This focus area demonstrates how stakeholder surveys, background historic and socio-economic research can be used to assess the effectiveness of current water management organizations in addressing basin issues and to identify potential links between scientific research and stakeholder needs for more effective management tools. Similarly, the characterization and analysis of droughts are other means of addressing institutional, management, and policy issues of bi-national concern. Individual research efforts include:

· Extraordinary drought evaluation for the Rio Grande/Bravo basin
· Institutional analysis and social assessment of the Upper San Pedro river basin
· Institutional analysis and social assessment of the Salt Verde river basin
· Implementation of legal recognition of surface-groundwater links
· Assessment of institutional structures of demand-side management integrated modeling

Extraordinary drought evaluation for the Rio Grande/Bravo Basin
J. Dracup (UCB)

Activities and Results

Using unimpaired streamflow data and traditional forecasting methods (Frick, Bode, et al, 1990), the annual streamflows for the Rio Grande/Bravo Basin were simulated and synthetically generated for a period of 10,000 years. Droughts were determined for different tracer lengths utilizing the synthetically generated annual flows. Sets of 50, 100, 500 and 1,000 years were used to determine the severity, duration and intensity of all possible droughts. The droughts were later ranked based on each property value. Using return periods of 25, 50, 100 and 500 years the droughts were averaged and compared to historical values. In addition, an exploratory analysis of the effects of the El Niño - Southern Oscillation (ENSO) and the Pacific Decadal Oscillation (PDO) on precipitation and streamflow in the river was conducted. Initial results show significant correlations between the ENSO and streamflows in the river, and in particular between the PDO and streamflows.

Additional analysis using paleoclimatological data for the Basin will be carried out, as well as additional analysis of the effects of ENSO and PDO. Development of an index to compare the severity of droughts within the Basin is expected, including a spatial analysis.
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Institutional analysis and social assessment of the bi-national Upper San Pedro river basin
R. Varady, A. Browning-Aiken (Udall)

Given the difference in political and economic institutions and processes for managing water in Mexico and the United States, this project is studying whether watershed councils are effective institutions at a binational level for articulating science research on hydrology and ecosystems with integrated watershed management. The hypothesis is that decision making about sustainable development in terms of water resources is based on a full assessment and analysis of complex ecological and socio-economic relationships within a watershed, and the availability of effective decision-making tools, such as Decision Support System models.

Our experiences in the Upper San Pedro Basin indicate that the potential for successful binational planning and management efforts increases with informal communication and cooperation among local borderlands agencies and NGOs. The research coordination, binational forums, and the evolution of the Partnership and ARASA working together all suggest a growing momentum toward coordinated water resources management. However, this process requires continued collaboration between policy and physical scientists to fully integrate science into decision making. SAHRA scientists face not only disparities in transboundary data collection, analysis, archiving, and dissemination, but also planning and decision-making processes sensitive to sovereignty and jurisdictional autonomy and water policies that fail to address stakeholder values other than market commitments. In general, the Binational Upper San Pedro Basin Project is essential for integrating science research with the needs of regional water resource management organizations and policy makers and for preparing policy makers and managers for more effective assessment and decision making about basin science questions.

Activities and Results

The research required for this assessment and analysis has included: 1) "Water Use and Needs" surveys in the U.S. and Mexican portion of the Upper San Pedro Basin; 2) interviews with water managers and policy makers in both portions of the basin; 3) capacity-building strategies for the development of the Mexican watershed council Asociación Regional Ambiental de Sonora-Arizona (ARASA)/The Sonora-Arizona Regional Environmental Association; 4) creation of a "San Pedro Dialogue on Water and Climate," a binational forum for the U.S. and Mexican watershed councils to discuss and share hydrologic, ecological, and climate research needs; and 5) an exchange of information and research needs between SAHRA and non-SAHRA scientists and the basin watershed councils on both sides of the border.

