{"id":48940,"date":"2021-01-29T18:27:15","date_gmt":"2021-01-30T01:27:15","guid":{"rendered":"https:\/\/dh.durangoherald.com\/tj\/some-colorado-water-officials-balk-at-wall-street-buying-rights\/"},"modified":"2021-01-30T01:27:15","modified_gmt":"2021-01-30T01:27:15","slug":"some-colorado-water-officials-balk-at-wall-street-buying-rights","status":"publish","type":"post","link":"https:\/\/dh.durangoherald.com\/tj\/some-colorado-water-officials-balk-at-wall-street-buying-rights\/","title":{"rendered":"Some Colorado water officials balk at Wall Street buying rights"},"content":{"rendered":"\n

\"Drought
Drought is exacerbating issues over water rights on the Colorado River and its tributaries.<\/span>Durango Herald file<\/span><\/figcaption><\/figure>\n<\/p>

The prospect of Wall Street buying water rights in Colorado has seemingly brought the water community on the Front Range and Western Slope together \u2013 a rare occurrence between two sides of the state often at odds over water use.<\/p>\n

In recent weeks, much attention has been focused on an issue not new to officials in the water world: private interests or hedge funds purchasing water rights from agricultural communities and diverting that water to cities.<\/p>\n

An open letter from almost 10 water officials from across the state, including the local Southwestern Water Conservation District, lashes out against the practice, saying, \u201cwaters that originate in our great state are the property of the public.\u201d<\/p>\n

\u201cThe people of Colorado have the right to appropriate and use that water for beneficial uses, such as municipal, irrigation, industrial and recreation,\u201d the letter, sent Thursday, says.<\/p>\n

The open letter is largely in response to a Jan. 3 article in The New York Times called \u201cWall Street Eyes Billions in the Colorado\u2019s Water,\u201d<\/a> which says private investors may become more of a force in the political water world.<\/p>\n

The article cites several examples of private investors purchasing water rights from ranches, and then diverting it to cities to feed new developments or subdivisions in drought-strapped places.<\/p>\n

Several private equity owners argue the practice could be one of the solutions to curb the impacts of climate change that has resulted in drought and less available water throughout the West.<\/p>\n

In one stance, Greenstone, a private investment firm, bought most of the water rights in Cibola, Arizona, and then sold the rights to a suburb of Phoenix known as Queen Creek, 175 miles away.<\/p>\n

\u201cOne of the things I think we\u2019ve learned over time is that a resource like water is best allocated through kind of a combination of market forces and regulatory oversight,\u201d Grady Gammage, a spokesman for Greenstone, said in the article.<\/p>\n

\u201cThe market would say,\u201d Gammage went on, \u201cwater is far more valuable serving urban populations.\u201d<\/p>\n

The Colorado water officials\u2019 letter says this is not the first time venture capital firms have eyed the state\u2019s water resources.<\/p>\n

\u201cThis time around, however, the investors and their representatives are posturing to portray themselves as the only solution to a climate-change driven reduction in the flows of our rivers,\u201d the letter says.<\/p>\n

Indeed, demand for water is growing on the Colorado River, which supports about 40 million people and 5.5 million acres of agricultural land in seven states. And increasingly, prolonged drought is resulting in less of it being available to users.<\/p>\n

Colorado water managers in the letter argue efforts are already concentrated on responding to the issue, and should be led by the state and local officials, not private for-profit businesses.<\/p>\n

Namely, the letter cites the \u201cDemand Management\u201d program to temporarily compensate water users in Colorado and other Upper Basin states to reduce their use of water to be able to meet obligations under the Colorado River Compact.<\/p>\n

\u201cThe introduction of private investors in our statewide water planning efforts will only serve to further exacerbate the water divisions that exist between our urban areas and our irrigated agricultural communities,\u201d the letter says.<\/p>\n

The practice has been more common in urban areas along the Front Range or near Phoenix, and the issue hasn\u2019t reared its head quite yet in Southwest Colorado, according to several water officials interviewed for this story.<\/p>\n

Robert Genualdi, Colorado Division of Water Resources Division 7 engineer, which covers Durango, said there are several key distinctions why the hedge funds of Wall Street haven\u2019t set their sights on local waterways.<\/p>\n

For one, in most places along the Front Range where it is happening, the waterways are over-appropriated and there is not enough water to go around to serve new developments or subdivisions.<\/p>\n

As a result, entities looking for water for urban areas seek out farm and ranch owners who may be interested in selling their rights. Then, the developers use that water for their projects and let the farms go fallow, known as \u201cbuy and dry.\u201d<\/p>\n

On the other hand, most waterways in the region, like the Animas River, are not over-allocated, meaning water rights can still be bought, Genualdi said.<\/p>\n

\u201cIn our corner of the state, it\u2019s probably not as prevalent as it might be in other parts of the state because of the water availability down here,\u201d he said.<\/p>\n

