tennessee's inter-basin water transfer act: a changing water policy agenda

Water Policy 3 (2001) 1–12

Tennessee’s Inter-Basin Water Transfer Act: a changing waterpolicy agenda

David Lewis Feldman*

Energy, Environment and Resources Center, The University of Tennessee at Knoxville, 311 Conference Center Building,

Knoxville, TN 37996-4134, USA

Received 27 November 2000; received in revised form 2 January 2001; accepted 11 January 2001

Abstract

The Inter-Basin Water Transfer Act requires Tennessee’s public water providers whose rights are securedby eminent domain to acquire a permit for surface or groundwater withdrawals that are diverted outsidetheir basin of origin and may adversely affect surface water flow. It bolsters rights of riparian users,regulates water quantities diverted and returned, and mandates consideration of alternatives to diversion.Public providers must register annual withdrawals and the state can protect deficit-ridden areas. I analyzethe evolution of this novel law; the role of in-state and external threats reflecting larger regional trends in itspassage; the role of a University research group, other stakeholders, and legislative negotiations in itspassage; and the Act’s lessons and significance for the future of American water policy. I conclude that theAct represents an important policy agenda change in response to perceived threats and new information onthe vulnerability of the state’s water. # 2001 Elsevier Science Ltd. All rights reserved.

Keywords: Interbasin diversion; Water transfer; Legislation; Water policy; River basin planning

1. Introduction

Vitally important to agriculture, industry, transportation, energy production, recreation, andthe environment, Tennessee’s water is a finite and increasingly threatened resource. Recentdrought, population shifts, urban development and sprawl, and growing competition among usershas begun to generate concerns over the continued availability of a stable, dependable watersupply (Hutson, 1998). In addition, the state’s water has become the locus of interstate conflicts.This article argues that Tennessee’s new Inter-Basin Water Transfer Act represents an

important policy agenda change in response to perceived threats and new information on the

*Corresponding author. Tel.: +1-865-974-4086; fax: +1-865-974-1838.

E-mail address: [email protected] (D.L. Feldman).

1366-7017/01/$ - see front matter # 2001 Elsevier Science Ltd. All rights reserved.

PII: S 1 3 6 6 - 7 0 1 7 ( 0 1 ) 0 0 0 0 2 - 2

vulnerability of the state’s water. These threats partly reflect larger regional trends. We describethe sources of this policy change, the genesis of the new law, the role of stakeholder and legislativenegotiations in its passage, and its lessons for the future of American water policy.

2. Why regulate inter-basin water diversion?

Over the past two decades, conflicts over water supply have erupted throughout the Southeastdue to three major trends. These are: competition among users of the same watercourses andaquifers; changes in land use, population, and urbanization affecting demand (and in regionalclimate affecting supply); and difficulties in balancing economic growth against demands for ahigh quality water supply to support various offstream uses as well as satisfy instream needs(Schaake, Miller, & Tisdale, 1997; Arrandale, 1999).Principal measures to address them include two interstate compacts between Alabama, Florida,

and Georgia to allocate the flow of the Apalachicola–Chattahoochee–Flint and Alabama–Coosa–Tallapoosa basins (H. J. Res. 91, 1997; Kundell & Tetens, 1998; Arrandale, 1999). Thus far,despite some negotiating progress, these efforts have yielded few solutions acceptable to affectedparties. These disputes are increasingly intractable for three reasons.(A) Growing competition over shared surface and groundwater supplies increasingly takes the form

of ‘up-’ versus ‘down-stream’ users: Upstream versus downstream conflict is not new }

agricultural areas of the Western and Midwestern US have long experienced such antagonism.However, what is new is emerging up- versus down-stream conflict largely affecting urban watersupply } a problem particularly evident in the Eastern US. Atlanta’s rapid population growthhas placed demands on two major river basins (the Apalachicola–Chattahoochee–Flint andAlabama–Coosa–Tallapoosa systems or ACF–ACT systems), leading to conflict, in the firstinstance, between Alabama, Florida, and Georgia } and in the second instance, Alabama andGeorgia } over how to ensure an adequate public supply while protecting ‘upstream’ recreationand power and ‘downstream’ flood control, navigation, and ecological protection } especially inFlorida’s oyster-rich Apalachicola Bay. Somewhat earlier, pursuit of a diversion project on theRoanoke River (begun in 1983) by the city of Virginia Beach to satisfy growing municipal needsled North Carolina to protest the project’s adverse impacts to its residents.(B) Rapid urbanization and drought impose new pressures on the region’s water and reveal the need

