WSP01794

• File Number: 8051
• Description: Area of Origin
• Basin: Statewide
• Date: 1/1/1986
• Author: McDonnel and Howell
• Title: University of Colorado Law Review - Area-Of-Origin Protection in Transbasin Water Diversions: An Evaluation of Alternative Approaches
• Water Supply Pro - Doc Type: Report/Study

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,-\RE.-\.OF.ORIGI:'-i PROTECT/O:"

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preSent ';:1]ue. pi:1ced in escrow at interest. ro be used by the basin of V'
ongln ro ccmpensate unprotected parries :1nd for whatever other pur-
pos~s its citizenry prefers.
Compensation should definitely nor be aimed at keeping water
prices or COStS of Water development to in-basin users from nsing as
water becomes scarcer. \\/ater orices should rerlect the real scarCl!V
,,,]ue of water, .-\s water is transferred outslde a basin because of its
greater value there. water does become scarcer in the basin than it
otherWIse would have been. The cost of water to users should rerlect
the fact of thIS scarcity and not the scarcllY of some bygone era, Pro-
visions like those in the Colorado W"ter Conservancy District Act dis-
cussed earlier.~) which require that "present. . . and, ' , prospective
appropriations of wmer ' , , nOl be impaired nor increased in cost"
distorr the real scarcity signals to in-basin water users and induce
them ro apply water to uses and in qu"ntities that are nOl justifiable in
light of current scarcities.
It is not clear that compensatory srorage will always be the most
useful form of compensation to the area of origin. Perhaps schools.
highways. or hospllals would be of greater benefit, given the hydro-
logic situation and other needs. Even when storage is the most useful
form of compensation. there is the issue of liming of construCl1on of
that storage, Clearly. it should be sized and timed in accordance with
the water needs of the area of origin, One official. mistaking inelTI,
ciency for foresight. recently Slated. "We built Green Mount"in Reser-
voir 4-5 ye:.lrs ;lgO. and now we need it."
These observations "Iso have implications for the institutions that
negotiate for "nd m"nage the resources gamed through compensation,
If negotiations over losses are to represent all of the unprotected losmg
p"nies identified above and if the uses of these compensatory resources
are to be determined in the interest of all losing parries and not JUSt
Water users, then a governmental unit of general jurisdiction should
control negotiations and manage the use of the compensatory
resources.

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F General Economic Guidelines for Compensation

By way of summary. the following general gUidelines concerning
compensation are otfered:
I. Cumpensation paid should equal the present value of net in-
comes and rublic amenities lost in the area of origin that are not pro-
t~('tt:u ~lIld~r ...:on\~!JtilJnJ.1 ~l.ppr()priation doctrin~. The rel~\~lnl

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