressing various aspects of political externalities for a Special Issue of the International Journal of Water Resources Development (IJWRD); and 2) a book plan consisting of a series of chapters addressing political externalities associated with water institutional change. Gopalakrishnan (Hawaii) will engage book plan discussion with Springer Publishing. W1190 members will then be solicited for book chapter contributions.

    Related Work on Water Quality Conducted by USDA ERS in Cooperation with the Committee

    Several ERS research outputs examine the implications of market versus regulatory policies designed to reduce agricultural-induced environmental quality impacts associated with nitrogen and animal-waste loadings from several policy perspectives, including their multi-media impacts.

    Ribaudo, et al. (2005) assessed the economic and environmental tradeoffs across the multi-media nature of animal-waste pollution abatement. These authors addressed the issue from both a farm-level (hog farms) and a national-level policy perspective, including addressing potential implications of adding air-quality regulations to existing Clean Water Act regulations (in the Chesapeake Bay watershed).

    Ribaudo, et al. (2004) examined the impacts of establishing nitrogen discharge credit trading to reduce agricultural nitrogen loads contributing to hypoxic and anoxic waters of the northern Gulf of Mexico.

    Johansson and Moledina (2005) used a game-theoretic approach to examine the impacts of producer strategic behavior in the face of asymmetric information on pollution abatement costs associated with fees or tradable permits used to reduce point and nonpoint source phosphorous discharges.

    Johansson, et al. (2005) examined the impacts of trade liberalization with special attention devoted to environmental quality impacts in the presence and absence of non-degradation environmental standards.

    Aillery, Gollehon, and Breneman (2005) provides technical documentation for a regional-based, nonlinear mathematical-programming model of animal manure-nutrient production and distribution (applied to the Chesapeake Bay watershed). This model is designed to assess regional costs of manure management, transport, and land applications, given the existing structure of the animal industry and manure-storage technologies in use.

    Ribaudo, et al. (2005) (1) extends the impacts of animal waste management to both air and water quality; (2) draws-out the broader national-scale impacts of multi-media pollution-abatement policies, including long-term structural adjustments and welfare impacts on producers and consumers; and (3) contributed directly to policy implications of adding air-quality regulations to existing Clean Water Act regulations.

    Ribaudo, et al. (2004) demonstrated that a nitrogen-reduction credit trading program (between agricultural nonpoint and point sources) would reduce the cost of nitrogen control and nitrogen discharges. Results show that a substantial degree of credit trading could affect agricultural commodity prices, and thereby affect agricultural production/pollution outside the basin.

    Johansson and Moledina (2005) show that fees and tradable permit policies, to be successful, must account for producer strategic behavior given producer-based asymmetric information on pollution abatement costs.

    Aillery, Gollehon, and Breneman (2005) demonstrate the policy importance of accounting for spatial interactions involving animal concentrations and land available for manure spreading that can significantly affect manure land application costs faced by animal producers.

    Impact Statements:
    1. Agricultural producers in Colorados Arkansas and Uncompahgre River Valleys are able to improve their irrigation practices and salinity management as a result of research and analysis demonstrating long-run economic benefits of integrating irrigation and salinity management.
    2. Agricultural and natural resource researchers throughout the West will benefit from the cooperative work between the USDA, Bureau of Reclamation, and National Agricultural Statistics Service as they develop integrated datasets.
    3. Agricultural policy is shown to be improved with a better understanding of the role and effect of farm-size on technology adoption for irrigation water conservation.
    4. Awareness of the potential adverse farm-level effects of reduced irrigation supply was enhanced for water managers throughout the West who participated in the May 24-25, 2004 ERS/Farm Foundation workshop.
    5. Water researchers throughout the West and beyond gained considerable insight through the publication of a special issue of the International Journal of Water Resources Development on the theme of Water and Disasters (Volume 21, Number 4 / December 2005).
    6. The Hawaiian Water Commission, Office of State Planning, State of Hawaii Tourism Authority and the Honolulu Board of Water Supply benefited considerably from the findings and conclusions emerging from the study of the serious water situation facing Hawaii.
    Last Modified: unknown

    Date of Annual Report: 12/10/2006

    Report Information:
  • Annual Meeting Dates: 10/12/06 to 10/13/06
  • Period the Report Covers: 10/2005 to 09/2006

    • Participants:
    Brief Summary of Minutes of Annual Meeting:
    10/12/2006 Morning Session I

    Brian discussed the need for new faces, members from other states, and new interdisciplinary collaboration. Ari suggested that soils scientists would be great. Brian reviewed the agenda and the progress report, with the need to report activities, products, and impacts.

    Ray Huffaker discussed Seattle and dinner plans were made.

    LeRoy discussed funding and proposals to modify Hatch funds and formula funding. Each state is obligated to spend ¼ of its funds on interdisciplinary , multistate projects. Past efforts to realign were thwarted. Reforms of Hatch have not been through the Senate. Deans and AES directors have proposed to place USDA research funding, ARS, ERS, and CSREES, though one agency, ie NSF, reporting through Sec AG., and double budget. Grow funding for research portfolio ¾ competitive, and ¼ base (Hatch). IF Hatch funds are lost things will change drastically.

    The group discussed impacts of work. Benefits are years away.

    Brian mentioned the absence of ERS collaboration which has limited progress on the products listed in the project proposal. We understand that USDA undersecretaries are not happy with ERS absence with irrigated agriculture. However Susan Offut claims that water is the realm of NRCS.

    Water is the top priority of AES nation wide. Not refined quality in east and quantity in west. USDA finds that quantity and quality can not be separated. Water quality has always been a W1190 issue.

    Morning Session II

    Wyatt led a discussion of Product 1, and discussed the on farm decision making tool with soil salinity and yield impacts for the Rio Grand valley in Texas. Wyatt thinks we can broaden this to other water quality issues, sedimentation. Brian suggested that we can integrate the Rio Grand model. We can do upper and lower Rio Grand. We can do a regional multistate project that does deal with soil to watershed modeling.

    The fact that many of the project proposals products were developed and led by members who were no longer with us, led us to reassess how the committee proceeds. The committee then suggested that because of changing personnel that we could not maintain the focus on the products and reporting on the products. Instead it was decided to revert to state reports and that reporting should be done by objective and not products.

    State reports

    Nebraska Ray Supalla distributed the Nebraska report. Efforts were mostly objective 2. Major issues included reduced consumptive water use and conflicts with Kansas. The Water Optimizer tool was used. Ray said water trading between irrigators occurs, but transfers to instream flow uses are not popular.

    Washington

    Ray Huffaker reported orally. He discussed dam sediment removal technology, as a tradeoff between current and future uses.

    Idaho

    Garth Taylor discussed collaboration with the Bureau of Reclamation. Research used a partial equilibrium model with externalities, with GAMS with rights and priorities. Groundwater externalities are positive. Input output work economic impacts. He discussed CREP $1/3 billion, a super boondoggle to produce paper water by leasing land. They will use this money to put corners into pivots.

    New Mexico

    Brian reported orally, written report will be sent. Research was on impacts of salinity on water and soil in Rio Grand. Need to scale back on objectives in order to not scare irrigation districts. Should collaborate on upstream and downstream impacts. Also research on effects of climate change on New Mexico.

    Texas

    Ari discussed the Desalinization lifecycle economics model. Largest inland desalinization plant in the world, uses brackish water deep-well injections in the El Paso area. El Paso was a Federal flood disaster area. Flood insurance needs is an issue. Need to redraw flood maps. Need to put in new gages. Need a post flood assessment.

    Other research was on the use of irrigation return flows, conjunctive use, and the physical understanding of return flows and salinity.

    Ari also discussed leveraging from Rio Grand initiative.

    Wyatt discussed data on detecting salinity. Data did not show good correlation. Production functions on 48 years of historical data.

    Other research was on the long term impacts of biofuels. Water quality issues of biofuels is salinity. Ray suggested that in Nebraska one irrigation well is an ethanol plant. So the context of ethanol using too much water, is not there. A good fact sheet would be nice.

    MTB was an ethanol substitute, but this contaminated the groundwater.

    Ethanol should be kept on the radar.

    Hawaii

    Gopal discussed political externalities, public expenditure on public goods are not based upon economic principles, but political reasons, lobbying etc.