In 2001/2002 our activities fall into the categories of (i) collaboration and coalition building; and (ii) publications. In the category of collaboration and coalition building we have three major achievements. First, we built the capacity of the Mexican watershed coalition, ARASA, to address regional water problems by assisting in grant writing for operational expenses, management training, environmental conflict management and by promoting the collaboration of ARASA with other Mexican environmental non-governmental organizations (NGOs). We also have been facilitating the San Pedro Dialogue on Water and Climate with ARASA and the Upper San Pedro Partnership. Finally, we collaborated on the establishment of a binational environmental education program, called ECOSTART, focused on the Upper San Pedro River Basin. A number of publications have also resulted from our efforts.

Our results have been: 1) an assessment of community water needs in Mexico and the U.S.; 2) the development of a Mexican watershed council, ARASA, with the capacity to attract funding for community water-related projects and management training for basin stakeholders, 3) the establishment of a binational steering committee to discuss additional hydrologic, ecological, and climate information needs within the binational basin (San Pedro Dialogue on Water and Climate), and 4) the successful establishment of a binational environmental education program, ECOSTART, with a primary focus on conservation of the San Pedro River. This work has been complemented by the development of a binational Upper San Pedro River Decision Support System (DSS) that merges knowledge from diverse disciplines and simulation tools in a practical, meaningful decision-making environment and assesses the reliability of management decisions of the Upper San Pedro Partnership and ARASA. The San Pedro hydrologic modeling efforts have been the result of working with SAHRA researchers Kevin Lansey, Tom Maddock III, William Yeh, and James McPhee, and the binational education program has been established in part through collaboration with SAHRA researcher Jim Washburne's UA GLOBE Program.

Plans

Based on earlier pioneering efforts in binational watershed management focused on riparian and growth issues, we have found that science that is relevant and that solves real problems is critical for decision makers in the Upper San Pedro Basin who are attempting to resolve water allocation challenges. Our research in watershed management issues and capacity building provides SAHRA physical scientists and economists the opportunity to tie their work to the needs of water managers and policy makers. Our research within the regional Southwest provides a model for other watersheds, as well as a context in which SAHRA scientists can collaborate with real stakeholders to produce socially and economically useful water management tools. With these goals in mind, we are proposing the following steps:

• Promote binational watershed management policies via continued capacity-building efforts for watershed councils and binational steering committees.
• Introduce concept of climate change and variability into discussions of water management on both sides of border via DWC and NOAA grants.
• Include aspects of water quality in integrated approach to management.
• Expand environmental education project (ECOSTART) into rural areas and include upper grades; extend collaboration with GLOBE for training teachers.
• Strengthen connections between SAHRA researchers, particularly modelers, and decision makers, especially watershed councils.
• Collaborate with UNM researchers (e.g., David Brookshire) on market economic valuation analysis.
• Work with stakeholders to develop, refine, adapt, and demonstrate use of models for integrated management.
• Seek additional funds to support above work.
• Continue to disseminate innovative results of work at national and international conferences and forums, and publish in journals, books, and other venues.
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Institutional analysis and social assessment of the Salt Verde river basin
R. Varady, A. Browning-Aiken (Udall)

Given the variety of water interests in the Verde/Salt Basin, especially in regard to the number of watershed councils or associations, and the relatively recent Arizona Rural Watershed Initiative, our project seeks to determine if watershed councils are effective institutions for articulating science research on hydrology and ecosystems with integrated watershed management at the basin level. The hypothesis is that decision making about sustainable development in terms of water resources is based on a full assessment and analysis of complex ecological and socio-economic relationships within a watershed and the availability of effective decision-making tools such as Decision Support System models.

SAHRA social and physical scientists have selected the Yavapai County Water Advisory Committee as the strongest and most representative watershed organization in the basin and are focusing their efforts on the successful construction of the DSS model for the Prescott AMA and on building the capacity of the Yavapai County WAC to address basin water issues more effectively. However, this process requires continued collaboration between policy and physical scientists to fully integrate science into decision making. SAHRA scientists face not only complex scientific information about the geohydrology of the region, but also uncertainty in the planning and decision-making processes.

