ATMs: Alternatives to Buy and Dry

Alternative Transfer Mechanisms (ATMs) are voluntary alternatives to the traditional practice of “Buy and Dry” – which is the commonly used term for buying shares or interests of agricultural water, changing the agricultural water to municipal or other uses through the water court process, and then permanently drying up the land. There is an increasing concern included in Colorado’s Water Plan about what will happen to our agricultural communities from these practices which are being used to support growth. The goal of ATMs is to address the water supply gap while minimizing the impact to rural communities and farming and ranching families.

Colorado’s Water Plan estimates that 50,000 acre-feet per year of water may be able to come from ATMs to help provide much needed water for municipal and other uses in a more sustainable manner. Some types of ATMs include: 

  • Rotational fallowing - in lieu of irrigating an entire field or farm, irrigators fallow a portion of the field or farm. The fallowed area is moved (i.e., rotated) annually. The credit associated with the fallowed area can be used elsewhere, under an approved project. Pilot projects for rotational fallowing are on-going in Colorado.
  • Interruptible supply agreements - these are temporary agreements between two or more water right owners for temporary use of the water by a new party in up to three years within a 10-year period. IWSAs are approved by the State Engineer in accordance with Colorado House Bill 13-1130.
  • Municipal-agricultural water-use sharing – this concept involves many options which may make water available for municipalities. The main subcategories, per the Water Plan, include continued farming and deficit irrigation.
  • Water cooperatives - simply said, water cooperatives study and identify excess water supplies (e.g., unused recharge credits) that could be used by other parties without causing injury.
  • Water banks - often associated with curtailing an interstate compact call, the water bank concept allows owners of water rights to reduce water usage on a temporary basis and save or bank the water in storage. A water bank is currently being studied in the Colorado River Basin.
  • Flex markets - voluntary agreements to include multiple end users such as irrigation, municipal, environmental and industrial water users.

Generally, ATMs involving temporary modifications in irrigated areas (such as rotational fallowing, municipal-agricultural water-use sharing, water banks and flex markets) need consideration of revegetation, erosion control and weed control. Beyond these physical considerations, there are also significant legal, technical, and financial barriers to implementing ATMs. The Water Plan includes a list of potential future actions that may increase the success of ATMs which include the development of an incentives program with financial incentives, a streamlined approval process, and encouragement or maintenance of highly productive lands and establishment of ATM Demonstration Projects.

The Colorado Water Conservation Board has grant money earmarked for ATM projects or evaluation of a potential project. Any private or public entity that can contract with the state and establish a documented need for the project can apply. 

If you are interested in learning more about Alternative Transfer Mechanisms or to discuss a project, contact us today.