    The role of pork barrel politics. Gopal produced a short paper, and a proposal for WAEA meeting in AK was not accepted, but idea continues.

    Simulation of water markets and gains from trade. Vested interests thwarted water code, another example of political externalities. Including rent seeking. Three page proposal. Special issue Journal of Institutional and Policy Research. Special issue of International Journal of Water Resource Management. Floods and droughts and extreme climate events. Special issue on water and disasters. New area thinking outside the box. Two or three tangible projects.

    Indiana

    Work in objective 3, with a little in objective 2. She did conceptual research on privatization. This is a big international issue. The role of public participation was an issue. She is looking for studies on common property groundwater management. Texas has rule of capture and that leads to creation of groundwater districts. North Dakota has a prior appropriation that privatizes groundwater and place the state in a management.

    She is conducting a survey of substitutes and complements of water trusts and state management. She will assess public private role, substitutes and private. But maybe states are complements and not substitutes for trusts. Instream flows as beneficial use. So trusts can purchase rights some states maintain seniority.

    North Dakota

    Bob discussed research on local water management institutions. A survey is being conducted and result will be available in 2007.

    Bureau of Reclamation

    Rob mentioned Garths and Rays studies. We were invited to the First annual research meeting in Bureau of Reclamation in Denver. He discussed FRIS data. Market transfers between farmer to farmer but little else. This is a nice issue for political externalities.

    Illinois

    Nick talked about the spatial analysis that integrates hydrology, economics, engineering, instituions, modeling. Jeff Peterson and Alex Saak in KSU will work on Republican River. Nebraska data will be used. Other research focuses on lake eutrophication, to determine a threshold when you do not know where the threshold is.

    10/13/2006

    Brian discussed key strategies and key alliances for upcoming year

    We should be set goals for interaction next year. Garth wants to work with Bureau of Rec, use their money, basin water allocation issues collaborate with engineers and hydrologists. We should continue research on demand for water, and incorporate Grant Cardons work. We want to work on modeling so that we do not need to reinvent the wheel. Water, soil, production functions are very integrated.

    Business meeting

    Where next year Nominations . . . 1. Nebraska, Lincoln or Omaha. 2. Federal Center in Denver hosted by Bu of Rec. 3. South Padre or El Paso 4. Kansas City 5. Idaho

    Dates October is 11 & 12 or 18 & 19.

    Vote on final dates.

    Vote Passes in favor of Nebraska. It will probably be in Lincoln, perhaps not a football weekend.

    In Nebraska Meeting with DNR, district,

    Field trip, crane migration

    It was suggested that we should shape meeting around two thrusts 1. modelling, field crop yield to basin, value functions, 2. water institutions and political externalities, water institution modeling.

    Issues include cohesive modelling decision making process and adaptive management on the Platte.

    Submissions for special session to WAEA meeting Portland.

    Work on institutional modeling. China is an issue, central control. ACOE decision making projects.

    Officers for upcoming year Brian proposes that Brian keep the chair, Bob passes to vice chair, Garth has been nominated for incoming secretary, seconded, and passed.

    Report writing was discussed with suggestions of how to facilitate the process. Write impact statements

    Gopal discussed effort lets get a lot of papers on institutions

    We discussed recruitment of New Members and Friends, suggestions included: Idaho  no resource economists and more community development people Texas  Ari has names California  Mark Grissner an official member, Jay Lund, Mike Campana,

    Suggestions for Future Thrust Areas 1. Salinity Management and Basin Modeling 2. Institutional Design and Political Externalities

    Accomplishments:
    Water throughout the Western U.S. is central to both regional economies and environments. This collaborative research project focuses on the strategic mobilization of water across uses and sectors, in particular, those relating to irrigated agriculture  the largest water user in the West. Recent years have witnessed major changes in the technology, economics, and institutions that have a significant bearing on water, its use and its conservation. Also the continuing change in western economies, with the increasing importance of recreation, leisure, and the environment and the relative decreasing importance of irrigated agriculture implies further research challenges in order to ensure efficient water use. The overall research objectives are summarized as follows:

    1. Develop and evaluate alternative technologies to monitor environmental effects of water allocation and management; 2. Quantify comparative economic values of water in alternative uses; and 3. Assess the effectiveness of alternative management institutions, laws, and policies for water allocation.

    Two continuing themes demonstrate ongoing multistate and multidisciplinary collaboration and linkages. These themes are: i) expanding crop water-use and evapotranspiration models to the watershed and basin levels, which will be addressed under Objective 2; and ii) assessing institutional and policy linkages through a theme of political externalities, which is addressed under Objective 3.

    Objective 1: Develop and evaluate alternative technologies to monitor environmental effects of water allocation and management

    Activities, Accomplishments and Impacts.

    Research in Washington and Nebraska assessed reservoir storage. Researchers in Nebraska focused on how water shortages have impacted the recreation industry or the regional economy and on whether there are any short-term water management opportunities for mitigating such impacts which are economically justifiable.

    Major findings from this study were: 1) Diverting less water for recreation or hydropower in order to provide for improved recreation would be economically efficient under some reservoir conditions; 2) the most cost effective method of augmenting the reservoir would be to reduce winter releases for hydropower; and 3) reallocating water from irrigation and hydropower would not be a cost effective method of enhancing the Western Nebraska regional economy.

    Research in Washington Huffaker and colleagues have addressed the Economic Dynamics of Reservoir Sedimentation Management. Singular perturbation methods were applied to investigate the economic dynamics of optimally controlling the accumulation of sediments that destroy water storage capacity in dam/reservoir projects. The impoundment of water in the reservoir evolves on a fast time scale, and the loss of storage capacity to sediment evolves on a slow time scale. The work breaks new ground by formulating a hydro-economic threshold of reservoir storage capacity that indicates whether a manager should optimally manage the reservoir as a renewable resource (by applying a sustained sediment removal policy) or a nonrenewable resource (by eventually abandoning the reservoir and allowing it to fill with sediment). This work was done in collaboration with a civil engineer specializing in reservoir sedimentation, and under the sponsorship of the International Coordinating Committee on Reservoir Sedimentation (UNESCO).

    In Washington research investigated the dynamics of sediment accumulation in a storage reservoir when sediment removal competes for impounded water required for other valuable uses (e.g., hydropower generation, irrigation diversions, recreation, etc.). The extent to which different impounded-water consumption polices succeed in bifurcating the system from unstable (decreasing storage capacity) to stable (sustained storage capacity) operating regimes was assessed.

    In New Mexico, Hurd, Ward and colleagues researched soil salinity measurement methods to rapidly monitor the impact of basin-scale water management decisions. These researchers: i) assembled data on the salinity impacts to specific agricultural crops in the Rio Grande Valley; and ii) analyzed the impacts of alternative salinity scenarios on water use and economic returns to agriculture in the Rio Grande Valley. Salinity effects on water quality present many complex challenges to the long-run management of water resources along the Rio Grande. This exploratory assessment suggests that the adverse effects of salinity on agriculture and economic returns are measurable, as production shifts from high- to low-valued crops and total acreage falls as salinity levels rise. Salinity management is likely to become increasingly important to the region in order to maintain water quality and the arability of agricultural cropland. More comprehensive study of salinity management options, effects, and costs is suggested with particular attention given to the interaction of water conservation activities to salt-leaching requirements.

    In Texas, water quality impacts of alternative tillage and atrazine management practices on atrazine field losses in corn production in Central Texas were monitored in 2006 and concentrations were minimized by incorporating atrazine at application time. Long term computer simulations agreed that losses of atrazine, in this case loads, would be lowest with incorporation but also by banding over the seed row. Soil salinity sample analyses were compared with EC readings made by a Veris ground survey as an alternative method to monitor and manage environmental conditions and effects. The results of this research showed there was poor correlation between laboratory salinity analyses and the EC measurements. This is an important finding for those relying on EC measurements using this equipment.

    Continuing Activities In Illinois, Brozovic is continuing a spatial analysis of wetland mitigation patterns. Spatial analysis will be used to characterize the spatial and temporal socioeconomic impacts of compensatory wetland mitigation. This research is undertaken with researchers from urban and regional planning. Brozovic will also continue analyzing the economic dynamics of ecosystems with unknown thresholds. This research is a theoretical analysis of the optimal management of pollutant inputs into a lake ecosystem when there is an unknown threshold separating physical regimes with distinct behaviors.

