Lansing — Attorney General Jennifer Granholm today called on state lawmakers to immediately consider new legislative proposals to close legal holes that now allow private companies to divert millions of gallons of fresh water out of the Great Lakes basin. Ms. Granholm noted that Michigan’s weak water policy enabled the Perrier Group, the nation’s largest bottler of spring water, to gain permission this year to divert up to 210 million gallons of water annually from a spring in Mecosta County with minimal review by the state Department of Environmental Quality.

The Attorney General asserted that Perrier is exhibit "A" in the case for new state water policy and said she would work with legislators, the environmental community, and others to craft a comprehensive water policy to protect the Great Lakes and all water resources that feed into the lakes. "As a Great Lakes state, Michigan shares responsibility for more than one - fifth of the world's fresh water. Yet we are only one of only two states in the region without a framework for using this precious resource," said Ms. Granholm. "Our Great Lakes are our greatest natural resource. Michigan must have stronger implementation of a comprehensive policy to protect them."

Ms. Granholm’s call for action came on the same day that the Michigan Land Use Institute released Liquid Gold Rush a comprehensive analysis of the state’s quick permitting of Perrier’s plan to bottle central Michigan spring water and implications for the environment, economy, and quantity of fresh water in the Great Lakes region.

In addition, state Representative Julie Dennis (D-Muskegon) joined the Attorney General, environmental organizations, and other lawmakers at a news conference in the rotunda of the State Capitol in which she outlined three legislative proposals to begin protecting fresh water in Michigan. They include:

1. A resolution urging Great Lakes states and Canadian provinces to conclude negotiations and implement the Annex 2001 agreement. The agreement addresses water issues, including water withdrawals both within and out of the Great Lakes basin. The resolution also emphasizes that primary management of the Great Lakes and associated water resources should rest with states and local governments.
   
   
2. Legislation to prohibit taxpayer-financed subsidies for companies that bottle Great Lakes water.
   
   
3. Legislation to strengthen the state’s water policy to safeguard the quality and quantity of Michigan’s fresh water resources. This would establish new criteria for high capacity groundwater wells that receive permits under the Safe Drinking Water Act. It would require companies to assess the effect of water withdrawals on neighboring communities and their water resources. The factors that would need to be assessed include impact on floodplains, wetlands, aquifers, aquatic species, wildlife, agricultural resources, and environmentally sensitive areas.

"Our efforts today start an ongoing process of protecting Michigan’s fresh water resources," said Rep. Dennis. "We will focus on protecting the water resources of Michigan communities to ensure they have the ability to properly use their own water. Our legislation targets gaps in current water management policy in our state."

"This legislation lays the groundwork for more comprehensive water management policy in our state," added State Representative William O’Neil (D-Allen Park), a primary sponsor of the package. "If we plan to protect this important resource, we need more information about water use and the quality and quantity of the resource."

The lawmakers said they planned to introduce their legislation before the end of the year and to hold public hearings in early 2002.

"Our lack of water management policy makes it impossible for us to assess what is a sustainable water withdrawal by a community or an industry," said Rep. Chris Kolb (D-Ann Arbor), the ranking Democrat on the House Land Use and Environment Committee. "We currently have no procedure to measure the impact of different water usage on our environment or water sources."

In August 2001, the state granted the Perrier Group permission to drill two wells and pump 105 million gallons of water per year from central Michigan. The state also approved pipelines for an expansion to more than 210 million gallons.

Rather than take a conservative approach to the Perrier Group’s unusual proposal, Michigan actually encouraged the company to take the state’s water. The Michigan Economic Development Corporation, a state agency, offered the Perrier Group a taxpayer-financed subsidy package of infrastructure improvements, worker training, and property and education tax abatements worth $9.6 million.

Urgent Policy Action
The Perrier Group and the DEQ assert the water bottling operation is no different from other food and beverage manufacturers that use state water in their products. But, according to Liquid Gold Rush the Institute’s new report, citizens and lawmakers are questioning that in a world where water scarcity is driving entrepreneurs to search for places to privatize and exploit public water resources. The objective of such businesses is not to sell a new brand of beverage but to capitalize on the basic human need for water.

Citizens and lawmakers are also debating whether Perrier has the right to transfer water out of its basin without express authorization from the Michigan Legislature. That issue is now being tested in Mecosta County District Court. The public interest group, Michigan Citizens for Water Conservation, filed a lawsuit in September 2001 that seeks to guard against the privatization of Michigan's water. The organization’s goal is to bring about legislative authorization law for any such water sales, to assure it's allowed only for public interest, only where there is a clear surplus of water, only where there is no impairment, including the cumulative impacts on present and future uses.

"Michigan Citizens for Water Conservation filed the lawsuit to prevent the privatization from occurring, with the goal of moving the legislature toward a law that requires companies like Perrier to obtain a license to withdraw and remove pure water for sale," said James Olson, the group’s Traverse City-based lawyer. "The Mecosta suit seeks to stop the withdrawal and sale of water for private purposes.

Other Issues
In addition to questioning whether the Perrier Group has any authority to transfer pure water out of its rightful basin, Liquid Gold Rush also found that the DEQ's permitting process failed to fully consider the long-term effects of draining water from its basin.

Focused almost exclusively on water quality, Michigan regulations do not fully consider potential damage from high-capacity wells on interconnected rivers and lakes and the Great Lakes themselves. This absence of comprehensive water supply considerations in Michigan already is showing negative effects, with many parts of the state suffering shortages as high-capacity, unregulated suburban, agricultural, and industrial wells stress local aquifers; create new water infrastructure costs; and deprive future farms, businesses, and residential and recreational users of adequate water supplies.

Recommendations
Michigan policy makers need immediately to modernize the state's water policy and laws to reflect new conditions. Based on significant public interest and extensive research, the Michigan Land Use Institute is convinced the Perrier Group's entrance into Michigan is a singular starting point for the Legislature to take a leadership role and more clearly define the state's water policy.

Specifically, the Michigan Land Use Institute urged the Legislature to:

1. Define and restrict commercial water transfers out of local basins.
   
   
2. Hold public hearings to decide how to define and restrict commercial water transfers, as well as whether and how to authorize any exceptions to commercial restrictions and how to respond to humanitarian aid requests.
   
   
3. Design a new water use statute that recognizes clean fresh water as a finite and threatened resource impressed with the public trust.
   
   
4. Expand and strengthen rules for reviewing and permitting new, high-capacity water uses.
   
   
5. Improve water use monitoring by mapping the state's underground water system; keeping detailed, up-to-date records on the physical characteristics of underground aquifers; and requiring large water users to report the amounts of water they withdraw from aquifers.
   
   
6. Establish a Water Resources Trust Fund similar to the existing Natural Resources Trust Fund to enhance research, stewardship, quality, public access, conservation, and restoration of Michigan's waters.

Keith Schneider, the Institute’s program director, is a regular contributor to the New York Times, Detroit Free Press and gristmagazine.com. Reach him at keith@mlui.org.