Anita M. Chaudhry

Policies that improve drought resilience have heterogenous effects on agricultural land values. We examine the value of surface water transfers and groundwater resources in a hedonic analysis of agricultural parcels in California. We find that parcels in irrigation districts, that engage in inter-basin surface water transfers, experience increase in value in subsequent years, but the gains are short-lived and unevenly distributed. Value of groundwater stock is higher in parcels outside irrigation districts. We also find that policies to restrict groundwater substitution-based transfers, that aimed to reduce groundwater open-access externalities, have not been a deterrent against transfers in all areas.

We discuss data quality and modeling issues inherent in the use of nationwide property data to value environmental amenities. By example of ZTRAX, a U.S.-wide real estate database, we identify challenges and propose guidance for: (1) the identification of arm’s-length sales, (2) the geo-location of parcels and buildings, (3) temporal linkages between transaction, assessor, and parcel data, (4) the identification of property types, such as single-family homes and vacant lands, and (5) dealing with missing or mismeasured data for standard housing attributes. We review current practice and show that how researchers address these issues can meaningfully influence research findings.

Analytics can support numerous aspects of water industry planning, management, and operations. Given this wide range of touchpoints and applications, it is becoming increasingly imperative that the championship and capability of broad-based analytics needs to be developed and practically integrated to address the current and transitional challenges facing the drinking water industry. Analytics will contribute substantially to future efforts to provide innovative solutions that make the water industry more sustainable and resilient. The purpose of this book is to introduce analytics to practicing water engineers so they can deploy the covered subjects, approaches, and detailed techniques in their daily operations, management, and decision-making processes. Also, undergraduate students as well as early graduate students who are in the water concentrations will be exposed to established analytical techniques, along with many methods that are currently considered to be new or emerging/maturing. This book covers a broad spectrum of water industry analytics topics in an easy-to-follow manner. The overall background and contexts are motivated by (and directly drawn from) actual water utility projects that the authors have worked on numerous recent years. The authors strongly believe that the water industry should embrace and integrate data-driven fundamentals and methods into their daily operations and decision-making process(es) to replace established “rule-of-thumb” and weak heuristic approaches – and an analytics viewpoint, approach, and culture is key to this industry transformation. ISBN: 9781789062373 (paperback) ISBN: 9781789062380 (eBook) ISBN: 9781789062397 (ePub)

Policies that seek to reduce groundwater open-access externalities may be in conflict with the facilitation of water trading during droughts. Using panel data on cropland values, we examine this interaction in the context of groundwater export restrictions. We find that land subject to restrictions experienced a relative decline of 34% ($2,057/acre, roughly half of foregone potential water sales revenue) during the drought immediately following implementation of the policies. During a later, more severe drought, there is no difference in value. Our empirical approach also provides novel estimates of the value of changes in groundwater stock. (JEL Q15, Q18)