The State as a Participant in Water Markets: Appropriate Roles for Congress and the Courts

The Supreme Court has ruled that water is a commodity in commerce the same as coal and oil and gas. It has held further that automatic state ownership of the resource because the water is within a state's boundaries is a legal fiction. This ruling will require substantial readjustment by the states including possible acquisition of water by the states in the water market the same as any private water right holder. If the state becomes the owner of water resources, it may lease those water resources for use within the state and at the same time preserve sufficient control over the resource to continue to function as a viable political entity in the federal system. The proper role of the Supreme Court in evaluating state attempts at ownership of their water resources should be to support the states in this effort and to protect the states from efforts by Congress to preclude such state ownership.