The Formative Political Economy of the Central Arizona Groundwater Replenishment District

The Central Arizona Groundwater Replenishment District (CAGRD) exists to facilitate compliance with the Assured Water Supply rules by replenishing excess groundwater pumped by its members. Created to largely benefit the real estate development community, the Arizona law does not require groundwater replenishment to take place within the area of hydrologic impact. The significant growth of CAGRD's replenishment obligation in recent years has caused policy makers to question the sustainability of pumping in one location and replenishing in another. Utilizing a Nash model of cooperative negotiation with bargaining power, this research analyzes the political economy behind the creation of the District and the implications for Arizona's water future.

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