Understanding the Real Fight Over Water in Arizona

Joe Weisenthal (0:10)

Hello, and welcome to another episode of the Odd Lots Podcast. I'm Joe Weisenthal.

Tracy Alloway (0:15)

And I'm Tracy Alloway.

Joe Weisenthal (0:16)

Tracy, Arizona water. I'm like, I'm really fascinated by this topic, and I also have a really hard time wrapping my head around it.

Tracy Alloway (0:25)

We sort of hear different things. So just to lay the groundwork here, or the groundwater, ha.

We have interviewed a land broker in Arizona, and we have also interviewed an alfalfa farmer. And water has come up every time, and we sort of hear different things from those two stakeholders. So I remember the farmer was sort of blaming the property developers for water shortages, and then the property developers are like, actually agriculture uses the majority of water in the state, and at the same time, you have concerns over water availability, and we saw some news on that front recently.

Joe Weisenthal (1:03)

Yeah, so at the beginning of the month, I believe the governor of Arizona announced this plan to sort of constrain the amount of new development that will be allowed around the Phoenix area, which is of course one of the fastest growing areas. And as you mentioned, the developers will say, oh, we have plenty of room to add more homes because the farmers are taking up 80% of the water that we have in the desert, and the farmers say, well, there wasn't really a problem with water until everyone started moving to our state.

Tracy Alloway (1:32)

I'm imagining that Spider-Man meme of everyone pointing fingers at each other, but I think the big difference and what's happening now is that we are starting to see water shortages or constraints affect development decisions.

Joe Weisenthal (1:47)

Right, so then the big question is like, okay, so Arizona and some of these other southwestern states that in part get their water from the Colorado River all have to conserve water to some extent. There's been this mega drought in the southwest for I think like 25 years now, some of the underground aquifers, they're depleting at some pace. The water from the rivers is lower than it used to be.

So, and then, and we hadn't even, you know, we're talking about housing versus agriculture, there's also a lot of industry and the semi-conductors.

Tracy Alloway (2:17)

Semiconductors, yeah.

Joe Weisenthal (2:18)

So we sort of have to get a sense, I think of the big picture of like, frankly, who's gonna lose out? Who is gonna, who has water today that won't have access to it in the future?

Tracy Alloway (2:26)

Right, and how do you make those decisions? How do you decide what to prioritize?

Joe Weisenthal (2:31)

Right, because with all utilities, it's never like a pure market. There's not just like, or at least I don't think, you know, it's like when you like, try to wrap your head around like, how the Texas grid works, you know? It's not like there's like some price of electricity and who pays the most. It's like, there's auction mechanisms, there's subsidies, et cetera, all kinds of complexity.

Tracy Alloway (2:49)

Texas grid is a bit of a special case, but point taken.

Joe Weisenthal (2:52)

I think Arizona water might also be in that case, of many special cases. So we really do have the perfect guest, someone who is steeped in water and water policy and made a whole career of it.

We're gonna be speaking to Kathryn Sorensen. She's the Director of Research at the Kyl Center for Water at the Morrison Institute for Public Policy at Arizona State.

Previously, she was the head of Phoenix Water Services. So someone who really knows water, I'm gonna break it down. So Kathryn Sorensen, thank you so much for coming on Odd Lots. Really appreciate you joining us.

Kathryn Sorensen (3:26)

Thank you, I'm really excited for our conversation.

Joe Weisenthal (3:28)

Why don't you start just in the very sort of just go back a little bit a few weeks ago and the governor of Arizona did announce these constraints to some extent on new construction capacity around Phoenix. What was announced and why?

Kathryn Sorensen (3:45)

Yeah, that's a great question. And there is a complicated answer to that.

Joe Weisenthal (3:50)

And you can ask it. I told you it's not gonna be an easy one, but yay.

Kathryn Sorensen (3:54)

It's not an easy one.

So what that related to was actually sustainable groundwater management in the Phoenix metropolitan area. So in Arizona, we have some of the most progressive groundwater management laws that you will find not only in this country, but literally in the world. Back in 1980, we passed groundwater management that effectively ties water availability to the ability to grow.