Headwaters Fall 2017 Alternative Water Transfers

HEADWATERS W AT E R E D U C AT I O N C O L O R A D O | F A L L 2 0 1 7

Can Colorado Save Its Farms?

HOW ALTERNATIVE WATER TRANSFER METHODS PROVIDE OPTIONS TO: → Keep water in farming → Help municipalities plan ahead → Share between ag and environmental uses → Bank water on the Colorado River

A QUESTION OF BALANCE CWC Annual Convention January 24-26, 2018 Hyatt Regency Denver Tech Center

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ALTERNATIVE WATER TRANSFERS FALL 2017 WATER IS… BANKABLE • 14

Can water from fallowed West Slope farms translate to deposits into Lake Powell?

PRODUCTIVE • 16

Suspended irrigation equates to loss in crop productivity, but eventually yields bounce back.

OPPORTUNITY • 17

Organizations are offering boosts to usher new blood into ag. The rules: Keep water on the farm and share with cities.

FEATURES

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Thanks to Our Contributors A sincere thank you to our members and donors who make our work possible.

Flex Time for Colorado Water Water sharing and banking, coined “alternative transfer methods” or ATMs, could provide flexibility for stretched water supplies— but not without marked challenges.

BY ALLEN BEST

Voices From the Field Meet four Coloradans and get first-hand perspectives on ATMs

COLUMNS

21 Bill Lauck / Lauck Farms and the Fort Morgan Ditch Company

CURRENTS • 7

24 Gene Manuello / Manuello Farms, Sterling Irrigation Company and Colorado Ag Water Alliance

Notes from the Director

25 Glenn Hirakata / Hirakata Farms

WATERMARKS • 8

29 Jesse Kruthaupt / Kruthaupt Ranch and Trout Unlimited

Notes from the Editor

BY JERD SMITH

ABOVE: A “dry-up parcel” sign marks the fallowed portion of Glenn Hirakata’s farm. Hirakata is participating in the Catlin Canal Pilot Project in which he is compensated to dry up some of his land, leaving water in Pueblo Reservoir for municipal use in Fountain, Security and Fowler. Photo by Michael Sweeney ON THE COVER: Bill Lauck and others on the Fort Morgan Ditch are participating in an ATM, leasing water to Xcel Energy during dry years. Most years, Lauck’s water stays on his farm to irrigate corn and he receives payment for participating, while Xcel has a backup supply of water—insurance if it’s needed. Photo by Matthew Staver

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WEco

Mission in Motion

GROWING CAPACITY

Welcome Sophie Kirschenman We are pleased to welcome our newest team member, Sophie Kirschenman, education and outreach coordinator. Sophie will help run Water Education Colorado's leadership and education programs, with a particular focus on managing the Water Educator Network.

She is excited to engage and build relationships with local community members and empower them to join the conversations that will shape Colorado’s water future. When she’s not working you can find her outdoors, exploring Colorado’s never-ending trails with her dog, Liza. We’re thrilled to have her join the Water Education Colorado community.

Welcome Sophie!

Water Education Colorado's Sophie Kirschenman with her dog, Liza.

STRENGTHENING LEADERSHIP

Congratulations 2017 Water Leaders!

On September 15, our 10th class of Water Leaders graduated after seven months of intensive personal and professional development focusing on leadership skills that will propel them in their current and future roles. These 15 graduates join our Water Leaders Alumni group, now 143 strong. This year’s class traveled to Loveland, Redstone, Alamosa and Denver, meeting for four two-day sessions. Thank you to our

program sponsor, the Colorado Water Conservation Board, and a big thank you to Cheryl Benedict of MORF Consulting who co-facilitates the program alongside Stephanie Scott of Water Education Colorado.

WANT TO BECOME A WATER LEADER? Applications for the 2018 class will open Nov. 20. For more information please contact stephanie@yourwatercolorado.org

JOIN US IN CELEBRATING OUR 2017 CLASS:

Josh Baile, Willows Water District Jackie Brown, Tri-State Generation and Transmission Association Devon Buckels, The Greenway Foundation Logan Burba, South Metro Water Supply Authority Michelle DeLaria, Colorado Department of Public Health and Environment Sarah Dominick, Denver Water Alexander Funk, National Young Farmers Coalition Heather Justus, Town of Castle Rock Christopher Kurtz, CDM Smith Josh Nims, City of Westminster Leann Noga, Southeastern Colorado Water Conservancy District Jessica Olson, Left Hand Watershed Oversight Group Emma Regier Reesor, Rio Grande Headwaters Restoration Project Scott Schreiber, Wright Water Engineers

The 2017 Water Leaders class spent its second session in Redstone, learning about individual leadership styles with coach Cheryl Benedict (third from right) of MORF Consulting.

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Troy Wineland, Colorado Division of Water Resources

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Graduates of the 2017 Water Fluency class met in Parachute for their final in-person session. These community leaders left armed with resources and knowledge to make informed decisions on water-related issues.

STRENGTHENING LEADERSHIP

CREATING KNOWLEDGE

Decision Makers Speak Fluent Water

On Tour

2017 marked the graduation of our third Water Fluency class, but our first offering of the program on Colorado’s Western Slope. Through this bootcamp-style course, the class meets to gain an indepth understanding of water’s complex history, institutional framework and current opportunities and challenges. In the end, participants take knowledge, connections and resources back to their communities where they’ll be better equipped to make decisions on water-related issues.

The 2017 class of 33 individuals was comprised of city and county employees, county commissioners, special district employees, town managers, federal and state agency employees, business owners, interested citizens, oil and gas industry representatives, and landowners.

Participants met for four days of face-

Water Education Colorado wrapped up a wonderful summer of programming with our Innovating for Viability Land and Water Tour in September. The tour was a success with more than 50 participants who traveled between Pueblo and Rocky Ford to spend the day visiting farm operations and learning about water, soil health, food safety and more. We were joined by Reps. Clarice Navarro and Daneya Esgar. "I had an amazing day, touring the Lower Arkansas River Basin and some of the local farms,” Esgar says.

The tour was offered in partnership with the National Young Farmers Coalition, Rocky Mountain Farmers Union, and Colorado Ag Water Alliance.

Thank you to tour sponsors: Farm Credit of Southern Colorado, Colorado Water Conservation Board, Larson Insurance Agency, Hoffman Insurance Agency, and Otero County Government.

to-face learning in Glenwood Springs, Palisade and Parachute, with online discussions and resources between classes to continue the dialogue. Thank you to 2017 partners: Special District Association, Colorado Water Conservation Board, Colorado Water Resources and Power Development Authority, Colorado Municipal League, Colorado River District, Drought Response Information Project, Ruth Powell Hutchins Water Center at Colorado Mesa University, Colorado Counties Inc., and SGM. INTERESTED IN WATER FLUENCY? Applications for the 2018 class, coming to southern Colorado May through July, will open in February 2018. Contact stephanie@yourwatercolorado.org to learn more.

SUPPORT ORIGINAL REPORTING ON COLORADO WATER ISSUES! Advertising and sponsorship opportunities for Headwaters magazine are available with benefits including ad placement within the issue, your logo on the back cover and recognition online. Demonstrate your organization's commitment to water! Interested? The next issue of Headwaters, focused on public lands and water, will arrive in mailboxes in March 2018. Contact alicia@yourwatercolorado.org to learn more.

H E A DWAT E R S | FA L L 2017

Stay tuned for our annual Climate Workshop in March 2018, Urban Waters Bike Tours in Fort Collins in May, and Rio Grande Basin Tour in June! More information and registration coming soon to www.yourwatercolorado.org.

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Pssst. We've made a change...

Same great programs. Same trusted resources.

NEW NAME. More water-aware Coloradans.

After 15 years as the Colorado Foundation for Water Education, we’re embarking on a new chapter and introducing our new brand: Water Education Colorado!

It's an exciting time to be involved!

We believe water is our most valuable resource, it’s what makes Colorado such a great place to live, and it’s too important for more citizens not to be informed and engaged.

We plan to use this new name as a launchpad to grow more water-aware Coloradans. ​No matter how much you know or have yet to understand about water, we're here for you. Relevant, in-depth journalism, resources, tours, workshops and leadership programs focused on the one thing none of us can live without. ​​Join our journey and share with peers as our new brand is implemented in the coming months: • A fresh layout for Headwaters magazine this winter • An all-new website and URL in spring 2018 • A series of informal, social water events around the state throughout the year

FO R U P DAT E S O N O U R P RO G R E SS, V I S I T YO U RWAT E RC O LO R A D O.O RG

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WAT E R E DUC AT I O N CO LO R A D O | YOU RWAT E RCO LO R A D O.O RG

Water Education Colorado Jayla Poppleton Executive Director Jennie Geurts Director of Operations Stephanie Scott Leadership and Education Program Manager Sophie Kirschenman Education and Outreach Coordinator Alicia Prescott Development Coordinator Caitlin Coleman Headwaters Editor and Communications Specialist Charles Chamberlin Headwaters Graphic Designer

BOARD OF DIRECTORS

Eric Hecox President Gregory J. Hobbs, Jr. Vice President Scott Lorenz Secretary Alan Matlosz Treasurer Gregg Ten Eyck Past President

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t’s finally here! After a decade and a half as the Colorado Foundation for Water Education, we’re introducing a new outlook that comes with a new name: Water Education Colorado!

Our next chapter aims to engage and inform more Coloradans by building on the programs and trust we’ve developed over the last 15 years. We believe more people can and should benefit from our independent, collaborative and statewide approach to water education. So here we go!

At our Sustaining Colorado Watersheds conference in October, I picked up a few gems from other presenters that really resonated at this moment in time.

First, that to inspire others to act we must start with why, and our narrative must inspire hope. We’re boiling that down in explaining our rebrand. Why is water education so critical to the future of Colorado?

Why is Water Education Colorado an organization you should support? Talk to any of our staff or board members and we can have a good conversation about this! Suffice it here to say we are 100 percent committed to equipping citizens with water knowledge and leadership capacity. We act with the hope that our work will lead to better decisions—and ultimately a better legacy for our children, one with plenty of clean water.

Next, I heard some of our collective hope lies in compromise. At Water Education Colorado, we focus first on relaying facts and interpreting science and policy. But we also uncover different views so that people begin to understand each other and can work toward viable solutions.

Finally, people are the common denominator. From Dr. Peter Wilcock, a river restoration scientist: “Restoration is a social enterprise, and the starting point is people.” Isn’t that the case with every initiative undertaken in this business?

I feel privileged to be doing work that connects the two most valuable resources Colorado has to offer: water and people. It’s a joy to work alongside so many committed, talented and hopeful women and men in this great mission that is water education. Thank you for all that you contribute, and let’s keep after it!

