Opportunities for resolving water allocation conflicts in the San Pedro River Basin of Arizona through improving economic efficiency

Abstract

A major center of controversy and litigation in the West today is the issue of Federal reserved water rights for Indian tribes. The Gila River Indian Community has claimed an early priority to all appropriable water in the San Pedro basin. The time, legal expense, and the uncertain outcome of adjudication create incentive for involved parties to reach a negotiated solution to the conflict. An analysis of this conflict reveals much higher economic returns to San Pedro River water in the San Pedro basin than at the Gila River Indian Reservation, due largely to loss of water in transport down river. The existence of divergence of economic returns presents the possibility of negotiating a settlement to the conflict. Negotiation for water rights presumes and is critically dependant upon ability to transfer those rights. Non marketability of Indian water rights maximizes the potential damage to non-Indian water users.