for jointly managing water supply and quality: Urban sprawl, growing consumptive uses (i.e.,activities that remove water from streams or aquifers such as manufacturing, power generation,and irrigation), and periodic drought are forcing policy makers to re-examine water uses andconsider new allocation measures. Below normal rains in the 1980s and 1990s dramaticallyaffected power generation, navigation, and municipal supply throughout the region, as well aswater quality due to low dissolved oxygen concentrations (affecting fish and aquatic habitat).Some believe these problems may worsen over time as consumptive uses increase and the regionexhausts new, practical dam sites (Clarkson & Smerdon, 1989; Hoos, 1992; Schaake et al., 1997).(C) Protecting water supplies and keeping them clean & safe, while promoting growth, are difficult-

to-reconcile goals in growing communities that seek to economically diversify: As Southeastcommunities develop, promoting economic growth while protecting water quality is becomingmore difficult, especially as regional population grows (the region has five of the nation’s 10 fastest

D.L. Feldman / Water Policy 3 (2001) 1–122

growing states: Florida, Georgia, North Carolina, Tennessee, and Virginia). Threats to qualityand supply caused by industry crossing state lines (e.g., the Savannah River in Georgia and SouthCarolina); competition for water among rural communities on Tennessee’s Cumberland Plateau;and Florida’s attempts to restore the Everglades illustrate the difficulty in balancing agricultural,industrial and other uses while protecting, or even repairing the environment (Charlier, 1999;Solley, 1999; Robertshaw, 1999). This issue also has environmental justice implications }

attempts to augment or supplement water supply historically have favored the interests of whiteEuropean-descendants at the expense of Native Americans or other minorities (Berry, 1998).While especially true in the Western US, it is also true in the Eastern part of the nation. Tennesseeis, in some respects, a microcosm of all three trends and faces several threats, as outlined below.

2.1. Internal and external threats

While water supply is generally plentiful statewide, regional variations in demand aresignificant, and pose numerous demands upon policymakers. East Tennessee (those counties eastof the Cumberland plateau) uses 2.5 times as much water as Middle Tennessee and 24 times asmuch as West Tennessee due, in part, to electric power generation. Moreover, while surface wateruse predominates statewide, groundwater constitutes 89% of the water used for non-powerpurposes in West Tennessee, and half the state’s population (residing in its westernmost quarter)rely on groundwater for drinking water. In addition, highly consumptive uses are increasing (e.g.,agricultural water use increased from roughly 50Mgal/d to over 85Mgal/d between 1975 and1990 before declining somewhat) (Hutson, 1998).Periodic drought has also been a serious threat. In 1985–1988, when precipitation statewide was

75% of normal and streamflow half of normal, serious declines in water quality occurred leadingto emergency measures to allocate and conserve, including bans on ‘non-essential’ uses (Hoos,1992). Despite these problems, a survey of nearly 40 user groups, conducted by the Energy,Environment and Resources Center at the University of Tennessee (UT-EERC) in 1999, suggestsresistance to rationing or withdrawal permits. Respondents favored better planning and droughtmanagement (Feldman & Elmendorf, 2000).Previously mentioned interstate disputes throughout the region are also becoming increasingly

important to Tennessee itself. The two compacts which Georgia, Florida, and Alabama are a part,and which were ratified by Congress in 1997, are scheduled to take effect once the three statesagree on an allocation formula. Such an agreement would place verifiable limits on Georgia’sability to draw water from both the Apalachicola–Chattahoochee–Flint and Alabama–Coosa–Talapoosa basins.Concern that Atlanta might have to look elsewhere for water sources to satisfy growing needs

has spurred, among other options being investigated, purchasing water from Chattanooga’smunicipal supplier (the Tennessee-American Water Company or TAWC) and diverting it viapipeline. Preliminary discussions along these lines, in 1998, prompted concern that the state’swater supply was vulnerable to outside demands, exacerbated tensions between Chattanooga andTAWC over city input into such plans (they were already feuding over water rates), and led toconcerns over how Georgia, a non-riparian state, can rightfully draw water from the TennesseeRiver (Atlanta Regional Water Supply Plan Update, 1997; Gilbert, 1999).