    Harman and Hurd are moving forward with proposal activities to support the use of the Cropman simulation model to assist in on-farm efforts to improve irrigation and salinity management.

    Objective 2: Quantify comparative economic values of water in alternative uses

    Activities, Accomplishments and Impacts.

    In Nebraska procedures for linking economic, evapotranspiration, and hydrology models on a watershed scale were developed and tested. Results from the water optimizer model for most areas in Nebraska suggest that in the general case deficit irrigation of corn and soybeans is the most profitable option when water becomes limiting. Reducing irrigated area does not become an attractive option until water supply is reduced to about 70 percent of the full irrigation requirement for corn, and irrigating drought tolerant crops such as wheat or grain sorghum is rarely preferred.

    In Kansas county level optimization models were developed by Peterson and colleagues to project irrigation water use in the Southern High Plains Region. Projections were made for a 60-year horizon for all counties overlying the High Plains aquifer in KS, CO, and TX. Combined results are summarized in Peterson et al. (2006). Although there is substantial heterogeneity in the region, the models generally predict that farmers will respond to aquifer decline be steadily reducing irrigated acreage while holding water application rates per acre approximately constant.

    A theoretical model was developed by Saak and Peterson to assess the role of imperfect information in water extracted from a common pool aquifer. In particular, agents in the model realize that their withdrawal rates have some impact on their neighbors future water availability, but are unsure about the magnitude of this impact. In hydrologic terms, there rate of aquifer transmissivity is unknown to individual users. In a simple 2-user, 2-period game, the lack of information can be shown to either increase or decrease water use and welfare levels in the Nash equilibrium. The direction of impact depends on a rather subtle curvature property of the users net benefit functions, which can be interpreted as a feature of risk preferences. Policy makers in the Southern Ogallala region have improved information to assess the prospects for water conservation policies.

    In Texas, irrigation production functions were developed from simulations of major crops in the Lower Rio Grande Valley of Texas using explanatory variables: historical weather as a proxy for annual precipitation, five salt levels, a range of sandy to clay soils, and alternative seasonal irrigation amounts for winter and spring corn, cotton, grain sorghum, sugarcane, onions, cabbage, watermelons, and cantaloupes. Soil salinity can be detrimental to salt sensitive crop yields and developing irrigation functions with salt levels as explanatory variables can aid irrigators in assessing yield risk due to saline irrigation water.

    In Texas, Individual irrigation rates and timings were also simulated for use in efficient allocation of water between competing crops such as spring corn, cotton and sorghum. A decision tool, IRRG AID at http://cropman.brc.tamus.edu, is based on these three functions. Marek installed two 34,000 lb. class monolithic lysimeters at the Texas Agricultural Experiment Station, Uvalde Research Center to enable accurate measurement and determination of crop ET for the South Texas Region. Spinach crop water use coefficients were determined and published for use by producers in the South Texas region to increase water use efficiency and producer profitability.

    This past year, the Texas High Plains ET (TXHPET) network was established (http://txhighplainset.tamu.edu) and many of the newly developed features are to be extended to stations located in the far (San Angelo region & Pecos) and South Texas region (Uvalde and vicinity). Research continues on the reduction of ET estimates through model improvement in the ET networks by assessing crop stage development and growing degree (heat unit) triggers.

    Marek installed two 34,000 lb. class monolithic lysimeters at the Texas Agricultural Experiment Station, Uvalde Research Center to enable accurate measurement and determination of crop ET for the South Texas Region. Spinach crop water use coefficients were determined and published for use by producers in the South Texas region to increase water use efficiency and producer profitability.

    This past year, the Texas High Plains ET (TXHPET) network was established (http://txhighplainset.tamu.edu) and many of the newly developed features are to be extended to stations located in the far (San Angelo region & Pecos) and South Texas region (Uvalde and vicinity). Research continues on the reduction of ET estimates through model improvement in the ET networks by assessing crop stage development and growing degree (heat unit) triggers.

    Continuing Activities.

    In Nebraska Suppalla and colleagues will continue developing and testing procedures for linking economic, evapotranspiration and hydrology models on a watershed. There appears to be a consensus that the Soil Water Assessment Tool (SWAT) developed by the USDA-ARS is the one of the preferred models for simulating the hydrology of agricultural watersheds. Early analysis shows that the methods in the SWAT model may under predict the water use of fully irrigated crops. The model also lacks the ability to simulate the impact of irrigation uniformity on deep percolation from irrigation. Thus, while the model shows promise we anticipate that it will need revision for agricultural watersheds in the Great Plains. Researchers are investigating means to include this variability into the SWAT model. In Illinois, Brozovic collaborating with researchers from Illinois, Nebraska, Kansas, and California is conducting spatial dynamic modeling of groundwater management. Dynamic optimization methods are being applied to spatial models of groundwater externalities that incorporate civil engineering equations of transient groundwater flow. Ongoing research includes collaborative theoretical and empirical studies with economic and engineering researchers from Illinois, Nebraska, Kansas, and California. I am directing an undergraduate minority student, who participated in the McNair Scholars Program, in a portion of this research.

    Objective 3: Assess the effectiveness of alternative management institutions, laws, and policies for water allocation

    Activities, Accomplishments and Impacts.

    Work in Hawaii featured a review, discussion and analysis of water allocation laws and procedures in Hawaii in terms of political externalities. The term political externalities, in the context of our research, is used to describe the many ways in which decisions and actions concerning the ownership, allocation, planning and management of water resources are influenced via the political process. As part of this study we developed and reviewed information about the ownership, allocation, and management of water for irrigation and agricultural purposes in Hawaii, with special reference to sugar and pineapple plantations, the principal consumers of water in the state. The major findings from our study suggested the following; 1) Ten big corporations owned approximately 25% of the land in Hawaii and 80% of the state's sugar and pineapple plantations during the study period (1930-1992). These plantations used about 24% of the fresh water consumed in the state of Hawaii. 2) They were able to purchase water at very low prices from the state because of political connections. We estimated the gains to the sugar plantations during the 60-year period due to excessively low prices charged to be nearly $1.4 billion, a clear case of private gain at public loss; 3) Attempts at establishing a Water Code for Hawaii were thwarted by vested interests through political interventions, resulting in inefficient water allocation; 4) In disputes involving private use of Hawaii's public water resources, in many instances in the past, judicial decisions favoring private parties were handed down; 5) Water demands of Native Hawaiians were neglected; 6) No specific criteria for prioritizing water use were developed at the state level. In brief, water allocation and management in Hawaii up until recently presented a compelling picture of political externalities in action.

    In Washington, the law and economics of resolving reservoir sediment management conflicts was researched.

    In 2006 researchers in Nebraska completed work on a water marketing project in cooperation with the Bureau of Reclamation and ERS. This effort involved three main components: a legal review of water marketing practices in the 17 western states; water auction experiments using the University of Nebraska Economics Laboratory; and a mail survey of Nebraska Irrigators. The major findings, conclusions and policy implications were:

    1. Allowing more creativity in satisfying the no-injury rule through water supply augmentation, as is practiced in Colorado, would make water marketing a more flexible tool than it currently is in other western states.

    2. The effectiveness of markets could be enhanced in most states by using simplified general approaches to determining consumptive use, transfer entitlements and expected third party impacts.

    3. Buyer priced auctions had a lower cost of water right acquisition for the state, resulted in a more efficient market and produced a more equitable outcome for irrigators. The seller priced auctions, however, resulted in more total revenue for all players combined, provided more opportunity for sellers to exercise marketing skills and were a little easier to administer.

    4. Water right owners who participated in an experimental auction practiced a strategy which led to similar prices for all rights sold, rather than differential prices reflecting differences in irrigation productivity. This finding, if supported by additional replications, has major implications for the cost of acquiring irrigation rights when the water is to be used for non-agricultural purposes.

    5. The proposed use of water by the buyer substantially influences the willingness of irrigators to participate in a water market. Less than 20 percent of Nebraska irrigators would likely participate in a market if the water was for endangered species or for use by municipalities out-of-state, whereas over 60 percent were likely to participate if the water was for other agricultural uses.

