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Securing Good Drinking Water: Footing the Bill to Fix Nature

By Daniel Moss When a relentless sun parches the landscape and dries water sources to a dangerous and unhealthy trickle, who’s supposed to pay the repair bill? It’s not so much the water bill itself that’s the trouble – most people will pay a fair price for good quality water if they can afford it...

By Daniel Moss

When a relentless sun parches the landscape and dries water sources to a dangerous and unhealthy trickle, who’s supposed to pay the repair bill?

It’s not so much the water bill itself that’s the trouble – most people will pay a fair price for good quality water if they can afford it – it’s the cost of fixing a broken watershed. Drinkable water was once an inalienable right on planet earth; now there’s talk of “payments for environmental services” (PES) through which ordinary citizens may have to pay to get rivers flowing and aquifers gurgling. That sounds awfully expensive for the average household.

Joaquín Saldaña, coordinator of CONAFOR's Matching Funds program, on a field visit to a municipal environmental services program in Coatepec, Mexico.
Joaquín Saldaña, coordinator of CONAFOR’s Matching Funds program, on a field visit to a municipal environmental services program in Coatepec, Mexico.

Only a small fraction of Mexico City’s 21 million residents, and indeed the country’s 120 million, receive uninterrupted water from the tap that they can confidently drink. Working for the National Forest Commission of Mexico, CONAFOR, Joaquin Saldaña spends his days (and many nights) figuring out how to finance the rehabilitation of Mexico’s failing watersheds which diminish the quality and quantity of water to households across the nation. He tries to keep his piercing green eyes focused beyond the droughts, floods and politics to a far horizon where healthy ecosystems and healthy rural economies can deliver healthy water.

Joaquin has persisted at his job over many election cycles, observing that environmental conservation programs are, not surprisingly, sensitive to political whims and decisions. Having seen weak reforestation programs, he knows it’s not just a matter of throwing money at the problem. His forestry team drives cautiously down steep mountain roads during field monitoring missions — brushing up against more than a few narco-traffickers — to identify projects and investigate whether funded strategies are actually nursing ecosystems back to health. The team is trained in forestry, but equally fluent in anthropology, hydrology and community organizing.

Joaquin’s Matching Funds program borrows a page from Economics Nobel Prize Winner, Elinor Ostrom by enlisting local users and providers of environmental services in co-managing shared water and land resources. Communal property owners (ejidos) and private landowners who steward ecosystems are considered ecosystem services providers – in this case, providing clean and abundant water – while a beer company, a municipality or a water utility operator – those who can compensate the providers – are users. Rural communities in ecologically-sensitive zones can receive a federal grant when they match it with local funds.

Joaquin’s program has a redistributive bent, with federal monies flowing to poor rural areas. Funds can be used to restore watersheds and care for natural resources – for example through soil conservation, sustainable forestry and water source protection – strategies which have the added benefit of shoring up a bleeding countryside that in recent decades has sent millions of displaced farmers to the U.S.

The urban areas, wealthier than their rural counterparts, pay a greater share into this payment for environmental service program and benefit by safeguarding their distant water supplies. The program strengthens a critical link between cities and rural communities.

The water crisis is making headlines – long overdue from Saldaña’s perspective – from Mexico City to Flint, Michigan. The idea of payment for environmental services dates back at least as far as the Dust Bowl, when the United States Department of Agriculture offered soil conservation incentives to farmers to restore blown-away croplands. The wonkish term captures two big ideas:

1) Regulations and enforcement are only part of the solution; property owners and businesses need carrots – the sweeter the better – to motivate their watershed-friendly land and water use; and

2) The human communities that steward ecosystems, for example, ensuring that forests recharge groundwater, ought to be incentivized and recognized as providing a public service. Also known as compensation for ecosystem services, payment for environmental service programs are gaining traction, occasionally written into public policies.

One program model that caught Joaquin’s eye is that of New York City. When Joaquin met Albert Appleton at a learning exchange among U.S. and Latin American fresh water advocates, Joaquin was keen to learn how the public water utility of that giant city made payments upstream.

