Watershed Governance Structures & Funding Mechanisms

Considerations for a Colorado River Basin Restoration Initiative

September 2012

This document summarizes governance structure information acquired during the analysis of watershed initiative case studies examined for the 2011 Tamarisk Coalition (TC) report Sustainable Funding Options for a Comprehensive Riparian Restoration Initiative in the Colorado River Basin (Tamarisk Coalition 2011), which will be referred to as the TC Sustainable Funding Report throughout this paper. This document’s purposes are 1) to inform a discussion of governance structures that may be appropriate to manage a Colorado River Basin (CRB) Restoration Initiative and, 2) to inform governance structure discussions for Colorado River tributary restoration initiatives, given their respective political climates and potentially viable funding options.

Defining Governance Structure

For the purposes of this document, governance structure is defined as the set of formal and informal rules, hierarchies, and mechanisms established to advance joint objectives by: 1) providing adequate leadership, direction, control, and coordination of individuals and organizations, and 2) establishing new statutes, resources, structures, and protocols where necessary.

Literature review and case study synthesis yielded four major categories of governance structure: Model 1) the inter-organizational network; Model 2) the collaborative organizational form or “second-order organization”; Model 3) market structures; and Model 4) increasing capacity in existing organizations or agencies (Imperial & Koontz 2007). In addition, the role of hierarchical government, or meta-governance, will be discussed (Bell & Quiggin 2008).

Inter-organizational networks and second-order organizations both involve collaborative frameworks but differ in the extent of their formalized structure. Market-based structures can be generally defined as “structured interactions between organized economic agents” and must be carefully crafted to support restoration goals (Schilder 2000:53). An alternative to creating a new governance structure to address large-scale watershed restoration is building capacity within an existing agency or inter-organizational network (Imperial 2004). Finally, meta-governance, defined as “the government of governance” (Bell & Quiggin 2008:713), has been found to play an important role in supporting all forms of watershed-level restoration initiatives.

Case Studies

A number of case studies examined in the TC Sustainable Funding Report provide the basis for this governance structure analysis. Selected case studies were reframed in this document to focus on governance and its interactions with funding structures and, to the extent possible, regional politics (Appendix A). Each case study reexamined is representative of a particular category of governance structure, demonstrates particularly applicable lessons learned, or is situated in close proximity to the CRB. Case studies are listed below, along with the rationale for their selection.

• Multiple federal case studies – These case studies provide excellent examples of increased capacity in existing, hierarchical government as well as the need to create new governance structures to deal with complex, large-scale ecosystems.
• Chesapeake Bay Program (CBP) – One of the oldest watershed restoration efforts in the United States and the CBP has a governance structure that has persisted over time.
• Great Lakes – One of the oldest watershed restoration efforts in the United States and has a US-Canada international component, provides a comparison to the US-Mexico component of the CRB.
• European Union Water Framework Directive – Employs innovative water pricing and comprehensive restoration plan to support watersheds on a continental scale.
• Murray-Darling – Employs a top-down market approach to govern and fund restoration efforts on a large-scale in an arid region of Australia.
• Columbia River Basin – Employs a bottom-up market approach in the United States.
• California Bay-Delta (CALFED) – Has struggled to create an adequate governance structure and provides valuable lessons learned. Additionally its success or failure is particularly important as it shares water users with the Colorado River.
• Platte River –Involves two of the CRB states (Colorado and Wyoming) and is similar to the Upper Colorado River Endangered Fish Recovery Program.

Section 1: Governance Structures provides an overview of the four major categories of governance structure described above. Table 1 pairs each case study with its particular form of governance structure, and provides information on the forms of meta-governance supporting or mandating each initiative.

Section 2: Sustainable Funding and Governance – Characteristics of Success defines sustainable funding and examines the types of funding mechanisms that were successful under each governance structure model.

Contextual factors that influence governance strategies are presented in Section 3: Watershed Case Study Lessons Learned. A list of attributes, or components, associated with successful governance structures was developed from these lessons. Components of Successful Governance Structure can be found at the end of Section 2. To summarize, most successful governance structures have the following components:

• Trust, Funding, and Time
• An Effective Governance Structure
• Adequate Power to Drive Action
• A Recognized Problem (a crisis as a catalyst)
• Appropriate Scope
• Effective Leadership
• Appropriate Participation/Membership
• Properly Aligned Environmental, Economic, and Social Values
• Clear and Specific Goals
• Effective Implementation
• Adequate Regulation
• Adequate Authority
• Adequate Technical Resources
• Adequate Monitoring
• Adaptive Management
• Demonstration Projects
• Adequate Public Education and Relations
• Effective and Agreed Upon Decision Making Protocol(s)

Section 4: Contextual Considerations for the CRB provides an overview ofthe existing conditions in the CRB. Table 2 provides general contextual considerations, paired with Tamarisk Coalition insights and recommendations on the special relevance of these issues to the CRB.

The Tamarisk Coalition’s intent in preparing this document- to identify governance structures that may be appropriate for a CRB Restoration Initiative and for Colorado River tributary restoration initiatives- is embodied in Section 5: Governance Structure Viability in the CRB.

This section breaks out the pros and cons of each governance structure model as it is realized in the case studies. Table 3 then provides a summary of how these models and their challenges and successes inform future possibilities for the CRB.

The findings of this study indicate that overall the case studies with the most functional governance structures, i.e. those which have secured at least partially sustainable funding and have made the most environmental progress on the ground, have several important factors in common:

1) adequate meta-governance role and financial support, and 2) adequate inclusion of stakeholders, including local and private groups. A discussion of these factors constitutes Section 6: General Conclusions and Recommended Next Steps.

All of this information, as well as the cases studies discussed in detail in Appendix A, inform the General Conclusions and Recommended Next Steps section. This section discusses how each of the general governance structures examined might be utilized for the CRB, considering the regional politics and the potential funding mechanisms that have been identified to date. It also outlines several next steps to engage in a more robust discussion of this topic.

General conclusions about each of the four broad governance structure categories are discussed in regards to their: 1) applicability to the CRB, 2) potential for buy-in, and 3) potential funding options. The discussion shows that there are pros and cons to any approach and that a myriad of options exist for combining several or all of them. The CRB is currently operating within a loosely based network structure. To close the current governance gap, the present network could either become more formally structured, or a second-order organization could be created within the existing framework. A market system could also be created within the existing network, a more formalized network, or a second- order organization. However, it is unlikely that a market system would effectively close the governance gap on its own, as none of the case studies examined effectively did so without a more formalized network or partnership (network or second-order organization).

In sum, based on our review of these nine case studies, a future CRB initiative will likely comprise a combination of these four governance structure models. The exact construct of a future CRB initiative should be driven by the type of meta-governance in place and an increased understanding of existing collaboration efforts throughout the CRB.