January 1, 2008
Water’s abundance in some areas and shortage in others has the industry drowning in concern about water availability. Here’s how some are handling it.
The global demand for freshwater is doubling every 20 years, and at least 1 billion people are not sure each day where their water will come from — or whether they’ll even have any. That’s what Mike Newman, managing director of the Michigan Aggregates Association told attendees of the National Stone, Sand & Gravel Association’s 2007 Annual Convention last March. (See “Dewatering the Problem: How one state kept its head above water when backlash about water usage threatened the existence of some aggregates operations,” AggBeat, May 2007.)
And concern about water availability isn’t lessening. These water issues aren’t just a third-world problem — in fact, concern about water availability is continuing to grow in our own nation and has trickled down to many of our own locales. This problem could potentially threaten the aggregates industry, which deals with large volumes of water on a daily basis through dewatering and other production activities. That means your operation could be affected.
Water has become such an important issue and resource that prestigious investment-banking firms are now looking at it as the new super commodity. “They are saying that water is the oil market of the future,” Newman says.
In the mainstream
Just recently, the issue of water availability has been in the public eye in Atlanta and its surrounding area. According to an Associated Press report released at at Aggregates Manager press time, more than one-quarter of the Southeast was covered by an “exceptional” drought — the National Weather Service’s worst drought category.
But even in a water-rich state such as Illinois, there is growing concern about continued availability of water given the current demand as well as projected new demands including population growth, expansion of ethanol production, and potential for coal gasification, explains John Henriksen, executive director of the Illinois Association of Aggregate Producers (IAAP).
Newman agrees. “The issue is not going to go away, no matter what region in the country you are from,” he says. “If you don’t see it now, it might be in a year or in five years. This is a long-term issue for our industry. We have to confront it and be a player in it.”
However, Newman says, oftentimes, “We run into environmental groups that are driven by emotion and not science.” Many environmental groups want water to be held in a public trust. This means that water wouldn’t be owned by people, and therefore, controlled by states. A public trust is the principle that certain resources are preserved for public use and that the government is required to maintain it for the public’s reasonable use.
“The public policy debate on freshwater is driven by economics, social values, and environmental concerns,” Newman adds. “The primary targets of the environmental community in Michigan on water issues are bottled watering operations, aggregate producers, and agricultural irrigators.”
Developing a plan
When the Michigan Aggregates Association started having conflicts about five years ago — both real and perceived — the group began working with legislators to ensure that everything done is based on science. The National Wildlife Federation went to Michigan’s Department of Environmental Quality and asked that several quarries in southeast Michigan be shut down. “We can be good stewards of water, but we have to be able to use it as a resource,” Newman says. “Why does everything have to be so unreasonable? Why is there never a common ground? It’s all or nothing.”
With an abundance of water in some areas and an extreme shortage in others, states are getting very protective about their water sources, particularly more water-rich regions such as those surrounding the Great Lakes.
So the association took a proactive approach and helped to develop a five-step process to ensure that its access to water is protected but addressed state and community concerns about being good stewards of water. Many times, conflicts now can be resolved amicably, Newman says (see sidebar, “Using a Five-Step Process”).
For example, a homeowner about seven miles from a Michigan aggregates operation claimed that facility caused failure of the home’s well. However, the cone of depression was nowhere near that part of the aggregates operation. The quarry owners didn’t feel the complaint was legitimate, but the homeowner still believed the aggregates operation was responsible for the problem. In the past, the only recourse would be for the homeowner to litigate the situation if the aggregates operation didn’t believe it was responsible for the problem.
Now, there is a plan in place that presents a fair way to resolve the issue for both parties. “If the well was 200 yards from the quarry, it is very possible that the failure of the well was due to that operation,” Newman says. “But seven miles away…I would say there isn’t a legitimate complaint.”
Now, the homeowner can still file a complaint, but an electrical inspection first must be conducted to ensure that no circuits or pumps failed. A well inspection also must be performed. The findings from both inspections must be submitted to the state and reviewed by a hydrologist before a complaint can be filed. “Most of the time, problems can be resolved without going through the courts,” Newman says. “Usually, you just settle if it was determined that the claim was reasonable.”