    6. The length of a lease substantially influences likely water market participation, with nearly 60 percent of Nebraska irrigators interested in one year leases and less than 10 percent interested in 30 years leases or permanent sale.

    7. Nebraska irrigators indicated that their minimum acceptable price for leasing their water rights was approximately double the estimated average irrigation use value.

    8. The single most important policy implication which flows from this analysis is that any public entity that proposes to acquire irrigation rights in a willing-buyer and willing-seller relationship, irrespective of the type of bidding process used, should expect to pay substantially more than what the water is worth in irrigation. This is especially true if it is a long-term acquisition and/or if the water is being acquired for some use that is not regarded by the agricultural community as important.

    Continuing Activities.

    Research will continue on the theme of political externalities. Work in Hawaii will focus on developing specific suggestions for the consideration of the state Water Commission, the state Board of Water Supply and other agencies that play an important role in crafting and implementing water.

    Research efforts in North Dakota focused on the analysis of local management institutions, with a focus on the Red River Basin. After extensive consultation with local water managers and experts, two survey instruments were developed and refined by Hearne and colleagues. Practice surveys were conducted and a full survey of Local water management organizations in the Red River Basin of Minnesota and North Dakota and their board members will conducted in November and December of 2006. These surveys will provide primary data for a MS theses as well as peer reviewed publications. A second graduate research assistant was recruited and has initiated his literature review on stakeholder analysis of water management.

    Research in Idaho conducted by Taylor and colleagues have focused agriculture, municipal, industrial, and environmental demands for Idahos limited water supplies.

    Impact Statements:
    1. Texas and New Mexico State Univesrsity scientists found drought damages in the upper Rio Grande Basin could be reduced by 20 to 33 percent per year through intra compact and interstate water markets, respectively, that would allow water transfers across water management jurisdictions.
    2. Policy makers in Kansas and the Southern Ogallala region have improved information to assess the prospects for water conservation policies.
    3. The findings from research in Hawaii have provided substantial historical data and empirical evidence about political externalities that have played a significant role in decision-making on water allocation in the state.
    4. A new hydro-economic threshold of reservoir storage capacity that indicates whether a manager should optimally manage the reservoir as a renewable resource or a nonrenewable resource was developed in Washington.
    5. Texas economists research on institutional incentives and policy analysis provided support for irrigation district managers, consulting engineers, and US Bureau of Reclamation in economic and financial analyses of proposed water saving infrastructure projects and methods to analyze changing agricultural irrigation and municipal water delivery rates.
    6. Updated agricultural water use demand estimates were developed for Texas state water plan. Research showed sugarcane yields decreased at the rate of 0.04 t ha 1 per unit salinity (ppm) above 1000ppm, somewhat less than previously cited. Sprinkler water application results indicate potential for reducing dust control water usage at cattle feed yards.
    Last Modified: 15-Jan-2007

    Date of Annual Report: 12/05/2007

    Report Information:
  • Annual Meeting Dates: 10/04/07 to 10/05/07
  • Period the Report Covers: 10/2006 to 09/2007

    • Participants:
    Brief Summary of Minutes of Annual Meeting:
    The meeting was held in Lincoln Nebraska, on October 4- 5, 2007 at the Embassy Suites Hotel. News from CSREES and the Western AES Directors was presented by Mike ONeill and LeRoy Daugherty. Michael Hayes, Director of the National Drought Mitigation Center presented "Drought Management Issues and the Activities of the National Drought Mitigation Center." Jasper Fanning, the General Manager of the Upper Republican Natural Resources District presented "Nebraska's Experience with Natural Resource Districts and Groundwater Management." Glenn Schiable encouraged comments on the Farm and Ranch Irrigation Survey. Gopal introduced the new Journal of Natural Resources Policy Research.

    State/agency reports were presented orally by all participants. These reports are later presented in this progress report.

    Chris Goehmans was elected incoming Secretary. Next years office holders will be Bob Hearne, Chair; Garth Taylor, Vice Chari, and Chris Goehmans was elected incoming Secretary.

    The writing team for the next proposal will be, Bob Hearne, Brian Hurd, Ray Supalla, Grant Cardon, and Garth Taylor. Denver was proposed as the meeting venue for October 2008.

    Accomplishments:
    Water throughout the Western U.S. is central to both regional economies and environments. Water use is critical to agricultural production, growing cities and industries, the maintenance of vital ecosystems and habitats, and the quality of life in the Western United States. This collaborative research project focuses on the strategic mobilization of water across uses and sectors, in particular, those relating to irrigated agriculture  the largest water user in the West.

    Recent years have witnessed major changes in the technology, economics, and institutions that have a significant bearing on water, its use and its conservation. Also the continuing change in western economies, with the increasing importance of recreation, leisure, and the environment and the relative decreasing importance of irrigated agriculture implies further research challenges in order to ensure efficient water use. The overall research objectives are summarized as follows:

    1. Develop and evaluate alternative technologies to monitor environmental effects of water allocation and management; 2. Quantify comparative economic values of water in alternative uses; and 3. Assess the effectiveness of alternative management institutions, laws, and policies for water allocation.

    A number of continuing themes demonstrate ongoing multistate and multidisciplinary collaboration and linkages. These themes include: i) modeling water use and extraction under incomplete information which will be addressed under Objective1 ; ii) expanding crop water-use and evapotranspiration models to the watershed and basin levels, which will be addressed under Objective 2; and iii) assessing institutional and policy linkages through a theme of political externalities, which is addressed under Objective 3.

    Objective 1: Develop and evaluate alternative technologies to monitor environmental effects of water allocation and management

    Activities and Accomplishments

    A salinity project was initiated by Texas researchers in 2007 in the Lower Rio Grande Valley to study the effects of irrigating with saline water of about 700-800 ppm salts. Six furrow irrigated fields containing corn, cotton, grain sorghum, and hay-grazer were sampled both pre-plant and post-harvest to a depth of 4 feet at both the top and the bottom of the field. Several trends were noted this year including (a) salinity levels increased sharply in the 3- and 4-ft depths, (b) salinity increased at the bottom of the field compared with the top and (c) negative log normal function strongly indicates a decreasing trend in salinity as the percent sand in the soil profile increases.

    The irrigation production functions developed can assist irrigators in strategic planning of irrigation, alternatives, rates and timings to increase efficiency of water use. High salinity levels can impact crop yields, some more so than others. Being aware of irrigation water quality and its impacts on soil salinity levels enhances irrigators abilities to utilize irrigation practices that minimize salinity accumulations. The IRRG-AID spreadsheets are being evaluated for use by the US Bureau of Reclamation for use in CO and AZ. They are also applicable for use in NM and OK.

    Saak and Peterson developed a theoretical model to assess the role of imperfect information in water extracted from a common pool aquifer. In particular, agents in the model realize that their withdrawal rates have some impact on their neighbors future water availability, but are unsure about the magnitude of this impact. In hydrologic terms, the rate of aquifer transmissivity is unknown to individual users. In a simple 2-user, 2-period game, the lack of information can be shown to either increase or decrease water use and welfare levels in the Nash equilibrium. The direction of impact depends on a rather subtle curvature property of the users net benefit functions, which can be interpreted as a feature of risk preferences. Brozovi applied dynamic optimization methods to spatial models of water resource management. This project involves multidisciplinary collaboration between economists, engineers, and sociologists, and includes case studies in Illinois and Nebraska, as well as collaboration with an environmental NGO and a CGIAR center. Further work in this research program includes collaboratory efforts with Illinois, Texas, and California.

    Though there is ample evidence of saline soil and water conditions in Utah, there is not sufficient understanding of the distribution, extent and severity of salt-affected soil and water resources in the major watersheds of the state. Without such inventories, and spatial mapping of such conditions, one cannot track the effects of drought on soil and water quality, nor predict the effect of long-term drought on salt-impacted water use, plant growth, water balance and economics in these watersheds. Cardons research on incorporating crop-water-salinity response models into economic decision models is on-going. Specific projects include continued work in the Arkansas River basin of southeast Colorado on crop salinity tolerance and performance, salinity tolerance of fruit and berry crops in Utah, and mapping the extent and severity of soil and water salinity in the irrigated areas of the Bear River Basin in northern Utah.