Also, Genualdi pointed out that much of the water is stored in Bureau of Reclamation projects \u2013 like Vallecito, Lake Nighthorse and McPhee reservoirs \u2013 which bring some level of federal protections against the practice.<\/p>\n

\u201cThose projects were built for specific things, so it\u2019s more of a task to get water use changed,\u201d he said. \u201cYou\u2019d have to go to Congress for a change.\u201d<\/p>\n

While not currently an issue in Southwest Colorado, efforts should be made to prepare for private interests in water, said Amy Huff, a water attorney recently appointed to the Southwestern Water Conservation Board.<\/p>\n

\u201cI think it\u2019s a possibility it could happen in the next few years,\u201d she said. \u201cBut I don\u2019t think right away. We\u2019re not a low hanging fruit for someone.\u201d<\/p>\n

Where water officials see the biggest issue of hedge funds buying up rights is within ditch companies where individual water-right holders have the ability to sell off their rights to private interests, Huff said.<\/p>\n

That structure, Huff said, is not the case for most of water distribution in Southwest Colorado, though she did mention one Mancos ditch company that is seeking better protections against the practice.<\/p>\n

A call to Dan James with the Animas Consolidated Ditch Company was not returned.<\/p>\n

Mike Preston, former manager for the Dolores Water Conservancy District, said several water districts in the region have set up restrictions for people to sell off to private companies.<\/p>\n

\u201cThey\u2019ve done what they can to protect themselves,\u201d he said. \u201cThat water is all tied up to the land.\u201d<\/p>\n

Ed Tolen, general manager of the La Plata Archuleta Water District, said his water right holders shouldn\u2019t have to worry because it\u2019s all domestic water use, not for irrigation.<\/p>\n

But still, he said there is concern among the agricultural community that some ranchers and farmers may have to send their water to lower basin states to meet water compacts.<\/p>\n

\u201cPeople are thinking if they buy land with water rights, they could sell that water to help meet that compact requirement,\u201d Tolen said. \u201cI think it\u2019s something we need to prepare for.\u201d<\/p>\n

Indeed, the Colorado state Legislature formed a study group to take on the issue and provide a report and recommendations by August.<\/p>\n

\u201cOne thing is clear. There is no place for private for-profit interests in this process,\u201d the open letter said. \u201cColorado state government has a long history of opposing interstate marketing and transfers of water by private interests, and that opposition should continue.\u201d<\/p>\n

jromeo@durangoherald.com<\/a><\/em><\/p>\n","protected":false},"excerpt":{"rendered":"

of state may be more shielded from issue, for now<\/p>\n","protected":false},"author":1,"featured_media":48941,"comment_status":"open","ping_status":"open","sticky":false,"template":"","format":"standard","meta":{"_acf_changed":false,"footnotes":""},"categories":[],"tags":[281,304,1462,28,280,1263,1394,295],"naviga_topic":[],"class_list":["post-48940","post","type-post","status-publish","format-standard","has-post-thumbnail","hentry","tag-agriculture","tag-animas-river","tag-colorado-river","tag-headlines","tag-mcphee-reservoir","tag-ranching","tag-vallecito-reservoir","tag-water"],"acf":[],"author_name":"dh_admin","_links":{"self":[{"href":"https:\/\/dh.durangoherald.com\/tj\/wp-json\/wp\/v2\/posts\/48940","targetHints":{"allow":["GET"]}}],"collection":[{"href":"https:\/\/dh.durangoherald.com\/tj\/wp-json\/wp\/v2\/posts"}],"about":[{"href":"https:\/\/dh.durangoherald.com\/tj\/wp-json\/wp\/v2\/types\/post"}],"author":[{"embeddable":true,"href":"https:\/\/dh.durangoherald.com\/tj\/wp-json\/wp\/v2\/users\/1"}],"replies":[{"embeddable":true,"href":"https:\/\/dh.durangoherald.com\/tj\/wp-json\/wp\/v2\/comments?post=48940"}],"version-history":[{"count":0,"href":"https:\/\/dh.durangoherald.com\/tj\/wp-json\/wp\/v2\/posts\/48940\/revisions"}],"wp:featuredmedia":[{"embeddable":true,"href":"https:\/\/dh.durangoherald.com\/tj\/wp-json\/wp\/v2\/media\/48941"}],"wp:attachment":[{"href":"https:\/\/dh.durangoherald.com\/tj\/wp-json\/wp\/v2\/media?parent=48940"}],"wp:term":[{"taxonomy":"category","embeddable":true,"href":"https:\/\/dh.durangoherald.com\/tj\/wp-json\/wp\/v2\/categories?post=48940"},{"taxonomy":"post_tag","embeddable":true,"href":"https:\/\/dh.durangoherald.com\/tj\/wp-json\/wp\/v2\/tags?post=48940"},{"taxonomy":"naviga_topic","embeddable":true,"href":"https:\/\/dh.durangoherald.com\/tj\/wp-json\/wp\/v2\/naviga_topic?post=48940"}],"curies":[{"name":"wp","href":"https:\/\/api.w.org\/{rel}","templated":true}]}}