Nearly 50 claims have been filed in the last three years — many against aggregate operations — and all but one has been resolved amicably, Newman notes. “This is a good process for both community relations, and it also weeds out a lot of inaccurate claims where people would just try to get a new well by putting pressure on a quarry, even thought it had no impact on it. The system works well, and everyone seems to be pleased with it. There is still a system of litigation in place, but this intermediate process has been very helpful.”
Who’s water is it, anyway?
IAAP’s Henriksen notes that the industry should seize any opportunity that is presented to work collaboratively with interest groups that are concerned about water issues — whether they are traditional allies or historical foes. “We must be prepared to educate policymakers and the public at large regarding the aggregates industry’s impact on the hydrogeologic regime of our region,” Henriksen points out.
Looking at Illinois as a case study, the state was looking at a top-down control model for water withdrawal legislation. In 2004, a bill was filed in the Illinois Senate that would have required the Department of Natural Resources to develop a program to issue permits for “high-capacity” wells and community water supply systems. A high-capacity well was define as a well that withdraws 70 gallons per minute; 100,000 gallons per day, or 3 million gallons per month; or a well with a casing diameter of 6 inches or more. The permit applicant would be required to demonstrate that the water to be withdrawn would not be detrimental to the aquifer, environment, or existing wells.
The problem was that some ready-mixed concrete plants use wells that fit the water withdrawal characteristics of a high-capacity well, Henriksen explains. “There was also come concern expressed that some of our [IAAP] members may have wells with a casing diameter of 6 inches or greater,” he says. “ So we looked for allies to stop the bill.”
The IAAP enlisted the support of farmers, homebuilders, realtors, and other miners. These interest groups all have a stake in land-use issues, Henriksen says, making them a natural coalition to fight the bill. Coalition lobbying efforts stopped the bill and ensured that the revised bill filed in 2005 “essentially exempted farmers and miners,” he says. “Coalition members also gained experience working with the local government groups pushing this legislation, experience that is helpful in future settings.” The outcome of their work resulted in the failure to pass strict water withdrawal legislation, leading to the issuance of a 2006 executive order that mandated a statewide study of water-supply issues.
The members of a non-profit group filed a petition seeking the creation of an area water authority, in accordance with the Illinois Water Authorities Act. The water authority authorized by this Illinois law is created by a referendum on which citizens of the proposed authority area vote. If the voters within the boundaries of the proposed authority area approved the referendum, a three-trustee volunteer panel would have controlled future water use within the borders. They would have had the following power:
Levy taxes on property within the boundaries of the authority at the rate of .08 percent of the value as equalized or assessed by the Department of Revenue.
Regulate the permitting of any new wells for high-capacity residential, municipal, industrial, and commercial users.
Monitor and conserve groundwater and protect important groundwater recharge areas within the authority by exercising broad condemnation, police, and zoning powers.
This proposed local water authority area argued that it was a necessary step to protect the region’s groundwater from overdevelopment. It also proposed boundaries that excluded nearly all of the large population centers located within a three-county area, Henriksen explains. These boundaries would have ensured that only voters within the rural — and anti-growth — areas if these counties would have the right to decide whether this water authority should be created.
However, the IAAP, its members, and other opponents of the area water authority successfully demonstrated that the boundaries of the authority were dictated by politics instead of science, Henriksen says. “Fortunately, our industry, in concert with the homebuilders, realtors, road contractors, and organized labor organizations located in these counties…[helped] to defeat the referendum,” he says. The proposed area water authority “went down in flames by a 4-to-1 margin.”
Additionally, the IAAP and its group are participating in a Regional Water Supply Planning Group (RWSPG) in hopes “to introduce a more balanced approach to water allocation issues,” Henriksen notes.
