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Rising Water Prices Are An Increasing Challenge for Colorado Communities
The price of water continues to escalate, increasing the cost to ratepayers, homebuyers, businesses, and taxpayers across Colorado – including in Douglas County.
A recent story from CBS4 in Denver showcased an auction where willing sellers made the decision to exercise their private property rights, with prices going beyond $50,000 per acre-foot.
One of the sellers, a 92 year-old widow of a farmer, was able to sell her water rights and provide $5 million for her and her family.
The story not only shows how valuable water rights are, but also details the challenges Front Range communities face in needing to find new, affordable sources of renewable, high-quality water.
The public sector is finding it increasingly expensive.
In Parker, for example, the local water and sanitation district recently raised rates and imposed a separate fee to pay for its highly speculative and environmentally fraught proposed water project that, by many estimates, could have a price tag north of $1 billion.
The Parker Water and Sanitation District funds itself from multiple streams of tap fees, rate fees and a 6 percent property tax fee – but even that isn’t enough.
The district is floating the idea of issuing general obligation bonds (in essence a big, publicly-backed credit card) to pay for its project.
The rising cost of water requires outside-the-box thinking for projects or they will succumb to the “Parker Model” which is a cornucopia of fees and taxes on residents.
We need to explore innovative and forward looking solutions from both public AND private sectors that balance private property rights of citizens and the needs of the community for affordable, renewable water supplies.
Watch for more stories in the media about how delaying forward-thinking action on water increases overall costs – and puts off the inevitable need to tackle water security.
Recent Headlines
Once roughly $1,600 a share, Colorado population growth lands family nearly $5 million for 90 shares of Big Thompson River
As the population of Colorado continues to grow, especially in the northern half of the state, the demand and price of water continue to grow. That was evident on Wednesday as one Northern Colorado family sold their 90 shares of rights to the Big Thompson River for nearly $5 million at auction.
…As recently as the 1990s, some water shares in the region were being sold for around $1,600, according to local farmer and water rights owner Don Martin.
…Bidders came with deep wallets, with some bidding more than $70,000 a share before fees. Some looked to purchase more than 12 shares while others sought to buy individual shares.
In order to place a bid, participants had to prove in advance that they have a current need for water rights.
As Colorado water rights costs rise, speculators step in. But it's not easy
After the auctioning of 90 shares of Colorado water rights in Boulder County on Wednesday, thoughts turned to the rising cost. Some of the rights -- with associated fees -- sold for more than $80,000.
…That's because water rights have their own requirements. Unlike property rights, they can be lost if not utilized. The rights specify how they are to be used. Among the uses are agriculture or municipal or industrial use.
"If they don't do that, and they just buy the water, and then don't do anything with it, and don't go to water court to change it and they don't continue to irrigate, then it could be taken by the courts, because they're not putting it to beneficial use after 10 years," said Kelley [former water commissioner].
There are six water courts in Colorado that monitor water's use.
…And seeking permission in the water courts is not easy either. Other users on the system can object to change in the right's permitted use.
One of the world’s biggest cities may be just months away from running out of water
...Politicians are downplaying any sense of crisis, but some experts say the situation has now reached such critical levels that Mexico City could be barreling towards “day zero” in a matter of months — where the taps run dry for huge swaths of the city.
…Around 60% of Mexico City’s water comes from its underground aquifer, but this has been so over-extracted that the city is sinking at a frightening rate — around 20 inches a year, according to recent research. And the aquifer is not being replenished anywhere near fast enough. The rainwater rolls off the city’s hard, impermeable surfaces, rather than sinking into the ground.
…The crisis has set up a fierce debate about whether the city will reach a “day zero,” where the Cutzamala system falls to such low levels that it will be unable to provide any water to the city’s residents.
Did you know? Approximately a decade ago, Colorado-Big Thompson (CBT) water shares were trading on average at $6,000 - $8,000 per share. Today, shares trade at $60,000 to $80,000 which is about a 1000% increase.
Upcoming News from DCFF
Every other week, DCFF will report on important news and challenges impacting our community. We hope you will stay engaged and connected with us.