    Continuing Activities Brozovi is also investigating the economic dynamics of ecosystems with unknown thresholds. This research is a theoretical analysis of the optimal management of pollutant inputs into a lake ecosystem when there is an unknown threshold separating physical regimes with distinct behaviors. This project involves interstate collaboration between economists in Illinois and New York.

    Objective 2: Quantify comparative economic values of water in alternative uses

    Activities and Accomplishments

    Supalla and Martin investigated reservoir management in Nebraska. The amount of water stored in Lake McConaughy reached a historical low in the fall of 2004. In 2005 and 2006 the Central Nebraska Public Power and Irrigation District (CNPPID) irrigators received less than a full supply of Lake McConaughy water for the first time in over 50 years of operation. Electric power interests, recreation interests and the regional economy have also been adversely affected. The central policy question is what if anything should the State of Nebraska do to minimize the adverse impacts from this situation and/or prevent it from developing again in the future? Phase I of this project, conducted in 2005 and 2006, addressed some of the most urgent concerns associated with this question. It focused on how water shortages have impacted the recreation industry or the regional economy and on whether there were any short-term water management opportunities for mitigating such impacts which were economically justifiable. The major finding from Phase I was that that the welfare affects of different policy options depended substantially on how quickly the reservoir was likely to refill in each case.

    Phase II of the study is scheduled for completion in late 2007. Preliminary results suggest that there is a an 80 percent probability that the recreation benefits from reduced reservoir releases will exceed the costs in terms of reduced hydropower and irrigation, given expected refill probabilities. Phase II also considered the economics of augmenting reservoir inflows by reducing upstream irrigation, as an alternative to reduced releases. This option was found to be much more costly, especially if irrigation was reduced by retiring acres instead of by limiting the amount of water pumped.

    Economists from Texas are bringing economics, finance, accounting, and computer modeling to water planning in the Texas Lower Rio Grande Valley. Efforts assist and educate engineers and municipal water managers about comparative life-cycle costs of adding water in the most economical manner between reverse-osmosis desalination and conventional surface-water treatment for their particular location/situation. Irrigation district managers are provided (a) customized computer spreadsheet software which allows the analysis of rate changes (and other variables) upon projected income statements, as well as (b) analyses indicating which water-delivery infrastructure rehabilitative projects provide the most bang-for-the-buck over the long term with comparative life-cycle costs.

    Eddy covariance towers and Bowen ration equipment have been used to measure the water use on a dryland cropping system, on irrigated corn and soybeans, and on native pasture in western Nebraska. Data collection continues to provide historical data for varying precipitation patterns. Additional equipment is being installed to measure water use of a wider array of crops and invasive trees. Research is also underway to evaluate the use of satellite image analysis to estimate evapotranspiration at the watershed scale. Initial research shows that the SEBAL and METRIC models offer promise but may require local calibration in semi-humid and semi-arid climates that experience significant precipitation between passes of the satellite.

    Water optimizer was used in Nebraska to analyze alternative water management strategies when the available water supply is limited. It is a field-level, single-season program which computes how many acres to irrigate, which crops to produce and how much water to apply to each crop in a normal weather year. Eight crops (corn, soybeans, wheat, grain sorghum, alfalfa, edible beans, sugar beets and sunflowers) are considered for irrigation levels ranging from zero (dryland) to fully watered. It is a non-linear optimization model, built in an Excel spreadsheet.

    Water Optimizer was originally developed in 2005-2006. In 2007 model coverage was expanded from 18 Nebraska counties to state-wide coverage. Model capabilities were expanded to include simultaneous multi-field analysis. Users can evaluate up to five fields (wells) at one time and the model will allocate the available water to the fields where it is most profitable.

    Users of Water Optimizer who want to evaluate alternative strategies using default prices, costs, water requirements and yields need to input only the following data for their field: county where the field is located, dominant soil type (coarse, medium or fine textured), field size in acres, irrigation system type (center pivot or gravity at three alternative efficiency levels), irrigation energy source (electric, diesel, propane, gas or natural gas), and their annual water allocation entered in acre-inches per acre.

    Users who believe that their situation may differ from the default values by enough to cause different best management strategies can easily change any of the following parameters: crop prices, fully-watered crop yields, cost items for crops and cost items for irrigation.

    When using 2007 relative prices for corn and soybeans instead of the historical average prices the results were quite different. In 2007 the price of all crops increased substantially with corn increasing by the largest amount. Under these conditions, continuous corn was the most profitable crop in most areas, and the best limited water strategy in the central 2/3 of Nebraska was to deficit irrigate corn and not reduce irrigated area until the water supply fell below 60 percent of the full requirement, compared to 75 to 80 percent under historical average prices. Essentially, higher crop prices increase the profitability of irrigation in most areas by more than they increase profits from dryland, thus making it profitable to deficit irrigate at lower and lower levels instead of shifting to dryland. In the extreme western and eastern parts of the state, however, 2007 prices didnt alter the optimum strategy by very much.

    The water optimizer model may be downloaded from the University of Nebraska Extension website http://extension-water.unl.edu.

    Continuing Activities.

    Pressure on the Ogallala Aquifer from increased irrigation has prompted Kansas researchers to look at options for irrigators facing reduced water allocations. In a holistic approach, a web-based risk analysis tool is being developed that incorporates scientifically based information with a producers site-specific knowledge to assist them in making informed cropping decisions under a variety of water use scenarios.

    Several irrigated crop yield functions were developed for the Winter Garden and Texas High Plains areas of Texas using long-term simulations of the EPIC model based on various irrigation timings and rates, soil types, and weather stations. Similar to the LRGV functions of last year, they relate yield to precipitation, irrigation rates and timings, N fertilizer levels, percent sand in the topsoil, and interaction terms. IRRG-AID spreadsheets and User Guides were developed for irrigators to utilize in strategic decision-making (cropman.brc.tamus.edu). USBR is reviewing IRRG-AID for use in CO and AZ and the spreadsheets are also applicable for use in NM and OK.

    In western Nebraska, evapotranspiration data are being used to improve estimates of water use for irrigation management and watershed modeling. Four types of models are being evaluated: simple irrigation water requirement models, daily soil water balance models, watershed-scale models and models used to interpolate between dates of satellite images. Results show that models are reasonably accurate for irrigated conditions. The watershed-scale models and the irrigation water requirement models overestimated evapotranspiration for dryland conditions for many conditions. The daily soil water balance performed better for dryland conditions and for the non growing season when crop residue shades and insolates the soil surface.

    Objective 3: Assess the effectiveness of alternative management institutions, laws, and policies for water allocation Activities and Accomplishments

    Incentives and barriers to water conservation in the Rio Grande Basin were identified and analyzed from surveys and other data by NM and TX scientists. Existing barriers to water conservation include policies on carry-over storage, interstate compacts, conservation attitudes, land tenure arrangements, and duty of water uncertainty. A low water price was discourages water conservation even if other institutions promote it. Water conserving policies can be more effectively implemented where water institutions and programs are designed to be compatible with the underlying scarcity.

    Further additions and improvements to the multi-state (TX and NM) and bi-national (US-MX) Rio Grande Watershed Council regional coordinated water resources database and GIS are improving institutional collaboration of irrigation districts, federal agencies, universities and other organizations. $200,000 was acquired under this program to install and provide access to real-time monitoring of flows and water quality conditions.

    In 2007 Supalla and Martin initiated a study to evaluate the use of cap and trade as a groundwater management strategy in the Republican Basin in Nebraska, where the rights to pump have been capped, but trade between wells has not been allowed except under very limited circumstances. Preliminary results suggest that trading could reduce the cost of limiting irrigation to augment stream flows could be reduced by up to $30 per acre, depending on the initial water right allocation and on the amount of well to well differences in pumping costs, irrigation efficiency and crop yields.

    Stated choice experiments were conducted in Kansas with farmers to elicit their willingness to participate in a Water Quality Trading (WQT) market under different conditions. Participation in such a market would involve implementation of environmentally beneficial best management practices, in exchange for a monetary payment. The data were analyzed with a mixed logit model to reveal farmers willingness to accept values (minimum acceptable payments) under different market scenarios. Farmers were found to be heterogeneous, with some of them heavily discounting payments in situations where enrollment procedures were onerous or where penalties for contract violations were large (Peterson et al., 2007). These results imply that WQT market rules must be set with care to encourage widespread participation.

