This working paper offers a framework and roadmap for development of a robust groundwater-sharing system consistent with California’s Sustainable Groundwater Management Act, which requires communities in priority areas to prepare groundwater sustainability plans. The proposed system draws on global experience. Robustness is its signature feature. Opportunities are maximized by a suite of robust local governance, allocation, and administrative arrangements. Additionally, the proposed system incentivizes innovation, stimulates investment, and facilitates low-cost adjustment to changes in groundwater demand. Among the dynamic components underlying this sharing system are a share register that records ownership and transfers of ownership in the basin’s available shares. These unit shares are fungible; each represents a proportional stake in access to the basin’s groundwater resources. Volumetric allocations are made in proportion to the number of shares held during determined periods throughout the water year. These allocations are recorded in bank-like water accounts, affording account holders an efficient means to manage their resource but also ensuring that they cannot use more than is available. Unused water can be saved for later use. At the start of the transition to the new system, users are given an allocation buffer so that they have flexibility and time to adjust. Those who want to can make quick non-contestable trades at low cost.
Nicholas Institute for Environmental Policy Solutions