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The Water Desk is now accepting applications for grants to support coverage of Western water issues and the Colorado River Basin.
We are offering two grantmaking programs:
1) Standard grants of up to $10,000. The standard grants support in-depth reporting efforts that lead to the publication or broadcast of content. The deadline for applications for the 2020 standard grants is August 17. We anticipate announcing recipients of the standard grants in mid-September.
2) Micro-grants of up to $2,000. These are meant to pay for discrete expenses that are necessary to produce content or advance a journalist’s professional development. Applications for micro-grants will be reviewed on a rolling basis. We plan to make decisions on micro-grant applications within one month of their submission.
The geographic scope of our grantmaking includes Arizona, California, Colorado, Nevada, New Mexico, Utah, Wyoming and the borderlands of Northwest Mexico.
We welcome proposals from journalists and outlets representing a wide range of media: newspapers, magazines, websites, video, television, radio, podcasts and other channels.
Because water is intertwined with so many issues, we are open to proposals covering a broad spectrum of topics, including climate change, biodiversity, pollution, public health, environmental justice, food, agriculture, drinking water, economics, recreation and more.
Questions? Please feel free to contact Susan Moran, a consultant to The Water Desk, at susan.moran@colorado.edu.
The bathtub ring in Lake Powell in October 2014, which illustrates how reservoir levels have dropped since 2000. A state official says she sees no reason Colorado shouldn’t move forward with an investigation of a program that would send water to Lake Powell. Photo by Brent Gardner-Smith/Aspen Journalism.
After a year of meetings, workshops and in-depth discussions, state officials feel a feasibility investigation into a program that would pay water users to reduce consumption and add to a savings account in Lake Powell should continue.
Although no formal decision has yet been made on whether to implement a voluntary, temporary and compensated water-use reduction plan known as demand management, Amy Ostdiek, Colorado Water Conservation Board deputy section chief for interstate, federal and water information, told the state agency’s board of directors on Wednesday she has not found a reason to keep from moving forward.
“I didn’t identify any points that would indicate to me that we should stop the feasibility investigation,” said Ostdiek, who has been leading and organizing the process for the state. “From my perspective, we have not identified a reason not to continue the analysis or any hard reason it wouldn’t work.”
At the heart of a potential program is a reduction in water use in an attempt to send up to 500,000 acre-feet downstream to Lake Powell to bolster levels in the giant reservoir and meet 1922 Colorado River Compact obligations.
Under such a program, agricultural water users could get paid to temporarily fallow fields and leave more water in the river, in order to fill a 500,000 acre-foot pool as an insurance policy in case of continued drought or further reduction in average flows.
This field near Carbondale is irrigated with water that eventually flows into the Colorado River. The state has wrapped up the first year of an investigation into a program that could pay irrigators to reduce their consumptive use in order to send water downstream to a savings account in Lake Powell. Photo by Heather Sackett/Aspen Journalism.
Report from workgroups
In June 2019, the CWCB, a state agency responsible for developing and protecting Colorado’s water, named 74 water experts and managers to eight work groups tasked with tackling complicated issues and questions around the creation of a demand management program. The groups were divided by topics: law and policy; monitoring and verification; water-rights administration and accounting; environmental considerations; economic considerations and local government; funding; education and outreach; and agricultural impacts.
A ninth group, headed by former Colorado lawmaker and chair of the Interbasin Compact Committee Russell George, has been focusing on how to ensure a demand management program is equitable among water users and basins. The IBCC facilitates conversations among representatives of different river basins and addresses statewide water issues.
Each group met multiple times over the past year and their findings, as well as their lingering questions, were included in a 200-page demand management update report presented Wednesday to CWCB directors.
The sprawling report summarizes the work completed by the groups and their overlapping key values, concerns and uncertainties. The sustainability of agriculture and agricultural communities ranked highest in the values category, while program design and participation ranked highest in the uncertainties category.
Several board members offered their opinions on a potential demand management program. Steve Anderson, who represents the Gunnison-Uncompahgre River basin, questioned whether the state could create water savings by funding more projects outlined in the Basin Implementation Plans instead of crafting a demand management program. The BIPs identify how each basin’s water needs will be met through existing or new projects, policies and processes.
“Once we become more efficient I think we would generate more system water for the Colorado,” he said. “At the end of the day we are going to have a choice between buying an insurance plan or using those funds elsewhere for conservation and efficiency.”
It is unclear how much a demand management program would cost the state, but one of the work groups is dedicated to the funding question.
The main goal of a demand management program would be to defend against what’s known as a “compact call,” which could happen if the upper basin states — Colorado, Utah, Wyoming and New Mexico — were not able to deliver the 75 million acre-feet of water over 10 years to the lower basin states, as required by the Colorado River Compact. Colorado water managers desperately want to avoid this scenario, which looms larger each year with the increasing effects of drought and climate change on an over-allocated river, because it could trigger mandatory cutbacks for water users.
CWCB board member Greg Felt, who represents the Arkansas River basin, struck a dark tone, saying moving forward with a demand management program is necessary because one of the potential alternatives — involuntary cutbacks, also known as “curtailment” under a compact call — will be impossible to enforce.
“I frankly think that people are not going to accept curtailments on any rights the way they have historically,” Felt said. “From what I’ve watched this year in rural Colorado, people aren’t going to be buying curtailment. The water is going to come out of the stream. You can’t have enough water commissioners to stop that.”
Water from the Government Highline Canal pours into Highline Lake in Mack. If irrigators in Grand Valley need more water than what was supplied upstream, the Grand Valley Water Users Association – the group that regulates water flow in the canal – can close the gate to the lake to back up water as a last resort. Photo by Bethany Blitz/Aspen Journalism.
Funding for next steps restored
With the first year of a feasibility investigation complete, the ultimate decision on whether to move forward with a demand management program lies with CWCB board members. The board plans to discuss the work presented by the work groups at a one-day workshop in September.
CWCB staff also are planning a virtual regional workshop for the public to learn more about the first year’s findings. Both meetings will be open to the public.
For several weeks there was uncertainty surrounding the future funding of the demand management feasibility investigation, when on May 1, Gov. Jared Polis suspended the program’s funding due to the COVID-19-caused state budget crisis. But the funding was restored in this year’s projects bill, according to CWCB Deputy Director Lauren Ris.
The agency now has until the end of June 2021 to spend the remaining $834,000 of the original $1.7 million allocation, should the board decide to continue delving into the issue for another year.
CWCB Director Rebecca Mitchell urged the board to be leaders for Colorado on the issue of demand management.
“We want to do whatever we can to avoid a curtailment situation,” Mitchell said. “Everyone is looking to see what we do and how we handle this, and we do have a very unique opportunity at a very critical time to lead strongly on this.”
Aspen Journalism is a local, nonprofit, investigative news organization covering water and rivers in collaboration with The Aspen Times and other Swift Communications newspapers. This story ran in the July 18 edition of The Aspen Timesand the July 19 edition of Aspen Journalism.
Out of sight and out of mind to most people, the Salton Sea in California’s far southeast corner has challenged policymakers and local agencies alike to save the desert lake from becoming a fetid, hyper-saline water body inhospitable to wildlife and surrounded by clouds of choking dust.
The sea’s problems stretch beyond its boundaries in Imperial and Riverside counties and threaten to undermine multistate management of the Colorado River. A 2019 Drought Contingency Plan for the Lower Colorado River Basin was briefly stalled when the Imperial Irrigation District, holding the river’s largest water allocation, balked at participating in the plan because, the district said, it ignored the problems of the Salton Sea.
“The Salton Sea has to be acknowledged for what it is — a serious public health and environmental crisis that can and will have long-term, devastating consequences across the region,” said Norma Galindo, president of the irrigation district’s board of directors. “It is an indispensable part of the Colorado River system, not an invisible one. Its decline simply must be addressed.”
The Salton Sea “is an indispensable part of the Colorado River system, not an invisible one. Its decline simply must be addressed.” ~ Norma Galindo, Imperial Irrigation District board president
The state of California, long derided for its failure to act in the past, says it is now moving full-bore to address the sea’s problems, with ambitious plans for wildlife habitat expansion and dust suppression.
“We are moving as fast as we can and are fully committed to doing the really good things that we need to be doing at the Salton Sea to address the real issues down there,” said Arturo Delgado, assistant secretary for Salton Sea policy at the California Natural Resources Agency.
Agencies with a stake in the Salton Sea are racing to cope with twin problems: suppressing dust from the sea’s receding shoreline to protect the small communities that ring the lake while enhancing areas that are essential to fish and birds. In a state where more than 90 percent of historic wetlands have been lost, the Salton Sea is a vital stop for birds along the migratory route of the Pacific Flyway. All told, more than 400 bird species make regular use of the Salton Sea.
