EAST LANSING — The latest draft of a proposal to prevent mass water diversions from the Great Lakes Basin contains flaws that could undermine its good intentions, according to water policy experts from the United States and Canada who met here recently to evaluate the agreement.

Experts said they were surprised that the new draft proposal, known as the Annex 2001 Implementing Agreements, drops all mention of water as a public trust resource. The elimination of the public trust declaration is part of a broader ongoing debate over how best to address water privatization and export.

For instance, while the proposal forbids entrepreneurs from shipping tankers of bulk water from Lake Superior to China, it allows them to ship the same amount of water packaged in small bottles to any Wal-Mart store on the planet.

The proposal also drops previous requirements that large-scale water users contribute to Great Lakes cleanup efforts even as federal and local governments in the United States figure out a way to pay for a $20 billion publicly financed Great Lakes restoration program. And it delays investments in industrial water-conservation at the same time that some large companies begin to employ such measures to boost their profitability and global competitiveness.

These and other concerns are dampening support for the latest Annex draft even as it takes on new urgency. A large international company, Nestle Waters, is challenging the only legal tool Great Lakes governors currently have to prevent large-scale water diversions, the federal Water Resources Development Act. Some legal experts predict that Nestle could win its case.

The draft Annex 2001 is supposed to update the 1985 Great Lakes Charter, a regional water-use treaty, and establish a legally defensible water management program by installing more rigorous rules for governing large withdrawals from the Great Lakes ecosystem. Representatives of eight American states and two Canadian provinces have been working on the document for several years and are currently holding hearings on their proposal throughout the Great Lakes Basin.

That public comment period is coming to a close and Great Lakes leaders hope to sign the document as early as this fall. But some observers say it might be better to start the entire process over.

“No agreement might be better than a bad agreement,” said Ralph Pentland, the former director of water planning and management in the Canadian Department of the Environment.

Two Steps Forward, One Step Back?
Mr. Pentland was one of several water policy experts who participated in a July 29 video teleconference on the draft proposal that linked Michigan State University here with Munk University for International Studies in Toronto and locations in Chicago, Buffalo, Madison, and Quebec City.

At the teleconference, scientists and government officials considered the two complementary parts of the Annex: The Great Lakes Basin Water Resources Compact, which includes Minnesota, Wisconsin, Illinois, Indiana, Michigan, Ohio, Pennsylvania, and New York, and The Great Lakes Basin Sustainable Water Resources Agreement, which includes those eight states plus Ontario and Quebec.

The agreements are widely viewed as a hopeful new strategy to defend and sustain the beauty and productivity of the region's globally unique freshwater supply amidst rising pressure from urban sprawl, climate change, international trade law, and other global mega-trends.

Environmental advocates said the latest draft is considerably better than the first version, released in July 2004. They liked the fact that the new draft clearly treats ground and surface water as parts of the same aquatic system and treats global warming as a major threat. And, in contrast to the 2004 version, which established a system to permit large water diversions, the new version proposes a system to prohibit them, albeit with some exceptions.

Those exceptions are now at the center of much debate. One would allow unlimited diversions when the water is traveling in containers of less than 20 liters, which environmentalists fear will trigger a rush of new water bottling operations shipping basin water planet-wide. Environmentalists also said that another exception, which would allow suburbs around Chicago, Milwaukee, and other “straddling counties” that lie both within and outside of the Great Lakes Basin to use Great Lakes water, could undermine the entire agreement. Some policy experts contend that basing withdrawal permits on environmental factors and watershed boundaries, instead of jurisdictional considerations, is a key tactic for defending the lakes in international legal disputes.

“Straddling counties today, straddling states tomorrow,” said Elizabeth May, the executive director of the Sierra Club of Canada.

Who Owns Water?
But what raised the most hackles (at least one observer called it “shocking") was something that was missing from the draft this time: A clear declaration that Great Lakes water is a publicly owned resource.

“The very first sentence in the July 2004 draft stated the Great Lakes basin water resources are precious natural resources shared and held in trust by the Great Lakes states,” said Jodi Habush Sinykin, legal counsel for the Madison-based Midwest Environmental Advocates. “But the 2005 draft uses only the general statement that the parties have an important, continuing, and abiding role in the Great Lakes.”

 “The deletion of this public trust language,” Ms. Sinykin said, “is a significant departure from the intent of the Great Lakes Charter and the Annex and, as a rule, may provide another arrow in the quiver of those interested in challenging the agreement as a violation of international trade law.”

Jon Allan, the director of environmental services for Consumers Energy Company and the only business representative participating as a conference panelist, also raised concerns. Mr. Allan said improving coordination between the draft Annex 2001 and existing regulatory programs could strengthen the agreement and limit bureaucratic burdens for industry.

He is concerned that some of the biggest water-consuming projects would be subject to regional review and approval when, in his view, local jurisdiction makes more sense because withdrawals are most likely to affect the local ecology and economy. Mr. Allan also said the proposal could better recognize the value of using water for economic development and the potential for improving industrial water use practices.

“The document has a very strong theme of use less, less is better,” he said. “But there is really no look at the efficiency issue, and how using more water may be better, but maybe we can use it more wisely and more efficiently. There is a very strong notion just to preclude use of water. From an economic and a social perspective, that is not the right track to take.”

Striving for Sustainability
The Council of Great Lakes Governors will accept public comments on the draft Annex 2001 proposal until August 29, 2005. The individual states and provinces are sponsoring several official public hearings throughout the region, including in Grand Haven, Mich., on August 8, Detroit on August 12; Portage, Ind., on Aug. 15; Cleveland on Aug. 18; and Lansing, Mich. on Aug. 23.

Sam Speck, the director of the Ohio Department of Natural Resources and chair of the working group that drafted the Annex 2001 proposal, hopes the hearings lead to agreement about the need for a modern set of water use principles to protect Great Lakes waters.

“At base, [this agreement] represents an effort by Great Lakes states and provinces to find and commit to a common ethic for sustainable use of the waters of the Great Lakes Basin,” Mr. Speck said. “This is about sustainable use and development of our shared waters. Not setting the resource aside as something that should not be used. We must adopt a process and standards for using the water wisely so it’s available for as much use as possible without undercutting the sustainability of the resource over the long-term.”

Andy Guy, who writes extensively about sustaining the Great Lakes in the global economy, directs the Michigan Land Use Institute’s Great Lakes Project and reports on Smart Growth from the Institute’s Grand Rapids office. Reach him at aguy@mlui.org.