D.L. Feldman / Water Policy 3 (2001) 1–12 3

In 1999, the City of Chattanooga filed suit to acquire TAWC’s assets by eminent domain, inpart due to the latter’s refusal to lower fire hydrant fees. While TAWC offered to give the city avoice in any decisions to ship water to other regions, debate ensued over other issues, including themerits of public versus private ownership (with most of the public, according to pollingcommissioned by the company, wanting TAWC to remain in private hands); disagreement overthe net worth of TAWC’s assets; and the legality of TAWC’s ‘valid franchise’ to operate withinthe city. Both the city and TAWC have entered into a settlement agreement over the acquisitionsuit, and the court hearing the case dismissed the city’s claim that TAWC did not have a validfranchise to operate within the city. In exchange for an agreement by TAWC to reduce its annualfire hydrant fees, the city abandoned its lawsuit to acquire the company’s assets by eminentdomain. The settlement provides that TAWC ‘will not pursue the sale of water to Atlanta if suchsale is contrary to the public will of the community’, and further provides that ‘(s)hould anagreement to sell water to Atlanta be consummated, the city may participate by makinginvestments and realize benefits, if any, in proportion to its investment’ (Gilbert, 1999; Kelley,2000; Pare, 1998).Meanwhile, Memphis, one of the largest cities in the world to rely on groundwater for its

supply, faces potential conflict with Mississippi. The city’s water is provided by a publicly ownedmunicipal utility, Memphis Light, Gas, and Water (MLGW). MLGW’s wells tap into theMemphis Sand Aquifer, a reservoir underlying nearly 7400 mile2 of West. Tennessee and parts ofNorth Mississippi, South West Kentucky, and East Arkansas. While MLGW is the largest aquiferuser, DeSoto County, Mississippi, an area experiencing rapid growth, views the aquifer as apotential future supply source. Twenty to forty Mgal/d of Memphis’ nearly 145Mgal/dwithdrawn from the aquifer come from beneath DeSoto County. Additional concerns over theimpact of urban runoff on groundwater quality, officials in both states have begun calling forbetter understanding of the aquifer, protection of recharge zones, and pursuit of a more regionalapproach to its management (Charlier, 1999; Parks & Carmichael, 1990; Dunphy, 1997; Leahy,1998).

3. Genesis and evolution of the Inter-Basin Water Transfer Act

Six states bordering Tennessee (Alabama, Georgia, Kentucky, Mississippi, North Carolina, andVirginia) have adopted various measures to protect their water supply through a combination ofregistering surface and/or groundwater withdrawal; drought management; requiring minimumstream flows; permitting large withdrawals; and regulating inter-basin diversions. Alabama,North Carolina, and Virginia designate critical areas facing stress and restrict withdrawals, whileGeorgia recently initiated state involvement to improve regional planning for water supply andother resources in metro Atlanta (Feldman & Elmendorf, 2000).In early 1999, Tennessee’s Department of Environment and Conservation (TDEC) asked

the University of Tennessee’s Energy, Environment and Resources Center (UT-EERC) toassess present and foreseeable water supply problems, examine case studies of potentialconflict, and explore possible legal remedies similar to what other states had done. In late, 1999UT-EERC issued a report that recommended taking into account regional variations in statewidewater use; fostering greater cooperation among communities in water supply planning; and


strengthening existing water rights through instituting permits for inter-basin transfers. Almostsimultaneously, talk of increasing diversions from Tennessee to North Georgia and a proposalto tap into the Cumberland River to provide water supply for communities in Kentucky, gaveadded impetus to demands for new legislation. In response to concerns that the state neededgreater authority to regulate diversions, TDEC commissioned UT-EERC to help write newlegislation.

