An evaluation of the 1997 Edwards Aquifer Irrigation Suspension

In early 1997, the Texas Edwards Aquifer Authority implemented a pilot Irri gation Suspension Program with the objectives of increasing springflow and providing relief to municipalities during drought. Irrigators were paid an average of $234 per acre to suspend water use, a price higher than regional land rental rates. Auction theory and program implementation details sugge st that the program implementation partially caused inflated bids. The irri gation Suspension Program is also compared to two alternative programs: (1) subsidizing more efficient irrigation technology and (2) buying land. The irrigation suspension is found to be more cost-effective relative to subsid izing improved irrigation efficiency because it can be put in place only wh en aquifer levels are low. Land purchase is a cheaper alternative if the bi d levels remain at the levels observed.