Rep. Jeni Arndt

Jayla Poppleton

Rick Cables

Executive Director

Nick Colglazier Lisa Darling Jorge Figueroa Greg Johnson Dan Luecke

1750 Humboldt Suite 200 Denver, CO 80218 303-377-4433 • yourwatercolorado.org

Mara MacKillop Kevin McBride

THE MISSION of Water Education Colorado is to promote increased understanding of water resource

Kate McIntire

issues so Coloradans can make informed decisions. WEco is a non-advocacy organization committed

Reed Morris Lauren Ris Travis Robinson Sen. Jerry Sonnenberg

to providing educational opportunities that consider diverse perspectives and facilitate dialogue in order to advance the conversation.

HEADWATERS magazine is published three times each year by Water Education Colorado. Its goals are to raise awareness of current water issues,

FSC BUG HERE

and to provide opportunities for engagement and further learning.

Laura Spann

THANK YOU to all who assisted in the development of this issue. Headwaters’ reputation for balance

Chris Treese

and accuracy in reporting is achieved through rigorous consultation with experts and an extensive peer

Reagan Waskom

review process, helping to make it Colorado’s leading publication on water.

Copyright 2017 by Water Education Colorado. ISSN: 1546-0584

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BEYOND THIS ISSUE

S

haring is an elementary lesson, one we learn and practice early, sharing toys, lunch and other things with childhood peers. It seems simple: it’s nice to share what you can. But sharing water is a little different—at least in Colorado.

Alternative transfer methods are water-sharing agreements meant to keep water in agriculture by sharing some water rights through voluntary, compensated leases to satisfy other water needs. Colorado’s Water Plan sets a goal for irrigators around the state to share at least 50,000 acre-feet of ag water by 2030 using voluntary ATMs. While the policy goal seems straightforward, it’s complex to achieve. Beyond the engineering and legal mechanisms that enable sharing, these are agreements between people whose livelihoods depend on that water.

There’s a lot at stake—not everyone agrees on ATMs, but most Coloradans do find common ground around the desire to preserve agriculture and the fact that water is a key element for doing so.

Through this issue of Headwaters magazine, we explore the threats posed by lost water and dried-up farms, we look at some successful water-sharing projects and the logistics behind them, and we consider the potential for others. We also take a quick look into the lives and perspectives of some irrigators who are participating in ATMs as a promising path forward, and others who don’t see ATMs as an answer to keeping water in ag. Opinions on water sharing are many, and while we only profiled four irrigators in this issue, there’s a multitude of other valid viewpoints around this topic.

At the end of our feature story, “Flex Time for Colorado Water,” journalist Allen Best quotes Mark Harris of the Grand Valley Water Users Association.

In discussing opinions on ATMs Harris says, “You can’t just dismiss people’s concerns or fears. They may know more than you.” Those concerns have deep roots. We need to listen to and really hear other’s concerns and fears … and also their dreams and plans.

While we begin to tell these stories through articles and photographs within these pages, there is more to learn beyond this issue of Headwaters.

There are many additional connections to be made to move toward preserving agriculture in our state, including bridging knowledge gaps, studying and communicating science, exploring policy, ensuring robust economies, and developing common understanding. At Water Education Colorado, our new logo represents the major river basins in Colorado as artistic speech bubbles because we seek to empower people to engage in the dialogues and to talk across the divides to shape our water future. Get involved, connect, listen, share and join the conversations that will build a sustainable water future for all voices.

Caitlin Colema� Editor

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KEEP READING There is more to learn about Alternative Transfer Methods beyond this issue’s coverage. For digital content on Water Education Colorado’s Your Water Colorado blog, visit blog. yourwatercolorado.org and look for the following posts: • A Perpetual Ag-Municipal Agreement How the land conservation community came together with the City of Broomfield and pooled financial resources to preserve a farm and facilitate a water lease.

• Money for Water A pilot project in the Colorado River Basin wins over skeptical farmers and ranchers.

• Alternative Transfer Methods in Action When municipal drinking water supplies turned up contaminated, a pilot project in the Arkansas River Basin helped fill the gap.

• More reporting on water banking, water-sharing agreements, keeping water in agriculture and more.

WEBINAR Join us in December to explore the conversations around policy changes that might help the state reach its goal, as defined in Colorado’s Water Plan, of sharing at least 50,000 acre-feet of agricultural water using voluntary alternative transfer methods by 2030.

CONNECTING THE DROPS Tune in on air and online for Connecting the Drops radio. In partnership with Rocky Mountain Community Radio and thanks to support from CoBank, we offer segments that tie to what you’re reading in Headwaters. Listen for stories on: • Helping new farmers get their start, as explored in “Investing in the Future of Farming” (page 17).

• How ATMs can work in Colorado, and what they mean for rural communities.

HEADWATERS PULSE Our monthly e-newsletter delivers more original water reporting as well as information and updates on statewide water events, news, and links to programming. Subscribe to stay connected.

Visit yourwatercolorado.org/register LEARN MORE AT WWW.YOURWATERCOLORADO.ORG

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Value on Tap Since 1874

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Thank you for helping us spread water education across Colorado Thanks to the valuable contributions of our members and donors, Water Education Colorado has been able to deliver quality, comprehensive water education programs across Colorado since 2002.

A sincere thank you to our Fiscal Year 2017 (July 1, 2016–June 30, 2017) members and donors.

ENDOWING PARTNERS ($20,000+) CoBank • Colorado Water Conservation Board • Special District Association of Colorado

HEADWATERS ($5,000+) Aurora Water • Colorado Department of Public Health and Environment—Water Quality Control Division • Colorado Municipal League • Colorado River District • Colorado Springs Utilities • Colorado Water Resources and Power Development Authority • Denver Water • Jefferson County • Meridian Metropolitan District • Northern Water • Southwestern Water Conservation District • Walton Family Foundation

BASIN ($2,000+) Board of Water Works of Pueblo • Central Colorado Water Conservancy District • Collins Cockrel & Cole • Eagle River Water and Sanitation District • Leonard Rice Engineers, Inc. • Lower Arkansas Valley Water Conservancy District • Pitkin County Healthy Rivers and Streams Board • Bret and Jayla Poppleton • Rio Grande Water Conservation District • Chad Schneider • SGM • Shea Properties • South Metro Water Supply Authority • South Platte Water Related Activities Program • St. Vrain and Left Hand Water Conservancy District • Ute Water Conservancy District

AQUIFER ($1,000+) City of Grand Junction—Utilities • City of Longmont • Colorado School of Mines • The Consolidated Mutual Water Company • Drought Response Information Project • Environmental Defense Fund • Metro Wastewater Reclamation District • MWH-Stantec • Northern Water Municipal Subdistrict • Republican River Water Conservation District • Britta Strother • Telluride Ski & Golf • Town of Monument • University of Colorado Office for Outreach & Engagement • Upper Yampa Water Conservancy District • Water Sage • WateReuse Colorado • White & Jankowski • Wright Family Foundation RIVER ($500+) A

Adaptive Resources, Inc. • Anadarko Petroleum • Applegate Group B Jane Beckwith • Cheryl Benedict c Carlson, Hammond and Paddock •

Cherokee Metropolitan District • City of Boulder • City of Loveland • Civil Design Group • Colorado Parks and Wildlife • Colorado Water Institute D Ducks Unlimited E Eagle Bend Metro District • ELEMENT Water Consulting G George K. Baum and Company • Guaranty Bank and Trust H Harris Water Engineering, Inc. • HDR Engineering, Inc. • Greg & Bobbie Hobbs K Judith Kleinman • Knopf Family Foundation • Kogovsek and Associates, Inc. L Lower South Platte Water Conservancy District M Theron Makley • Alan Matlosz and Michelle Godfrey • Maynes Bradford Shipps and Sheftel • McElroy, Meyer, Walker & Condon, P.C. • McGrane Water Engineering, LLC N Katy Neusteter O Orchard Mesa Irrigation District R Roggen Farmers Elevator Association S Laurel Stadjuhar • John Stulp • Summit County T Gregg Ten Eyck • Tri-State Generation and Transmission Association • TZA Water Engineers Inc U Upper Arkansas Water Conservancy District • Upper Eagle Regional Water Authority • Upper Gunnison River Water Conservancy District V Vranesh and Raisch, LLP W Weld County Farm Bureau • West Sage Water Consultants • WetData

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TRIBUTARY ($250+)

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Anderson and Chapin, P.C. • Ayres Associates B Drew & Melissa Beckwith • Bishop-Brogden Associates c Rick Cables •

CDM Smith • Centennial Water and Sanitation District • City of Fort Collins • City of Thornton • Coalition for the Upper South Platte • Colorado Corn • Colorado Livestock Association • Colorado River Cattle Ranch • Colorado Water Trust • Cottonwood Water and Sanitation District • Sean Cronin D Lisa Darling • Darnauer Group Communications • Deere & Ault Consultants, Inc. • Delta County E ERO Resources Corp. • Evans Group, LLC F Fairfield and Woods, P.C. G GBSM • Les Gelvin H Harvey Economics • Eric Hecox • Scott Hummer J Greg Johnson K K. R. Swerdfeger Construction Inc. • Dave Koop L Left Hand Water District • Littleton/Englewood Wastewater Treatment Plant • Bruce Lytle M Mallon Lonnquist Morris & Watrous • Martin and Wood Water Consultants • John and Susan Maus • Middle Park Water Conservancy District • Morgan County Quality Water District N North Poudre Irrigation Company • North Sterling Irrigation District • North Table Mountain Water and Sanitation District • North Weld County Water District • Patrick Miller Noto P Platte Canyon Water and Sanitation District • Porzak Browning and Bushong R Gabe Racz • Robert Rich • Rocky Mountain Farmers Union S San Luis Valley Water Conservancy District • San Miguel County • Schmidt Construction • Nicole Seltzer • Simon Land and Cattle Co., Inc. • South Adams County Water and Sanitation District • Stifel Nicolaus T Town of Castle Rock • Town of Telluride • Town of Windsor • Chris Treese U Ulliman Schutte W Reagan Waskom • West Greeley Conservation District • Wilson Water Group • Kenneth & Ruth Wright