    In North Dakota, Hearne conducted an analysis of the attributes of active and collaborative local water management organizations (WMOs). This is part of a wider research effort on local water management institutions and organizations. These WMOs are local units of government responsible for water and natural resources management. They include Soil Conservation Districts and Water Resource District in North Dakota, and Watershed Districts and Soil and Water Conservation Districts in Minnesota. Seventy-eight surveys were sent directly to the organization's administrators, eleven to Watershed Districts (WDs), forty-one to Conservation Districts (CDs), twenty-three to Water Resource Districts (WRDs), and two to tribal nations. A statistical analysis of a nearly 20 activities as dependent variables and 15-20 attributes as explanatory variables is under progress.

    Research in Hawaii focused on a review, discussion, and analysis of Hawaiis water conservation policies and recommendations to improve the effectiveness of the current policies. Population growth, economic expansion, and a strong visitor industry have contributed on a sustained basis to increasing demands on water resources in Hawaii. As an island state, Hawaiis water supply is limited to locally available sources. Essentially all of Honolulus residential water is supplied by groundwater aquifer, requiring a 25-year cycle for rainfall to percolate through the basal rock into the aquifer and be put to productive use.

    Research in Hawaii examined current water conservation policies and proposed improvements to best meet future demands. The focus was limited to the City and County of Honolulu (CCH), which accounts for 71% of Hawaiis total population, and also most business and industry, including visitor services. Our study projected the demand for water in Hawaii for the 2005  2030 period by different sectors  residential, visitor, agriculture, golf courses, and industrial/ commercial. Total increase in demand was projected at 34% during this period.

    The Hawaii research reviewed existing water conservation policies and suggested specific improvements. Policy improvements were found most successful in the residential and visitor sectors. Mandatory residential use restrictions were estimated to reduce demand by 15%, far more effective than the 4% achieved under voluntary policies. Conservation pricing using increasing - block rates was recommended for all sectors to achieve economic efficiency. Recycling waste water could save another 6.4 mgd of freshwater resources.

    For the residential sector, policymakers have a menu of policy options to choose from, starting with relatively moderate reductions (4% to 10%) from voluntary and pricing measures. To achieve larger reductions in demand (> 15 %), they will likely need to consider relatively large price increases, more stringent mandatory policies, or a combination of policy instruments. A leadership opportunity exists for policymakers to initiate a comprehensive waste water recycling program island-wide. In the short term, however, an innovative program with incentives and cost sharing is vital to realize the potential benefits of recycling.

    Continuing Activities.

    Hawaiis collaboration with New Mexico, Kansas, and North Dakota in identifying a professional forum to present and discuss the key issues of political externalities in water resources management in the American West is continuing.

    Researchers in Hawaii plan to focus our research in the year ahead on a comprehensive analysis of recurring drought conditions that have posed a serious threat to agricultural production and other water-dependent activities. As part of this study, we plan to investigate the potential for water banking and other measures.

    Hearne is conducting a stated choice experiments analysis of preferences towards different basin management alternatives. Survey data is currently being analyzed and results will be available in early 2008.

    A new Ph.D. program on the Economics and Management of Water Resources and the Environment was developed at Kansas State University from a grant from the CSREES National Needs Graduate Training competition. Fellows in this program will fulfill all the standard rigorous requirements of an economics PhD, combined with water-related coursework in other sciences, immersion in interdisciplinary research, and international research internships.

    An investigation of the gains from optimal groundwater use management for heterogeneous users was conducted (Saak and Peterson, 2007 AAEA Selected Paper). A simple model shows that the relationship between farm size and pumping rates depends on the production technology and farmers utility of income. Greater inequality in farm sizes impacts the overall efficiency of water use in both dynamic (i.e. the speed with which the aquifer is depleted) and spatial dimensions (i.e. the distribution of pumping rates and income across farmers in each irrigation season). Under little inequality in farm sizes and certain conditions, the dynamic efficiency of water use is low, but the spatial efficiency (i.e. the distribution of application rates per acre on small and large farms) is relatively high. Both types of inefficiencies are exacerbated under intermediate levels of inequality in farm sizes. Finally, when the inequality in farm sizes is sufficiently high, the efficiency of groundwater allocation in both temporal and spatial dimensions improves. The effects of the heterogeneity in the elevation of the bottom of the aquifer and the initial stocks on the patterns of equilibrium and optimal groundwater exploitation are also investigated. Under certain conditions the user with a larger initial stock benefits from the commonality of groundwater.

    Researchers from Kansas and Texas conducted a survey of policy makers, state water managers, and other stakeholders which identified preferred policy alternatives for extending the economic life of the Ogallala aquifer. Results suggest that a voluntary incentive-based program that compensates landowners to permanently convert irrigated cropland to dryland is the preferred policy.

    Impact Statements:
    1. Information on the regional economic impact of water use reductions and the value of water rights, developed by several W-1190 committee members, has been incorporated into Kansass Conservation Reserve Enhancement Program. These impacts occur at agenda setting, policy design, and policy implementation.
    2. Prompted in part by the research of several W-1190 committee members, the Kansas Water Office commissioned a study by Kansas State University and the USGS to evaluate the water conservation impacts of a state program offering cost share on irrigation equipment subsidies. The study found that the program led to minimal water savings, and that money invested in the program could be more efficiently spent on programs with a more certain effect on conservation, such as water right retirement. This prompted a policy change, whereby funding for equipment cost share was reduced and additional funds were invested in water right retirements and leases. These impacts occur at agenda setting, policy design, policy implementation, and policy review.
    3. Results from the Lake McConaughy reservoir management study will be used in administrative hearings concerning the need for irrigation reductions in the North Platte Basin. This is a policy review impact.
    4. Research in Washington that has demonstrated that policies to promote efficient irrigation technologies are causing lower water levels for downstream users, is having an impact in local and national media.
    5. In 2007 Water Optimizer was used to evaluate alternative management strategies for all 93 counties in Nebraska. We found that when using historical crop prices there was very little difference in the profitability of a corn-soybean rotation compared to continuous corn for the eastern 2/3 of the Nebraska. For the western 1/3 the most profitable was crop was corn grown in rotation with either edible beans or sugar beets. Under historical relative prices the best strategy when water became limiting was to produce the same crops at deficit irrigation levels as long as the water supply for all acres averaged at least 75 to 80 percent of the full requirement for corn When water supplies dropped below these levels the best strategy was to begin reducing irrigated acres instead of deficit irrigating at still lower levels or shifting to alternative crops. This is a policy review impact.
    6. Multi-state (TX and NM) research findings on barriers to water conservation are being used to evaluate and improve the effectiveness of water conservation management practices. Incentives and barriers to water conservation in the Rio Grande Basin were identified and analyzed from surveys and other data by NM and TX scientists.
    7. Press coverage and invited presentations contributed to agenda setting for the ongoing New Mexico state-wide efforts to understand the impacts of climate change and the design of adaptation policies and strategies.
    8. Efforts in the Lower Rio Grande Valley in Texas have enabled over 10 entities, with a combined $25-$30 million annual budget, to either, plan a return to financial liquidity and attain long-term economic viability, envision and map out their business plan, and/or analyze significant capital expenses. This is a policy implementation impact.
    9. n Texas, eight Italian scientists were trained in modeling of climate change and agricultural production. This is a policy implementation impact.
    10. Data from evapotranspiration measurement is being used to improve modeling of watershed conditions and to fine tune irrigation management in Nebraska.
    11. Research regarding climate change impacts on New Mexicos water resources received significant publicity and attention from local and national press outlets, including the Associated Press and New York Times.
    Last Modified: 11-Dec-2007

    Date of Annual Report: 01/20/2009

    Report Information:
  • Annual Meeting Dates: 10/16/08 to 10/17/08
  • Period the Report Covers: 10/2007 to 09/2008

    • Participants:
    Brief Summary of Minutes of Annual Meeting:
    Thursday, October 16, 2008 Meeting called to order by chair Bob Hearne. Welcome extended to visitors. Appreciation given to Bureau for hosting meeting.

    Rob gave remarks about the meeting arrangements and gave welcome. LeRoy gave update on AES western directors meetings and initiatives, including the workshop for western water issues. Focus of the meeting is directed towards the review and further development of the project renewal proposal. Mention was made that it would be good to expand involvement in the future project, in particular, attract the interest of some civil engineers to the project.

