WATER: Is it a Public Trust Resource? Private Resource? Or Both?
co-authored by Devon Bombassei
What is the Public Trust Doctrine? Is it a concept that can be wielded like a sword to bring environmental miscreants to their knees in a courtroom? Or is it a shield to protect the citizenry against overzealous private interests that would seek to use this precious natural resource for profit and corporate gain?
As the debate over the use of water intensifies, the water industry–comprised of regional, municipal and private companies–is unsure whether the formal adoption of the Public Trust Doctrine by states and municipal entities may undermine long accepted business models and place constraints on their freedom to pursue legitimate business interests. Although the Public Trust Doctrine is a legal concept, it is not a planning tool. In basic terms, under the Public Trust Doctrine, the State is the trustee, the water is the trust and the beneficiaries of the trust are the people who rely on that water for
To a large extent, the past sales of water rights by water companies to third-party industrial users have spurred the discussion. If a private water utility, or a municipality, has what it considers an “over-supply” of water, why not sell off that over-supply to a third-party for economic gain? Isn’t that sale a textbook example of “supply” and “demand”? Under the Public Trust Doctrine, this economic analysis of the issue of over-supply may no longer be applicable. From an ecological perspective, what may be termed “over-supply” is merely good conservation practice. What may appear to be an over-supply today may present a very different picture ten or twenty years from now. Under the Public Trust Doctrine, the business logic that underlies the proposed sale is turned on its head. Activists argue that water ownership is not like a good gold mine to which a prospector stakes a claim and then exploits for private purposes.
In Connecticut, the debate has caused battle lines to be drawn over the emphasis to be given the Public Trust Doctrine in the
The water industry points out that its member companies are excellent stewards of the environment and water as a public resource. The water utilities spend millions of dollars, the industry argues, to upgrade facilities, comply with a complex web of regulation and deliver clean water to consumers at the lower possible price. Who would do this work as well as they? Industry fears that the adoption of a State Water Plan with an over-emphasis on the Public Trust Doctrine will result in utilities being subject to unnecessary regulation and costly legal challenges. Supporters of the present draft plan point out that the plan requires that a balance be struck between environmental and economic interests. However, the process may not be as one-sided as industry fears. Indeed, industry representatives and their advocates have served on most of the committees tasked with coming up with the State Water Plan.
A final draft of the State Water Plan seeks to balance the interests of competing stakeholders. As a result, the draft emphasizes a “Triple Bottom Line” – social, environmental, and economic – which is designed to allay industry fears that commercial interests will be overshadowed by an unreasonable expansion of the Public Trust Doctrine. Indeed, the draft encourages the use of fiscal metrics to evaluate the economic consequences of future water management proposals. How the draft report will achieve the much-sought balance remains unclear. The draft report recommends that the “Triple Bottom Line” tool must be accompanied by a “rigorous accounting framework” that will provide a measure of deference to various competing interests. Of course, with any new public policy initiative, the devil is in the details.
Of particular concern to environmentalists is the extension of long-term contracts that grant water rights to private interests for unspecified periods. The globalization of bottled water production has seen prodigious growth in the past decade, resulting in increased tension between industrial and ecological interests. Water-bottling giants, such as Niagara Bottling and Nestlé, riding on a wave of health and fitness concerns, have rapidly supplanted mom-and-pop bottling operations from earlier decades. As a result, bottled water has become the largest commercial beverage category by volume in the U.S., outpacing sales of carbonated soft drinks for the first time in 2016. In 2019, bottled water remains a massive global industry, and groundwater is nothing short of “up for grabs.”
By way of example of this phenomenon, residents of Stanley, Victoria in Australia witnessed firsthand the issues that often arise when remote multinational interests obtain control over local groundwater resources. When a local farmer sought to extract local groundwater to sell to Japanese bottling titan Asahi, local residents fought back. Asahi purchased water resources from a local land owner for use at a nearby bottling plant. Thus, private water rights to the groundwater in Stanley were exported, and owned by, a multinational corporation who may not fully appreciate how the depletion of water levels affected the community. Often where demand for bottled water is high, it takes the pressure off of governmental regulators to upgrade water utilities. The faulty logic applied in this scenario is that bottled water can make up for inadequate local drinking water sources. As a result of such fuzzy thinking, the quality of the local water supply is both depleted by third party use and by unaddressed infrastructure decline.
As water rights issues becoming increasingly tangled with global corporate interests, the water governance debate is sometimes framed in a tense atmosphere that pits competing charges of multinational greed and local protectionism. In some parts of the United States, the issue of water as a “public trust” has placed in conflict proponents of private property rights against the rights of the larger community. In these conflicts, water (or “water mining”) is treated like oil. For example, in Texas, water rights are analogous to oil and mineral rights. In Sipriano v. Great Spring Waters of America, the Texas Supreme Court upheld the state’s common law rule of “absolute capture,” which, contrary to the concept of “reasonable use” in states like Michigan and New York, permits unlimited pumping of groundwater for private use. Decisions like Sipriano have led to outrage from the public, whose principal concerns stem from reduction of stream flows, encroachment of a public resource, and increased pollution. For their part, companies like Nestlé balk at the increase in “public trust” rhetoric, citing their own financial concerns over reduced water demand and aging infrastructure. To water bottlers, water is a valued financial asset. In contrast, many Americans view their water as an inviolable human right.
Against this backdrop, Connecticut residents seek to reassert local control over groundwater by keeping it within the public trust. Increasing globalization will only spur demand for further reform. When water at a homeowner’s kitchen tap is controlled by a corporation headquartered in a foreign country, fear of alienation of precious water supply will only intensify.
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