STREAM ($100+) A Richard Alper • Don Ament • Frank Anesi • Dale Armstrong B David Bailey • Dianne Bailey • John Bartholow • Matt Becker • Laura Belanger • Big Thompson Watershed Forum • Barbara Biggs • Jennifer Bills • Tillie Bishop • Richard Bratton • Karla Brown • Peter Butler c Josephine Carpenter • Anne Castle • Keith Catlin • Tom Cech • Kathy Chandler-Henry • Ron Childs • Solomon Chou • City of Durango • Colorado State Archives • Dave Colvin • Conejos Water Conservancy District • Amy Conklin • Jeff Crane • Ken Curtis • Mario Curto D Glenda DeBekker • Depco Farms, Inc. • Sarah Dominick • Rebecca Dowling • Dynotek E Patrick Emery • Lewis Entz F Joanne Fagan • Paul Fanning • Steve Fearn • R. Scott Fifer • Peter Fleming • Forsgren Associates Inc. • Mark Fuller G Jay Gallagher • Pam Gardiner & Lyle Geurts • Kevin Gertig • Dala Giffin • Lorie Gillis • Thomas Gougeon • Balcomb and Green, P.C. H Hillary Hamann • Ian Hartley • Christine Hartman • Taylor Hawes • Alan Heath • Tanya Heikkila • Tom Huber J Dawn Jewell • JLB Engineering Consultants K Korey Kadrmas L Paul Lander • Don Langley • Katie Leone • Lower Arkansas Water Management Association • Dan Luecke • Lutin Curlee Family Partnership, Ltd. M Joseph Martinez • Peter Mayer • Kevin McBride • Murray McCaig • Ben McConahey • Bill McCormick • Jack McCormick • Kate McIntire • Julie McKenna • Lisa McVicker • Bart Miller • Diane Mitsch Bush N Kelsey Nichols P Park County Water Preservation Coalition • Tom Parks • Brian Payer • Bob Peters • Hensley Peterson • Sarah Pitts • James Pokrandt • Susan Pollack • David Pusey R Jerry Raisch • Howard Ramsdell • Patricia Rettig • Laurie Rink • Rocky Mountain Agribusiness Association • John Rodgers • Steven Rogowski S Rick Sackbauer • Bo Shaffer • Thomas Sharp • Jeff Shoemaker • Claire Sollars • South Canon Ditch Company • Southeastern Colorado Water Conservancy District • Shannon Spurlock • Randy Spydell T Jennifer Tanaka • Edward Tolen • Town of Breckenridge—Water Division • Town of Frederick • Jean Townsend • Bill Trampe • Larry Traubel • Molly Trujillo • 20 Sleeps West Real Estate • Daniel Tyler V James VanShaar • Garrett Varra W Chuck Wanner • Water Information Program • Robert Weaver • Michael Welsh • Dianna Welton • Brian Werner • Tom Williamsen • Troy Wineland • Gerald Wischmeyer • Fred Wolf X Xcel Energy Foundation Z Mickey Zeppelin

INDIVIDUAL ($50+) A Craig Adams • Gerald Adams • Kathy Adams • Vic Ahlberg • Dave Akers • Zach Allen • Allison Altaras • Jim Aranci • Jeni Arndt • Jolene Arnold • Jeffrey Arthur • Lena Atencio B Bruce Bacon • Anistacia Barber • Vicky & Pat Barney • Kristin Barrett • Tony Barrie • Joseph Barsugli • Gilbert Barth • Steve Basch • William Battaglin • Jacob Bauer • Bear Creek Water and Sanitation District • Beattie Chadwick & Houpt • David Beaujon • Richard Belt • Nicolas Benedict • Jennifer Berman • David Berry • Mike Berry • Peter Binney • Patricia Blakey • Gary Boldt • Dave Bower • James Boynton • Larry Brazil • Emily Bretl • Norman Brooks • Natalie Brower-Kirton • Marilyn Brown • Matthew Brown • Rob Buirgy • Kathleen Butler c Michael Calhoun • Eleanor Camann • Carollo Engineers • Katherine Carroll • Robert Case • Castle Pines Metropolitan District • Gretchen Cerveny • Robert Chapin • Elaine Chick • Jim Clare • Clay and Dodson, P.C. • Mona Cloys • Michael Cohen • Debbie Cokes • Bill Coleman • Ted Collin • Kevin Collins • Colorado State University— CSURF Real Estate Office • Bill Condon • Mike Connolly • Jason Cooley • Carrie Cordova • Craig Cotten • Tim Craft • Kirkwood Cunningham d Marsha Daughenbaugh • Casey Davenhill • Amber DeBoer • Elizabeth Decker • Brian Devine • Jody Dickson • David Diedrich • Jordan Dimick • Matthew Downey • Logan Dunning • Heather Dutton e Eagle County Government • East Grand Water Quality Board • Rodney Eisenbraun • Lindsay Ellis • Pam Elsner • Cole Emmons • Enercon Services, Inc. • Robert Enzaldo f Jorge Figueroa • Judy Firestien • Thomas Flanagan Jr. • Tom Fletcher • Jack Flowers • Foothills Park and Recreation District • J. R. Ford • Angela Fowler • Alesha Frederick • Tracy Fredin • David Freeman • Jennifer Fuller G Barbara Galloway • Julia Gallucci • Marilyn Gary • Dennis Gates • Jonathan George • Steve Glammeyer • Ned Goldsmith • William Goosmann • Steve Groh • Pete Gunderson h Harriet Hageman • Pam Hamamoto • Michael Hance • Wendy Hanophy • Linda Hanson • Floyd Harlan • Eric Harmon • Paul Harms • Nelson Harvey • Mary Hattendorf • Jared Heath • Nilmini Hecox • Brendan Hedel • Matt Heimerich • Sue Helm • Carla Hendrickson • Kate Henion • Mark & Sara Hermundstad • James Hickman • High Line Canal Preservation Association • Jeannette Hillery • Jim Hokit • Megan Holcomb • Allen Holcombe • Lisa Hollander • Barbara Horn • Larry Howard • Charles Howe • Bethany Howell • Terry Huffington • Phyllis Hunt • Kim Hutton • Eileen Hyatt • Hydros Consulting Inc. • James Hyre i Cliff Inbau • David Inouye • William Inveen • Ireland Stapleton Pryor and Pascoe, P.C. • Julio Iturreria j Nancy Jackson • Katie Jagt • Stefan Jansson • Amy Johnson • Adam Jokerst • Alix Joseph • John Justman k Laurna Kaatz • Andrew Kabot • Julie Kallenberger • Dave Kanzer • Melinda Kassen • Kurt Keeley • David Kienholz • John Kilrow • Andrew Kirsch • Stan Kloberdanz • Lisa Knerr • Will Koger • Chris Kraft • Krage Manufacturing, LLC • Robert Krassa • Adam Kremers • Adrianne Kroepsch • Rod Kuharich • Karl Kumli L Lambert Realty • Birgit Landin • Marnie Lansdown • Lee Ledesma • Jeff Lee • Cindy Lefever • Kim Lennberg • Margaret Lenz • Mark Levorsen • Patricia Locke • Robert Longenbaugh • Scott Lorenz • Jeffrey Lukas • Steve Lundt m Mara MacKillop • Kristin Maharg • Sean Makau • Steve Malers • Zach Margolis • Donald Martinusen • Richard McAllister • Bryan McCarty • McCarty Land and Water Valuation • Erin McDanal • Dennis McGrane • Charles McKay • Julie McKay • Meeker Regional Library District • Joe Meigs • Carolyn Melphy • Steve Miles • Steve Miller • Stephanie Mills • Minion Hydrologic • Erin Minks • Harold Miskel • Miss Management LLC • Allen Mitchek • Liza Mitchell • Rebecca Mitchell • Robin Molliconi • Martha Moore • Larry Morgan • Stephanie Morse • Ann Mullins n MaryAnn Nason • David Nelson • Josh Nims • Carolyn Nobel • Northwest Colorado Council of Governments • Norton Appraisal Services, Inc. • Amelia Nuding 0 Trisha Oeth • Kathleen Okon • Ellen Olson • Erika Oster • Otten Johnson Robinson Neff & Ragonetti, P.C. • David and Linda Overlin p Dick Parachini • Kathy Parker • PC Johnson Attorney at Law • Rachel Pence • Jack Perrin • Pikes Peak Library District • Allison Plute • Deborah Polich • Peter Pollock • Sara Porterfield • Alicia & Brandon Prescott • Mary Presecan • PS Systems, Inc. • Kira Puntenney r Ken Ransford • Realtors Land Institute - Colorado Chapter • Jamie Reddig • Klint Reedy • Gene Reetz • Chris Reichard • David Reinertsen • Melvin Rettig • Ann Rhodes • Jane Rhodes • Gigi Richard • Rachel Richards • Frank Riggle • Lee Rimel • Vicki Ripp • Ellen Roberts • Collin Robinson • Jeff Rogers • Sheila Rogers • Kelly Romero-Heaney • Kate Ronan • Donny Roush • Roxborough Water and Sanitation District • Denise Rue-Pastin • Phil Russell • Ken Rutt • Su Ryden s Nikki Sandve • William Sarni • George Saum • Michael Sawer • Wayne Schieldt • Don Schwindt • Alyson Scott • Stephanie Scott • Colleen Shipley • Nona Shipman • Kara Sibernagel • Jack Sibold • Lisa Sigler • Valerie Sigler • Kevin Sjursen • David Skuodas • Greg Smith • James Smith • MaryLou Smith • Treasa Smith • Zach Smith • Jo Ann Sorensen • Laura Spann • Alicia Sprague • Pavlos Stavropoulos • Timothy Steele • Jenelle Stefanic • Joe Stepanek • David Stiller • Dana Strongin • Ed Struzeski • Summit Global Management • Stu Swineford t Jack Taylor • Pete Taylor • Richard Tocher • Andrew Todd • Mick Todd • Milt Tokunaga • Town of Severance • Tri-County Water Conservancy District • Carl Trick • Thomas Trout • TST Infrastructure, LLC • Ken Turnbull • Howard Tuthill u George Ulrich v Paul van der Heijde • Jean Van Pelt • Wayne Vanderderschuere • Hayes Veeneman • Tom Verquer • Linda Vida • Jodi Villa • Robert Viscount W Marc Waage • Shelley Walchak • Robert Ward • Russell Waring • Bert Weaver • David Wegner • Gaythia Weis • Weld County Commissioners Office • Weld County Underground Water Users Association • Jennifer Wellman • WestWater Engineering • Kaylea White • John Wiener • Jody Williams • Lacey Williams • Kay Willson • Roger Wilson • Laura Wing • Karen Wogsland • Richard Wojciechowski • Dick Wolfe • Connie Woodhouse • W-Y GW Management Dist y John Yelenick z Viviana Zavala

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MATTHEW STAVER

Bankable > Productive > Opportunity

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WATER IS MAXIMIZING Coloradans seek to make the most of available water by sharing it among multiple users through flexible arrangements, also known as alternative transfer methods. At Lauck Farms in Northeastern Colorado this pond holds water delivered from the Fort Morgan Ditch Company. The water irrigates corn crops efficiently via a sprinkler system and subsurface drip system. That efficiency is key. The farm and others along the ditch participate in an agreement with Xcel Energy where they lease some water to Xcel during dry years when the utility needs additional water to cool its nearby power plant. The farm puts money from the lease back into its operation to continue improving efficiency so that it can stretch water supplies and continue to produce even when the sharing agreement with Xcel kicks in.