3.1. Policy aspirations versus political realities

The process of drafting and securing passage of the Inter-Basin Water Transfer Act faced fivemajor hurdles. First, except for drinking water sources and their safety, public water supply waslargely unregulated in Tennessee. One, existing state law regulates instream volume, but its powersare limited to preventing physical or chemical stream alterations that threaten aquatic habitatthrough a ‘habitat alteration permit’ process (Tenn. Code Ann. }} 69-8-103(4), 1997). Moreover,even federal protections were inadequate. Under the TVA Act of 1933, the Tennessee ValleyAuthority has statutory authority to manage the entire multi-state basin of the Tennessee Riverand its tributaries for flood control, power production and navigation. However, while the agencyhas significant power to approve construction of any structures on, in, or along the TennesseeRiver or its tributaries affecting its statutory functions or that could be hazardous to health orotherwise interfere with TVA operations, including water supply or intake lines (16 U.S.C. } 831y-1),allocation of water for offstream use is left to the riparian state system.Two, many key concepts in the draft bill had to be clearly defined to placate affected

interests (e.g., ‘basins’, ‘public water providers’, ‘significant harm’) Three, some groups initiallyopposed any new regulation, including utilities that already transfer water out-of-basin and thosewho envision economic gain in new out-of-basin transfers. Four, there was little time to negotiatewith affected interests and to educate legislators. Like many state legislatures, Tennessee’s meetsonly part of the year. A bill had to be introduced early in the session (mid-February) to ensurepassage by session’s end (June). Finally, a law regulating water supply must treat in- and out-of-state uses consistently or federal courts might rule that it violates the US Constitution’s commerceclause.Article 1, Section 9 of the Constitution prohibits states from giving ‘preference’, through

their regulation of commercial enterprises, to businesses operating within their borders overthose enterprises or economic activities based in other states. Originally written to apply toregulation of navigation ports and vessels traversing interstate waters, the clause has beenconstrued by the US Supreme Court to mean that Congress has broad plenary power toregulate interstate commerce, manage and use water for navigation, and regulate non-navigablestreams. It has also been construed to mean that water is a commodity of interstate commerceand states cannot discriminate against one another’s ability to engage in its commercialapplication or use.Thus, a means had to be found to regulate interbasin diversion without discriminating against

out-of-state users. This was done by requiring permits for all transfers ‘out of a basin’ withinTennessee} regardless of whether the source for that diversion originates in- or outside the state.In practice, this means that any applicant proposing to divert water from a basin withinTennessee, whether intending to divert the water to another Tennessee community or to a state


outside of Tennessee, must apply for permission to transfer water. In addition, the law requiresthat an applicant who plans to withdraw water for sale to a third party who intends to divert it(‘through one or more intermediaries’, in the words of the Act), must also obtain an interbasintransfer permit, and is responsible for meeting its conditions.

3.2. How proponents overcame political challenges

Three strategies were pursued to surmount these challenges, as discussed in detail below. Thefirst was increasing the bill’s ‘transparency’ in negotiation with key interest groups. The secondwas placating legislators’ concerns. The third was making sure influential news media werefamiliar with the issue.

3.2.1. Increasing ‘transparency’ } interest group negotiationsAffected interests acknowledged that the bill could bolster the rights of existing riparian users

through rule-making rather than litigation (a preferable process). By ‘rule-making’, we mean thatthe law: provides an administrative process that would draft specific guidelines to be met by anapplicant applying for an interbasin transfer permit; requires prior notification of a proposedtransfer of water so that various stakeholders can be afforded the opportunity to weigh itsconsequences; compels the applicant to undertake an assessment of possible adverse impactsbefore approval of the action; and permits public and stakeholder comment of a proposal totransfer water before approving it.In the US, ‘litigation’ generally works in a somewhat opposite fashion } a party claiming

wrongful harm from an already undertaken action, or a contemplated action, must file a civil suitagainst the instigator of the alleged harm. This process is sometimes unable to prevent the harmfrom occurring in the first place. Moreover, because it relies upon courts of law and legal fees, ittends to be expensive, cumbersome, and contentious.Interests affected by the bill also acknowledged that it would create a level ‘playing field’ for