A question of urgency
As California’s largest lake, the Salton Sea is unique. More than 230 feet below sea level, it has no natural outlet and is twice as salty as ocean water. For about 20 years, the sea’s water level has steadily declined, further concentrating the salinity.
Rising salinity levels have had a detrimental impact on wildlife at the Salton Sea. (Source: California Department of Water Resources)
Protecting and restoring the sea’s ecological values has been a longtime aspiration, but progress has been achingly slow. State plans, some of them ambitious in scope, have come and gone while the sea deteriorates.
“There is no sense of urgency,” said Frank Ruiz, Salton Sea program director with Audubon California. “The Salton Sea has never been a priority for the state or any other entity outside the area.”
Gov. Gavin Newsom’s administration has pledged to make progress. Getting there includes the laborious tasks of siting, designing and building dust suppression and habitat projects and convincing skeptical locals that inroads will be made where other efforts have fallen short. The state has set the lofty goal of creating 30,000 acres of habitat and dust suppression by 2028.
Delgado said he and his colleagues are up to the challenge.
“When I came in eight months ago, we took stock of our current situation and started developing a realistic timeline based on when we could possibly complete this work,” he said. “It’s a very aggressive timeline but it’s doable.”
Frank Ruiz, Salton Sea program director for Audubon California, has decried the pace of work at the Salton Sea. (Source: Audubon California)
The action plan includes working with local partners such as the Imperial Irrigation District, which has long chafed at the pace of progress at the sea. Earlier this year, the state and Imperial Irrigation District completed the Bruchard Road Dust Suppression Project on about 125 acres of exposed playa at the sea’s southern edge.
Imperial Irrigation District opposed participating in a Colorado River Lower Basin Drought Contingency Plan last year because it did not adequately address the sea’s plight. The federal government’s lack of financial commitment to the sea “has been the single biggest impediment to a Lower Basin Drought Contingency Plan that could do what Imperial and all other Colorado River contractors need it to do, which is reduce the risk of reaching critical elevations at Lake Mead,” said Galindo, the district’s board president. Earlier this month, in its legal challenge to the Drought Contingency Plan, the district reaffirmed its view that the drought plan should be suspended until the sea’s environmental needs are assessed.
Making something bad better
Deep furrows are carved into the playa to help suppress blowing dust along the receding shoreline of the Salton Sea. (Source: Imperial Irrigation District)
Imperial Irrigation District signed on to a landmark 2003 water transfer between the district and San Diego, known as the Quantification Settlement Agreement (QSA), to help California reduce its overuse of Colorado River water. One effect of that was a significant curtailment of the Salton Sea’s inflow from farm irrigation. As part of the agreement, the state committed to pursuing a restoration plan for the sea while the district contributed mitigation water through 2017. However, a long-term, comprehensive Salton Sea management program has never fully emerged, due in part to the expense.
The transition from the Gov. Jerry Brown administration to the Newsom administration in 2019 brought renewed focus to the sea. However, tangible results remain elusive, said Tina Shields, Imperial’s water manager.
“When you are 15 years behind, you are not just going to wave a magic wand and suddenly have all of these projects completed,” she said.
Identifying and remedying problem areas can be a checkered process, Shields said. Potential projects often face extensive hurdles. “You’d think it would be easy to permit a mitigation project, something that’s going to make something bad better,” Shields said. “But it’s just as complicated as building a Walmart in Temecula because you have to bring in all of those wetlands permits.”
The state’s plan hinges on near-term and long-term actions that improve all elements of the sea, including evaluation of a possible “whole sea” solution that would import ocean water from the Sea of Cortez to stabilize the Salton Sea. Adding water from a source as reliable as the Pacific Ocean would seem to be an obvious solution, but it’s not that easy.
“It’s all about the salt,” said Phil Rosentrater, executive director of the Salton Sea Authority, the joint powers authority of local leaders that works with the state to revitalize the sea. “Water is certainly a critical part of the equation for a more sustainable sea, but salt management is the difference between life and death for the ecosystem.”
“Everybody in the Western Hemisphere needs to care at one level because it’s an integral and critical part of the Pacific Flyway. If we lose the Salton Sea, we lose one of the last wetlands for migrating birds.” ~Celeste Cantú, former executive director, State Water Resources Control Board
Teed up for work this year are plans by the state to launch 3,800 acres of habitat for the fish-eating birds that are most affected by a crashing sea. Rosentrater said his agency is poised to leverage state investments with federal dollars to work on habitat and dust suppression projects.
Air quality is a significant issue. At times the rotten egg smell caused by the sea’s hydrogen sulfide emissions has spurred complaints from people in Simi Valley, 200 miles away.
Dust suppression is paramount. The sea’s inflow from farm runoff has fallen substantially since 2003, accelerating the sea’s retreat, increasing salinity and exposing more shoreline, especially in the shallower areas. What’s left is a chalky playa that stirs into blinding clouds when the wind blows. The dust is laden with toxic elements, posing further harm to local communities, many of them disadvantaged and already struggling with high asthma rates.
The situation does not sit well with Imperial County, which last year declared a local state of emergency at the sea to address the dust suppression issue. Last month, on June 23, the county’s Air Pollution Control District slapped notices of violation on the U.S. Fish and Wildlife Service and the Imperial Irrigation District for failing to address ongoing dust problems at the sea’s southeastern edge.
Projects to address the problems take time and resources and must navigate the regulatory permitting process. Furthermore, because the state is not a major landowner or water rights holder in the region, it must secure easements and needed water, said Delgado, the Resources Agency official.
The imperiled sea
Situated in an ancient lakebed that naturally filled with Colorado River water on occasion through the centuries, the Salton Sea of today came to life in the early 1900s when river water blew through an irrigation ditch. By the time the flow stopped, it filled a basin 45 miles long, 17 miles wide, and 83 feet deep.
In the 1950s and 1960s, it was touted as a Riviera-like destination for sun lovers and water enthusiasts, but that destiny was short-lived. Since then, the Salton Sea has assumed an other-worldly aura with occasional spikes of foul odor and dead fish.
The Salton Sea’s role as one of the few remaining refuges for migratory waterfowl raises its profile substantially.
“Everybody in the Western Hemisphere needs to care at one level because it’s an integral and critical part of the Pacific Flyway,” Celeste Cantú, former executive director of the State Water Resources Control Board, said in an interview. “If we lose the Salton Sea, we lose one of the last wetlands for migrating birds.”
A native of Calexico in the Imperial Valley, Cantú moderated a panel on the state’s response at the October 2019 Salton Sea Summit.
The state has outlined short-term and long-term actions for the sea, targeting habitat creation and more than 8,000 acres of dust suppression projects by the end of 2022.
Shields, with Imperial Irrigation District, sees both sides of the equation – the state’s efforts and the frustration of local residents tired of inaction.
“I think the state’s making progress,” she said. “The problem is for all the effort they are putting into it now; the general public isn’t going to see that progress for two or three years. Until you get the contractors out there, the trucks moving dirt, they [the general public] don’t get the process behind designing and going out to bid and staffing up.”
The big picture
Since the signing of the QSA, the clock has been ticking at the Salton Sea, which will keep demanding the attention of everyone concerned about and responsible for public health and ecological preservation.
Then there is how the sea will be accounted for in the grander vision of Colorado River management. Imperial Irrigation District hopes the sea “will have a much higher profile and receive the attention it needs in relation to the region’s collective management of the Colorado River,” said Galindo, the district’s board president.
Forging a sustainable path for the Salton Sea is “a must-have,” according to Norma Galindo, president of the Imperial Irrigation District’s board of directors. (Source: Imperial Irrigation District)
Forging a sustainable path for the Salton Sea is “a must-have” for Imperial, Galindo said. She added that the district’s twin goals of being a good citizen on the Colorado River and seeing a sustainable Salton Sea are compatible and “linked together, hydrologically and morally.”
Rosentrater acknowledged the inertia of the past and the difficulties with finding the right solutions. There was a time when people believed the sea’s problems were insurmountable and not worth the investment of time or resources. That’s changed.
“When you get down to it, doing nothing turns out to be the most costly and reckless of all options,” he said. “That was the conversation of a decade ago, let the thing die and stop trying to prop it up. We have come a long way from there to realizing if we let it go, it’s catastrophic.”
These wetlands, located on a 150-acre parcel in the Homestake Creek valley that Homestake Partners bought in 2018, would be inundated if Whitney Reservoir is constructed. The Forest Service received more than 500 comments, the majority in opposition to, test drilling associated with the project and the reservoir project itself. Photo by Heather Sackett/Aspen Journalism.