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Water is Bankable

A Deposit in Our Colorado River Account A water banking experiment grows on the Western Slope

BY NELSON HARVEY

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estern Colorado’s Grand Valley is known for its agriculture, from the peach orchards and grape vineyards at the foot of the Colorado Plateau to the verdant waves of alfalfa near the Utah border. Yet this past summer, a handful of Grand Valley farmers were paid to grow nothing at all.

It’s a test of an innovative scheme called water banking. The concept is to send the unconsumed water, normally used by those farmers, downstream to Lake Powell to bolster low reservoir levels. This voluntary, compensated program aims to stave off future water shortages that could endanger all who rely on the Colorado River—from western Colorado farmers to Front Range cities. It sounds paradoxical, but temporarily fallowing some farmland now could help prevent the permanent dry-up of farmland in the future.

Under the program, 10 members of the Grand Valley Water Users Association (GVWUA), which operates the historic Government Highline Canal, have taken 1,250 acres of land out of production this year, receiving $560 per acre to help make up for the alfalfa, corn or wheat they would otherwise have grown. Funding comes from the System Conservation Pilot Program and from the Colorado River Water Bank Work Group, a coalition that has been studying water banking since 2009 and includes the Colorado River District, the Southwestern Water Conservation District, The Nature Conservancy, Tri-State Generation and Transmission. Participating farmers must submit to periodic inspections and keep their fallowed land free of irrigated crops and weeds alike. To protect the GVWUA’s water rights, the water they would have used is diverted as usual from the Colorado River just northeast of Palisade and run through the Grand Valley Power Plant to generate hydropower, then returned to the river.

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In 2017, the pilot project returned an estimated 3,200 acre-feet of water to the Colorado River that would otherwise have been consumed by crops, according to GVWUA general manager Mark Harris. It’s a drop in the bucket compared to the 7.5 million acrefeet that Colorado and its neighbors in the Upper Colorado River Basin are required to ensure reaches the lower basin in an average year under the 1922 Colorado River Compact. Yet the program is an important first step in testing the theory that farms and cities could partner to replenish water levels in Lake Powell, the 254-square-mile reservoir that effectively serves as a bank account where upper basin states deposit the water that is later released to the lower basin.

Should Lake Powell levels continue to fall and reach a point below where the Glen Canyon Dam, which creates Lake Powell, can generate power, a line of undesirable

“The way we address the risk and uncertainty [associated with a compact call] will have long-term implications for agriculture and the environment.”

—Aaron Derwingson, The Nature Conservancy

dominoes could begin to fall. Important revenues from power generation that fund operations and environmental programs would crater. At that low reservoir level, with the power plant penstocks above water, the dam would not be able to deliver enough water for the upper basin to meet Colorado River Compact obligations. In such a scenario, the lower basin could issue a so-called “compact call,” where water rights appropriated after 1922 could be subject to curtailment until the lower basin gets its share. Thus the upper basin states would actively and quickly work to reduce agricultural or even municipal water use.

If dry conditions were to persist and legis-

lative changes weren’t made, East Slope water managers would likely adapt by buying up water rights that predate the Colorado River Compact of 1922, many of which are now used to irrigate West Slope farms. That could lead to the permanent dry-up of much Western Slope agriculture, an outcome that most Coloradans would hate to see.

“Our water rights would probably be looked at as very desirable in the event of a compact call, and I’d like to be part of a solution that prevents that call from ever happening,” says Joe Bernal, 54, who farms 900 acres in Loma, Colorado, west of Grand Junction, serves on the board of the GVWUA, and plans to fallow 160 acres of his farmland when the pilot program continues in 2018.

As a tool for averting a compact call, water banking could expand in the coming years. Aaron Derwingson, the Colorado River agricultural coordinator for The Nature Conservancy and a member of the water bank work group, says his organization is investigating at least six small-scale water banking pilot projects downstream in Utah, and others are underway on individual farms and ranches in Colorado.

“The way we address the risk and uncertainty [associated with a compact call] will have long-term implications for agriculture and the environment,” says Derwingson. “We want to be involved to help shape that approach.”

Yet the conditions required for a successful water bank are rare and tough to foster, Derwingson says. To begin with, water banking requires legal protections to “shepherd” unused water downstream without allowing its diversion by other water users. In the Grand Valley, an absence of downstream diversions assures the water’s safe passage to Lake Powell. Such favorable legal conditions are unlikely to be replicated elsewhere, meaning downstream water users could divert the unused water before it reaches its intended destination. In Colorado, there are some existing tools to shepherd conserved water downstream—including instream flow water rights—but it remains to be seen whether additional legal protections are required to enable water banking across the Colorado River Basin.

It’s also unclear how future water banks

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will be funded. While the Front Range Water Council has funded water banking in the past, and there are pilot programs like the System Conservation Program, in which Denver Water and others provide funding for projects to reduce water demand in the Colorado River Basin, some utilities may be ambivalent about footing the entire bill for water banking programs. So The Nature Conservancy is pursuing collaborations with corporations like PepsiCo that might be willing to invest in water security and fill the funding gap.

Finally, questions of governance—who runs a project, who makes decisions—will dog the creation of any new water banking entity and can take years to resolve, Derwingson says.

Aside from working to enroll somewhere between 15 and 20 of its members in an expanded water banking program in 2018, the GVWUA has also been offering tours and advice this past year to many water providers interested in launching pilot projects of their own. Yet Bernal and others worry that scaling up water banking significantly could have ripple effects across the agricultural economy—from farm equipment suppliers to feed stores—as more land is temporarily removed from production and farmers spend their money outside of the farming sector.

“We’re only fallowing about 5 percent of the agricultural land in the [GVWUA] district this year,” says Luke Gingerich, a water resources engineer with JUB Engineers in Palisade and the 2017 manager of the Grand Valley pilot project. “Even at this level, there are probably some quantifiable costs to agricultural vendors and the community at large. Any scaled-up program would have to quantify those and deal with them.” n

GREG POSCHMAN

TAKE THE NEXT STEP Read about demand management projects to shore up Lake Powell or submit a proposal for a conservation project in 2018 by digging into details of the System Conservation Pilot Program.

Find it at: ucrcommission.com/RepDoc/ SCPilotP.html.

Mark Harris with the Grand Valley Water Users Association stands with Luke Gingerich of JUB Engineers in a fallowed field west of Grand Junction. The field was temporarily dried up in 2017, with water sent downstream toward Lake Powell, in an effort that could be a step toward creating a water bank on the Colorado River.

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Water is Productive

When irrigation is reduced or entirely cut for a season, farmers and researchers wonder if crops will be affected in the long term or if yields will bounce back to normal.

On Fallowed Ground

BY NELSON HARVEY

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eighing whether to participate in a water-sharing arrangement like water banking, rotational fallowing, or deficit irrigation is a complex decision for any farmer. Aside from declines in crop revenue during the season when irrigation is reduced, farmers must also consider the long-term potential for reduced yields, lower-crop quality, and increased weed pressure once operations return to normal.

“Once a farmer gets involved in one of these programs, they are concerned that they’re unleashing a cascade of effects that could affect their production for a long time going forward,” says Dr. Perry Cabot, research and extension leader at Colorado State University’s Western Colorado Research Center.

To better understand those effects, Cabot partnered with CSU professors Joe Brummer and José Chávez on a three-year research project beginning in January 2015. Using $300,000 from the Colorado Water Conservation Board, the Colorado River District, The Nature Conservancy, the Front Range Water Council, and the Southwestern Water

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Conservation District, the team designed irrigation-reduction experiments on three alfalfa fields and three grass pastures in western Colorado. The alfalfa fields were located in Loma, Eckert and the community of Yellow Jacket in far southwestern Colorado, while the pastures were in Grand Junction, Montrose and Gunnison. Each field was divided into a reference plot, where irrigation continued as normal through 2015 and 2016, and a test plot, where irrigation was reduced in those years. On the grass test plots, irrigation was removed after one cutting of hay in the summer. The alfalfa test plots had their irrigation curtailed after either the first, second or third alfalfa cutting. Normal irrigation then resumed on all the test plots the follow-

floo-uhnt water fact

Deficit irrigation is an alternative to fallowing when farmers are looking to get by with less water—but does it make economic sense to keep growing with reduced irrigation? In some cases, yes, according to a 2017 study out of Colorado State University, especially if water costs are on the rise.

ing spring, and the researchers measured how the test plots recovered compared to the reference fields in terms of yield, crop quality and other variables.

Both yield and crop quality declined as expected during the periods when irrigation was removed entirely. Yet when irrigation was returned to normal in the spring, all fields except the higher-elevation grasses in Montrose and Gunnison saw their yields return to normal compared to the reference fields.

Grasses in Montrose and Gunnison took longer to recover, likely due to their relatively shallow roots. Crop quality also increased in most cases compared to the reference fields, a phenomenon that Cabot attributes to the plants coping with water stress by packing on carbohydrates, then using them for a boost of plant growth when water returns.

“The results are encouraging because they show that producers in some areas will not be harmed by irrigation reduction projects,” says Cabot. “And farmers can go into negotiations over irrigation reduction projects knowing that their fields will recover once the projects are done, even though it may take longer in some areas than in others.” n

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Measuring the on-farm effects of water-sharing programs

Water is Opportunity

Investing in the Future of Farming

BY LACEY WILLIAMS

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he trends are clear—fewer people are going into farming. In 2012, there were 20 percent fewer beginning farmers in Colorado than there were five years earlier. But it’s not just the declining number that’s concerning, it‘s also the age of those tilling the soil, as farmers older than 55 outnumber those younger than 35 by 12 to 1, according to the U.S. Department of Agriculture’s 2012 Census of Agriculture.

As if these demographic challenges weren’t enough, cost and availability of water and land also hinder new farmers. Getting started in farming is an expensive endeavor.

At the same time, irrigated agriculture in Colorado faces the challenge of standing up to buy and dry, the practice where municipalities purchase and permanently transfer water rights from willing agricultural sellers, drying up farmland in the process. Instead, irrigators and others across the state are seeking ways to keep water on farms. Some are looking to conservation easements, others are grouping easements with alternative transfer methods (ATMs) or creative lease options where water can be kept in agriculture but shared with municipalities during times of need.

Entities in the Arkansas Valley are pairing these challenges and facing them head-on by financially helping young and new farmers get their start—though in some cases that assistance comes with the caveat that the farmers participate in an ATM. The Lower Arkansas Valley Water Conservancy District (LAVWCD) has been encouraging farmers into the practice while maintaining water in the valley. “The goal is to help young farmers while tying water to the land in perpetuity,” says Jay Winner, general manager of the LAVWCD. Through conservation easements, the LAVWCD keeps water on the land. The LAVWCD started using easements in 2005 and after 12 years now holds 58 easements conserving 16,500 acres of ag land. That land is tied to surface and well water rights and nearly 2,780 shares of ditch water.