    Discussion moved on to identifying and developing the new project objectives. Eiswerth noted that it would be important to show linkages across objectives, in particular Obj 1 and 2. Edna suggested adding a subtask to show strategies at different scales.

    Breakout sessions conducted on the proposed objectives: purpose to formalize objective statements, methods, and milestones.

    Potential People for each of the four proposed objectives: 1. Farm: Grant, Dannele, Ray, Brian, Texas, California, Bill Gouden, 2. Modeling: Nate, Chris, Jeff, Grant, Brian, Ari, Frank, Bill Goulden, Texas Tech, ERS 3. Climate Change: Brian, Dannele, Jeff, Mark, Chris, Bill Goulden 4. Policy & Institutions: Bob, Gopal, Edna, Jeff, Ray Huffaker, Bonnie, Brian, Frank, Ari

    Reports from breakout sessions presented and discussed.

    State reports given for the states present.

    Friday, October 18, 2008

    Leroy lead discussion of proposal review process:

    Breakout Session to formulate finalized proposal objectives

    Business Meeting conducted Elections: Nicholas Brozovic elected to join the steering committee (Garth, chair; Chris, vice-chair, and Nick, secretary)

    Next Years Meeting Site: Tucson is recommended location. Proposed meeting dates: October 15, 16, 2009.

    Meeting adjourned.

    Accomplishments:
    Objective 1: Develop and evaluate alternative technologies to monitor environmental effects of water allocation and management

    New Mexico

    Several invited presentations were given regarding climate change research on impacts and adaptation, including the Far West Texas Climate Change Conference convened by Texas State Senator Shapleigh and the Texas Water Development Board.

    Research regarding economically sound measures to promote water sharing among water users in the Texas Gulf Coast region. Study is being used to forecast water demand by irrigated agriculture as part of a shared vision to support sustained water demands for urban, agricultural, and environmental uses in Texas Lower Colorado Basin. Basin Scale research on the effectiveness of public subsidies of drip irrigation technology in the lower Rio Grande Basin of New Mexico. Results show that higher levels of public subsidies of drip irrigation can

    Kansas

    Stated choice experiments were conducted with wastewater treatment plant managers to elicit their willingness to participate in a Water Quality Trading (WQT) market under different market rules conditions. Such a market would allow wastewater treatment plants to offset a portion of their nutrient discharges by buying water quality credits from farmers. Buying credits then becomes a substitute for investments in more sophisticated treatment technologies. However, the rules of trading may change the desire of plants to participate; for example, firms may need to devote significant staff time to administering and monitoring the contracts with farmers. The choice experiments were administered via in-person interviews with 45 plant managers across the state of Kansas in early 2008. Managers were presented with several hypothetical choice sets; in each choice set they were asked to select one of two possible opportunities to buy water quality credits or else select a non-participation option. Each opportunity to buy credits was associated with a different price of credits and different market rules.

    Kansas researchers have developed an Excel version of the Water Allocation Risk Analysis Tool (WARAT). This tool allows producers to evaluate the risk of multiple land-water allocation options associated with deficit irrigation. In a holistic approach, the tool incorporates scientifically based information with a producers site-specific knowledge to assist them in making informed cropping decisions under a variety of water use scenarios.

    Nebraska

    ET Measurement Activities: Eddy covariance towers and Bowen ratio equipment have been used to measure the water use of a dryland cropping system, irrigated corn and soybeans, and native pasture. Data collection continues to provide historical data for varying precipitation and land use patterns. Additional equipment is being installed to measure water use of a wider array of crops and invasive trees. Research is also underway to evaluate the use of satellite image analysis to estimate evapotranspiration at the watershed scale. Initial research shows that the SEBAL and METRIC models offer promise but require local calibration in semi-humid and semi-arid climates that experience significant precipitation between passes of the satellite and require modification of assumptions of the water use of the warmest pixels in the satellite scene. Studies are also underway to investigate the analysis of satellite images during the corn growing season. Modeling Activities: Evapotranspiration data are being used to improve estimates of water use for irrigation management and watershed modeling. Four types of models are being evaluated: simple irrigation water requirement models, daily soil water balance models, watershed-scale models and models used to interpolate between dates of satellite images. Results show that models are reasonably accurate for irrigated conditions. The watershed-scale models and the irrigation water requirement models overestimated evapotranspiration for dryland conditions for many conditions. The daily soil water balance performed better for dryland conditions and for the non-growing season when crop residue shades and insolates the soil surface.

    Objective 2: Quantify comparative economic values of water in alternative uses

    Hawaii

    Research centered on a critical aspect of water allocation and management in Hawaii: setting in stream flow standards and designing institutions for the implementations of set standards and designing institutions for the implementation of set standards. We conducted a comprehensive review, discussion, and analysis of the rationale for establishing in stream flow standards. We focused our study on the experience of Hawaii. The findings suggested that the old idea of beneficial use grounded in the notion of consumptive uses such as minimum in stream water levels essential to the preservation of native flora and fauna and traditional and customary Hawaiian practices such as taro farming.

    Our study showed that a number of private ditch companies on all islands of Hawaii have been diverting substantial quantities of water from the 376 or so streams in the state to meet urban, agricultural, and commercial uses for the past several decades. A case in point is the 165 million gallons of water per day diverted from the 8 streams in east Maui by a subsidiary of Alexander and Baldwin to major outside users such as Maui Land and Pineapple Co. Inc., and Hawaiian commercial sugar company, and the Kula farmers and ranchers. It was found that a major reduction in the diversion of water from the 8 streams and the subsequent cut back in water supply to former users could have a serious adverse impact on the islands economy, including large lay-offs of workers. A similar situation could occur in the case of commercial and urban users of water depending on private ditch companies for their water supply. Thus, the need does exist for the Commission on Water Resources Management to initiate a comprehensive study of the economic impacts of setting in stream flow standards prior to developing and implementing a statewide policy for setting standards. Specific institutional mechanisms for implementing stream flow standards also have to be developed.

    Idaho

    Our research and out- reach efforts in Idaho have focused on four different aspects of water policy and management:

    Climate change.

    Non-market value and impact of water related uses.

    Irrigation demand.

    Hydro/economic externalities

    Kansas

    A positive mathematical programming (PMP) model was developed to quantify the impact of corn-based ethanol production on the Ogallala aquifer. The model captures the effect of increased incentives to grow corn due to increased prices from ethanol demand. Corn is more water-intensive than alternative irrigated crops in the region, implying a greater strain on the already declining aquifer over time. The model was calibrated to base period (1999-2003) prices and land use and then was simulated over a 60-year horizon with both base period and recent (2006-07) prices reflecting the market impacts of ethanol development. Sheridan county, Kansas, was used as the study region, as it is representative of the Kansas portion of the Ogallala aquifer. A hydrologic module was included in the model to update the water in storage in the aquifer on an annual basis, using a single cell aquifer model and hydrologic data from the Kansas Geological Survey. Results imply a significant shift in crop acreages due to the impact of ethanol, leading to an accelerated decline rate of the aquifer.

    Nebraska

    Water Optimizer. Water Optimizer is a tool for analyzing alternative water management strategies when the available irrigation water supply is limited. It is a field-level, single-season program which computes how many acres to irrigate, which crops to produce and how much water to apply to each crop in a normal weather year. Eight crops (corn, soybeans, wheat, grain sorghum, alfalfa, edible beans, sugar beets and sunflowers) are considered for irrigation levels ranging from zero (dryland) to fully watered. It is a non-linear optimization model, built in an Excel spreadsheet.

    Water Optimizer was originally developed in 2005-2006. In 2008 a multi-year version of the model was developed which solves the problem dynamically over a five-year period.

    Users of Water Optimizer who want to evaluate alternative strategies using default prices, costs, water requirements and yields need to input only the following data for their field: county where the field is located, dominant soil type (coarse, medium or fine textured), field size in acres, irrigation system type (center pivot or gravity at three alternative efficiency levels), irrigation energy source (electric, diesel, propane, gas or natural gas), and their annual water allocation entered in acre-inches per acre.

    Users who believe that their situation may differ from the default values by enough to cause different best management strategies can easily change any of the following parameters: crop prices, fully-watered crop yields, cost items for crops and cost items for irrigation.