By David O. Williams
RED CLIFF — The U.S. Forest Service has been inundated with more than 500 online comments — the vast majority in opposition — to a geophysical study and drilling by the cities of Aurora and Colorado Springs to determine the feasibility of a second reservoir in the Homestake Creek drainage, including objections from nearby towns and a local state senator.
The geophysical study and the drilling are the next step in the lengthy process of developing a reservoir on lower Homestake Creek.
The mayors of Red Cliff and Minturn signed and submitted separate but identical letters questioning the legality of drilling 10 boreholes on Forest Service land near the Holy Cross Wilderness Area, which is six miles southwest of Red Cliff, to see whether soil and bedrock can support a dam for what would be known as Whitney Reservoir. Avon’s attorney has asked for a public comment extension to Aug. 4 so that it can hold a hearing.
“A Whitney Reservoir would irreparably change and harm our community,” Minturn Mayor John Widerman and Red Cliff Mayor Duke Gerber wrote in their letters, submitted June 30. “We are paying close attention to these proposals, other moves by Homestake Partners and the public controversy. This categorical exclusion is rushed, harmful and unlawful.”
Operating together as Homestake Partners, the cities of Aurora and Colorado Springs own water rights dating to the 1950s that, under the 1998 Eagle River Memorandum of Understanding (MOU), give them the basis to pursue developing 20,000 acre-feet of water a year from the Western Slope. They’ve been studying four potential dam sites in the Homestake Valley several miles below the cities’ existing Homestake Reservoir, which holds 43,600 acre-feet of water.
The smallest configuration of Whitney Reservoir, if deemed feasible and ultimately approved, would be 6,850 acre-feet, and the largest would be up to 20,000 acre-feet. The reservoir, on lower Homestake Creek, would pump water up to Homestake Reservoir, about five miles upstream, then through a tunnel under the Continental Divide to Turquoise Reservoir near Leadville.
In 2018, Homestake Partners paid $4.1 million for 150 acres of private land, which it leases back to the former owner for a nominal fee. That land, which would be inundated to accommodate a large portion of Whitney Reservoir’s surface area, is braided with streams and waterfalls and is lush with fens and other wetlands. It’s also home to a cabin once used as an officers quarters for the famed 10th Mountain Division of the U.S. Army. The site is not far from Camp Hale, between Red Cliff and Leadville, where soldiers trained for mountain warfare during World War II.
This cabin, once used by the 10th Mountain Division of the U.S. Army, sits on a 150-acre parcel owned by Homestake Partners. The site of the proposed Whitney Reservoir is near Camp Hale, between Red Cliff and Leadville. Photo by David O. Williams/Aspen Journalism.
Eagle River MOU
The Eagle River MOU is an agreement between Aurora and Colorado Springs and a bevy of Western Slope water interests. The Colorado River Water Conservation District, Eagle River Water & Sanitation District, Upper Eagle Regional Water Authority, and Vail Resorts are collectively defined in the MOU as the Reservoir Company. None of those entities submitted comments to the Forest Service on the drilling proposal. And according to Diane Johnson, communications and public affairs manager for the ERWSD and UERWA, none are helping to pay for the feasibility study and none are involved in the reservoir project, except to the degree that it is tied to the MOU.
The MOU provides for 20,000 acre-feet of average annual yield for the cities. “Yield” refers to a reliable supply of water. In some cases, yield equates to storage in a reservoir, but yield can also be created by other methods, such as pumping water uphill from a smaller, refilled reservoir, which is an option being studied by the cities on lower Homestake Creek. The MOU also provides for 10,000 acre-feet of “firm dry year yield” for the Western Slope entities in the Reservoir Company, and firm dry year yield means a reliable supply even in a very dry year. Those entities have developed about 2,000 acre-feet of that allocated firm yield in Eagle Park Reservoir, and it’s not yet clear whether the Whitney Reservoir project would help them realize any additional yield.
“The short answer is we support (Homestake Partners’) right to pursue an application for their yield,” Johnson said. “We trust the permitting process to bring all impacts and benefits to light for the community to consider and weigh in total.” .
Jim Pokrandt, director of community affairs for the River District, declined to comment on the investigatory test work, saying only, “Yes, we have signed the MOU. That said, … we are not participating in the Whitney Creek effort.”
Besides Homestake Partners and the Reservoir Company, the MOU was signed by the Climax Molybdenum Company. The two private companies signed onto the MOU — Vail Resorts and Freeport-McMoRan (Climax) — also declined to comment on either the drilling study or Whitney Reservoir.
Under the MOU, various parties can pursue projects on their own, and the other parties are bound to support those efforts, but only to the degree that a proposed project meets the objectives of the MOU, including whether a project “minimizes environmental impacts.”
Many of the 520 online comments as of the June 30 deadline objected to testing for the possibility of a dam, expressing concern for the complex wetlands in the area, but most of the comments also strongly condemn the overall project: a potential future Whitney Reservoir.
The cities are trying to keep the focus on the test drilling.
“This is simply a fatal-flaw reservoir siting study that includes subsurface exploration, and it’s basically just to evaluate feasibility of a dam construction on lower Homestake Creek,” said Maria Pastore, Colorado Springs Utilities’ senior project manager for water resource planning. “It’s simple exploratory work to determine if we can even go ahead with permitting and design.”
Marcia Gilles, acting ranger for the Eagle-Holy Cross District, said her office will continue accepting comments at any time during the ongoing analysis of the geophysical study despite the June 30 deadline. She added that if the Forest Service concludes there are no “extraordinary circumstances,” she can render a decision using what is known as a categorical exclusion and then issue a special-use permit as soon as August. A categorical exclusion requires less environmental scrutiny than other forms of analysis.
“At this time, the proposed action appears to be categorically excluded from requiring further analysis and documentation in an environmental assessment (EA) or environmental impact statement (EIS),” Gilles said. “Should the environmental analysis find extraordinary circumstances, the Forest Service would proceed to analyzing the project in an EA or EIS.”
State Sen. Kerry Donovan, a Vail Democrat, disagrees. She wrote to the Forest Service on June 30: “I … strongly urge you not to categorically exclude this project from (National Environmental Policy Act) analysis. I cannot express how sternly the citizens of my district oppose water diversion projects to Front Range communities.” Her district encompasses seven Western Slope counties, including Eagle, where the dam would be located.
Donovan called the proposed investigation — which would require temporary roads, heavy drilling equipment, continuous high-decibel noise, driving through Homestake Creek and use of its water in the drilling process — an affront to the “Keep It Public” movement, which advocates for effective federal management on public lands.
These wetlands in the Homestake Creek valley are near the site of the proposed Whitney Reservoir. The Forest Service is considering whether to issue a permit for drilling and a geotechnical study to test whether the site would support a dam. Photo by Heather Sackett/Aspen Journalism.
Drilling impacts
If approved by the Forest Service for a special-use permit, Homestake Partners would send in crews on foot to collect seismic and other geophysical data later this summer or fall. Crews with heavy equipment would then drill 10 boreholes up to 150 feet deep in three possible dam locations on Forest Service land. The drilling would take place on Forest Service land but not in a wilderness area.
Crews would use a standard pickup truck, a heavy-duty pickup pulling a flatbed trailer, and a semi-truck and trailer that would remain on designated roads and parking areas, with some lane closures of Homestake Road and dispersed campsites possible.
For off-road boring operations, crews would use a rubber-tracked drill rig, a utility vehicle pulling a small trailer, and a track-mounted skid steer. The drill rigs are up to 8 feet wide, 22 feet long and 8 feet high, and can extend up to 30 feet high during drilling, possibly requiring tree removal in some areas. The rigs would also have to cross Homestake Creek and some wetland areas, although crews would use temporary ramps or wood mats to mitigate impacts.
According to a technical report filed by Homestake Partners, the subsurface work is expected to take up to five days per drilling location, or at least 50 days of daytime work only. However, continuous daytime noise from the drilling could approach 100 decibels, which is equivalent to either an outboard motor, garbage truck, jackhammer or jet flyover at 1,000 feet. If work is not done by winter, crews have up to a year to complete the project and could return in 2021.
The drilling process would use several thousand gallons of Homestake Creek water per day that engineers say “would have negligible impacts on streamflow or aquatic habitat. Water pumped from Homestake Creek during drilling would amount to less than 0.01 (cubic feet per second), a small fraction of average flows,” according to a technical report included with application materials.
Homestake Partners would avoid wetlands as much as possible during drilling, but “where temporary wetland or waters disturbance is unavoidable, applicable 404 permitting would be secured from the U.S. Army Corps of Engineers.” Crossing of Homestake Creek would occur in late summer or fall when streamflows are low, and no drilling would occur in wetlands.
