As reservoir levels continue to plummet at the end of another dismal water year, some agricultural water users are asking Colorado lawmakers to consider a bill next session that would make it easier for them to get credit for conserving water.
It would be the next step in creating a conservation pool in Lake Powell that the Upper Basin states could use to protect against water scarcity.
Over the past decade, Colorado, New Mexico, Utah and Wyoming have dabbled in programs that pay willing participants to use less water on a temporary basis. But so far, that saved water has flowed downstream unaccounted for. Changes to state laws would be needed to allow state officials to shepherd conserved water into a Lake Powell pool.
“Our message is simple: Protect Colorado agriculture by enabling voluntary, compensated water conservation without causing injury to other water users,” Dan Waldvogle told state legislators at an August meeting of the Water and Natural Resources Committee in Steamboat Springs. “Give us credit for the water we save and guarantee that conserved consumptive use is fairly and fully compensated … . The 2026 legislative session is our last best chance to take action and control our future.”
Waldvogle was speaking on behalf of the Colorado Farm Bureau and Rocky Mountain Farmers Union. He also works for Conscience Bay Co., a Boulder-based real estate investment firm that owns a cattle-ranching operation in Delta County known as Western States Ranches.
But allowing the state to shepherd conserved water resurrects old concerns for some on the Western Slope. They say it could open the state to speculators and interstate water markets, with Colorado water users selling their water to the highest bidder in the Lower Basin, which includes California, Arizona and Nevada.
“We’re saying you should not pass a standalone shepherding law or conserved consumptive use law that would allow and enable the state engineer to do that without having a thorough discussion with all stakeholders and encoding in legislation important sideboards and protections for our agricultural industry and our community,” Colorado River Water Conservation District General Manager Andy Mueller told lawmakers at the August meeting.
State Engineer Jason Ullmann said in an email that he does “not have authority to require water conserved through voluntary programs to bypass other Colorado water users’ headgates unless it is necessary to meet Colorado’s compact obligations.” The bypassing of other users’ headgate to deliver water to a point downstream is more commonly known as shepherding.
The General Assembly would need to pass legislation in order to give him that authority, many stakeholders believe.
The conservation conversation comes at a pivotal time for water users on the Colorado River, which remains wracked by drought and climate change. The most recent projections from the U.S. Bureau of Reclamation show water levels at Lake Powell potentially falling below the threshold needed to make hydropower by November 2026. The reservoir is currently about 28% full.
State Sen. Dylan Roberts, a Democrat who represents several Western Slope counties including Eagle, Garfield, Grand, Moffat, Rio Blanco, Routt and Summit and is the chair of the Water and Natural Resources Committee, told Aspen Journalism that as of now, no bill to address shepherding or future conservation programs is in the works in Colorado. But that may be because the seven states that share the Colorado River are still hashing out how reservoirs will be operated and how cuts will be shared when the current guidelines expire next year.
At the beginning of this summer, negotiators from the seven basin states agreed to a concept that would share water based on flows in the river and not on demands, but talks have since stalled. Federal officials have given the states a Nov. 11 deadline to come up with the outline of a deal.
“I remain fully committed to reaching consensus, but I want to be candid, especially with you all,” Becky Mitchell, Colorado’s lead negotiator, told lawmakers. “The discussions with my counterparts have been and continue to be challenging. I understand why this discussion is so challenging for our Lower Basin counterparts. They have developed a reliance on water that is above their apportionment that is simply not there.”
Colorado and the other Upper Basin states have been tiptoeing into voluntary conservation pilot programs since 2015, and the 2019 Drought Contingency Plan allowed for a 500,000-acre-foot conservation pool in Lake Powell. Late last year, Upper Basin officials offered up a 200,000-acre-foot pool in Powell as part of negotiations, and some type of future voluntary conservation program for the Upper Basin appears increasingly likely.
The System Conservation Pilot Program, which first ran from 2015 to 2018, was rebooted in 2023 and paid water users in the Upper Basin to cut back in 2023 and 2024. Over two years, the program doled out about $45 million to conserve just over 100,000 acre-feet of water across the four states.
A main criticism of the SCPP was that the conserved water was not tracked to Lake Powell, even though one of the program’s stated intents was to boost levels in the nation’s second-largest reservoir. In some cases, the water was probably picked up by a downstream water user, with no net gain to Lake Powell. This is the issue that new state legislation could remedy. Until now, the experimental conservation programs were allowed with temporary approvals from state officials.
