Business for Water Stewardship
Arizona relies on the Colorado River for more than one third of its water supply. Years of intensive water consumption, drought, and rising temperatures have reduced water supply throughout the lower 100 miles of the river and threaten to exhaust its main reservoirs.
Historically, aquifers have been used to store surplus water and serve as a buffer against shortages in supply delivered from the Colorado River. However, with an average annual rainfall of around 8 inches, Arizona’s aquifers naturally replenish very slowly.
In spring 2020, the Business for Water Stewardship (a program of the Bonneville Environmental Foundation) commissioned Seidman to estimate the economic importance of groundwater for the State’s five Active Management Areas (AMAs), 2010 through 2018, excluding any Native American groundwater usage. These are the Phoenix AMA, the Pinal AMA, the Prescott AMA, the Santa Cruz AMA, and the Tucson AMA.
A modified IMPLAN input-output model for each AMA, based on zip codes, was used to estimate economic importance.
Seidman assessed economic importance by using a counterfactual scenario that estimated the economic activity that would occur absent the availability of groundwater, while assuming no substitution or adaptation for the water source.
Three measures of economic importance were provided. These are the estimated contributions to State Gross Domestic Product (GDP), total employment and total labor income.