“We have a multitude of different types [of easements],” says Mike Weber, engi

neer in training for the LAVWCD. While the variety of easements don’t all make farming more affordable for farmers, the LAVWCD’s purchased easements often do—and many of these deals go to young farmers. One such arrangement, agreed to in 2012 and implemented beginning in 2014, provided a young farmer with a 50 percent discount on the purchase of his farm, placed the farm and water into one of LAVWCD’s conservation easements, and put a portion of the water into an ATM. The water is now tied to the land but the farmer fallows up to 30 percent of his land each year so that water can be leased to the municipalities

“The goal is to help young farmers while tying water to the land in perpetuity.”

—Jay Winner, Lower Arkansas Valley Water Conservancy District

of Fountain, Security and Fowler. This deal on the Catlin Canal is enabled through HB 13-1248 which allowed the creation of pilot projects to test fallowing-leasing. Young people want to farm but when they have to pay full cost for the property and water, generating sufficient cash flow is too high a barrier, Winner says.

Now Aurora Water is developing a similar Cooperative Farm Purchase Program.

Aurora’s goal is to bolster its supply during dry years and contribute to the city’s water future in a sustainable way while ushering new farmers into the industry. The city intends to launch its young farmer program in late 2017 or 2018. Since the 2002 drought, Aurora has been developing a water portfolio to augment supplies in the event of another severe shortage. This plan aims to be one component of that portfolio.

Although it hasn’t been put into action yet, its initial proposal focuses on the Lower Arkansas Valley, where Aurora Water intends to contribute half of the upfront cost for a beginning farmer to purchase land and H E A DWAT E R S | FA L L 2017

accompanying water rights. In exchange for this financial contribution, the farm and water rights are put into a conservation easement held by Aurora. While the farmer retains ownership, the municipality obtains the right to lease the water in three of every 10 years through an interruptible water supply agreement. This mechanism, established by the state legislature in 2003, enables the temporary change of a water right in order to maximize the beneficial use of water. In the Cooperative Farm Purchase Program, the option is for 30 years, or three 10-year periods, with additional 30-year renewal options. Pre-determined price escalators are established for each subsequent period. This program provides flexibility to both the farmer and the municipality, as the city retains a first right of refusal to purchase the farm at market rate should the farmer decide to sell the farm.

Beginning farmers like Mark Marsh are intrigued by the arrangement and eager to work with Aurora. Marsh grew up on the dry lands north of Pueblo and has experienced what happens with buy and dry. He has been looking to purchase a farm to grow hay and corn but needs help financing it— he’s hoping that this program is the vehicle he needs to get into farming.

As Aurora and Marsh negotiate, the city has been working out the complicated legal details of such a deal and is looking forward to its first new farmer. Challenges do exist as continuation of the deal after the first 30 years will require a new statute and the municipality will need to convince farmers the program is a win-win. Aurora Water employees also know they have work to do to get the word out, but that may not be such a large feat. If the deal is as good as it sounds, Marsh says, he already knows others who would be interested in partnering with Aurora. n .

TAKE THE NEXT STEP Learn more about the challenges of getting started in farming, as well as opportunities, trainings and more success stories by connecting with the National Young Farmers Coalition: www.youngfarmers.org.

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FLEX TIME FOR COLORADO WATER BRIAN DEVINE

The stakes are high as Colorado attempts new methods for sharing and moving water

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HOST TOWNS with names like Padroni, Snyder and Hillrose can be found across pockets of Colorado’s farming country. People still live there, and while other rural towns thrive, these have become shells of their former selves, some unable to support a single business.

Vacant storefronts testify to the struggles of rural economies. The causes are many. Capital-intensive technology has replaced human labor on farms and commerce has consolidated around larger towns and cities, especially along the Front Range.

But the loss has been more precipitous in places that have sold their water. Crowley County is one of those places of lost water, dried soil, and tumbled economies. The Colorado Canal arrived in 1891, relatively late among irrigation conveyances. It delivered Arkansas River water to more than 50,000 acres around Ordway, the county seat, located 55 miles east of Pueblo. A few miles away, a factory at Sugar City shredded beets, but the factory closed in 1967, unable to compete with cane sugar. Farmers had other challenges, too. One by one, then in droves, they began selling water rights to Front Range water providers. When the selling ended, just 2,500 acres along the Colorado Canal remained irrigated. Dust storms followed, invasive weeds proliferated, and the natural precipitation of 11 to 12 inches a year was insufficient to sustain strong dryland agriculture. By the 1990s, Crowley County had become Colorado’s poster child for what happens when a place loses it water. As one anthropologist put it, Crowley County was the last to bloom and the first to wilt.

Can Colorado’s other rural communities be prevented from wilting? The question is urgent because Colorado continues to grow, adding 100,000 residents annually, the equivalent of one new City of Longmont a year. Most new residents live along the Front Range, home to 84 percent of

BY ALLEN BEST

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Coloradans in 2015, according to state Department of Local Affairs estimates. It’s all premised on water. Fields from Middle Park to the Arkansas Valley have dried, the result of cities buying farms for their water rights, a practice called buy and dry.

“A thousand acre-feet of water here, a thousand acre-feet there, and pretty soon it’s adding up to real water,” says Phil Brink of the Ag Water NetWORK, an organization formed by the Colorado Cattlemen’s Association to keep agricultural water connected

to agricultural land. Cities have gone to farms because that’s where the water is: Agriculture accounts for 86 percent of the total amount of water diverted from Colorado’s surface and groundwater sources, according to the Colorado Division of Water Resources. Perhaps new water sources can be developed, at least small amounts, without removing water from farms. But water from new projects will have the youngest, or most junior, rights, making them the most vulnerable. In severe drought years,

PREVIOUS PAGE: The sandy bottom of a former irrigation ditch in Crowley County lies dry,

overgrown with tumbleweeds. The water here was sold to municipalities in the 1970s and 80s, no longer diverted for agriculture—the classic tale of buy and dry.

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BRIAN DEVINE

Sugar City, once a mecca of irrigated agriculture in southeastern Colorado’s Crowley County, is now a ghost of its former self. Crowley County lost more than 90 percent of its irrigated agriculture to buy and dry over the span of a generation.

like 2002 and 2012, owners of only the oldest, most senior water rights, and owners of junior rights with replacement water supply plans in place, got water. That’s why buy and dry remains attractive to water managers responsible for ensuring municipal water supplies as the state’s population, now at 5.5 million people, pushes toward what demographers predict will be 9 million by mid-century. Farmers tend to hold the most senior—and most secure—rights.

By 2050, Colorado could lose 500,000 to 700,000 acres of currently irrigated farmland in order to meet municipal growth demands, according to the 2010 Statewide Water Supply Initiative. That could mean up to 33 percent of today’s irrigated land in the South Platte Valley would be dried up and 17 percent in the Arkansas River Valley.

The mainstem of the Colorado River—from Grand County to Grand Junction—could lose 29 percent of its irrigated acreage. Can we do better? Can we grow towns and cities and also corn and hay?

Yes, arguably, we can. New, innovative tools have been forged over the past several decades that seek to achieve this hydrological alchemy, where cities and farms grow side by side by sharing water, among them interruptible water supply agreements, split-season irrigation, and multiple-use decrees. The umbrella term used to describe such tools is ATMs, or alternative transfer methods.

Colorado’s Water Plan, published in 2015, calls for 50,000 acre-feet of water to be identified in ATMs by 2030. Just 17,400 acre-feet of potential yield is now available through ATMs, although not all is taken in any given year, according to a 2017 Colorado Water Conservation Board (CWCB) report.

The Colorado River poses a large and overlapping challenge of statewide concern.

Between 450,000 and 600,000 acre-feet of Western Slope water is drawn annually through tunnels and ditches to farms and cities east of the Continental Divide. But what if that water should become unavailable because of extended drought, reduced water flows, and interstate compact commitments? That chilling possibility has driven water leaders to investigate alternative methods for water sharing and water banking to protect both agriculture and municipal use in times of drought.

While Colorado’s water allocation process has become somewhat more flexible in the past 20 years because of new statutes,

VOICES FROM THE FIELD | BY JERD SMITH

Bill Lauck

Lauck Farms and the Fort Morgan Ditch Company

MATTHEW STAVER

B

ill Lauck was 49 in 1993 when he and his fellow farmers in the Fort Morgan Ditch Company, entered into what, back then and even now, was a groundbreaking 40-year agreement to lease 2,500 acrefeet of water it owns in the South Platte River to Xcel Energy. When the agreement was finalized, more than 70 percent of the ditch company’s farmers agreed to participate.

Lauck is a third-generation farmer. His grandfather bought the Fort Morgan ranch in 1949 after emigrating from Russia.

Now the family owns about 800 acres and leases an additional 160 acres for a large corn operation.

Lauck says he immediately supported the proposal to lease because he saw it as a way to benefit financially and to prevent more farms from being bought by cities or industrial users.

“It was and is a unique thing,” he says, because it’s one of the oldest and largest alternative transfers operating in the state.

With that history has come important lessons. Each year, the ditch board negotiates with Xcel to determine how Xcel’s water will be delivered. Key to making the program work is geography. The Fort Morgan ditch runs beside the power plant and is able to deliver water directly to the plant’s intakes. In some

Bill Lauck grows corn irrigated with water from the Fort Morgan Ditch. There, he and other members of the Fort Morgan Ditch Company are participating in a 40-year agreement to lease 2,500 acre-feet of water to Xcel Energy. years, the farmers deliver water to Xcel’s wells in the alluvium.

Once the water forecast is finalized in late April or early May, the farmers meet with Xcel officials to hammer out how the transfer will work, determining which months they will deliver water and how many credits they are going to derive as a result.

The agreement has functioned well, Lauck says, because Fort Morgan has senior rights on the river and storage rights in Jackson Reservoir, which provides important flexibility in drought years. Xcel also has

storage rights nearby.“We can move the water around so that it benefits everybody,” Lauck says.

In exchange for the option to use the water, Xcel pays the farmers an annual fee that increases each year based on the inflation rate—the farmers receive this small payment regardless of whether the water is needed. When Xcel does use the water, the farmers receive a larger payment.The farmers have had to shut down irrigation just three years in the 23 years the agreement has been in place.

Such alternative methods of

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transferring water are critical to sustaining agriculture and helping Colorado meet the growing demand for new water supplies, he says. “We need to keep agriculture alive in Eastern Colorado,” Lauck says. “If we do not come up with ways of doing alternative transfers, there will be communities that die.”

The Xcel agreement will expire in 17 years and Lauck is hopeful that it will be renewed. “I would like to see the community last here.

This has been a good alternative to what would have happened or what could happen,” he says. n

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opinions are divided about whether more flexibility may be needed. Projects from Larimer County to Grand Junction to Rocky Ford demonstrate that Colorado is looking for solutions. The answers matter, because you never know when the next big drought will arrive.

By 2009, municipal purchasers had bought water for more than 102,000 irrigated acres in the Arkansas Basin and more than 150,000 acre-feet of water was detached from the land.