While no permanent roads would be built for the drilling, temporary access routes would be necessary and reclaimed as much as possible.
“Access routes would be selected to reduce surface disturbance and vegetation removal, and to avoid identified or potential unexploded ordnances (UXOs) discovered during field surveys,” according to the technical report. The 10th Mountain Division used the area for winter warfare training during WWII.
Another concern cited in the report is the potential impact to Canada lynx. Listed as threatened under the Endangered Species Act, “only Canada lynx has potential habitat in the vicinity of the project area,” according to the report. “No impacts on lynx are anticipated from the proposed work because much of the activity would occur near Homestake Road, a well-traveled recreation access road. Work would be conducted over a short period (approximately five to six weeks) and impacts on potential habitat would be negligible.”
The vast majority of comments from a variety of environmental groups and concerned citizens focused on potential impacts to the area’s renowned wetlands and peat-forming fens, which the project proponents say they will avoid as much as possible. So far, Gilles said she is not aware of any legal challenges to the project.
Two prominent local conservation groups — Eagle Valley Land Trust and Eagle River Watershed Council — submitted comments to the Forest Service expressing serious reservations about both the drilling and the possibility of a dam.
“Geophysical exploration has an obvious significant nexus and direct relation to additional future actions, i.e., dam construction, which may in time massively impact the Eagle River watershed — regardless of whether the future actions are yet ripe for decisions,” ERWC officials wrote.
This map shows the location of test holes Homestake Partners plans to drill as part of its geotechnical investigation into the feasibility of a dam site in the Homestake Creek valley. The Forest Service has received more than 500 comments, most of them in opposition to, the drilling and the overall reservoir project. Photo by courtesy U.S. Forest Service.
Wilderness boundary
Even if the test drilling returns favorable results for a reservoir project, there is another obstacle that Homestake Partners will have to clear if they want to move forward with two iterations of the project: a wilderness-boundary change, which would require an act of Congress and the president’s signature.
The Whitney Reservoir alternatives range from 6,850 to 20,000 acre-feet and in some configurations would require federal legislation, which the cities are working to draft, requesting a boundary adjustment for the nearby Holy Cross Wilderness Area. The largest Whitney proposal would require an 80-acre adjustment, while an alternative location, lower down Homestake Creek, would require a 497-acre adjustment.
White River National Forest Supervisor Scott Fitzwilliams discounts the notion that his agency should reject outright the test-drilling application, as some environmental groups have suggested, until the wilderness-boundary issue is determined. Although some local and state lawmakers have said they are against shifting a wilderness boundary, Fitzwilliams said it’s still too soon for him to take up the wilderness issue.
“These are test holes,” Fitzwilliams said of the drilling, which is intended to see whether the substrata are solid enough for a dam and reservoir. “Going to get a (wilderness) boundary change is not a small deal for them, so why would you do it if you find fatal flaws? That’s a red herring.
“I understand it; nobody wants to see a dam in the Homestake drainage. I get that. But it just seems prudent to do (the drilling) to see if there’s any reason to go further.”
Aspen Journalism is collaborating with the Vail Daily and other Swift Communications newspapers on coverage of water and rivers. This story was published online by the Vail Daily on July 9, 2020 and in its print edition on July 10. The early online version of the story was edited to clarify aspects of the Eagle River MOU.
This story was published by Aspen Journalism on July 10, 2020.
This story was supported by The Water Desk using funding from the Walton Family Foundation.
Forty years after the Holy Cross Wilderness Area was created, an early effort to explore tapping its water supplies has generated more than 500 comments to the U.S. Forest Service.
Aurora and Colorado Springs, which own and operate the only reservoir in the area, Homestake I, hope to demonstrate that they can divert more water and build another reservoir to serve Front Range and West Slope interests without damaging the delicate wetlands and streams in the mountain forests there.
But first, they are asking the Forest Service for a special use permit to survey the area and to bore several test holes to determine soil conditions and areas best suited to build the proposed Whitney Reservoir. The public comment period closed June 30, although the Forest Service said it will continue to accept comments.
If a reservoir were to be built, it would also require that the 122,000-acre-plus wilderness area shrink by 500 acres, an action that will require congressional approval.
Significant opposition to the permit request is already building, with the Holy Cross Wilderness Defense Fund threatening legal action to stop the surveying and drilling of test holes into soils, according to comments submitted to the Forest Service.
Also opposing the process, among others, is Colorado state Sen. Kerry Donovan, who represents several West Slope counties. “Our wilderness areas are afforded the highest levels of protection and to begin action that disturbs them today begins a process of destroying them forever,” she said. [Editor’s note: Donovan is on the Board of Trustees of Water Education Colorado, which sponsors Fresh Water News].
In addition, she wrote, “With drought conditions becoming the new normal…it is imperative we protect high altitude water resources and keep each drop in the basin it was born in.”
The Eagle River is a tributary to the drought-stressed Colorado River, whose flows have already begun a serious decline.
Jerry Mallet is president of Colorado Headwaters, an environmental advocacy group. The fight to stop the proposal, he said, “will be as big as the Two Forks fight was several years ago,” referring to the successful effort to stop Two Forks Reservoir from being built on the South Platte River in 1990.
Aurora and Colorado Springs point to their legal obligations to develop a project that serves multiple interests, and which also protects the environment, while ensuring their citizens have access to water in the future.
“The studies…will provide the factual data necessary to identify and evaluate feasible reservoir alternatives to provide critical water supplies for human and environmental purposes,” said Colorado Springs spokesperson Natalie Eckhart. “We recognize the necessity to partner with other agencies throughout this process and are committed to working collaboratively with other communities and agencies to best manage our shared water resources.”
The proposal comes under a 1998 agreement known as the Eagle River Memorandum of Understanding, which allows the reservoir proponents to develop enough water to serve environmental, municipal and industrial interests. Aurora and Colorado Springs hope to develop 33,000 acre-feet of water, an amount roughly equal to that used annually by 66,000 homes.
Under the proposal, Aurora and Colorado Springs would receive 20,000 acre-feet, West Slope interests would receive 10,000 acre-feet, and 3,000 acre-feet would be set aside for the Climax Molybdenum Company.
Parties to the 1998 agreement include Aurora, Colorado Springs, the Colorado River District, the Eagle River Water and Sanitation District, the Upper Eagle River Water and Sanitation District, as well as Vail Associates.
Diane Johnson, spokesperson for the two Eagle River districts, said the agencies haven’t yet taken a position on the proposal, citing the need for the analysis required for the special use permit as well as any actual construction of a reservoir to be completed.
Located west of Vail between Minturn and Leadville, the Holy Cross Wilderness Area was the subject of a significant battle in the 1980s when Aurora and Colorado Springs sought to build a second major reservoir there known as Homestake II.
After opponents successfully took their case all the way to the U.S. Supreme Court, Homestake II was defeated in 1994.
In exchange, however, the cities were granted permission to develop a smaller amount of water in the future in partnership with Western Slope interests, resulting in the project that is now being proposed to the Forest Service.
To submit your comments or to get more information about the survey and drilling proposal, visit this U.S. Forest Service’s web page.
Jerd Smith is editor of Fresh Water News. She can be reached at 720-398-6474, via email at jerd@wateredco.org or @jerd_smith.
Fresh Water News is an independent, nonpartisan news initiative of Water Education Colorado. WEco is funded by multiple donors. Our editorial policy and donor list can be viewed at wateredco.org
This story originally appeared on Fresh Water News on July 8, 2020.
Colorado water quality regulators’ attempt to fast-track new rules shielding streams left unprotected by changes to the Clean Water Act was abandoned earlier this month after it failed to win support from lawmakers.
The proposed legislation, never formally introduced, sought to give the state limited authority to review major homebuilding and road projects, among others, that could have harmed streams formerly protected under the Clean Water Act.
But the Colorado Department of Public Health and Environment, after consulting with legislative leaders as well as environmental, water and construction interests, said it could not meet the requirements lawmakers asked of any new legislation proposed during the session, which was cut short by the COVID-19 shutdown.
“Legislative leadership said [any proposed laws] needed to be fast, friendly and free,” said John Putnam, environmental programs director at the CDPHE. “We did a lot of engagement but we did not get to that place that it was going to be perfectly friendly,” he said. “We could not get across the line.”
The CDPHE’s effort drew widespread support from environmental groups and the Colorado Department of Transportation, among others, but it triggered concern among some construction and water interests.
“I thought the issue merited more discussion than was going to be possible during this COVID-compromised session,” said John Kolanz, a Loveland attorney who represents developers and who works on Clean Water Act issues.
Northern Water, one of the state’s largest water providers, said it worked with regulators to try to draft an acceptable bill, but there wasn’t enough time to resolve all the questions the effort generated.