future interbasin transfers, and strengthen the state’s authority over water supply. However, theyinsisted that key concepts be made more transparent within the body of the bill before they wouldsupport it. Moreover, they did not want to wait for this clarification to occur in theaforementioned rule-making phase that follows a bill’s passage. Key demands includeddesignating the actual ‘catchments’ for purposes of permitting (TDEC divided the state into 10basins, and allowed key interests to offer slight adjustments to their boundaries in accordance withestablished water use patterns), and ‘grandfathering’ existing interbasin transfers.More specifically, the bill’s objective was defined as providing ‘an explicit mechanism . . . to

regulate proposals for the diversion of water from one river basin to another (to protect) . . . thepublic health, safety, welfare, and the environment as the water is no longer available for use inthe original stream’. It requires ‘all persons or entities . . . which have been granted powers toacquire water or water rights and associated property through eminent domain or condemnationor . . . for the use or benefit of public water supply systems’ to obtain a permit in order towithdraw water for the purpose of transferring it outside the basin of origin.The bill contained 16 separate sections enumerating, among other things, each of the 10 basins

in which the state was to divided as well as all the conditions to be met by an applicant applyingfor an interbasin transfer permit. It grants to TDEC the authority to issue or deny permits, impose


civil penalties for violating a permit’s conditions, conduct inspections, and bring suit againstviolators. The state’s commissioner of the environment is designated as having the authority togrant or deny permits and to amend a permit which is granted if reasons warrant. Such reasonsinclude violation of its terms as well as ‘a change in any condition that requires either a temporaryor permanent reduction or elimination of the . . . transfer because of reasonably likely adverseimpacts to downstream users’.The heart of the Act is Section 8 which grants to the state the authority to establish criteria for

permit issuance and/or denial. These criteria include, but are not limited to, existing usesdownstream of a proposed diversion, low flow conditions, impacts to water quality, climaticconditions, alternatives to the proposed withdrawal, the distance (i.e., ‘down-stream miles’) fromwhich water will be diverted, the amount of water to be transferred, and the location and timing ofreturn flow. An appeals process is provided for applicants whose proposals for diversion aredenied. Section 12 of the Act grants the state an additional power } the authority to ‘determineand delineate such basins or portions of basins’ where demands for water by current users haveeither led, or are likely to lead, to regional water shortages. These delineated areas may bedesignated as ‘protected areas’ from interbasin transfer for as long as the state determines thatthey are vulnerable to water shortage.Finally, the bill only requires a permit for ‘new or increased withdrawal of surface water or

groundwater’ for purposes of interbasin transfer. Existing transfers are not regulated unless thetransferor intends to enlarge the volume of water diverted outside the basin of origin } in whichcase the ‘enlargement’ is treated as a new diversion. Prior to conceding to this ‘grandfathering’ ofexisting transfers, TDEC received assurances from the US Geological Survey that existingtransfers posed no serious problems to Tennessee communities.Finally, at the insistence of environmental groups, permits were made renewable every five

years (a term consistent with other states’ practice), and those seeking new interbasin transfersmust consider alternatives. These compromises alleviated the concerns of most vocal interests.Until the very end, however, lobbyists for one water utility sought to weaken the bill’s languagedue to an interest in promoting out-of-state water sales.To ensure that all relevant voices were heard while the bill was being drafted, meetings were

held with lobbyists and other interests in special conference rooms at TDEC} as well as in officesprovided by Nashville-based law firms } and a variety of group representatives were invited.Among the stakeholders attending these meetings were the Tennessee Association of Business, aconsortium of state business organizations; representatives of the Tennessee Farm BureauFederation; various water utilities; and law firms representing clients interested in water supplyissues. Environmental groups in attendance included the Tennessee Conservation League and theSoutheastern Parks and Conservation Association. Care was taken to individually consult withcity and county officials and others with an interest in the issue, but who } due to conflictingobligations } could not attend meetings in the state capital, Nashville. After suggested changeswere made, revised drafts of the bill were circulated to those who attended these meetings,providing them with an opportunity to see how their input was used.

