The Colorado River Basin

were made that still govern the Colorado River Basin to this day. A few of the more important laws governing the way water rights are allocated today are the Colorado River Compact, Boulder Canyon Project Act of 1928, Mexican Water Treaty of 1944, and Upper Colorado River Basin Compact of 1948. The Colorado River Compact was an agreement made by all seven states in 1922 (US Department of the Interior, 2008). This was responsible for dividing the basin into Upper and Lower basins and appropriating half of the water, 7.5 million acre feet (maf), to each section (US Department of the Interior, 2008). This compact would serve as the basis for what is known today as the “Law of the River”, future laws and compacts would simply be incorporated to
adjust for this initial compact. The Boulder Canyon Project Act of 1928 was responsible for allocating the 7.5 maf of water among the Lower Basin states (US Department of the Interior, 2008). The allocations determined by this law are depicted below in figure 1. These allocations have not changed since they were first agreed upon in 1928. The Mexican Water Treaty of 1944 is responsible for allocating 1.5 maf of water annually to Mexico (US Department of the Interior, 2008). The Upper Colorado River Basin Compact of 1948 divided the 7.5 maf of water apportioned to the Upper Basin to the several states encompassed in it as well as 50,000 acre feet to the portion of Arizona lying within the Upper Basin boundaries (US Department of the Interior, 2008). The annual allocation for the Upper Basin states can also be seen in the figure to the side. While the Colorado River Basin has continued to exist with the current allocation rates for decades, it is facing a substantial problem to is continual presence in the American southwest.
The Lifeline of the West has hit its lowest point in human history and this rapid decline in water can be attributed to many factors. While there are numerous reasons the river has seen a dramatic fall in water levels most of them can be separated into two categories; inflow and outflow problems. The easiest explanation for the decline is an inflow problem, simply put, there isn’t enough water being put into the basin to sustain the amount of water removed from the system. The Leading factor in this supply shortage is the ongoing drought the Western United States is facing, and has been since the early 2000’s (State of the Rockies Research Team, 2012). The continuing drought in the Upper Basin states has led to a decrease in now accumulation in winter months and therefore runoff that supplies the basin. Furthermore, less rainfall during the summer and in Lower Basin states means that overall, less water is accumulating the basin. In the end, this is leading to a supply shortage, more is being removed from the river system than is being put back into it. The second category of out flow also has many of its own problematic characteristics that can explain the dramatic decline in water levels. To begin with, demand is also at an all-time high putting greater pressure on the Colorado River to
provide water. This water is used for municipal, industrial, agricultural, and ecological reasons. While agriculture uses more than 70% (Cohen, Christian-Smit & Berggren, 2103) of the water consumed growing populations in the southwest, most notably San Diego, Los Angeles, and Las Vegas, are leading to higher demand for water. People use this valuable resource to, among other things; bathe, water lawns, and drink. Finally, as discussed above, the Colorado River Basin is a valuable source for agricultural water. Farmers, and ranchers alike use this water for crops and animals to help sustain local economies that rely on agricultural products. Overall, the dwindling supply of snow and rain is leading to a decrease in the water supply and the increased demand is leading to a supply shortage that is becoming evident in the status quo by the low water levels in many of the dams used to contain this necessary resource. While the supply and demand of water explains a lot of the problems revolving around the Colorado River Basin, another problem is the low of the river itself. The current compacts and treaties that make up the law of the river are based on the prior appropriation doctrine, which along with the status quo make trading water rights extremely difficult. Intuition alone is enough to believe the status quo provides for an inefficient allocation of water (Hartwick & Olewiler, 1998). Leading to further inefficiencies is the fact that attempts to change the water allocation laws quickly becomes bogged down in legal proceedings which have high costs and often have little effect. Moreover, the current law of the river has allocations that reside on years of above average precipitation (About the Colorado River Basin, 2015). This, of course, would only lead to higher demand for the water than can normally be supplied by the environment that the river is located in. Again, this presumably minor detail will lead to supply shortages only compounding the problem of below average precipitation as experienced in the status quo. Ultimately, laws governing the Colorado River Basin are not helping the overwhelming problem facing the southwest. Legal battles and poor allocation rates are furthering an ongoing fight for water.

Policy Options
The main reason behind water allocation in the west is the Prior Appropriation Doctrine, coupled with the status quo inherent water rights trading limitation makes for a system that, intuitionally, doesn’t allocate water efficiently among the Colorado River Basin states (Hartwick & Olewiler, 1998, p.
78). Three potential policy options are available for policy makers that could alleviate the water dilemma in the west. First, the easiest policy would be to
change