Click the link to read the article on The Guardian website (Maanvi Singh). Here’s an excerpt:
Tucked into the bends of the lower Colorado River, Cibola, Arizona, is a community of about 200 people. Maybe 300, if you count the weekenders who come to boat and hunt. Dusty shrublands run into sleepy residential streets, which run into neat fields of cotton and alfalfa. Nearly a decade ago, Greenstone Resource Partners LLC, a private company backed by global investors, bought almost 500 acres of agricultural land here in Cibola. In a first-of-its-kind deal, the company recently sold the water rights tied to the land to the town of Queen Creek, a suburb of Phoenix, for a $14m gross profit. More than 2,000 acre-feet of water from the Colorado River that was once used to irrigate farmland is now flowing, through a canal system, to the taps of homes more than 200 miles away. A Guardian investigation into the unprecedented water transfer, and how it took shape, reveals that Greenstone strategically purchased land and influence to advance the deal. The company was able to do so by exploiting the arcane water policies governing the Colorado River…
In February, a federal judge ruled that the Cibola-Queen Creek transfer was done without proper environmental review, ordering the federal Bureau of Reclamation to complete a more thorough evaluation. The US Department of Justice, which is representing the bureau in the legal proceeding, declined to comment on whether the bureau would be appealing the decision.
Meanwhile, Greenstone – which appears to be the first water brokerage firm to sell rights to the Colorado River – could help chart the course of how the resource can be bought and sold in the west… in 2018, the company sold the water tied to that farmland to Queen Creek, a fast-growing sprawl of gated communities on the outskirts of Arizona’s capital. The city’s government agreed to pay the company $24m for the annual entitlement to 2,033 acre-feet of Colorado River water. In July of last year, amid continuing legal challenges and national scrutiny, that water was finally diverted. The alfalfa and cotton fields were fallowed – reduced to dry brush and cracked earth…
On its website, Greenstone describes itself as “a water company” and as “a developer and owner of reliable, sustainable water supplies”. Its CEO, Mike Schlehuber, previously worked for Vidler Water Company – another firm that essentially brokers water supply – as well as Summit Global Management, a company that invests in water suppliers and water rights. Greenstone’s managing director and vice-president, Mike Malano – a former realtor based in Phoenix who remains “active in the Arizona development community”, per his company bio – got himself elected to the board of the Cibola valley irrigation and drainage district, a quasi-governmental organization that oversees the distribution of water for agriculture in the region.
[Holly] Irwin was horrified. She felt that a company with ties to big banks and real estate developers, posing as a farm, had infiltrated her small town and sold off its most precious resource. The deal won’t have an immediate impact on Cibola’s residents. It doesn’t affect the municipal water supply. But she worries that the transfer will be the first of many. And if more and more farms are fallowed to feed water to cities, what will become of rural towns along the river?