“Other states have taken a year or years to do this,” said Peggy Montaño, Northern Water’s general counsel. “We were trying to get this done in weeks. We could see that it wasn’t going to work. But we intend to continue working with them.”
Only a handful of states have ever sought to assume what’s known as 404 dredge and fill authority, and Colorado officials said they were seeking something less ambitious, regulations that would fill a narrow regulatory gap, rather than the much broader, more complex 404 authority.
“It raises a lot of tough issues,” Kolanz said. “It will be interesting to see where this goes next.”
The 1972 Clean Water Act, among other things, defines which streams and waterways are subject to federal regulation, but those definitions have been fiercely contested in the courts for decades, in part because the United States is home to a wide variety of waterways and wetlands.
Major rivers, such as the Mississippi and the Ohio, carry barge and shipping traffic and are clearly “navigable,” the term early courts used to determine how water would be regulated. If a stream was considered navigable, it was subject to federal law.
But Colorado and other Western states rely on shallow streams that don’t carry traditional commercial traffic. Over the years those streams too became protected by the Clean Water Act, with the Obama Administration issuing a controversial expansion of the act.
Though development and environmental interests have said that a “durable” middle ground must be found to better define protected streams, the political tug-of-war has continued under the Trump Administration, with its officials fighting successfully to roll back measures put in place by the Obama Administration.
Now, under the new Waters of the U.S. rule, or WOTUS, as it is known, thousands of miles of streams in Colorado and other Western states will lose protected status June 22 when the new rule takes effect, with no permitting mechanism to ensure damage to unprotected streams caused by construction and road projects is minimized and repaired.
CDPHE officials are hopeful that a legal challenge issued on May 22 by Colorado Attorney General Phil Weiser to at least temporarily stop the federal rule will be successful, which would give the state more time to design and gain support for its own “Waters of the State” rule.
Putnam said regulators plan to make another effort at the State Capitol next year.
“There was a big push and a lot of time and effort put into this,” Putnam said. “But we just didn’t have the time to get it done.”
Jerd Smith is editor of Fresh Water News. She can be reached at 720-398-6474, via email at jerd@wateredco.org or @jerd_smith.
Fresh Water News is an independent, nonpartisan news initiative of Water Education Colorado. WEco is funded by multiple donors. Our editorial policy and donor list can be viewed at wateredco.org
This story originally appeared on Fresh Water News on June 17, 2020.
Twenty-seven water rights on Coal Creek near Redstone, which were associated with the now-defunct Mid-Continent mine, were placed on the 2011 revised abandonment list. By a directive from the state engineer, the state’s oldest water rights are protected from ending up on the 2020 abandonment list, which comes out next month. Photo by Heather Sackett/Aspen Journalism.
For the second time, the state’s top water cop has directed the Western Slope’s oldest and most valuable water rights to be left off the once-a-decade abandonment list. That means hundreds of these mostly irrigation water rights have been granted immunity — even though they are no longer being used — from the threat of “use it or lose it,” further enshrining them in the state’s system of water administration and dealing a blow to the validity of the well-known adage.
Every 10 years, engineers and water commissioners from the Colorado Division of Water Resources review every water right — through diversion records and site visits — to see whether it has been used at some point in the previous decade. If it hasn’t, it could end up on the decennial abandonment list, which is scheduled to come out in July.
But a November 2018 email from state engineer Kevin Rein to all four Western Slope division engineers instructs them to not include pre-compact rights on the abandonment list. That includes all the water rights in the Yampa/White/Green, Colorado, Gunnison and San Juan/Dolores river basins.
“Since the nature of the pre-compact water rights is unique in Colorado when it comes to administration of the Colorado River Compact, and in recognition of the fact that the value of the rights could benefit all water users in Colorado, as opposed to only the owner of the water right, I will ask that you direct your staff to do no further investigation of pre-compact water rights and to not include them in the Division Engineers Proposed Abandonment list for 2020,” the email reads.
A primary job of the state and division engineers is to administer Colorado’s system of prior appropriation, in which the older the water right, the more powerful it is.
Rein said he talked with major water providers and managers along the Front Range and on the Western Slope before making the decision, but he would not say which ones or anything about the nature of those conversations.
Former state engineer Dick Wolfe issued a similar directive regarding the 2010 abandonment list, meaning Colorado’s water rights that date to before June 25, 1929 — when Congress ratified the Colorado River Compact — have enjoyed an extra level of protection from state-led abandonment for two decades.
“We need to allow for the fact that if those water rights are abandoned and taken off the tabulation, then that amount of water is no longer available to Colorado,” Rein said.
But what exactly the value of unused, pre-compact water rights could have to all Colorado water users remains unclear. Post-compact water rights, meaning those after June 25, 1929, are still eligible for the abandonment list.
According to Rein, the decision to include water rights on an abandonment list is administrative one and he has statutory authority to revise the list.
Colorado State Engineer Kevin Rein speaks at an event at Colorado Mesa University in Grand Junction. At Rein’s direction, the oldest water rights on the Western Slope will be left off of the 2020 abandonment list. Photo by Brent Gardner-Smith/Aspen Journalism.
Colorado River Compact
A major fear of Colorado water managers is what’s known as a “compact call.” If the upper basin states — Colorado, Utah, Wyoming and New Mexico — don’t deliver the required 75 million acre-feet of water over 10 years as specified in the Colorado River Compact to the lower basin states — California, Nevada and Arizona — it could lead to a compact call. This scenario, which looms larger each year with the increasing effects of drought and climate change on an over-allocated river, could trigger involuntary cutbacks for Colorado water users.
But water rights that had been perfected before the compact was ratified are exempt from these cutbacks. And now the state is adding unused, pre-compact water rights to this exempt category. In Colorado, many of these oldest water rights belong to Western Slope agriculture.
Like moving a pawn early in a chess match, it is unclear exactly how this directive from Rein could help Colorado in the future. Nobody really knows whether or how a compact call (or negotiations among states to avoid one) might play out. Therefore, no one can say exactly what value these pre-compact water rights have to Colorado.
Water experts and managers throughout the upper and lower basin were reluctant to talk about the issue and gave diplomatic responses to questions about the sensitive political issue of interstate compact compliance.
“I don’t know the answer,” Rein said. “I think there’s general agreement that these water rights may have value in a compact-call scenario. I don’t know because of the complexities of it.”
Some water experts say preserving these pre-compact water rights, even though they aren’t being used, could give Colorado stronger footing in potential negotiations with lower basin states by propping up Colorado’s consumptive-use tally on paper.
“I would say it’s a conservative approach and it might help in your negotiations with other states,” said Doug Kemper, executive director of the Colorado Water Congress. “You would be making the argument that we have this portfolio of water rights, these are still on the books. But again, you’re trying to forecast how a negotiation might proceed, and I think to meaningfully comment on that would be almost impossible right now.”
Preserving these irrigation water rights also means they would be available to transfer to other users in the future, such as Front Range water providers — whose water rights are mostly post-1929 and therefore vulnerable to cutbacks under a compact call — as the state continues to urbanize.
In a prepared statement, Denver Water CEO Jim Lochhead said the water provider, which supplies water to 1.4 million people, “is supportive of the state’s efforts to protect Colorado’s pre-compact rights. This approach will benefit and help provide additional security for Colorado River water users on the West Slope and Front Range.”
Reagan Waskom, director of the Colorado Water Center at Colorado State University, agreed that hanging onto those pre-compact water rights could be in the state’s best interest.
“The idea of holding as many of those pre-compact rights in place makes sense from a purely Colorado-centric point of view,” said Waskom. “We still don’t know what a compact call or curtailment would look like, so we are going to stay as conservative and protective as we can.”
The Colorado River Water Conservation District is in favor of Rein’s directive, according to general counsel Peter Fleming. The Glenwood Springs-based River District works to protect water rights on the Western Slope, which often means advocating for agriculture interests.
But Fleming brings up an interesting point: The value of water rights in Colorado is based on them being used. If these water rights still exist on paper but haven’t been used in a decade — in some cases, two decades — what is their value?
“There’s this notion that pre-compact water rights are sacrosanct and very important, and that’s true if they have continued to be used and historically consumed,” Fleming said. “But you don’t just make water available by saying these rights that haven’t been used for X number of years still exist. So, I guess I would say it’s a risk-avoidance strategy, but it’s an unproven strategy.”
Coal Creek, where 27 water rights associated with the now-defunct Mid-Continent mine were placed on the 2011 revised abandonment list, flows into the Crystal River at Redstone. The state engineer has directed that all Western Slope, pre-Colorado River Compact rights are safe from state-led abandonment in 2020. Photo by Heather Sackett/Aspen Journalism.