The Chicago Metropolitan Agency for Planning (CMAP) is facilitating the work of the RWSPG. This is of particular interest to the aggregates industry because CMAP also will develop water-demand forecasts for the Illinois State Water Survey (ISWS) and work with the RWSPG to “craft a plan that includes implementation strategies,” Henriksen explains. The resulting water-supply plan will be submitted to the state of Illinois for approval. These results will be used to implement statewide water-use planning efforts.
During the next three years, Illinois is expected to define a comprehensive program for state and regional water supply planning, including development of standards for regional plans and guidance for regional planning processes, Henriksen says.
Practices of the provinces
To the north of us, in Canada, water availability and sustainability also has rigorous planning and legal ties associated with it. When an aggregate license (for private land) or aggregate permit (Crown land) is applied for, myriad technical reports must be prepared to accompany the application.
A Hydrogeological Level 1 report must be completed. This report serves as a preliminary evaluation to examine extraction, the established groundwater table, and the potential for adverse affects of groundwater, surface water resources, and their uses. A Hydrogeological Level 2 report must be prepared if the results of the Level 1 report show the potential for adverse effects. An impact assessment is then required to determine the significance of the effect and the feasibility of mitigation.
The technical report must include several items including the following: water wells; spring; groundwater aquifers; surface water courses and bodies; discharge to surface water; proposed water diversion; storage and drainage facilities on site; and water budget, as well as several other items, explains Carol Hochu, president of the Ontario Stone, Sand & Gravel Association.
“Proper management of ground and surface water is critical to ensuring extraction commences and continues,” Hochu says. “Additionally, the discharge of water from a site requires a permit, and hence a process of examination of impacts. While this primarily affects quarries, it has been used in pits as well.”
Recently, Ontario has led the involvement in the renewal of the Great Lakes Charter Annex, Hochu says. “One of the most salient points in those documents that are now working their way through the Great Lakes bordering states is the transfer of water between watersheds and the utilization and return flow of waters within the Great Lakes Basins,” she points out. “Standards for quantity removal and return flow are indicative of the need to address availability issues.”
The long-term sustainability of the industry depends on the availability of long-term supplies of clean water, water quality, water quantity, and water access. “Competing water users from agriculture, manufacturing, and other water consuming industries will drive the local and regional debates,” points out John S. Hayden, vice president of environmental services with the National Stone, Sand & Gravel Association (NSSGA).
However, it’s important to note that the aggregates industry is a water mover, not a consumer. “We need to separate ourselves in this contentious debate from other industry sectors that deplete groundwater and divert surface water,” Hayden says. This doesn’t mean the aggregates industry has no localized impact in areas where the groundwater table is high, he says. But controlled reintroduction of the pumped water back into the hydrogeologic cycle via groundwater injection wells — or just putting the water back into a surface system — can mitigate the localized impacts felt by neighbors on their supply wells, Hayden adds.
With members spread out across the nation with great diversity and regional differences, balancing the needs of members could prove challenging, especially because there are differing opinions as to whether water should be sent to different areas. To assist in alleviating these challenges, NSSGA in June created a Water Resources Task Force of the Environmental Committee to monitor and track state and regional activities with regard to water use, access, availability, and quality. This group, along with NSSGA’s Government Affairs Division, also will monitor federal legislative proposals dealing with water use.
“I see NSSGA as a clearinghouse of existing information related to water resource issues for our membership,” Hayden says. “We will gather information already created by states such as Michigan and others and use that to develop a clearinghouse of state and regional best management practices, legal dispute resolution initiatives, and workable regulatory schemes.”
Tracking regulatory initiatives is critical now, especially with some legislators suggesting national water policies. New Mexico Gov. Bill Richardson, a Democratic presidential candidate, told the Las Vegas Sun in late October that if he is elected, he plans to bring states together to discuss how the water-rich states could assist states with shortages, such as in the Southwest, according to a report in the Detroit Free Press that sources The Sun’s report.“I want a national water policy,” Richardson told The Sun, according to the newspaper report. “We need a dialogue between states to deal with issues like water conservation, water reuse technology, water delivery, and water production. States like Wisconsin are awash in water.”
These statements caused alarm among environmentalists, according to the report. And, “comments like these are taken very seriously in the Midwest,” MAA’s Newman says.