Appleton, the architect of New York City’s program, described to him how, over 20 years, the water authority transferred over a billion and a half dollars of urban customers’ money to the Watershed Agricultural Council and the Catskill Development Corporation. Those funds were invested in farm improvements and town sewage facilities that kept effluents out of New York City’s water supply, helped the rural economy, and enabled the city to avoid having to build a $6 billion treatment plant. The upstream spending is written into the water utility’s operating budget, a stable resource base Joaquin yearns for.

The New York City case works, however, because of Environmental Protection Agency regulations and legislation like the Safe Water Drinking Act – public policy tools and enforcement capacity that Joaquin doesn’t have to work with. Big-stick regulation loomed large for upstate NY farmers, providing a strong incentive to clean up their act – literally. Application of those sanctions is spotty and fraught in Mexico – and has deteriorated in the U.S. as well.

In the 1970s, Richard Nixon reluctantly signed into law the Clean Water and Clean Air Acts, setting in motion the heyday of environmental enforcement, paid for by polluters and taxpayers alike. Those regulations hurt – as was intended – leading the companies that spoiled the commons to fight back. From Reagan on, many regulatory agencies were dismantled or weakened. Even under Obama, enforcement remains under-resourced, evident in water disasters in Toledo, Charleston, and most tragically, in Flint. With thousands of cities around the world receiving lousy water quality ratings, payments for environmental services have grown in popularity as a possible way to improve quality without necessarily strengthening regulations.

One PES strategy garnering considerable attention is water funds. Monies are collected to invest in upstream watershed rehabilitation, whether it be to purchase conservation land or compensate landowners to preserve ecosystems. Joaquin collaborates with some of these funds in Saltillo, Coatepec and Monterey, among other places. These funds ask everyday water consumers to voluntarily pitch in to protect watersheds or in some cases, to pay a nominal environmental tax added to a water bill. Corona or Coca Cola might also be willing to make a tax deductible contribution for watershed recovery to safeguard its business’ primary material and demonstrate social responsibility.

The idea is for stakeholders, public and private, to mobilize money and in some cases seek agreement on water extraction and land use rules. Many funds are led by non-governmental organizations such as the Nature Conservancy and have contributed significantly to public education on water conservation and watershed restoration. But Joaquin has also seen their limitations. Funds raised can’t achieve the scale of necessarily gigantic watershed recovery efforts. The environmental tax can be regressive for poor households that have a hard time paying even basic water bills. Water concessions – which may privilege water to mines and export crops over people – are not consistently challenged. How to buttress regulations and enforcement is rarely addressed. Without this advocacy, the U.N. ratified human right to water may be vulnerable.

Climate change and ongoing water mismanagement spell big trouble for the health of our planet’s water sources. The more they deteriorate, the higher the price tag to get those natural systems once again pumping out healthy water. With the unfolding water crisis causing an increasing number of public health and human rights catastrophes, conflicting proposals – sometimes visionary, sometimes false – will be floated about where the money should come from to fix the problem. For the average person, and even the so-called expert, it won’t always be easy to distinguish which is which.

Joaquin will be a good person to watch. His main job will be ensuring that CONAFOR’s Matching Funds program stays flush. But he’ll also fix his eyes on the broader context, the enabling factors that make or break a fair and effective PES program.

Joaquin will continue to marshal public dollars from multiple sources (even as he turns grey battling politicians); encourage mayors, community councils and public water utility companies to step up as leaders in governing and managing their water; insist on measurable results from conservation work; and remind us to invest in regulatory structures that uphold water and land use laws. When watershed protection efforts subscribe to these basic principles, we may all have a shot at drinking clean water from our taps.

Daniel Moss has worked in community-based resource management in the U.S. and Latin America for 30 years. He writes on water issues for a variety of journals and blogs and coordinates Our Water Commons. He recently published a study entitled, “Urban Water Utilities and Upstream Communities Working Together”, about how Latin American water operators collaborate with upstream communities for watershed protection and water governance.

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