A transition from the era of building water projects and developing new supplies to an era of water reallocation is well underway in most of the West. Two decades ago, experts were debating the ability of western water institutions, originally conceived to serve the earliest non-native water diverters-irrigators and mines -- to adapt to the growing demands of cities. By acquiring water formerly used to grow crops, through voluntary market transactions, western cities have demonstrated that water law and policy prove flexible when the economic and political stakes are high enough.Initially fueled by urban growth, water reallocation is now being stimulated by a new array of forces. Throughout the West, water reallocation is beginning to reflect environmental benefits alongside the traditional uses for water in irrigation, cities, and industry. Some reallocations have involved market transfers of water arranged through voluntary negotiations; others have involved involuntary reallocations prompted by court rulings. This article argues that both types of reallocation will continue to be important in managing western water resources, but that each has quite different implications for the distribution of benefits and costs from reallocation