FROM BUY TO DRY

can instead end up in Aurora or Colorado Springs.

The Front Range urban corridor, where additional water is wanted most, lies almost entirely uphill and generally a long distance from most potential agricultural water sources. This sharply restricts the opportunities for downstream ATMs. But so do simple operational requirements of ditches and rivers. Water diverted at one place has an impact on water rights downstream. Water rights can be exchanged, but there are limits to this reordering. So municipalities look for ag water that is accessible. In the Lower Arkansas Valley, the existing infrastructure made buy and dry possible, but it also provides opportunities for new ATMs. Downstream from Buena Vista and stretching past Pueblo, the Arkansas has 20 major exit ramps, ditches created to deliver water to farms. Among the oldest is the Rocky Ford Ditch, which was carved into the

The Arkansas River Valley offers the most striking examples of both the problems of buy and dry and the tantalizing promise of innovative water sharing. The river originates near Leadville, augmented primarily by diversions that deliver water from the Fryingpan, Roaring Fork, and Eagle rivers through tunnels in the Sawatch Range. Water pauses in the Turquoise and Twin Lakes reservoirs before hurrying down toward Buena Vista. Some of it doesn’t get there.

At the Otero Pumping Plant, just north of Buena Vista, a large pipe ferries water across the Mosquito Range and into the South Platte River drainage. From there, it can flow by gravity to Aurora or, with one additional push, to Colorado Springs. This infrastructure is critical to understanding how water originally destined for the Colorado River or a corn field near Rocky Ford 22

dun-colored landscape in 1874. Old water rights like these are the most valuable to cities because, during dry times, the Arkansas generally still has enough water to satisfy such senior rights.

The transfer of water from farms to cities began in the 1890s, but the pace of sales quickened in the 1970s and 1980s as Aurora, Colorado Springs and Pueblo found willing sellers in farmers who were struggling because of high interest rates and low commodity prices. By 2009, municipal purchasers had bought water for more than 102,000 irrigated acres in the Arkansas Basin and more than 150,000 acre-feet of water was detached from the land, according to University of Colorado economist Chuck Howe. Not all purchased water has been taken off the land though. In the Arkansas Valley and elsewhere in Colorado, cities bought water preemptively, preparing for growth. In many cases, cities continue to

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The City of Aurora and other Front Range municipalities once looked to buy and dry to grow new water supplies for their increasing populations.

Now Aurora is working through a variety of ATMs to access ag water but still keep farmers in irrigated agriculture.

MICHAEL SWEENEY

lease the water they bought back to farmers until municipal demand reaches the point that the water is needed.

Aurora’s investments, deep and evolving, deserve special attention. After purchasing Crowley County water in the 1970s and 1980s, Aurora bought water attached to 58 percent of the land serviced by the Rocky Ford Ditch Co. in 1989. The buy produced dry, but this time the district water court required Aurora to revegetate acreage taken out of irrigation with native grasses. Revegetation brings the land back to a healthy natural state and prevents invasive weeds from taking over. Aurora’s strict revegetation work continues today.

In 2004, Aurora bought nearly all the rest of the Rocky Ford Ditch Co. water and about 2,800 acres of land, but that purchase was different than the first. By then, the city was facing fierce opposition from the late Bob Rawlings, editor of the Pueblo Chieftain, who led the public charge against buy and dry in the Arkansas Basin. Aurora tried a different tactic, a program called Continued Farming that allowed farmers to continue irrigating but with less water. Under Continued Farming, farmers sold their water rights to Aurora but kept their land and now lease some of that water back. The initial lease term was for 10 years, which was renewed for an additional 10, now expiring in 2024, though Continued Farming is expected to be an ongoing project, says Gerry Knapp, who supervises Aurora’s operations in the Lower Arkansas Valley. Aurora figures it gets about 1.26 acre-feet of water per acre while providing 0.5 acre-feet to the farmer.

To reduce on-farm water inputs, the city invested up to $1,400 per acre for installation of either drip irrigation systems or center-pivot sprinklers, both requiring less water than furrow flooding. With less water available, farmers had to start planting high-value, low-water crops like melons and onions. And to make drip irrigation work with this limited amount of water, irrigators look to the Arkansas Groundwater Users Association for well water and rely on the leased water to augment their depletions.

Aurora says 880 acres remain in production near Rocky Ford, out of the total 2,800 acre purchase, as a result of this highertech, crop-switching change.

director of the Colorado Water Congress but then the manager of water resources for Aurora Water. He recalls tightened water restrictions that ratcheted down demand by 35 percent. Even so, there was fear that Aurora, Colorado’s third-largest city, was running out of water—a supply it draws from within the basin and from across the Continental Divide through transbasin diversions. That, says Kemper, “is pretty frightening for a city.”

As reservoir levels dwindled to 29 percent of capacity, then a three-month supply, Aurora studied 50 alternatives. One of the most workable involved another ditch in the Rocky Ford area, the Rocky Ford High Line Canal Company. In March, utility officials went to Rocky Ford to meet with ditch members and asked them to voluntarily and temporarily lease their water to Aurora. Kemper remembers more than 200 people in the high school gymnasium. “Whether you participate is optional,” he told the crowd. When the votes were in, 80 percent of ditch-shareowners approved the terms of the deal. The leases, implemented in 2004 and 2005, directly encompassed 8,200 irrigated acres, representing 37 percent of shares in the Rocky

Ford High Line Canal Company. Farmers received $649 per acre per year, or a total of $10.6 million over the two years. Aurora also bore the cost of creating a substitute water supply plan, which specified how depletions to the system would be replaced so that other water rights weren’t injured. The plan took 18 months to execute. Eventually the drought abated and Aurora filled its reservoirs.

Aurora continues to look to the Arkansas Valley for water during the driest years. Rather than buying and drying farms, Aurora is entering into interruptible supply agreements with willing irrigators, which allow transfers from originally decreed places and uses to a new place and use for three of every 10 years.

Knapp says unique circumstances dictate whether each individual farmer chooses to participate in the transfers. Some are not interested in leasing their water, he says. “I’m fully comfortable with that. There are a lot of other factors that go into an individual farmer’s decisions about whether to participate.”

Although he works for Aurora, Knapp grew up and still lives around Rocky Ford.

He sees alternative transfers as necessary.

“If we want to maintain rural Colorado’s CONTINUED ON PAGE 26

AGREEMENTS ON THE ARK The searing drought of 2002 drove Aurora to desperately look for options. “It was devastatingly bad,” says Doug Kemper, now

Gerry Knapp, who supervises Aurora’s operations in the Lower Arkansas Valley, looks over rows of onions at Mameda Farms in Rocky Ford. The farm is drip irrigated as part of Aurora’s Continued Farming Project.

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VOICES FROM THE FIELD | BY JERD SMITH

Gene Manuello

Manuello Farms, Sterling Irrigation Company and Colorado Ag Water Alliance

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Gene Manuello, a cattle rancher and feedlot operator, is skeptical that ATMs can help keep water in agriculture, as are many other irrigators across the state. company is willing to participate in a transfer program. “As a whole our ditch board would not promote it. We would fight it,” he says.

“There are people who believe we don’t have a water problem because we can just take it from ag. I believe that is the wrong approach. The correct approach is storage. But I don’t believe we look at it strong enough and push hard enough to get these [storage] projects done. “ Last year, as part of his work with the Ag Water Alliance, Manuello traveled the state visiting with members of the alliance and asking about their views on alternative transfer methods.

Most of the producers interviewed opposed ATMs, Manuello says. Producers don’t trust that ATMs can be done with enough volume to alleviate the coming water shortage, and they don’t believe the transfers, regardless of how they are structured, will ultimately protect farmers and their water rights.

“In surveys, initially 70 percent to 80 percent of farmers say they are interested, but when it comes down to actually doing it, they are not.”

Manuello says he believes the seeming disconnect lies in farmers’ interest in trying to remain open to new ideas. But that interest isn’t enough to convince them

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to engage in transfers that, at least initially, don’t have enough data behind them to demonstrate conclusively that they won’t harm individual ag water rights.

Manuello says he’s also troubled that the well-funded leasing programs are making it more profitable to lease water to cities than to farm the land.

“If a person leases a bit of his water, especially if he is struggling, and some are and some aren’t, that’s why it is appealing.

But what will that do 100 years from now to society? We do have a growing population. We have a growing thirst for water, but aren’t we also going to have a growing appetite for food?” n

MATTHEW STAVER

ene Manuello, 72, has been running his family’s farm and feedlot operation on Colorado’s Northeastern Plains for decades. Manuello’s grandfather emigrated from Italy when he was nine years old, and in 1928 bought the farm that would form the basis of Manuello’s agriculture operation.

In this far-flung piece of the state, there is little faith that even widespread use of water leases and fallowing programs will do anything to protect the state’s rich agriculture economy or its water.

Manuello serves as president of the Sterling Irrigation Company and also serves on the board of the Colorado Ag Water Alliance.

The alliance supports ATM policy that is beneficial to ag as a means of minimizing the movement toward permanent dry up of irrigated lands. However, it believes that the use of ATMs results in the loss of agriculture to some degree, whether temporary or permanent.

“Ag water to me is to produce corn and alfalfa, to produce crops and feed our country,” Manuello says. “I don’t have a problem with transfers themselves, but I do have a problem with promoting them as if they are going to solve our water problems.”

The Sterling Irrigation Company is one of the oldest and largest operating on the South Platte and has water rights that date back to 1874. None of the farmers with shares in the ditch

Glenn Hirakata Hirakata Farms

MICHAEL SWEENEY

G

lenn Hirakata, 53, is a fourth-generation farmer in the Arkansas River Valley. In a region with traditions that go way back, Hirakata is embracing something decidedly modern, a program in which the region’s scarce water is being shared with cities.

“It’s such a new concept,” he says. “It’s a learning process.” The 10-year lease-fallow program on the Catlin Ditch involves six farms and 902 acres of irrigated land.

The water is exchanged through Pueblo Reservoir and then delivered to Fountain and the Security Water District. The Town of Fowler also participates, using the water to augment its well pumping.

Hirakata, who grows honeydew and watermelons, as well as cantaloupe, pumpkins and some grain, is one of six farmers who signed up for the program in 2015.

He placed one, 150-acre farm in the pilot. His family has about 1,250 acres under cultivation.

He first learned of the pilot, known as the Catlin Canal Pilot Project, in 2015 when staffers at the Lower Arkansas Water Conservancy District began informally asking area farmers if they could support such an effort. “Out of all of the individuals, some of them were like, ‘no, no.’

But there was a handful of us who said it’s worth looking further into it,” Hirakata says. “I don’t know for a fact how it’s going to work but I think it’s worth looking into.”