3.2.2. Placating legislators’ concernsKey leaders from both political parties, two of whom represented the Chattanooga area, co-

sponsored the bill in the House of Representatives and Senate. This was significant because


Chattanooga is potentially directly affected by impacts of proposed water transfers from theTennessee River to Atlanta. Also, the bill had bi-partisan support } essentially, leaders from thetwo political parties represented in the state legislature (Democrats and Republicans) came out infavor of the bill, making passage more likely; especially since legislative sponsors held senior rank.However, these two factors could not surmount all hurdles. While Democrats generally viewedthe bill as ‘good’ policy, they preferred stronger legislation that would protect particular regionsas well as the state as-a-whole. Some of the bill’s amendments were concessions to these concerns.One amendment requires registration of all public withdrawals (to provide a benchmark againstwhich water-transfer impacts can be assessed) and TDEC can forbid diversion from ‘over-stressed’ areas of the state.For their part, most Republicans were pleased that business interests did not oppose the bill.

They also were inclined to support the bill, in part, because the governor, who was a member oftheir party, favored it and his staff vigorously lobbied on its behalf. Both parties were assured,meanwhile, that permitting costs and economic burdens would be nominal. The task of gatheringtogether supporting information for permits would be the responsibility of utilities; pass-alongcosts to consumers would be small; and costs to the state to process permits would range from $10to 15,000/each. Finally, the UT-EERC study proved useful in helping to convince legislators ofthe value of, and need for, a new law. Two of the study’s findings were especially cogent: (1) morevigorous enforcement of existing state law would not afford protection against potentiallyharmful diversions; and (2) neighboring states had some means of regulating inter-basin transfers.In the end, although the bill prevailed 29-0 in the Senate and 96-0 in the House, this unanimitydoes not adequately reveal the considerable effort expended to make the bill palatable. Factorsoutside the control of its proponents were partly responsible for this outcome.

3.2.3. Media coverage as catalystNashville and Chattanooga newspapers, as well as one statewide journal (the Tennessee Farm

Bureau Federation newsletter), discussed possible threats that made the bill’s passage beneficial,and these and other media endorsed the bill’s passage. Administration officials cultivated closeconnections with key reporters across the state and offered access to detailed information onwater supply issues and story angles. Moreover, stories and editorials were circulated amonglegislators. This was important because while public and legislator knowledge about the issue wasinitially low, media coverage appears to have heightened interest in it. This is evidenced by publicreference made to various editorials or news articles by legislators during one-on-one meetingsand during committee debate.

4. Major lessons for state water policy reform

Sound science and policy analysis were useful but insufficient to ensure the bill’s passage. Thelaw passed due to a combination of favorable circumstance and savvy politicking, as well asefforts taken to ensure that no particular interest would be unduly burdened by its requirements.Legislator attention focused on water supply issues due, in part, to media coverage of the Tri-statewater wars, the potential for Atlanta buying Tennessee River water, and the region’s recentdrought. Most important, supporters made the issue lucid by demonstrating that threats to the


state’s water supply were real and that other states had taken action in response to similar threats.They also established the law’s need by showing why existing regulation was not fully protective.This was perhaps the single most important key to passage of the new law and requires somefurther explanation.Like most eastern states, Tennessee’s principal water law doctrine is based on riparian rights. In

principle, riparian rights doctrine affords numerous protections against unwarranted, harmfulinter-basin diversions of water. The principal protection lies in preventing the diminution of waterquantity or quality that would adversely affect a downstream user. Only ‘reasonable’ diversionsare allowable. Unfortunately, however, definitions of ‘reasonableness’ vary from case-to-case andcourt-to-court. Moreover, riparian rights doctrine, and previous court precedents, are not veryclear on the conditions for mitigating adverse impacts, and assuring adequately timed return flowuncertain (Tarlock, 1997; Black, 1990; Butler, 1990; Wright, 1998).In addition, supporters satisfied the concerns of key interests by clarifying legislative intent, thus

making the bill more transparent. This was accomplished, principally, by defining basins, and‘grandfathering’ existing inter-basin transfers (which amounted to approximately 10 milliongallons per day). Bi-partisan legislative support was achieved through key amendments thatstrengthened the bill and assurances that implementation costs would be small.Finally, the issue that the legislation was designed to address was framed in a way that made it