Our experiences in Verde River Basin indicate that the potential for successful planning and management efforts are challenged by the complexity of issues and the multiplicity of watershed organizations within the basin. The water export from Big Chino sub-basin, which is considered by many to be the source or origin of the Verde River, to Prescott, an Active Management Area (AMA) is the source of contention between the following groups: 1) upstream residents and developers; 2) downstream users, including Phoenix; 3) environmental groups or agencies, including US Game and Fish, that are concerned with the habitat threat of a potential decrease in Verde River surface flow due to Big Chino groundwater export; 4) the Camp Verde Apache community, concerned with traditional uses, including gravel industry; 5) recreational or tourism supporters who fear the impacts of a potential decrease in surface flow; 6) communities such as Clarkdale, Jerome, Cottonwood, Paulden, and Camp Verde needing to consolidate water services to make them more economically efficient, but lacking the tax structure to develop community or regional water services.

Arizona's lack of a regional or even state-wide water use and management plan has contributed to watershed conflicts because whatever one basin or even community does or does not do in regard to water management and planning affects everyone else in the region. Rapid population growth and the potential for development, particularly in the Big Chino and Prescott Valley, add to the need for this kind of planning in order to maintain sufficient water for the present as well as the future. Active Management Areas (AMAs) are the major focus of legislative attention to water management at this point because those areas are operating or are soon to operate with a groundwater deficit. Legislation, particularly in the form of the Arizona Rural Watershed Initiative, has supported research in the Verde Watershed in an effort to answer hydrologic questions about the relationships between the subbasins, the sources of the Verde, and the potential impacts of increased pumping in the Big Chino subbasin on the Verde River. However, legislative funding has not kept pace with the need of watershed initiatives for further research or organizational development.

Legal problems regarding water law also contribute to the conflicts in the Verde. First, Arizona water law is in the process of clarifying the hydrologic connection (subflow) between groundwater and surface water, particularly in wells located near streams. Second, other legal problems concern the incomplete settlement of Native American Indian claims (reserved rights to surface water) to the Verde, which could detract from the amount of water allotted to land owners in the Verde Watershed with prior appropriation rights (surface water). While the Yavapai in Prescott have achieved settlement of their water rights within Prescott and the Fort McDowell Indian Community as well, the Camp Verde Yavapai Apache settlement is still pending. Third, downstream water rights, particularly those of irrigation districts and the Salt River Project (SRP) near Phoenix (1/3 of Phoenix water comes from Verde River surface), are also at issue, as indicated above. Finally, the Endangered Species Act (minnow loach) and the Wild and Scenic River designation potentially could provide a legal basis for pumping mitigation or litigation. In a similar manner, in-stream flow rights in Arizona indicate that water levels in the Verde have to be kept sufficient for fish and wildlife.

Activities and Results

The research required for the Verde Basin Conflict Assessment and Analysis has included: 1) historical and contemporary groundwater and surface water use in the Upper and Middle Verde Basins; 2) interviews with water managers and policy makers in the basin; 3) a history of the development of basin watershed organizations, their missions and objectives; 4) a survey of policy issues affecting water use in the Verde, specifically the designation of Prescott, AZ, as an Active Management Area (AMA), and adjudication regarding Native American water rights of the Apache and Yavapai in the basin; 5) findings of hydrologic research on the connections between groundwater and surface water and between the Upper and Middle Verde groundwater; 6) recognition of legal conflicts over the application of the Endangered Species Act to the Verde River and over identification of subflow, and 7) investigation of the nature of natural resource planning models already existing within the Verde Basin and of the need for additional hydrologic modeling efforts.

The results of this assessment and analysis have been: 1) the creation of a Decision Support System (DSS) model for the Prescott AMA with the support of the Yavapai County Water Advisory Committee; and 2) facilitation of an adaptive management retreat with the Yavapai County Water Advisory Committee (WAC) in order for the watershed group to overcome planning obstacles and conflicts and to establish more effective planning methods for addressing watershed conflicts over water appropriation and management. SAHRA researcher Kevin Lansey has been working with social scientists Robert Varady and Anne Browning-Aiken in the Verde to establish the Decision Support System model with the Prescott AMA.