“We want action,” Waldvogle said. “And I think the way I define action is for [lawmakers] to move forward in developing a program in order to really catalyze our communities into these discussions. To really develop all the sideboards necessary to have a program is going to take a longer time frame.”
Western States Ranches
Conscience Bay owns about 3,800 acres on parcels scattered throughout Delta County, 3,000 of which the company says are irrigated. About 3,200 of these total acres are clustered in Harts Basin near Eckert, making up the headquarters of the company’s reaching operation known as Western States Ranches. The ranch participated in the SCPP in 2024, with water to some fields shut off June 1 and others July 1. The ranch saved about 550 acre-feet, or 7% of its water, according to ranch managers.
Ranch representatives see participation in these early voluntary conservation programs as a way to have some control over their operations should water cuts become mandatory in the future. They say they are interested in innovative ways to adapt to water scarcity, and they partnered with Colorado State University scientists to study the effects on forage crops of taking irrigation off their fields that were enrolled in SCPP in 2024.
“We wanted to figure out how this is going to affect us, and if we are required to do this in the future, we want to have the knowledge to make good decisions,” said Mike Higuera, agricultural operations manager of Western States Ranches. “We assume that we are going to have to conserve water in this game.”
Western States Ranches hosted an August field day in Eckert with the Western Landowners Alliance for other local farmers and ranchers to learn about drought-resilient ranching and share the findings from CSU researchers.
The ranch’s participation in SCPP has resurrected fears that the owners, who began purchasing the Delta County properties in 2017, are speculating — buying up land for its senior water rights and hoarding them for a future profit. With a water-conservation program in the Upper Basin all but guaranteed, some worry that Western States Ranches could be looking to profit off sending their water downstream.
The question came up at the August field day when a Paonia-area rancher said he had heard the ranch owners were speculators. Conscience Bay representatives have always denied that accusation.
“I can tell you there are a lot better ways to make money,” Higuera replied.
According to SCPP documents, the ranch was paid $278,372 for their water in 2024. Higuera said that amounted to about 10% of their revenue last year, with cattle sales making up the other 90%.
Colorado in recent years has tried to tackle the thorny issues of how to fairly roll out a conservation program while prohibiting speculation. Defining what speculation is and who is a speculator is slippery and hinges on determining the water rights purchaser’s intent — a nearly impossible thing to know or police with 100% certainty. The bottom line of the state’s existing anti-speculation policy is that water-rights owners must put that water to beneficial use.
Ultimately, a 2021 workgroup failed to find consensus about ways to strengthen protections against speculation and a drought task force failed to provide recommendations about conserved consumptive programs for lawmakers, underscoring the difficulty of protecting the state’s water without infringing on private property rights. Some agricultural producers balked at laws that could restrict their ability to make money by selling their land and associated water rights.
At the heart of speculation concerns is the fear of large-scale, permanent dry-up of agricultural lands. Mueller has long cautioned that conservation programs, if not done carefully, could disproportionately impact rural agricultural communities. Although SCPP was open to all water-use sectors, all of Colorado’s participants in SCPP in 2023 and 2024 were from Western Slope agriculture.
“Any program that we have must be designed for our state’s best ability to support the longevity of agriculture and the vitality of our communities, and we’ve got to be thoughtful and precise,” Mueller said.
Paying for programs
Another big question about Upper Basin conservation remains: How will it be paid for?
SCPP in 2023 and 2024 was funded with money from the federal Inflation Reduction Act. The bill that could have authorized SCPP again in 2025 is still stalled in the House. Over 2023 and 2024, the program doled out about $45 million to water users in the Upper Basin and saved about 101,000 acre-feet.
Without overhauling the West’s system of water rights, voluntary, temporary and compensated conservation programs are one of the only carrots to entice agricultural water users — who account for the majority of water use in the Colorado River Basin — to cut back. But they are expensive, and it’s unclear how future long-term conservation programs would be funded.
Colorado’s entire congressional delegation in early August sent a bipartisan letter to federal water managers, in an effort to shake loose $140 million in funding that was promised for projects addressing drought on the Western Slope in the final days of the Biden administration and then frozen by the Trump administration.
U.S. Sen. Michael Bennet, D-Colo., addressed the question at a Colorado Water Congress meeting in Steamboat Springs in August.
“We’re now not going to have a great federal partner for a while, I’m afraid, and we’re going to have to figure out how to rely on each other and do it in more imaginative ways than maybe we have in the past,” Bennet said.