Abandonment
Rein’s directive also helps debunk the adage “use it or lose it.” While the pre-compact rights are not being used, they also are no longer in danger of being lost. The threat of the state taking away a water right has now disappeared for Western Slope pre-compact irrigation rights.
The often-misunderstood tenet “use it or lose it” is embodied by the abandonment process.
Some water users believe that if they don’t divert the full amount they are entitled to — even if they don’t always need that much — the state will take it away and it will be available to another water user. But the concept is much more nuanced than that.
Colorado water law says abandonment is “the termination of a water right in whole or in part as a result of the intent of the owner thereof to discontinue permanently the use of all or a part of the water available.”
Just not using the water will not lead to abandonment; there must be an intent to abandon the right.
For a water user to keep their water right, they must put the water to “beneficial use,” which in the case of irrigation water means growing crops. If the water has not been used for 10 years — meaning there are no diversion records and the local water commissioner does not see evidence of water use on their site visits — division engineers could presume that the water right has been abandoned. They put it on the state’s initial abandonment list, which is updated every 10 years and published in local newspapers.
Water-right holders then have one year to file an objection to their listing in writing with the division engineer.
“We don’t like close calls, so if they diverted the water 11 years ago, we are going think, ‘Eh, I don’t know,’ because we are talking about somebody’s property right,” said Alan Martellaro, Division Engineer for Water Division 5.
After working through the objections with water-right holders, the division engineer publishes the revised abandonment list. If a water-right holder still protests their placement on the list, they can go to water court to argue that they did not intend to abandon the water right.
For the 2010 Division 5 abandonment list, Martellaro said the pre-compact rights comprised easily half the list before Wolfe instructed division engineers to take them off. The 2011 revised Division 5 abandonment list included about 75 water rights, one-third of which were related to the now-defunct Mid-Continent mine on Coal Creek near Redstone where a 1981 explosion killed 15 miners.
The 2020 abandonment list is expected to come out in July.
Aspen Journalism is a local, nonprofit and investigative news organization that covers water and river issues in collaboration with The Aspen Times and other Swift Communications newspapers. This story appeared in the June 22 edition of The Aspen Times and the June 22 edition of Aspen Journalism.
Farmer Zay Lopez ran his small market farm in the Grand Valley’s far west end for five years, using water from the Colorado River to grow vegetables. In December 2019 he sold his 26-acre farm to Water Asset Management. (Luke Runyon, KUNC)
By Heather Sackett, Aspen Journalism & Luke Runyon, KUNC
MACK, Colorado — For five years, Zay Lopez tended vegetables, hayfields and cornfields, chickens, and a small flock of sheep here on the western edge of Colorado’s Grand Valley — farming made possible by water from the Colorado River.
Lopez has a passion for agriculture, and for a while, he carved out a niche with his business, The Produce Peddler, trucking veggies seven hours away to a farmers market in Pinedale, Wyoming.
Lopez also moonlights as a Realtor, with his finger on the pulse of the local real estate market. A few years ago, he noticed a strange new phenomenon. Much of the irrigated agricultural land sold in the valley — such as parcels just down the road from his farm — wasn’t being bought by another farmer. Instead, his new neighbor was Water Asset Management, a New York City-based hedge fund with deep pockets.
When Lopez and his wife Leah grew tired of trying to make ends meet, they decided to pack up and move to southern Colorado to grow hemp. They, too, sold their 26-acre farm to WAM.
“It was hard to make the mortgage payment plus all of our other payments, and I didn’t see — with our current model of what we were doing — how we could get out of that hole,” he said. “Selling the farm wasn’t really a choice. We had to do it.”
Lopez’s recent sale is the continuation of a trend that has made some in the agricultural communities west of Grand Junction nervous; has created a buzz among water managers; and has led state lawmakers to pass a bill looking at strengthening Colorado’s anti-water-speculation law.
Listen: KUNC’s Luke Runyon and Aspen Journalism’s Heather Sackett report from Colorado’s Grand Valley. (4:22)
WAM is buying irrigated land as an investment in the future potential value of the water. Although the company isn’t doing anything illegal, its actions have rekindled deep-seated and long-held fears about water in the West — that it could hasten the death of agricultural communities’ way of life and create an unregulated market for water that would drive up prices and drive out family farms.
Because of these sensitive issues, many people in the Grand Valley are reluctant to talk about WAM and what it is doing. Meetings have erupted in anger, some who have sold have become social pariahs, and top water officials from the valley’s canal companies refuse to talk to reporters on the record. For a while, a local rancher was actively updating a website “wall of shame” for people involved in Grand Valley water deals.
“They are the same concerns that have existed since the 1930s,” said Anne Castle, a senior fellow at the University of Colorado’s Getches-Wilkinson Center. “The east slope municipal diverters or an investment firm — it doesn’t matter who it is — are going to be able to offer more money for water than you could derive from farming or ranching. The concern is that if that becomes a trend, then the whole economy of the Western Slope changes and the agriculture economy will be very different and smaller than it is now.”
The Walton Family Foundation provides funding to KUNC and partial funding for Castle’s work. A member of the Walton family currently provides funding to Aspen Journalism via the Catena Foundation.
The Grand River Diversion Dam, also known as the “Roller Dam”, was built in 1913 to diver water from the Colorado River to the Government Highline Canal that farmers use to irrigate their lands in Grand County. (Luke Runyon/KUNC)
Water Asset Management
Since 2017, WAM has spent $16.6 million buying up 2,222 acres of irrigated agricultural land in the communities of Fruita, Loma and Mack, west of Grand Junction. The company is now the largest landowner in the Grand Valley Water Users Association, the nonprofit canal company that delivers water to many Grand Valley irrigators.
WAM now owns 1,659 acres in the GVWUA delivery area, which according to its website has 23,341 irrigated acres. That means the hedge fund owns about 7% of the land irrigated by the Government Highline Canal.
Interactive: tour purchases by Water Asset Management, a New York City-based hedge fund
WAM, whose headquarters is on Madison Avenue in Manhattan, says it “seeks to be a leader in managing global water investments that solve water quality and availability issues,” according to its website. WAM is run by co-founder and principal Disque Deane Jr., while Matthew Ketellapper has been doing much of the “boots on the ground” work in the Grand Valley as the company’s Colorado asset manager.
Deane has been involved in water markets in the West for years, buying water and land tied to water rights. He doesn’t give many interviews, but according to a 2016 ProPublica article, “debt, death and divorce” has become his sort of motto, because those circumstances drive people to sell.
WAM are cash buyers — a rare offer in this rural area. In many cases, WAM makes improvements to irrigation infrastructure, such as adding center pivots and lining ditches, and leases the land back to farmers to keep it in agricultural production.
Grand Valley’s farmland is expansive, with views stretching west to Utah, north to the Book Cliffs and south to Colorado National Monument. It is also exceedingly dry. The area where Lopez’s former farm is located was once a community of homesteaders known as New Liberty, who eked out a living by dryland farming before the construction of irrigation infrastructure, a notion at which Lopez marvels.
Not much would grow here without the region’s two main irrigation canals, which draw water from the Colorado River: Government Highline Canal and Grand Valley Irrigation Canal. The bigger of the two, the 55-mile-long Government Highline, snakes through the northern part of the valley and is managed by GVWUA. One hundred and fifty miles of ditches known as laterals bring water from the main canal to individual farms.
In mid-March, before the water began flowing in the canals and bringing the annual green return of irrigated agriculture to this valley, the air was thick with smoke as farmers burned their ditches and the earth was dusty, brown and parched.
What leaves people scratching their heads is this: How does a New York City investment firm plan to make money from marginal desert land in western Colorado?
“Everyone is very cautious about what these guys from New York are doing out here buying up our ground,” Lopez said. “I mean, honestly, it’s still kind of a mystery what their overall vision is.”
The Government Highline Canal flows past Highline State Park. WAM, a New York City-based hedge fund, has been buying up parcels of land that have water rights to the canal. (Bethany Blitz/Aspen Journalism)
‘Temporary, voluntary, compensated’
The key to WAM’s overall vision may lie in demand management, a state program still in the investigation and feasibility stage.
At the heart of such a program envisioned by state officials — and designed to be “temporary, voluntary and compensated” — is the concept of paying irrigators to use less water by fallowing fields. By doing so, there will be more water in the Colorado River flowing downstream to be stored in Lake Powell in an effort to bolster reservoir levels and help Colorado meet its Colorado River Compact obligations.
The future of the demand management feasibility investigation is unclear because the state on May 1 cut its budget by $750,000 due to the COVID-19-caused state financial crisis.
