But they do not, so it is.
Coyote has some thoughts, you need to read the entire article, but here is his plan to solve the problem:
"So here is my five minute plan: We may be a ways away from creating an actual market in water, but in the mean time, the quasi-governmental agencies providing it need to raise the prices (to everyone) up to a level that demand matches supply. More conservation will occur, and marginal commercial, residential, and agricultural development will disappear. If the price goes high enough, someone may even go out and find a new, innovative source of water for the area."
I Can Fix the Water "Shortage" in Five Minutes | Coyote Blog
But this is too simple, and easy, and has none of the graft, and corruption elements so necessary to politicians, so it will never be implemented. Oh, it would work like a charm, but no graft, no politicians.