The complex historical, ecological, legal, political, economic, and social factors of the Salt Verde watershed are explored in Jennifer Shepherd's UA master's thesis, "Science, Uncertainty, and Decision-making in the Verde River Watershed," which was completed during the past year as part of project activities. In the thesis, Shepherd analyzes relevant watershed management documents, media coverage, court cases, the dialogue and information presented at watershed group meetings, and interviews with local stakeholders to decipher the role of knowledge and science in the decision-making process in the Verde River Basin in the hope of uncovering ways in which the process might be improved.

Plans

Based on the earlier Verde Basin environmental conflict assessment, we have found that integrated water resource management within the basin faces obstacles in strategic action planning that SAHRA physical science (particularly DSS), and Udall Center support (with environmental conflict mediation and strategic planning) can remediate. Science that is relevant and that solves real problems is critical for decision makers in the Verde Basin who are attempting to resolve water allocation challenges. Our research in watershed management issues and capacity building provides SAHRA physical scientists and economists the opportunity to tie their work to the needs of water managers and policymakers. Our research within the regional Southwest provides a model for other watersheds, as well as a context in which SAHRA scientists can collaborate with real stakeholders to produce socially and economically useful water-management tools. With these goals in mind, we propose the following steps:

• Strengthen efforts to unify or at least coordinate work by disparate watershed councils, in the context of the larger, statewide Arizona Rural Watershed Initiative, in order to establish a regional, multijurisdictional water-management authority.
• Convene two workshops, retreats, or public meetings per year to help achieve this goal.
• Strengthen SAHRA's presence in the Verde Basin through such specific scientific projects as a Verde River flow model and measurement of consumptive uses in the Verde.
• Work with stakeholders to develop, refine, adapt, and demonstrate use of models for integrated management.
• Continue to disseminate innovative results of work at national and international conferences and fora; and publish in journals, books, and venues
  
• Seek additional funds to support the above work.
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Implementation of legal recognition of surface-groundwater links
T. Maddock, K. McHugh (UA-HWR)

Arid western states primarily apply the doctrine of prior appropriation ("first in time, first in right") to surface waters, but these states differ on how to appropriate ground water resources. Historically, most state systems have treated surface water and ground water as two separate systems. The hydrologic principle of capture, in which groundwater pumping captures water directly or indirectly from a stream or river, is particularly important since most western states' water policies do not comply with this hydrological reality. Most states now have recognized the hydrologic connection and are beginning to apply laws that provide instruction on how to deal with groundwater users that are essentially pumping surface water. Most states have also begun to utilize computer models in order to help apply these laws. Western water policy began with little to no understanding of the surface water/groundwater system as a whole. These laws that separate the two "types" of water have become entrenched into the communities, and the legislature and courts are struggling to adjust the laws to recognize the hydrological reality. The research method proposed will gather and summarize all state laws which pertain to groundwater/surface water interaction and examine the studies and models that are being used to aid in applying these laws. Research will also include a description in layman's terms of groundwater principles, especially the principles governing capture.

Activities and Results

Water policy for specified western states has been extensively researched. Models or studies associated with applying these policies have also been gathered. State policies governing the appropriation of both surface water and groundwater have been summarized for the states of Arizona, New Mexico, Colorado, Nebraska, Kansas, Oregon, and Texas. These summaries specifically refer to state statutes and court cases pertaining to the surface water/groundwater interaction. Policy evolution is also noted in these summaries. The Arizona Department of Water Resources' guidelines for determining "subflow" and the cone of depression as requested by the courts in the Gila River adjudication has been summarized. Contacts are being made in reference to several studies or within the state agency that deals with water permitting. Summarization and examination of models and studies is in the beginning phase.

Many states are beginning to rely on groundwater models to determine if a proposed withdrawal is within that state's designated area or zone. Extensive hydrogeological studies are also being performed to get the best and most up-to-date physical information for these computer models and conceptual models of the system.