Henriksen agrees, adding that future challenges will center on whether the government decides to limit water withdrawal of producers and any other water users. “We must be prepared to educate policymakers and the public at large regarding the aggregates industry’s impact on the hydrogeologic regime of our region,” Henriksen points out. “Our…economy and well-being depend on the ready availability of water, a resource we have historically taken for granted…The aggregates industry must be alert for legislative, regulatory, or policy initiatives that impact our access to water as well as to access required by our customers.”
What are your rights?
Different states have different laws as to who may claim rights to water and how it may be done. Water rights in the United States are determined through two divergent systems. Riparian water rights are common in the Eastern United States, and prior appropriation water rights (developed in Colorado and California) are common in the West. Each state has its own variations on these basic principles. Typically, water rights are established by obtaining authorization from an individual state via a water right permit.
Michigan, for example, uses riparian law. Under riparian law, there is entitlement to the water on personal land as long as it is used in a “reasonable” way. (There are not exacting definitions for the term “reasonable,” so this could leave some room for problems. However, what is considered “reasonable” is generally determined if there is a conflict and it goes into a court of law.)
Water rights under a prior appropriation doctrine are “first in time, first in right,” meaning that a more senior water right may operate to the exclusion of junior water rights. A “priority date” is significant for this.
Using a Five-Step Process
Here’s a quick look at the Michigan Aggregates Association’s (MAA) proactive approach to ensure that its access to water is protected, while addressing state and community concerns and being good stewards of water. This five-step process, which is still under final development, has helped to amicably resolve conflicts about water usage and rights.
Step 1: Conflict Resolution — This helps to eliminate emotion. “You won’t have citizens saying, ‘My well went dry, and no one could help me,’” says Mike Newman, MAA executive director. “If you take away the emotion, it no longer becomes an issue.”
Step 2: Registration Program/Database for Large Wells — Wells that produce more than 100,000 gallons a day (those that use the 70 gallons per minute rule) must register with the state. “You have to tell them you have the well, where it is located, and how much water you pump,” Newman says. A database should be put together to show who has the wells and how much water is being used. This step needs to be tied closely to Step 3.
Step 3: Geological Mapping — The Michigan legislature developed a geological map of where the large wells are located and mapped out the aquifers. “This let us know where the water was and how much there was, within reason,” Newman says.
Step 4: Permitting, First Phase — Everyone is grandfathered in. Operations already in the system could not be asked to apply for a permit. However, if any new usage would exceed 2 million gallons per day, the operation would then have to get a permit for the increased water use. “If the operation was going from 5 million to 6 million gallons, no permit would be needed,” Newman says. “But if a quarry has been pumping 5 million gallons and wanted to move to 8 million gallons a day, it would have to get a permit because it would be exceeding an additional 2 million gallons.”
Step 5: Water Regulatory Program — This step addresses adverse resource impact (ARI) through use of an assessment tool still under development. “This is where the rubber starts to hit the road,” Newman says. “This is where we are now, and this is where it’s getting more complicated. The overriding feeling of everyone involved in the debate is the avoidance of ARI. But there is always the argument as to where the lines fall for ARI.”
This ARI assessment tool has been developed, but it has not yet been implemented. It’s in the legislative form (Michigan S.B. 860) but is still being worked out. The tool, once implemented, would allow a person to use a computer to interactive plug in a facility or future facility’s parameters to determine whether there would be an ARI through use of these zones: Zone A: No ARI present. Zone B: Indicates some sensitivity to ARI. More research may need to be conducted, processing may need to be changed, or a different technology may need to be used. A facility should be able to be erected at this location. Zone C: This zone is getting close to having an impact if one has not already occurred. However, at this point, mitigation or restorative action could take place to improve the area so an operation could still be opened at this site. Zone D: A facility should not be built or operated at this location.
“This assessment tool isn’t going to be finished soon — it will take a couple years,” Newman says. “But you need to have a proactive scheme. You need to look at the issues, get in early, and make sure there is a system that works for everyone…and be a player in it.”