Under the terms of the agreement, farmers can fallow up to 30

percent of their acreage to save water that can be transferred to municipalities. Fields are allowed to be fallowed for three out of 10 years. In 2016, 406 acre-feet of water was delivered to the three towns. In exchange, farmers were paid $1,020 per acre, and spent $37 an acre controlling weeds and erosion on land that had been fallowed.

The program is working well so far, Hirakata says, but 2016 and 2017 have provided abundant water. “We don’t know what is going to happen in a dry year,” he says. “There is a lot of risk.

You have to deliver the water to

receive any benefit. If we can’t deliver, we’ve left ground idle.” To create the data needed to support the program, each farm’s water system was analyzed and engineering work completed to ensure the measurements were accurate.

Under the pilot, which is deemed temporary and overseen by the Colorado Water Conservation Board and the Colorado Division of Water Resources, some water is left in the stream to ensure downstream water rights are satisfied while the experiment is underway. “We have left water on the table to reduce downstream opposition,” he says. “If we

did it long-term or permanently, we would have to do more fighting for every little drop.”

There are still plenty of skeptics in the region, Hirakata says, and he may become one of them if, after a dry year, his farm is hurt financially. But he’s keeping an open mind for now. “If there is a way to work this, to lease water and continue to farm, you don’t dry up the valley. It’s a plus for both of us. Don’t be closed minded. Don’t say ‘hell no.’ It might not be in my lifetime that it really comes into reality, but it could be something that my kids could see.” n

Glenn Hirakata, a fourth-generation Rocky Ford farmer who grows watermelons, cantaloupes and pumpkins, opens his headgate along the Catlin Canal.

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In 1976, the yearbook for Rocky Ford High School showed 149 graduates. In 2006, it had dropped to 41.

Glenda Schemenaur, along with other irrigators in the North Sterling Irrigation District, is partner to a deal with BNN Energy, a subsidiary of Tallgrass Energy. Schemenaur leases water off her hay and cattle farm in northeastern Colorado, which Tallgrass uses for hydraulic fracturing.

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With water prices rising, farmers want to keep their options open. A good deal now might not look so handsome in a decade. left small communities struggling. Rocky Ford High School had 149 graduates in 1976. Just 30 years later, it had only 41 graduates.

ATMs FOR ENERGY COMPANIES Energy companies and farmers in northeastern Colorado have also found mutual benefit in ATMs. The newest contract, between a subsidiary of Tallgrass Energy and owners

of water in the North Sterling Reservoir, was executed in May 2017. Tallgrass built an 18inch pipeline from the reservoir to deliver up to 6,800 acre-feet annually to an oil and gas field 38 miles away near Pawnee Buttes. In the North Sterling Irrigation District, 98.8 percent of farmers approved the deal. Financial terms were not disclosed publicly.

“This came at a really good time. Commodity prices have been down for a couple

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MATTHEW STAVER

agriculture economy, we are going to have to do some of these water-sharing arrangements and short-term transfers that meet both the municipal needs and keep agricultural production intact. We are incrementally showing that you can. That’s a big deal to me.”

But you can still hear grumbles in coffee shops of the Arkansas Valley. The loss of water, willing or not, remains a sensitive subject.

At the heart of the discontent are the empty storefronts. They’re not all attributable to buy and dry. More than anything, the efficiencies of technology may be to blame for smaller rural populations which mean fewer patrons for stores and restaurants and declining school enrollments. The cumulative changes have

MATTHEW STAVER

Xcel Energy’s Pawnee Power Station is set to receive water for cooling the plant under two interruptible water supply agreements—winter-time water from the North Sterling Irrigation District and summer water supplies from the Fort Morgan Water Company.

of years. So this will be a good source of additional income for our farmers,” says Jim Yahn, manager of the North Sterling Irrigation District. The water diverted to hydraulically fracture wells near Pawnee Buttes will mean some fields north of Sterling will not get irrigated—but only for a decade, the length of the contract.

North Sterling had previously struck a 25-year deal with Xcel Energy in 2004. It’s best understood as an insurance policy that was triggered by the drought of 2002. Xcel worried it would have insufficient water for cooling its coal-fired power plant at Brush. And operations of the power plant cannot tolerate gaps in water supply, says Rich Belt, senior water resources analyst for Xcel. The water is needed, Belt says, because adversity on the river, such as that caused by

a major forest fire, cannot be known in advance. The interruptible supply agreement forged between the two parties currently requires that North Sterling farmers be paid $40 per acre-foot, for a total of $150,000 annually, regardless of whether Xcel uses their water. If Xcel does use their water, it must pay an additional $425 per acre-foot.

Both fees are tied to the Consumer Price Index so they increase over time. So far, Xcel has not needed to buy the extra water.

Rising prices for water in the South Platte Valley have made farmers in the irrigation districts that he manages leerier of long-term deals, Yahn reports. He also manages Prewitt Reservoir, and prices of shares there have skyrocketed. Yahn thinks the closer water rights are to the Front Range, the less interest there will be among farmers in long-term contracts.

With water prices rising, farmers want to keep their options open. A good deal now might not look so handsome in a decade.

In both deals involving the North Sterling Irrigation District, ATMs provide farmers with stabilizing revenue. The farmers harvest that income, as they would harvest corn or sugar beets, and in that sense the water ATMs are like those of banks. But even when sharing their water on a temporary basis, the district’s farmers retain ownership. “I see it as an alternative source of income, maximizing your income however you can on the farm,” Yahn says. Too, that income potential can provide security when seeking bank loans.

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The Xcel deal requires no additional storage or pipelines. The Tallgrass deal forced the energy company to install a pumping station, electrical transmission and the pipeline, but will eliminate 300,000 trips per year by water trucks. But a Denver-area water provider leasing water from the Sterling area would have to build a 150-mile-long pipeline, which would significantly increase the investment in such a deal, making it less feasible.

FLEXIBILITY AND INNOVATION Since 2002, legislators have adopted several laws that delivered “flexibility for water transfers in an otherwise rigid water rights system,” as a 2016 study by WestWater Research, completed for the Environmental Defense Fund, summarized. The result is that it’s now “potentially easier and lesscostly to transfer an agriculture water right to new uses, at least on a temporary and intermittent basis.”

One such law passed in 2003, allows irrigators to temporarily loan or lease their water rights for instream flows during drought emergencies. Instream flow water rights allow water to remain in a river, stream or lake to benefit the environment. The 2003 law was pressed into service during the drought year of 2012 on the Yampa River. Winter had been dry and rivers looked sure to be barely wet by summer. The Colorado Water Trust, a nonprofit that works to restore flows to Colorado’s rivers, began soliciting water leases

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in late April. The Upper Yampa River Water Conservancy District responded almost immediately with an offer of water from Stagecoach Reservoir. It was a buyer-seller deal, temporary in nature and transacted fast enough under the new law to restore water to the river by early July. Only days before, Steamboat Today published a photograph that revealed a river you could walk across, cobble to cobble, without getting wet.

In its 16 years, the Colorado Water Trust has put together 17 flow-restoration deals on Colorado waterways. “We are ecumenical. We work statewide and we will work with absolutely anyone who wants to work with us,” says Amy Beatie, who was executive director of the trust up until October 2017. She points to the organization’s newest deal, on the Little Cimarron River in the Gunnison Basin, as the most innovative.

The Little Cimarron has been subject to seasonal dry-ups. This innovative arrangement allows water to be diverted as normal to grow hay in June and July. But instead of diverting to flood hay fields again in August and September, a time when flow levels typically drop, the water is instead left in the river. This is not a temporary, but permanent, split-season arrangement.

The Colorado Water Trust owns the water rights. While hay growers use the water early in the season, the CWCB—the state agency that is legally allowed to hold in-

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stream flow water rights—uses the water to keep streams wet during dry months.

The key words, says Beatie, are flexibility and innovation.

FROM THE ATM TO THE BANK In the Colorado River Basin, study of ATMs is being driven by growing concern that Colorado might need to curtail demand to meet terms of the 1922 Colorado River Compact. A compact call could occur if the upper basin states—Colorado, New Mexico, Utah and Wyoming—failed to send enough water, or an average of 7.5 million acre-feet per year over a 10-year period, to the lower basin. In Colorado, diversions affected could be all those with post-1922 water rights, which includes water users statewide. One worry, at least on the Western Slope, is that Front Range cities would be tempted to buy and dry Western Slope farms. The concern has been heightened by hydrologic and climatic models, which show that climate change could permanently reduce flows throughout the basin.

Colorado is not alone in this worry. Four major municipal water providers throughout the basin states—Denver Water, the Central Arizona Water Conservation District, the Metropolitan Water District of Southern California, and the Southern Nevada Water Authority—along with the U.S. Bureau

CONTINUED ON PAGE 30

floo-uhnt water fact

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A 2016 survey conducted by the Colorado Cattlemen’s Association’s Ag Water NetWORK asked irrigators if the ultimate use of the leased water in an ATM—municipal, recreational, environmental, etc.—would affect their interest in participating.

Nearly 50 percent of respondents said yes.

COURTESY COLORADO WATER TRUST

The McKinley Ditch off the Little Cimarron River is home to the Colorado Water Trust’s new permanent deal. Here, hay growers divert water early in the season, but late in the season the water is kept in the river through an instream flow water right.

of Reclamation in 2014 launched the Pilot System Conservation Program, an effort to explore how the basin states can use less water in order to ensure critical water levels are sustained in Powell and Mead, the two big reservoirs on the river. Colorado has had 11 pilot projects on the Western Slope funded through the program. Money has gone toward reducing municipal outdoor water use, but mostly the projects have involved farming: growing crops that use less water, more efficient irrigation, temporarily fallowing fields, and deficit irrigation, or using less water than normal with an expectation of reduced yields.

Will irrigators be interested in participating in ATMs and other demand management programs? “There has been interest far beyond what we had expected,” says Jim Lochhead, chief executive of Denver Water.

But the amounts conserved so far are minor, he says—just over 11,500 acre-feet in 2017 among the upper basin states compared to the 200,000 acre-feet, give or take, that Lochhead says might make a small difference in keeping Powell levels high enough. The upper basin altogether uses about 4.5 million acre-feet annually.

Beyond stand-alone demand management efforts, a coalition of stakeholders in Colorado, the Colorado River Water Bank Work Group—including representatives from the Colorado River District, The Nature Conservancy, Tri-State Generation and Transmission, irrigators and others—is working to create a water bank, as was authorized by Colorado legislators in 2003.

Water banking describes an arrangement where water rights owners voluntarily temporarily reduce their water use and are compensated. That water can be saved and used in the future, used by someone else in exchange for a fee, or managed in a way that benefits the entire basin. It is usually employed where there is significant storage capacity to facilitate water transfers. The work group has been investigating how to create

VOICES FROM THE FIELD | BY JERD SMITH

Jesse Kruthaupt

Kruthaupt Ranch and Trout Unlimited

J

esse Kruthaupt, 37, grew up in Gunnison. When he was in high school, his parents bought a 500-acre cow-calf operation east of town.

