The Farming Fallout: Coloradoan Families Struggle In Wake Of Extreme Drought

The Colorado River stretches nearly 1,450 miles through multiple states. More than 40 million people in Wyoming, Utah, Colorado, and Arizona rely on water from the Colorado River Basin for use in their daily lives; because this also contributes to a $1.4 trillion economy, the drought caused by rising temperatures has put a number of businesses at risk. None are in as much danger as the farming industry.

Colorado makes up a surprising amount of the more than three million farmers in this country; nearly half of the state’s 66 million acres are dedicated to farms and ranches. The drought — which has recently been declared a natural disaster in 13 counties by the USDA — is crushing the livelihood of farmers and their families in a number of ways.

Water Rights And Wars

Colorado has a history of relying on a system of water allocation. Just as you possess a deed to the land, you can gain permits to control the right to use water in whichever major river basin you reside in. However, these are based largely on seniority — some of which has been owned by families as far back as a century (or more) ago.

Under this [prior appropriation] doctrine, the first appropriator of water has a senior right to that water, and that right must be satisfied before any subsequent rights junior to that right can receive water,” states the Division of Water Resources in the state of Colorado.

As you can imagine, this situation has only gotten tenser as the drought has worsened. Farms are valued quite high due to the fact that they include equipment worth tens of thousands of dollars, and the potential hundreds of thousands of dollars the land is worth itself. Unfortunately, these assets cannot be sold off easily to pay bills; even if they were sold in an emergency situation, the cost of replacing the equipment would be exorbitant and could send farmers and their families into ruin.

As a result, many have turned to selling or renting their water rights and opting for “prevent planting;” when farmers know their risk of crop loss is high, they will purposefully leave them unplanted to reduce the chances of losing money. Of course, this also greatly limits the amount of profit they can make. Though families are hoping that next year brings an El Nino, there is no way to predict whether this drought — which has been going since 2000 — will finally come to an end.

Rising Retirement Age

To make matters worse, it’s coming at a time when Coloradoan farmers are getting on in age. In 2012, the average was 59 years old; because farming can only continue if families pass their farms on down generational lines, it’s vital that children be taking up the agricultural mantle. But given the state of affairs with water shortages, and the general disinterest younger people have in hard labor on the land, there is little to encourage them to follow in such a path.

“We’re at a pivot point,” said Colorado Agriculture Commissioner Kate Greenberg. “If something isn’t done to keep farmers on the land, we’re going to continue losing [agriculture] at an incredible rate.”

As previously stated, farmers can be wealthy on paper due to their assets yet have little money to actually spend. Emily Brown, daughter of a Coloradoan farmer herself, feels that the aid of accountants, lawyers, and bankers can help ease the transition — especially because the drive of keeping the family legacy running is so strong.

She’s right: it’s recommended that people who have assets valued at six figures or higher establish trusts to minimize estate taxes and avoid probate. By securing 401k’s that don’t draw income from the farm after the child takes over, and obtaining livestock leases, conservation easements, and other purchasing options, the stress of living and working entirely for yourself in a complex field can be assuaged. Lawyers or accountants can also help families struggling with the drought move their assets around and stay afloat.

The future of agriculture in Colorado may be unknown if this historic drought continues, but farmers and their families are determined to do everything they can to keep their land and livelihood.

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