likely that citizens would embrace the law. Media coverage made the possible adverse impacts ofunregulated interbasin transfers understandable to the general public, as well as to local and statedecision-makers. For water policy making, one lesson of this experience is that state legislators aremost likely to take action on an issue having to do with the management of water supply when itmeets three conditions: (1) proposed legislation must respond to a genuine problem for whichinadequate legal remedy is currently available; (2) it must be crafted so as to be acceptable to keyinterests affected by it; and (3) it is helpful if other political entities } within the same region }

have already taken action to address this issue. The latter tends to affirm, in the eyes of legislators,the existence of a real problem and the prudence of taking vigorous action, if only in ‘self-defense’,as explained below.There is one other lesson that may be drawn from this experience, and which is more broadly

generalizable: while it is a stretch to argue that the political, economic, and cultural differencesprevailing among US states engaged in disputes over water are largely comparable to thoseexisting between entire nations, or even among provinces within other, more ethically complexsocieties, there are some relevant parallels. For one thing, there are two major impediments tofinding cooperative solutions to trans-boundary water disputes, among states as well as amongnations: (1) the perception by some protagonists that they lack adequate and equal power toinfluence the outcome of negotiations; and (2) the perception among protagonists that they lackeconomic and/or legal tools to resolve the underlying sources of disputes (e.g., the ability toallocate water supply; the infrastructure to manage competing demands).These problems of inequality of power and resources have been recognized as partly inhibiting

lasting, durable solutions to water conflicts between Israel and Jordan, and Israel and thePalestinian West Bank; especially when such inequalities are accompanied by secrecy andfundamental value differences among protagonists (Hassoun, 1998; Elmusa, 1995; Morris, 1993,1992). Similarly, the difficulty encountered by some states who share common river basins indeveloping cooperative management schemes characterized by economies-of-scale has been found


to be a serious problem resulting largely from unequal } and generally scarce } economicresources. This has been found to be true among the Mekong River basin states of Thailand,Cambodia, and Vietnam, for example (Browder & Ortolano, 2000).It can be argued that problems comparable in kind } though certainly different in

severity } are found among American states grappling with conflicts over trans-boundarywater resources, such as Alabama, Florida, and Georgia or Georgia and Tennessee. What is thepoint? Just as Alabama, Florida and Georgia have had difficulty negotiating a lastingsettlement of their current water disputes due to the perception that Georgia, a powerfulupstream state with a large Congressional delegation, economic resources, and majormetropolis (i.e., Atlanta) is reluctant to relinquish very much through negotiation, so too havesome Tennesseans feared Georgia’s potential power to divert water from the Tennessee River.In the latter case, the absence of any state statute regulating water diversion in Tennesseecontributed to this perception of weakness. Ironically, one result of the new Inter-BasinTransfer law is the possibility that new inter-state transfers of water from Tennessee to Georgia orelsewhere may yet occur through mutual agreement, but with the assurance that the formerwill be in a position to craft any agreement in ways that might yield benefits for itself, as well asfor the latter.In other words, while inter-state cooperation is inhibited by the perception of unequal power, it

may be facilitated by internal reforms which strengthen a state’s bargaining position relative to itsneighbors. This has lessons extending beyond the Southeastern US. What we are saying is thatone pre-condition for inter-jurisdictional cooperation between states competing over water supplyis the development of sound regulatory mechanisms by individual jurisdictions themselves. Suchmechanisms build internal capacity to manage water supply, make it possible to negotiate from aposition of advantage, and make it plausible to cooperate on a regional basis.

Acknowledgements

I would like to thank Dodd Galbreath, Director of the Environmental Policy Office, and AlanLeiserson, General Counsel, both of whom work for the Tennessee Department of Environmentand Conservation. They not only supported this research but provided a sound education on thestate legislative process. Their efforts were pivotal to the bill’s passage. I also gratefully thank JillElmendorf, former UT law student, for her invaluable input to the UT-EERC report which set thestage for drafting and ultimate passage of the Interbasin Transfer Act, and for her assistance inhelping to craft an early version of the Inter-Basin transfer bill, and in suggesting ways to improveit. An earlier version of this article was presented at the 2000 American Water ResourcesAssociation Meeting in Miami, Florida.

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tennessee's inter-basin water transfer act: a changing water policy agenda

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