Decision Support Tool

Helping to keep ag water connected with ag land

The Lease Screening decision support Tool helps ag water right holders assess the potential of leasing their water rights for other uses. The tool is based on characteristics of successful ag water leases that are operating in Colorado.

What is agricultural water leasing? An ag water lease provides water for other uses (municipal, industrial, etc.) while enabling the ag water right holder to maintain ownership of the water right. The lease arrangement is voluntary and temporary, and the water right holder is compensated for the water leased. Ag water leasing is also referred to as an 'Alternative Transfer Mechanism' (ATM).

Only consumptive use (CU) water can be leased. The consumptive use (CU) amount is that portion of diverted water that is actually used by the crop and/or forage via evapotranspiration. The Historic Consumptive Use (HCU) of a water right is based on the consumptive use of the crops or forage grown over a period of time.

Why is ag water leasing important? The Colorado Water Plan encourages ag water leasing as a way to avoid permanent “buying and drying” of more irrigated agricultural land. Colorado's population could reach nearly 10 million by 2050. Increased demand for water by the municipal and industrial sectors could cause the loss of up to 700,000 acres of irrigated ag land. This amount represents about one-fourth of all irrigated ag land in Colorado, and would have serious and lasting impacts on rural communities, counties, jobs, schools, wildlife and the environment. The Water Plan sets forth a goal of 50,000 acre-feet to be leased from agriculture to the Municipal / Industrial (M & I) sectors annually. The Water Plan also calls for a substantial increase in conservation by the M & I sectors, and increased storage of water, both above ground and below.

Who can use the ag water Lease Screening decision support Tool? Anyone can access and utilize it, however, the Decision Support Tool was designed for surface irrigation water right holders in Colorado who are interested in getting a better understanding of how suitable their water rights are for leasing. There are several leases going on Colorado already. Most of them involve mutual ditch companies that are leasing water for M & I or aquatic life support uses. There are also numerous water leases ongoing between ag water right holders and the oil and gas sector.

Questions or Comments? Contact the Ag Water NetWORK Consulting Coordinator, or CCA/PWC at 303-431-6422.

Ag Water Lease Decision Support Tool

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Demand for water varies by basin and within basins.
Having a large water portfolio, such as those held by some ditch companies, helps guarantee leased water can be provided even during droughts. Large individual water rights can also have significant appeal to a potential lessee, especially if the water right is very senior to other rights in the basin.
Storage rights are useful in facilitating water exchanges and help ensure that leased water can be delivered even during drought periods.
Storage rights located upstream of, or shared by a municipality can help facilitate simplified water exchanges between the parties.
The greater the number of irrigated acres, the greater the potential to 'free up' a significant amount of water for leasing.
Fallowing or deficit irrigating hayland and pasture may require significant management adjustments (herd reduction, hay purchases, pasture recovery period).
Any irrigation method can accomodate leasing, but more expensive irrigation methods (subsurface drip) may reduce financial viability of leasing due to the ROI needed.
Do you...
Leases are easier to facilitate if the leased water can be delivered using existing streams, rivers,ditches or pipelines.
Proximity to demand sources positively correlates with leasing potential.
Like surface storage, under ground water storage can help guarantee leased water can be provided during droughts, and can help facilitate exchanges.
Never or rarely needing to lease water from others suggests a senior decree date with adequate volume even in dry years.
Having all or most of your usual amount of irrigation water available even during a drought increases potential lease appeal.
Older water rights have use priority over younger water rights, and are more highly valued by potential lessees.

An actual ag water leasing opportunity can only be determined by thoroughly evaluating the water right(s) and the site-specific characteristics that influence the ability to deliver water for other uses.

For details on the criteria used to compute your rating score, click here Rating Criteria
Partial project funding for the Ag Water NetWORK is provided by a 2022 grant from the Colorado Water Conservation Board.
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