Water law in the western U.S. doesn’t generally allow a user to save water from one year to the next. You use it, or you lose it. That, for example, is the situation faced by the Imperial Irrigation District this year, which faces the prospect of (horrors!) having Los Angeles get the extra water if the farmers don’t find something to do with it.
A new paper in Water Resources Research by Donna Brennan touts the benefits of creating a property right in stored water, allowing farmers to store and trade water across years, rather than only within a single year:
[C]ompared to the historically used, centrally determined storage policy, a market-based storage policy would store more water, on average, and would also allocate more water in periods of low rainfall.
It’s hard to think about the legal and policy approach that might be used here to implement such a thing. Suggestions?