Excerpted from Inside the EPA • Water Policy Report, April 18, 2005

A novel New Mexico law creating a strategic water reserve could provide a model for other arid Western states to protect drinking water and head off litigation prompted by limited stream flow, such as Clean Water Act suits over contamination concentrations, suits to protect endangered species and interstate water resource disputes. ...

[S]ome federal lawmakers have raised the idea of creating a national strategic water reserve and say the New Mexico approach is a tool that other states could use. ...

The New Mexico strategic reserve, signed into law by Gov. Bill Richardson (D) earlier this month, creates a pool of state-held water rights on every river system in the state. It marks the first time the state has held water rights, according to ... Think New Mexico, the non-partisan think tank that first proposed the reserve in a 2003 report.

The strategic reserve is supported by a broad coalition of stakeholders including business, agricultural, environmental, wildlife and municipal organizations.

By holding water rights, the state is able to legally dedicate water for public benefit purposes and allow it to take action to increase stream flows before litigation stemming from water shortages arise.

For example, the state may be able to increase stream flow to dilute high concentrations of contaminants to prevent enforcement litigation against dischargers. “With New Mexico’s rivers drying up, the state is increasingly at risk of lawsuits over violations of the Clean Water Act,” the group’s report says. Although water quality was not the primary focus of the reserve’s creation, maintaining adequate stream flow “can only help [water] quality.”

The report also says the state may be able to use the rights to limit degradation of the state’s drinking water, which may be the most serious consequence of failing to protect New Mexico’s rivers.