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farmer, whoever that ultimate user of the resource is. At the other end of the spectrum, you have the absolute inflexibility of water moving at all. The term water marketing from my view - and our view of it as it has evolved - is that it is a creative way for us to begin to talk about flexibilities that allow us to unravel some of rhe mistakes that were made in the early Compact discussions. Unfortu- nately, as the loser in those discussions [our state] really has to look at it that way. We tried to sit and look in the crystal ball and decide what the economic need for water in every one of the states were and the economic ball was a little cloudy. It was a little too rigid and it was a little cloudy. Now, the Compact brings a lot of good in its wake. It creates an arena whereby we all have to talk to one another in order for anything to happen. It protects our seats as states at the table. In many ways, it defines who those stewards of the water resource are. There cannot be any sort of marketing - and I'm using that word for lack of a better term, I personally prefer the word partnership or collaborative effort to the word market because market in my eye is very limited in its hydrographic applicability. I mean, a market existing in the same hydrographic groundwa- ter basin, if you will, where you're shifting use from one interest to another, that's accepted, that's fine, that works well. But let's look at it from a different perspective. We don't have the institutions in place to allow that kind of a collaborative partnership and those kind of flexibilities to emerge that protect the states' entitle- ments they fought for so bitterly at the end of the 1920s and got from losing in perpetuity. The states that are now feeling the pinch of those lousy negotia- tions, from their vantage point, don't have any sort of flexibilities built into the system. We're still working within silos. We're still working within very rigid frameworks and everybody is trying to be the top of the heap. In the Lower Basin, particularly, we don't even have an Upper Basin Commission. I would agree that the time has come to create some forums and some opportunities that help define how markets and collaborative partnerships can and will exist. Forums for regional discussions may even later include discussions on a seven state basis. If water is going to begin to move around, it has to be done in an adaptive sense. It has to be done in a framework where it is not now and forever more water moving from one entity to another entity. It can only do so within a limited time frame because our crystal ball gets really murky as we go out into future years. And that discussion can only occur between those that hold stewardship responsibility. Who are those individuals? Who are those groups? They are the ones that the users will come back on if mistakes are made. They are the ones that have to feel the risk of the entrepreneurial venture ... they're the ones that feel the risk and they're the ones that suffer the consequences of the risk. Those discussions have not occurred. We've talked a lot about benefit. We've talked a lot about moving water. We've talked a lot about dollars. We've not talked about the lack of water. What happens if it disappears? What happens if the drought no one wants to talk about emerges? Who bears the consequences and who bears the risk? I would suggest that it is this reality that places the limitations on a market. We're very comfortable with an Arizona groundwater bank, and we know that that means that the days of free water in their pure definition are over. But we also know that when we spend that money we're helping Arizona avoid risk. We know that the dollars we are spending have a larger benefit to all those who are giving us and allowing us to use that water in the shorter term. They are, in the final analysis, going to also benefit from that. I struggle finding where the stockholder has a seat at the table. I really can't make that transition from a completely regulated environ- ment to one that is completely free-flowing, where stockholders are trading shares in a water market much akin to where they trade pork bellies. Those that benefit from the financial resources that are put into a pool today must be those that are assuming the risk when the water is gone or when the risk is incurred and when conditions change. Our view of it is that institutions need to be created and emerge that allow for the dialogue, that allow for flexibility, that allow for an adaptive plan to be developed that does not lock us in to tomorrow's debate of how the last plan didn't work. People can agree to a WATER MARKETING ON THE COLORADO RIVER large quantity of water shifting hands, that's not the problem. The problem is under what terms and conditions. - Dennis Underwood WEATHERFORD: Thank you. Let's move on to questions that you may have of one another. QUEALY: Dennis, I'd like to have you step back to your previous life and your vast experience with the Bureau of Reclamation. In any Upper Basin to Lower SYMPOSIUM PROCEEDINGS SEPTEMBER 1999 o