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"consumptive use" and not the amount actually pumped. Jarvis III also emphasized that the Jarvis 1/ decision, which authorized Tucson to retire lands from cultivation to develop a water source, was based purely on equitable principles and had no counterpart in the American Rule of Reasonable Use. Finally, in a decision that provided the major impetus to development of new groundwater legislation in Arizona, the court reiterated that the doctrine of reasonable use does not permit transfers off the overlying lands if others are injured.23 In granting an injunction against pumping by mining companies that damaged the farming operations of irrigators, the court stressed that no authority supported a pro- position that off land transfers were not off lands overlying a common source of supply. The court determined that, except in certain highly unusual circumstances, many overlying owners would be disadvantaged by such a rule since water would not move up gradient from the point of return, The limits which the reasonable use rule placed on certain high value users of water, typically mines and cities, resulted in a search for political solutions, The result was the 1980 Arizona Groundwater Management Act which created Active Management Areas (AMA's) covering some 80% of the state's population. Within an AM A, new irrigation is prohibited, other new uses require a permit, existing irrigators are subjected to withdrawal limits based on crops historically grown, transfer provisions are in- stitutionalized both within and away from basins, pump taxes are authorized, and a schedule for reducing the amount of water available to current irrigators and other users is implemented. Out- side of AM As, the American Rule applies except that the remedy of injunction is no longer avail- able to overlying landowners injured by another's transfer of groundwater off the overlying land. The Arizona statute illustrates the type of regula- tion that might be sustained in an American Rule jurisdiction. Thus, although it is often said that landowners "own" the water beneath their lands in American Rule jurisdictions, clearly rights can only be established by use and even long periods of uninterrupted use establish no right to a continued level of use. Many criticisms that apply to the English Rule of Absolute Ownership, however, apply with equal force to the American Rule of Reasonable Use. Socio-Economic Impacts Many of the economic criticisms of the English Rule also apply to the American Rule of Reason- able Use. As is the case under the English Rule, property rights under the American Rule are not 3-6 secure. Landowners normally are free to capture as much water as they can as fast as they can as long as the water is applied to a use intimately connected with the overlying land. Any adverse effects on other landowners are ignored. The only increase in security brought about by the American Rule is the restriction on use of water off the overlyi ng lands. Landowners need not fear that water will be captured by high volume, off- land users such as municipalities, without compensation being paid. Thus, the American Rule seems to be appropriate only where off-land uses constitute the major threat of aquifer depletion. The American Rule is, however, a bit more flexible than the English Rule. Since water must be reasonably used in conjunction with the over- lying land, properly drafted regulations could probably survive constitutional challenge on taking grounds. The types of regulation that would be permissible may, however, be limited. Water use efficiency standards, for instance, might be upheld while water quantity limitations might be struck down, Thus, the American Rule is somewhat inflexible, though not to the degree of the English Rule. From an equity perspective, the American Rule also favors high volume, short term users over users who would prefer to use lesser amounts of water over a longer period of time, as long as the high volume users do not transfer the water off the overlying land. TheAmerican Rule also favors current users overfuture users, users of water on overlying lands over public and private off-land users, and private landowners over the general public. Physical-Hydrologic and Environmental Impacts Adoption of this rule would tend to encourage rapid aquifer depletion by overlying owners. To the extent that irrigation is the dominant use of water, environmental and p.hysical-hydrologic impacts would be similar to those described under the English Rule. Adverse impacts, how- ever, could be reduced by adopting management strategies that would be permitted under this rule. Without knowledge of the regulations adopted, however, impacts cannot be determin- ed further. Alternative #4: Adopt the California Rule of Correlative Rights as the definition of ground- water property rights in Nebraska.