    In 2008 Water Optimizer was used to evaluate alternative management strategies for unprecedented relative prices. Although all commodity prices increased in absolute terms, the most important relative change was an increase in the price of wheat relative to corn and soybeans. Wheat became competitive as the most profitable irrigated crop for Western Nebraska, especially under water limiting conditions, for the first time in recent history. Although corn remained the most profitable crop when a full irrigation supply was available, it became profitable to shift some acres to soybeans or wheat rather than deficit irrigate corn at less than 80 to 90 percent of a full water supply. For more traditional price scenarios deficit irrigation of corn was frequently the preferred alternative until water supplies dropped to 60 percent of the irrigation requirement of corn.

    The Water Optimizer model may be downloaded from the University of Nebraska Extension website: http://extension-water.unl.edu

    Reservoir Management. The amount of water stored in Lake McConaughy reached a historical low in the Fall of 2004. In 2005 and in years since then, Central Nebraska Public Power and Irrigation District (CNPPID) irrigators received less than a full supply of Lake McConaughy water for the first time in over 50 years of operation. Electric power interests, recreation interests and the regional economy have also been adversely affected. The central policy question is what, if anything should the State of Nebraska do to minimize the adverse impacts from this situation and/or prevent it from developing again in the future? Phase I of this project, conducted in 2005 and 2006, addressed some of the most urgent concerns associated with this question. It focused on how water shortages have impacted the recreation industry or the regional economy and on whether there were any short-term water management opportunities for mitigating such impacts which were economically justifiable. The major finding from Phase I was that that the welfare affects of different policy options depended substantially on how quickly the reservoir was likely to refill in each case.

    Phase II of the study was completed in 2008. This study used a statistical hydrology approach to determine the reservoir refill probability distribution. A two stage ordinary least squares regression analysis found that nearly 90 percent of the variation in Lake McConaughy inflows can be explained by current year runoff (snowmelt), upstream storage and upstream irrigation development. The statistical results were used to simulate reservoir inflows and refill probabilities. Results suggest that there is a 70 percent chance that it will take more than five years for the reservoir to reach 65 percent of capacity, which is the ideal level for recreation. This statistical model was also used to estimate the economic effects on recreation, hydropower and irrigation of policies to augment inflows to the reservoir, or temporarily reduce releases. The model shows that if policy makers want to increase inflows to the reservoir by reducing upstream irrigation an allocation approach would be less costly than reducing irrigated acres. However, neither method of limiting upstream irrigation was found to be an economically cost efficient solution. Results suggest that reducing releases would produce a greater net economic benefit than increasing inflows, and would be economically efficient in some cases. The cost to irrigators of reduced releases is relatively low because many irrigators have utilized wells and local transfers in the delivery area to mitigate economic effects.

    Illinois

    During the period from October 2007 to September 2008, research efforts focused on watershed-scale spatial analysis of surface water-groundwater interactions. This research was funded by an NSF Coupled Natural-Human Systems grant. One MS thesis and two PhD dissertations are in progress in the Department of Agricultural and Consumer Economics at the University of Illinois. Research collaborations with economists, hydrologists, and sociologists from Illinois, Michigan, and Texas are underway. Issues that are currently being analyzed include groundwater management in the Republican River Basin in Nebraska and salmonid habitat preservation in coastal California. Preliminary results suggest that alternative water-use reduction policies in the Republican River Basin have quite different welfare impacts on farmers.

    Texas

    Current efforts focus on developing and implementing computer models which provide water-resource planners and managers economic and financial information which facilitate their active planning, evaluating the effectiveness of proposed agriculture irrigation water conservation best management practices, policies and feasibility of reclaimed water use, and flood management recommendations.

    Specifically scientists are (a) facilitating improved raw-water rate analyses for irrigation districts, (b) calculating the economics of best management practices (BMPs) which reduce nutrient and sediment loads into reservoirs, (c) investigating the presence of economies of size with life-cycle costs across potable-water treatment facilities, (d) estimating the economics associated with a beneficial-pest management program aimed at reducing infestation of a water-thirsty invasive plant species (i.e., Aundo donax) along the Rio Grande and related riparian areas, and (e) evaluating potential water saving effectiveness and economic benefits of proposed agricultural irrigation practices in arid regions of the Rio Grande basin. Impacts from these efforts are broad and include, respectively:

    + a changed philosophy which is improving the accuracy of financial projections and conditions of several irrigation districts as comprehensive information is now included in raw-water rate analyses and other financial planning;

    + development of a comprehensive method to determine of the optimal mix of BMPs to improve reservoir storage capacity and water quality;

    + robust analyses of alternative water-supply technologies, enabling planners and engineers insights into true economic and financial costs of potable water output; and

    + the unique establishment of the economic and financial costs and benefits of simultaneously saving water and removing an invasive plant species.

    Objective 3: Assess the effectiveness of alternative management institutions, laws, and policies for water allocation AZ

    Long-term drought and over-allocated water supplies have created challenges for water resource managers and water users such as cities, irrigations districts and habitat protection programs. We have been modeling how temperature and precipitation patterns influence market prices for water. Using data from 1987 to 2007, we empirically model price trends in the western U.S. In partnership with federal agencies, we also focus on evaluating dry year water supply reliability tools and the net benefits of various strategies to promote and implement state, regional, and national policies for supply reliability during dry periods. Research conducted by Arizona faculty has examined the economic benefits of enhanced and more reliable surface flows to improve urban and agricultural water supply and water-dependent wildlife habitat and recreation, with consideration of impacts on site users, non-use values and local economies and with an emphasis on the effects created by climate-related water supply variability. A guide to various economic tools is under preparation for use by agricultural, municipal, state, tribal and federal water managers. Tribal water settlements and government-to-government agreements involving tribes are found to be a key factor in regional water supplies and management.

    NM

    Research is underway to develop a decision support system for water allocation and development for irrigated agriculture in Afghanistan. Research is part of a USAID contract to examine water and agricultural futures for Afghanistan. As part of this work, work is underway to inform the design of sustainable water allocations, institutions, and infrastructure.

    Kansas

    Researchers from Kansas and Texas conducted a survey of policy makers, state water managers, and other stakeholders which identified preferred policy alternatives for extending the economic life of the Ogallala aquifer. Based on the identified policies, dynamic models of producer choice have been developed to compare the costs and benefits of the policy options.

    Nebraska

    In 2008 we completed an evaluation of cap and trade as a groundwater management strategy in the Republican Basin where the rights to pump have been capped, but trade between wells has been allowed only under very limited circumstances. We found that the impact of a cap and trade water market depended on the size of the allocation and on the characteristics of the land and irrigation systems involved in the trade. Economic benefits from trade ranged from $40 to $150 per acre foot traded, from $16 to $150 per acre foot reduction in consumptive use, and from $6 to $18 per acre of irrigated land in the region. The highest benefits occurred at relatively high allocations which capped withdrawals at 65 to 75 percent of the expected unrestricted pumping level.

    North Dakota

    Research efforts focused on the analysis of local management institutions, with a focus on the Red River Basin. An analysis of stakeholder preferences for water management in the Red River Basin used survey data from three groups, local political leaders, informed stakeholders, and random residents. Results demonstrated that preferences were not significantly different across three stakeholder groups,. Random residents demonstrated high willingness to pay for certain recreation and water quality attributes. DEA analysis is being used to measure effectiveness of conservation districts. This measure of effectiveness will then be analyzed as a function of district attributes.

    

    Impact Statements:
    1. Policy makers have gained understanding of the impact of climate change on surface water irrigation resources.
    2. Water planners have an accessible tool to calculate irrigation demand.
    3. Policy makers have gained insights and policy analyses tools of water prices, allocation and hydro/economic externalities.
    4. Given policy makers in the Northwest a greater understanding of the non-market value and impacts of water related recreation and uses.
    5. Research regarding climate change impacts on New Mexicos water resources received significant publicity and attention from local and national press outlets, including the Associated Press and New York Times.
    6. Several invited presentations were given regarding climate change research on impacts and adaptation, including the Far West Texas Climate Change Conference convened by Texas State Senator Shapleigh and the Texas Water Development Board.
    Last Modified: 26-Jan-2009
    Back to Top