On November 9, 1922 seven U.S. States (Upper River: Colorado, New Mexico, Utah, and Wyoming; Lower River: California, Arizona, & Nevada) signed a compact commonly known as the “law of the river” designed to regulate each states usage of the water from the river, to ensure that the Lower Division has water to use for the future. This is important because the Colorado River is the only fresh water resource in the area.
This compact has been an area of dispute in the past with Arizona being unhappy with the allocation of water for the lower basin. There have been many different cases under the name Arizona v. California that have been litigated due to Arizona’s claims that California is using more water then it is entitled to. Another issue addressed in 1983 was the rights of Indian Tribes to a portion of the water in the Colorado River.
Water Marketing is a concept that would allow the water in the Colorado River to be transferred, leased, or sold from one state to another. This transfer can become problematic because it involves the U.S. Bureau of Reclamation that manages the river. The Bureau released draft regulations in 1994 to regulate intrastate marketing of water. Objections (especially from Arizona) were brought up here about the federal governments infringement on State’s rights to manage the river. Other issues include management of excess water in water banks created and managed by Arizona, which is very protective of it’s share of the Colorado River as well as California’s growing population and need for more water. Another issue that affects the marketing of the water is having to consider the interstate and intrastate movement of the river.