He moved with them to the ranch and began to learn the intricacies of water rights, irrigation and hay meadows.

Twenty years later, Kruthaupt works as a project manager for Trout Unlimited and he helped craft the first environmental water lease on Tomichi Creek using his family’s 1890s water rights. Approved by the Colorado Water Conservation Board (CWCB) two years ago, the agreement specifies that in three out of 10 years, if his family opts to participate, they will fallow 100 acres of hay meadows. The water freed up by that fallowing will remain in Tomichi Creek to help bolster the state’s instream flow right in a nine-mile reach of the stream. The lease is only valid in years when the state’s instream flow right, which has a 1983 appropriation date, is short of water. That hasn’t happened yet. The past two years have provided plenty of water for the Kruthaupt family and for the creek.

Kruthaupt, who has three young children, initiated the talks with the CWCB and the Colorado Water Trust because he believed a temporary lease, which did not require water court approval, was a way to help generate income for his family’s farm and provide an environmental benefit. Key to the deal was his family’s ability to opt

Under a temporary instream flow lease, Jesse Kruthaupt and his family partnered with the Colorado Water Trust, Trout Unlimited and the Colorado Water Conservation Board to share the use of their ranch’s water.

During dry years, Kruthaupt will fallow 100 acres of hay meadows so that water can remain in Tomichi Creek. in or out. “That was a no-brainer for us,” he says.

Still, Kruthaupt has moved forward cautiously because of concern in the valley over the precedents that use of such a new water management tool could set. Some 40 other families ranch on Tomichi Creek. While none expressed outright opposition to the lease, many are quietly concerned, Kruthaupt said. And no other ranchers have come forward seeking to make a similar arrangement with the CWCB. Under this agreement, the Kruthaupt family is paid only in years when it fallows ground.

Based on engineering studies,

the lease should keep about 100 acre-feet of water in the stream for environmental purposes. In exchange, the Kruthaupt family will be paid $15,000 to $20,000 each year the lease is activated, Kruthaupt said, with funding for the lease provided by Trout Unlimited. The agreement to use this water for an instream flow had to be approved by the Colorado Division of Water Resources as well as the CWCB. “It’s a good deal for us and it gives us the flexibility we need,” he says. “But I’m still a little concerned about how it will play out when it is finally implemented.” He sees the next several years as a

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learning period for his family, the CWCB and the other ranchers on the creek.

“I’m sure we’re going to learn some things once this is implemented,” he says. “I believe these types of tools are important to helping preserve ag. But being the first one, I don’t want to give it a bad spin, and I don’t want to upset my neighbors.” n Jerd Smith is a freelance writer and editor with an interest in water and conservation issues.

A Northwestern University grad, Smith is an avid hiker and cross country skier who lives in the foothills above Boulder.

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THE ANATOMY OF AN ATM

The Super Ditch

Coloradans are testing ways to make water sharing more feasible. While each ATM is unique with different Pueblo objectives, location, hydrology, infrastructure, funding, water rights, and individual Pueblo Reservoir players, the workings of Bessemer these pilots are informing Ditch future projects and policy.

The Super Ditch, incorporated in 2008, represents seven ditch companies operating eight ditches along the Arkansas River between Pueblo and John Martin Reservoirs.

Among those eight ditches is the Catlin Canal. While the pilot on the Catlin stands on its own, it provides a glimpse into how the Super Ditch might eventually operate.

Oxford Farmer’s Ditch

Ft. Lyon Storage

Otero Canal

Ft. Lyon Canal

Holbrook Canal

Catlin Canal

Highline Canal

John Martin Reservoir

E Security

On the Farm Six farmers with just over 900 acres of land along the Catlin Canal A are participating in the pilot project. Each year, the farmers can choose to fallow up to 30 percent of each participating plot of land, up to a maximum of 271 acres.

In 2017, 239 acres were fallowed. The same land can be fallowed in three out of 10 years, making crop rotation necessary.

D Fountain

C Fountain Valley Conduit

FALLOWED

CULTIVATED

2018

2019

2020

2021

PUEBLO COUNTY CROWLEY COUNTY

Pueblo

B

Sugar City

Pueblo Reservoir

Ordway

BENT COUNTY

Arkansas River Fowler

John Martin Reservoir

F Manzanola

Las Animas

Rocky Ford

Swink

Catlin Canal A

La Junta OTERO COUNTY

F

The Catlin Canal Pilot Under the pilot, water is exchanged in Pueblo Reservoir B and pumped north through the Fountain Valley Conduit C for delivery to the towns of Fountain D and Security E. The Colorado Water Conservation Board approved the pilot in 2015 and deliveries began the same year.

Fountain, Security and Fowler combined can receive up to 500

a bank in the Colorado River Basin which would compensate water users willing to temporarily reduce their Colorado River water consumption so that the saved water could flow downstream toward Lake Powell.

Although a West Slope water bank hasn’t yet launched, a pilot project in the Grand Junction area, funded in part by the work group and in part by the Pilot System Con-

30

acre-feet of water each year, but that amount is not guaranteed. In 2016, the Catlin Pilot Project delivered just over 405 acre-feet to the municipalities.

While Fountain and Security pay $500 per acre-foot of water, farmers receive payment based on the number of acres fallowed, averaging just over $1,000 per acre in 2016.

The Fountain Valley Conduit, completed in 1985, moves water from Pueblo Reservoir to Colorado Springs, Fountain, Security and other Fountain Valley water providers.

Without this existing infrastructure, the transfer of water through the Catlin pilot would have been cost-prohibitive.

servation Program, began this year with 1,250 acres of the Grand Valley Water Users Association’s (GVWUA) 24,000 irrigated acres, spread across 10 participating farms, fallowed for portions of the irrigating season. About 5 percent, or 3,200 acre-feet, of the association’s water was in the program to flow downstream toward Powell. The pilot is a way for these irrigators to prepare

Recharge ponds F located about 12 miles apart at the top and bottom of the Catlin Canal were constructed to prevent injury to downstream water users. Irrigators participating in the pilot put water into the ponds to mimic delayed return flows.

Tailwater return flow obligations are also in place to prevent injury that would have occurred from reduced surface water return flows.

for and avoid a more urgent situation on the Colorado River says Mark Harris, general manager of the GVWUA. “We’re not doing it for California. We are doing it for reasons that we think benefit us,” Harris says. “If there is some benefit to the common good, well, so be it.”

While this water banking investigation on the Colorado River is new, the

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CHARLES CHAMBERLIN

House Bill 13-1248 authorized the Colorado Water Conservation Board to administer a pilot program to test fallowing-leasing for the temporary transfer of agricultural water to municipal use. The program can include up to 10 separate pilots, each lasting up to 10 years in duration. The Catlin Canal Pilot A is the first administered.

state does have one bank in the Arkansas River Basin, without any transactions to date. In 2008, shareholders of six ditches between Pueblo and Lamar created the Lower Arkansas Valley Super Ditch Co. Today the Super Ditch represents seven ditch companies operating eight ditches in the region. In a pilot project on the Catlin Canal, 911 acres were selected for rotational fallowing, with 240 acres fallowed in 2015. That same year, 405 acre-feet were delivered to the Town of Fowler, City of Fountain and Security Water District. The six participating farmers received $150 per fallowed acre, and $500 per acre-foot of water delivered, amounting to just over $1,000 per acre. Individuals associated with the Super Ditch have been eager to proclaim it a success. “The Catlin Pilot Project demonstrates that temporary agriculture water sharing is possible in Colorado,” wrote water attorney Peter Nichols in a September 2016 article.

Why aren’t more municipalities contracting for water from the Super Ditch? “It’s all about control,” says Jay Winner, executive director of the Lower Arkansas Valley Water Conservancy District, parent of the Super Ditch. While for some, that may mean owning the water, others see it as an issue of long-term reliability in supply and pricing. Aurora Water tried to lease water from the Super Ditch, but Aurora wanted a lower price than the Super Ditch was willing to afford so negotiations fell through. Still, the Super Ditch is a promising option for Aurora in the future, says Knapp. Relatively full reservoirs now have delayed the urgency of agreements, but Winner expects that will change. Drought is always around the corner. “In the world of water, you’d better be patient,” says Winner. “And with the Super Ditch, we are very patient.”

MICHAEL SWEENEY

BABY STEPS Taking measure of water banking and ATM tools, Jennifer Gimbel, senior water policy scholar at the Colorado Water Institute, describes the need for “very careful baby steps.”

Both east and west of the Great Divide, there’s a strong camp of water attorneys and others who have studied ATMs and see a need for lowering barriers and creating even greater flexibility in Colorado water rights administration and programs.

Nichols, in his 2016 article, noted need for a “friendlier institutional and legal structure” for processing proposed water-sharing agreements. In a 2016 paper, Anne Castle

Hirakata Farms employees cart a load of melons to the packing plant with the last truckload of the day. While up to 30 percent of Hirakata’s land is fallowed for participation in the Catlin Canal Pilot Project, the rest of the land remains irrigated and productive.

and Lawrence MacDonnell, both with the University of Colorado Boulder’s GetchesWilkinson Center, cited need for a “compelling model that allows short-term changes of water rights, evaluated and approved based on well-known and easily applied calculations, and protective of the rights of others.” At the same time, others see the system as flexible enough as is.

In late summer of 2017, the existing legal system accommodated a transaction heralded as the state’s first perpetual agriculture-municipal ATM project. The transaction involves the 211-acre Malchow farm near Berthoud irrigated by both native ditch water and imported Colorado-Big Thompson Project water. The deal specifies continued farming operations into perpetuity, but a water-sharing agreement that gives Broomfield the water in three of 10 years.

C-BT water does not have to go through water court for a changed use, making this an ideal demonstration project, points out Todd Doherty, president of Western Water Partnerships, an organization that works to preserve irrigated agricultural lands by facilitating water-sharing agreements.

But what should be apparent by now is that no one model works for all cases.

“Every situation is unique,” says Kemper

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of Colorado Water Congress. That’s also Harris’ observation as he talks about moving “into the age of potential scarcity” on the Colorado River. He advises patience and respect.

“It’s new, it’s uncomfortable. There are real risks. Some people will selectively or cavalierly dismiss people’s concerns, real or perceived,” Harris says. But water is emotional and these issues are emotional.

“Nobody has a monopoly on the truth. You can’t just dismiss people’s concerns or fears. They may know more than you.” n

Allen Best writes about water, energy and transportation. He is based in metropolitan Denver but grew up a block from a corn field in the South Platte Valley. He can be found at mountaintownnews.net.

TAKE THE NEXT STEP Get involved with some of the organizations who are getting creative with ATMs by visiting these sites: • Western Water Partnerships www.westernwaterpartnerships.com • Lower Arkansas Valley Water Conservancy District www.lavwcd.com • Colorado Water Trust www.coloradowatertrust.org

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