Plans for next reporting period

Summarization of western states' water policies pertaining to the surface water/ground water interaction is approximately 80% complete. Examination and analysis of computer models and studies is in the beginning phase. Along with a description of groundwater principles in laypeople's terms, this research will provide an up-to-date synopsis of the current understanding of the physical system and the current state laws that apply to the system. Examination of the representation of the physical reality in the legal system will provide lawmakers a tool for assessing the need for adjustment in the legal realm. The research will provide not only a one-stop reference for anyone interested in the current policy regarding the surface water /ground water interaction, but also a jumping board for those who are interested in other aspects of western water policy. The examination and analysis of the current models and studies being used by different states will compare and contrast the models in order to determine their effectiveness. Compiling all of these models and studies will also provide decision-makers with an easy reference guide.
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Assessment of institutional structures for demand side management integrated modeling
D. Brookshire (UNM)

To develop a demand-side management model, four broad categories of effort must be undertaken. First, the behavior of household, industrial, commercial, institutional and agricultural users must be understood within a variety of price regimes. This must be done at the micro level in order to fully recognize and account for the diversity of preferences within and across groups. Second, the behavior within and across a variety of institutional structures must be understood both in the short- and long-run setting (capital is fixed versus being substitutable). Examples would be block pricing versus peak pricing versus type-of-use pricing. Third, the goals of the policy-making bodies must be identified and understood. That is, do policy-making bodies seek efficient outcome or use some other policy objective? Finally, the demand behavior for the market side must be integrated into an overall modeling framework that includes physical conditions as well as the appropriate institutional objectives and institutional structures.

Activities and Results

For the first category, projects on the experimental analysis of consumer demand and a survey of disaggregated demand are underway and will address the behavior for residential, industrial, and commercial users. The third category is a new initiative for dynamic simulation modeling. The fourth category, integrated modeling, is a new initiative for Years 4 and 5. The new initiatives are proposed to start at a low level of effort; it is anticipated that they will become part of the next 5-year proposal.

Plans

The present project is a new initiative, proposed to address the behavior within alternative institutional structures. There are two sub-components to this proposed effort. First, the issue of water banking and/or water marketing is to be explored. The market framework for re-allocating water is developed conceptually, but little has been done to operationally explore the nature of banking or marketing allocation schemes. Second, the behavior of consumers and others within alternative pricing regimes remains unexplored in pricing regimes that reflect the scarcity value of water.

Water markets and banking are being set forth as possibly desirable allocation structures. Our recent efforts have involved determining the extent of water banking legislation and implementation in the Western U.S. Further, we have pursued data that speak to the operational nature of observed water markets. We propose to further pursue the data collection effort that is represented in Brookshire, et al. (2002) and develop a series of experimental water markets and water banking institutions. The experimental laboratory setting at UNM is ideal for research in these areas. Further, the basin-wide setting is ideal. We have developed cooperative relationships with many of the stakeholders in the area and we envision that they would be part of the overall design process.

Alternative pricing regimes are being debated. The EPA (1997, p.21) reports that 49% use a uniform rate structure, 2% some type of flat fee, 16% a declining rate, 11% an increasing rate, and less than 1% a peak rate structure. As we discuss elsewhere, the behavior of consumers and others for alternative pricing regimes is being explored. The proposal to explore alternative pricing regimes builds upon this work and is necessary for an integrated model to be used by policy makers. Also of interest is consumer response whereby pricing regimes may generate alternative behavior when the possibility of capital substitution exists. Not only are we interested in how consumers react to alternative prices and pricing regimes, but also the capital substitution that they might undertake in the case of a conservation program.

We propose to design a series of experimental protocols that eventually would be linked to the TA5 effort on experimental analysis of consumer demand. The protocols would build upon our access to the Albuquerque Water Wise data set, and would involve residents of Albuquerque in the actual experiments. We would approach relevant individuals in the governments of Albuquerque and Santa Fe (and others to be identified) for aid in designing the protocol.

Year 4 will be a low-level effort. Design of the experimental protocol will be undertaken for both projects. In Year 5 we will begin implementing the experimental protocols. These efforts follow the pattern of development that has been used in the initial disaggregated demand.