- SoCal has water "shortages" in the city and environmental problems in the Salton Sea.
- Mexico has 1.5 MAF of Colorado River water, but the Colorado River still doesn't reach the Sea of Cortez. (There are many water problems in Mexico.)
- SoCal agricultural areas (IID, PVID and CVID*) have 3.85 MAF is water, but it's generally acknowledged that that water goes to many low value uses (grasses, etc.)
- The Federal Government condemns 2.85 MAF of ag water and pays the "market" price for it. (Let's say $250/AF for the annual delivery capitalizes to $2,500/AF for rights) That's $7.125 billion to farmers.
- The government sells 1 MAF of water rights at $7,125/AF to SoCal cities. If the annual flow costs $712.50. it's cheaper than the cost of desalination or recycling water...
- The Federal government gives the 1.85 MAF remaining to the Mexican government -- contingent on 1 MAF reaching the Sea of Cortez.
The ag areas cannot complain of taking because they get fat money. (If we wanted to be cruel, we should buy the water for $170/AF, i.e., the capitalized value of water given the $17/AF price that farmers pay.) Since they get over $7 billion, they can than afford to pay the
Bottom Line: Water allocation is so bad in Southern California that we can move it around and solve big problems pretty easily (says the academic...)
* Addendum: To catch up on Imperial Irrigation District's continued follies, read how they are making an inefficient internal water bank (trading prices set by bureaucrats) and reducing oversight on how "fallowing mitigation" funds are being spent -- hattip to DW.