The thing many water managers and users in Colorado fear most is what’s known as a compact call. Under the terms of the 1922 Colorado River Compact, the Upper Basin states (Colorado, Utah, Wyoming and New Mexico) are required to deliver 75 million acre-feet of water over 10 years to the Lower Basin states (California, Nevada and Arizona). If the Upper Basin can’t deliver because of drought, climate change or any other reason, it could lead to a compact call, triggering involuntary cutbacks and an interstate legal quagmire that could drag on for decades.
A new demand management program would allow Colorado to send water to a 500,000-acre-foot pool in Lake Powell that would act as a modest insurance policy to help protect the Upper Basin against a compact call.
The Grand Valley, which takes its name from the “Grand River,” the historical name for the Colorado River, is well-positioned for a demand management program. Water left in the river at this location is almost certain to reach Lake Powell because there are few major diversions between here and the giant reservoir.
And entities in the Grand Valley have rights to a lot of water. With 1912 adjudication dates, Grand Valley irrigation districts are some of the most-senior water rights on the Colorado River and can call about 2,200 cubic feet per second down through the river system.
There is some precedent that a demand management program would work in the Grand Valley, as some irrigators here have participated in two different experimental pay-to-fallow programs undertaken by the Upper Colorado River Commission and the GVWUA. These types of programs have intense interest from many sectors, including municipalities, which often see transferring water from agriculture as a viable way to increase their supplies, as well as from environmental organizations that would like to see more water stay in the river.
Water Asset Management bought this 57-acre parcel as part of a $6 million deal in January. The land is irrigated with water from the Grand Valley Irrigation Company Canal. (Bethany Blitz/Aspen Journalism)
Returns on water
Since 2017, WAM has made investments in Grand Valley agriculture, choosing to make purchases of parcels in batches every few months. But in the past six months, the hedge fund has taken one step that signals what could be a renewed effort to sway Western water rules in its favor.
WAM recently brought onto its team a heavy hitter in the world of Colorado River politicking: Denver-based attorney James Eklund.
Eklund is the former director of the state’s top water policy agency, the Colorado Water Conservation Board, and served as the state’s representative to the Upper Colorado River Commission, another powerful policymaking agency on the river. He was one of the architects of the Drought Contingency Plan, the document that made the case for a demand management program throughout the Upper Basin. Soon after he left these public posts, he began representing WAM as counsel.
Eklund, who comes from a Western Slope ranching family, says WAM’s strategy is to buy irrigated land and then pump money into cutting-edge technology and practices, thereby increasing irrigation efficiency and crop yield. The leftover water could be, in exchange for payment, sent downstream under a demand management program.
“I definitely think that if there’s a program that pays farmers, (WAM is) interested in it — and for good reason,” Eklund said. “They want to make sure their investment is generating the types of returns that their investors expect.”
That strategy doesn’t sit well with Andy Mueller, general manager of the Colorado River Water Conservation District. His organization’s mission is to protect water interests on the Western Slope, which often means protecting agricultural interests. He worries that WAM’s land buys are being done with the intent to separate the water from the land and that the private equity fund does not have the community’s best interest at heart.
“I think a charitable view would be that they are engaging in the acquisition of private property in a capitalistic society, and they have the right to do that,” Mueller said. “And that might be as charitable as I could get with them.”
So far, WAM has been keeping the land in agricultural production, much the same as it had been with previous owners. According to Colorado water law, to retain its agricultural water rights, the company must continue to put the water to “beneficial use,” or, in other words, utilize the water to keep growing crops.
And Mueller’s fear of separating water from land isn’t currently possible under the rules of GVWUA, where three-quarters of the land purchased by WAM sits. Under that organization’s rules, the water cannot be sold separately from the land; you must own the land to get the associated water.
Without access to GVWUA records, it is difficult, if not impossible, to figure out exactly how much water WAM has the rights to. Class 1 land irrigated by GVWUA comes with 4 acre-feet of water per acre each irrigation season.
There is not a way to tell from publicly available property records how much of the land WAM has purchased is irrigated Class 1 land. But if all the land WAM has purchased is Class 1, then it would have at least 6,636 acre-feet of water.
Eklund said the amount of water held by WAM is akin to financial information, which the hedge fund, per its policy, won’t disclose. GVWUA director Mark Harris and the organization’s counsel, Kirsten Kurath have both repeatedly declined to be interviewed on the record for this story. However, Kurath, said in an email that GVWUA is aware of and monitoring activities within its district.
Another lingering, hard-to-answer question is how much WAM’s water is worth. Under the System Conservation Pilot Program, run by the Upper Colorado River Commission, Grand Valley farmers were paid $200 for every acre-foot of water they left in the river. Using this number as a benchmark, WAM’s 6,636 acre-feet of water could currently be worth more than $1.3 million. But that price the program paid to farmers was to lease it for only one year, which could bring the true value of the transferred water to tens of millions of dollars, experts say. How much it could be worth in a hotter, drier future is unknown.
“A lot of the crops we grow are not very profitable, so I think they are projecting, hey, this water is going to be more valuable than even the crops they are growing with it,” Lopez said.
Mark Harris, General Manager of the Grand Valley Water Users Association, checks on the entrance to Tunnel 3, where water in the Government Highline Canal goes through the mountain to Palisade, continuing to Grand County. (Bethany Blitz/Aspen Journalism)
Preventing speculation
WAM’s land buys have not escaped the attention of Colorado lawmakers, who say what the company is doing is legally dubious. State Sen. Kerry Donovan is a rancher who represents District 5, a stretch of rural mountains, agricultural valleys and ski towns on the Western Slope.
In the 2020 legislative session, before the coronavirus pandemic slowed legislative activity, she sponsored Senate Bill 48, which Gov. Jared Polis recently signed into law. The new legislation directs Colorado’s Department of Natural Resources to convene a workgroup to explore ways to strengthen the state’s anti-speculation law.
“I also hope (this bill) sends a message to people that might be looking to Colorado to make a quick buck that we’re not interested in that type of behavior in our state,” Donovan said. “If you’re just coming up here to buy up water to turn into a profit in the years to come for your clients, like, ‘No, thank you.’”
Colorado’s current anti-speculation doctrine is based on case law that says those seeking a water right must have a vested interest in the lands to be served by the water and must have a specific plan to put the water to beneficial use.
“(WAM’s) goal is to buy assets, to make money — and as much money as they can,” Donovan said. “I don’t want that type of player in the prior appropriation system, just full stop.”
WAM attorney Eklund says the investment firm’s directors are not speculators; they are farmers.
“The characterization of any farming or ranching operation that is putting water to a beneficial use as a speculator, that’s just plain-and-simple wrong,” he said. “In light of Colorado water law, this is not accurate as a description that they’re speculating here.”
Eklund sees a bigger role for WAM and other similar players in a potential future water market. He would like to see Colorado fill up that insurance pool in Lake Powell as quickly as possible and said WAM can help the state do that.
“(WAM is) looking at how they can move water down to Lake Powell to avert a crisis,” Eklund said. “And they’re trying to make sure that we’re becoming more resilient in the agricultural economy in the Grand Valley by strategically planning for how that water gets into the account in Lake Powell.”
Since 2017 Water Asset Management has bought 1,659 acres of land in the delivery area of the Grand Valley Water Users Association. Their most recent purchase was of land irrigated by the Grand Valley Irrigation Company Canal. (Map by Caitlin Ketel, parcel data from Mesa County)
A shift?
The type of land purchase that WAM usually pursues has recently shifted. All of the Grand Valley land that the company bought up until this year had been irrigated with water from the Government Highline Canal, where the right to water depends on how much irrigated acreage someone has and where water is tied to the land.
But WAM’s most recent purchase in January was a $6 million deal on 541 acres in Fruita and irrigated by the Grand Valley Irrigation Company Canal, the other big player in Grand Valley agriculture. In its delivery system, shares of water can be bought and sold, and the amount of water is not tied to the land. It marks a departure from the company’s previous purchases, even as Eklund maintains it’s not a change in WAM’s strategy.
“I would say it’s very significant,” Mueller said. “Land that is irrigated under a private water right like the GVIC, that becomes more challenging and more threatening from a permanent-dry-up perspective.”
But even as suspicion and skepticism run high, some Grand Valley farmers, including Lopez, say WAM has been a good neighbor so far.
“Absolutely, they are committed to the future of agriculture in the Grand Valley. They are fronting a lot of money to do these irrigation projects and leasing the ground back to the farmers who had farmed it already,” Lopez said. “Now, is that just to look good to the community and their investors? I have no idea.”
Editor’s note: This story has been updated with additional context about the potential value of Water Asset Management’s Grand Valley investments.
Aspen Journalism is a local, nonprofit and investigative news organization that covers water and river issues.
