From The Valley Courier (Ruth Heide):
Roundtable member Judy Lopez and her boss Sarah Parmar with Colorado Open Lands (COL) talked with the Roundtable members on Tuesday about providing more options for farmers and ranchers considering conservation easements on their properties. The Roundtable is a group of San Luis Valley residents representing a variety of water uses throughout the Valley.
Parmar said COL has protected half a million acres across the state through conservation easements. “Conservation easements are still the only permanent tool to keep land and water in agriculture,” she said.
Parmar explained that conservation easements originated on the East Coast, and when they were introduced in Colorado, “water was an afterthought.” The focus was on land protection. However, as they evolved, conservation easements also focused on protecting the water rights associated with the land, not allowing the water rights to be sold but requiring them to remain in their historical use, Parmar explained.
Up to this point, conservation easement agreements were very restrictive regarding water use, she said. To meet current conditions and needs, however, COL brought together a team to look at more flexibility with water rights under conservation easements while still protecting the investment of those funding such easements. The efforts began with the South Platte Roundtable, which was concerned that about one third of irrigated land and water would be transferred to municipal use by 2050 through “buy and dry” purchases. “Buy and dry is the easiest way for municipalities to get water,” Parmar said.
To prevent permanent loss of the water, COL began looking at ways in which property owners could lease their water rights for a certain number of years, like seven out of 10, to municipalities like Castle Rock, while retaining some agricultural use of the water. During the years their water was going to municipalities, farmers could fallow their land, deficit irrigate, irrigate for less than a full season or use a crop that used less water, Parmar explained.
Parmar said South Platte Basin water users who were surveyed on the issue were interested in the concept, with nearly 60 percent saying they would be interested in a lease situation.
Parmar said their choices were to preserve the water rights through conservation easements or sell them off entirely, the latter being more profitable. A leasing option provided farmers and ranchers with another alternative, she said. The water would remain with the land but could be involved in a long-term lease with a municipality, which would give that municipality some assurances as well, Parmar explained.
Parmar said attorneys working with COL have developed easements that would accomplish these goals and meet IRS codes for conservation easements and the tax benefits associated with them.
Lopez said the way this would likely work in the San Luis Valley would be agriculture-to-agriculture leasing, not agriculture-to-municipality leasing. This might help with some of the challenges facing the Valley now from water export threats to state regulations, she said. It might also allow some folks to keep their properties that might not have been able to, she added.
Lopez said the water portions of conservation easements would be evaluated on a case-by-case basis.
Roundtable member Ronda Lobato asked about the possibility of changing existing conservation easements. Parmar said she did not think that was out of the realm of possibility. She said there are about two million acres under conservation easements through various organizations across the state, a lot of it in the San Luis Valley.
Roundtable member Mike Gibson was very opposed to changing existing conservation easements. He said the roundtable had approved funding for conservation easements on the basis the water would stay on the land and be used for historical purposes. He said the people who entered those agreements for their land also did so with the understanding the water would remain protected, and to change that would affect other factors like habitat.
Roundtable Chairman Nathan Coombs, who is the manager of the Conejos Water Conservancy District, said he understood that conservation easements already in place were created with some options off the table, but with the current situation in the Rio Grande Basin, it might be time to look at more flexibility.