I. Introduction

Graphic 1
Graphic 1: The Great Lakes Region

Where water has flowed, so has the course of human history. Societies have flourished or foundered based on the availability of water for agriculture, the production of goods, trade routes, and military might. No less today than in centuries past, secure water rights are essential to our individual and collective well-being.

Michigan is most blessed by an unparalleled abundance of rivers, lakes, and streams. With more than 3,288 miles of shoreline,[8] the state is bordered by lakes containing nearly 20 percent of the Earth’s surface fresh-water supply. Spread evenly across the contiguous 48 states, the Great Lakes waters would measure 9.5 feet deep.[9]

Michigan is most blessed by an unparalleled abundance of rivers, lakes, and streams.

Despite these water riches, the Granholm administration claims that a crisis looms unless longstanding water rights are abolished and replaced with regulations requiring, in part, a government permit to use water, a five-year water-management plan, and documentation that water use is justified.  Such requirements also are necessary, the governor claims, to bring Michigan into compliance with the so-called Annex 2001, a voluntary code under consideration by the eight states and two Canadian provinces that cooperatively exercise jurisdiction over the Great Lakes.

This report examines the veracity of such claims, including Gov. Jennifer Granholm’s repeated assertions that Michigan lags other Great Lakes states in protecting groundwater supplies and lacks the means to prevent large-scale diversions that supposedly could turn the Great Lakes into mere puddles.

In the pages that follow we review data on groundwater supplies, current Michigan law with respect to water use, and the extent of regulation in other Great Lakes states. These sections are followed by an examination of the governor’s proposed legislation, and the likely consequences of replacing existing water rights with unnecessarily stringent government controls.

The stakes are high in this latest debate over water regulation. Agriculture and manufacturing, staples of Michigan’s economy, rely on ready access to water. Enactment of the proposed Water Legacy Act and provisions of Annex 2001 would create a costly and intrusive regulatory regime that would undermine the state’s economy and override centuries of property rights secured under common law.

The governor’s focus on regulating groundwater is also misplaced. The vast majority of water withdrawals — 90 percent — are taken directly from the lakes. Only 10 percent is drawn from tributary streams and groundwater sources.[10]

Disputes over water use in the Great Lakes Basin are hardly new; they date back more than a century. In 1889, for example, the Illinois Legislature approved construction of a 28-mile canal to replace the puny Chicago River to transport the city’s growing loads of sewage to the Mississippi. The canal was engineered to draw water from Lake Michigan with which to wash the diluted waste westward (in effect, creating the world’s only backward-flowing river). Subsequently, the federal government sued the Sanitary District of Chicago to limit the diversion, which was said to have lowered water levels across the Great Lakes basin and thus interfered with navigation. The U.S. Supreme Court, in a 1925 opinion penned by Justice Oliver Wendell Holmes, ordered limits on the diversion that remain in effect today.[11]

A lawsuit over water withdrawals also plays a role in the current debate over passage of the Water Legacy Act. In promoting the proposed regulations, the Granholm administration has repeatedly cited the case of Nestlé Waters, whose state permit to pump spring water for its Ice Mountain brand is under challenge by a citizens group in Mecosta County. On Nov. 25, 2003, Mecosta County Circuit Court Judge Lawrence Root, defying basic provisions of Michigan water law, ordered the plant to cease all withdrawals. But the shutdown order has been blocked by the Michigan Court of Appeals pending an appeal by Nestlé.

The company is permitted to continue pumping, but at a reduced rate of 250 gallons per minute rather than the rate of 400 gallons per minute originally authorized under its permit. Recent monitoring of the area by state officials documented water levels at an “all time high.”[12] Meanwhile, the northern Michigan town of Evart initiated negotiations and reached agreement with Nestlé to supply the bottling operation with additional water from its municipal system.

Should Judge Root’s reasoning in this case be allowed to stand, groundwater use across the state would be open to legal challenge.

The Michigan Department of Environmental Quality issued the permit to Nestlé after intensively studying the aquifer and surrounding environs from which the company proposed to draw water. The operation met or exceeded all legal requirements, including the federal Safe Drinking Water Act. As stated in the DEQ’s summary of the case:

The Drinking Water and Radiological Protection Division (DWRPD) review included an independent analysis of aquifer test data, a determination of aquifer hydraulic characteristics, and an estimate of the impact the proposed ground water withdrawal would have on area aquifer levels. The DWRPD is confident the aquifer at the Sanctuary site can sustain the ground water withdrawal desired by [Nestlé]. The projected decline in ground water levels is so minimal there is no reason to believe there will be an adverse impact to adjacent users of the ground water resource in the vicinity of the Sanctuary well site.[13]

Although critics protest Nestlé’s “export” of water, the Great Lakes basin actually imports more bottled water than it exports — 37 million gallons imported compared to 2.6 million gallons exported.[14] In its latest report on the Great Lakes, the International Joint Commission concluded: “[B]ottled water appears to have no effect on water levels in the Great Lakes Basin.[15]

The opposition to the Nestlé permit exposes the dangers of the proposed Water Legacy Act. In spite of the scientific evidence and the law, Gov. Granholm and some activists regard the Ice Mountain operation as ideologically unsound. The proposed legislation would allow such political calculations to override science and common law in water-use management. But such unchecked regulatory power would violate fundamental principles of due process and equal protection.

This is evident in the sweeping language of the proposed legislation. For example, Senate Bill 7 grants the DEQ the discretion to reject a groundwater permit if regulators deem an applicant’s “five-year water management and conservation plan” or its “water management practices” as not ”beneficial.” A permit could also be denied if regulators decide that there are better means to obtain water than the applicant proposes.  Moreover, regulators would be allowed to dictate “any other conditions, limitations, and restrictions that the Department determines are necessary to protect the environment and the public health, safety, and welfare and to ensure the conservation and proper management of the waters of the state.”[16]

Simply put, the Water Legacy Act would grant the DEQ broad power to dictate the terms of water use. Insofar as water is a valuable resource, such a shift in control would amount to a massive transfer of wealth from private property owners to the government.

As it is, numerous federal and state statutes, as well as treaties with Canada, already govern groundwater and the Great Lakes.

Were Michigan to actually face a water shortage, a case for legislative action could be made. That is not the reality today, nor is it likely to be in the future given science-based forecasts. In fact, the U.S. Geological Service is forecasting a decline of 2 to 3 percent in the consumptive use of water withdrawn from within the U.S. boundaries of the Great Lakes by 2020.[17]

Far more threatening to the state today is the parched business climate that has been induced, in part, by onerous regulation. Gov. Granholm can’t credibly call for improving the state’s economy while at the same time imposing more of the same type of regulation that has chased business investment beyond Michigan’s borders.