KUNC’s Colorado River reporting project is supported by a grant from the Walton Family Foundation. KUNC is solely responsible for its editorial content.
Republished with permission from Aspen Journalism, which originally ran this story on May 29, 2020.
Lawmakers began work Jan. 8, 2020 on a range of water issues including conservation on the Colorado River and how to allocate cash for the Colorado Water Plan. Credit: Jerd Smith
Cash for the Colorado Water Plan and other projects took a modest hit this year, as state lawmakers sought to cut $3.3 billion to compensate for one of the largest deficits in its history.
But water officials said the pain could have been worse, with loan and grant funds for major water projects such as the Arkansas Valley Conduit preserved and furloughs of Colorado Water Conservation Board staffers avoided for now.
Rep. Dylan Roberts, D-Avon, said lawmakers worked hard to maintain funding during a time when massive cuts across state government were being made.
“It was important to craft a budget that addressed the COVID-19 financial crisis,” he said, “and to continue to invest in our water infrastructure regardless of what might be going on otherwise.”
As the legislature wrapped up its highly compressed session last week, lawmakers approved $12.25 million from the CWCB’s Construction Fund for the state water plan, the amount the CWCB recommended. The fund derives its cash from water project loan repayments, earned interest, and federal mineral royalty distributions.
$7.5 million of those earmarked funds will pay for water storage and supply, conservation and land use planning, education and outreach, agriculture, and environment and recreation projects.
Another $4 million will continue to fund watershed restoration activities, the amount spent last year, and $750,000 is earmarked to fund alternative agricultural transfer projects, down $250,000 from last year.
Rep. Marc Catlin, R-Montrose, said this year’s funding simply keeps “the commitments the state of Colorado has already made in regard to projects that are ongoing and in progress.”
But there was no new general fund support for the Colorado Water Plan.
In 2019 the General Assembly appropriated $8.3 million from the general fund to support the water plan over three years, the first time since its adoption in 2015 that general fund revenue was used toward the plan’s implementation.
CWCB spent $3 million of that in the 2019/2020 fiscal year to bolster water plan implementation grants and it will spend the balance over the next two years. After that, continued general fund support is uncertain until the state’s economy rebounds, officials said.
Also cut was more than $850,000 from the $1.7 million general fund appropriation made last year to conduct public outreach and feasibility studies on a massive Colorado River conservation project. If the program, known as demand management, is formally adopted, it is anticipated that it would pay farmers and other water users to voluntarily reduce their use of Colorado River water so that it can be stored in Lake Powell as a hedge against future Colorado River Compact shortfalls.
The CWCB’s Amy Ostdiek, deputy section chief of interstate, federal and water information programs, said her section has been able to save enough money on travel costs and other expenses this year to continue studying demand management over the next year.
Major funding for the long-awaited Arkansas Valley Conduit was also preserved. The conduit is designed to bring clean drinking water to Eastern Plains communities whose wells have been contaminated by salts, nitrates and other elements..
“We’re obviously very grateful that the General Assembly retained funding for the [Conduit],” said Chris Woodka, senior policy and issues manager for the Southeastern Colorado Water Conservancy District in Pueblo. “The state funding, coupled with significant federal funding approved by Congress earlier this year, will allow construction of the [Conduit] to begin when design activities are completed over the next two years.”
Larry Morandi was formerly director of State Policy Research with the National Conference of State Legislatures in Denver, and is a frequent contributor to Fresh Water News. He can be reached at larrymorandi@comcast.net.
Fresh Water News is an independent, nonpartisan news initiative of Water Education Colorado. WEco is funded by multiple donors. Our editorial policy and donor list can be viewed at www.wateredco.org.
This story originally appeared on Fresh Water News on June 24, 2020.
Other than Aspen’s golf course, these fields just up valley from Woody Creek are some of the only areas classified by the state database as irrigated land in the upper Roaring Fork River valley. The City of Aspen is studying opportunities for an Alternative Transfer Method, or ATM, to increase the city’s water supplies by temporarily transferring water from agricultural use. Photo by Heather Sackett/Aspen Journalism.
ASPEN — The city of Aspen is moving ahead on a project aimed at increasing the reliability of its water supply and environmental flows through what’s known as an “alternative transfer method,” or ATM.
But water managers will have to think outside the box since the usual process of an ATM is transferring water from agricultural to municipal use, and there isn’t much irrigated agriculture in the upper Roaring Fork River basin.
In Colorado, most water rights are held by irrigators. So when towns and cities want to increase their water supplies, they often turn to agriculture to secure extra acre-feet. Permanent water-transfer agreements, often derided as “buy and dry,” can harm agricultural communities and economies, and ATMs are seen as a way to reallocate water more fairly and sustainably from agriculture to municipalities.
These voluntary water-sharing agreements would allow local irrigators to temporarily loan their water to Aspen and get paid for doing so. The most straightforward way for this to happen would be for water-rights holders above the city’s diversions on Castle and Maroon creeks to loan their water to the city.
But according to Colorado’s Decision Support System, which is the state database that tracks irrigated land, there is no irrigated land above Aspen.
“Certainly, the easiest way to meet the most goals is to find water above the city,” said Jason Brothers, principal at Summit Water Engineers, the engineer on the project. “If that’s not available, we will have to look at creative ideas.”
Most of the irrigated acreage in the upper Roaring Fork River valley is grass pasture in the Woody Creek area.
Aspen’s ATM project is funded with a $183,356 grant from the Colorado Water Conservation Board, plus $15,000 each from the city and Western Resource Advocates. It would be the first program designed for a Western Slope headwaters municipality.
In addition to increasing city water supplies, a secondary goal of the project is to improve river flows for the benefit of the environment, especially in the reach of the Roaring Fork through downtown Aspen. In dry years, flows can fall short of the 32 cubic feet per second of water required by the CWCB’s junior instream flow right, which is meant to protect the river environment “to a reasonable degree.”
The 2015 Colorado Water Plan sets a goal of 50,000 acre-feet of water transfers through ATMs by 2030.
“I think that backdrop (of buy and dry) really kind of set the stage for more of a state focus on how do we meet our continuing water-supply needs and can we do that in a way that minimizes harm to ag,” said Alex Funk, agricultural water resources specialist for the CWCB.
According to the grant application, city officials say there are 2,800 irrigated acres in the upper Roaring Fork valley and tributary basins, which the team could explore for compatibility with an ATM program, and that if a third or a quarter of these irrigated lands were in such a program, it could yield 1,000 acre-feet of water.
City officials won’t clarify exactly where those irrigated acres are. The project is still in its infancy and officials don’t have many answers yet, said Steve Hunter, utilities resource manager for Aspen’s water department.
“We just kicked this off,” Hunter said. “I don’t see answers coming for months, if not the latter end of a year into the project.”
Front Range cities take water from the Roaring Fork River basin in a transmountain diversion through the Twin Lakes Tunnel. The city of Aspen is studying the potential for an Alternative Transfer Method, or ATM, to increase its water supplies, which could include approaching transmountain diverters about participating in a water-sharing agreement. Photo by Elizabeth Stewart-Severy/Aspen Journalism
Transmountain diverters
One of those creative opportunities Brothers mentioned could involve participation by Front Range water providers that divert water from the headwaters of the Roaring Fork River. The cities of Colorado Springs, Aurora and Pueblo divert water from the upper Roaring Fork through the Independence Pass Transmountain Diversion System via the Twin Lakes Tunnel.
“We are not just looking at in-basin ATMs, but exploring the concept of ATMs on the east slope and if entities would be willing to forego their diversions from the West Slope,” said Todd Doherty, president of Western Water Partnerships. “We are seeing if there’s a willingness between the stakeholders to even consider that.”
Transmountain ATM opportunities are still conceptual at this point, and a water transfer from a transmountain diverter to Aspen would be a break from the way ATMs are typically conducted. However, Funk said the CWCB would be supportive of a municipal-to-municipal transfer of water under the ATM program.
Doherty’s organization is based in Denver and is a Colorado Public Benefit Corporation. The city has contracted with WWP for $213,356 to complete Phase 1 of the ATM investigation, which will entail examining all the water rights that could potentially be available to participate in an ATM program and approaching the holders of those water rights to see whether they are interested. No water-sharing agreement will happen unless the irrigators think it’s a better deal than what they are growing, Doherty said.
“I think it will be a success if we can get a few, hopefully a few larger ones, that will help demonstrate to the other irrigators in the basin that maybe this deal is worth looking at,” Doherty said.
Aspen Journalism is a local, nonprofit and investigative news organization that collaborates with The Aspen Times and other Swift Communications newspapers on coverage of water and rivers. This story ran in the May 29 edition of The Aspen Timesand the May 29 edition of Aspen Journalism.
