Posted August 15, 2013

Farm groups in Arizona oppose an Arizona Department of Water Resources rule modification that would gradually eliminate extinguishment credits held by farmers, according to the Arizona City Independent.  Extinguishment credits or groundwater credits “may be sold by farmers in full or in part when farmland is retired and used by buyers, usually developers, within the same management area.”

Under the modified rule, growers may continue farming, but their credit allocations “begin to drop next year, from 100 to 94 percent of the original amount.  Ten years from now, the credits drop to 64 percent and by 2054, they hit zero.”
The Arizona Department of Water Resources (ADWR) says that “long-term” viability of area water supplies and protecting the area’s aquifer from over-pumping were concerns that prompted the modified rule.  ADWR’s plan to “gradually zero-out extinguishment credits was devised several years ago” and implementation of the plan was delayed in part “because of economic conditions.”  An ADWR fact sheet states that if “groundwater use were to continue at rates exceeding natural recharge from rainfall and streambed infiltration, water levels could drop to levels that would make it economically infeasible to continue farming.”  The Arizona City Independent Article is available here. 
Arizona farm groups oppose the modified rule, set to take effect on Jan. 1, according to Coolidge Examiner. A group of Pinal County farmers hope to repeal or modify the ADWR plan before Jan. 1.  Groups opposing the plan are concerned that farmland value will drop as the credits are reduced, causing many farmers to sell quickly.  The Coolidge Examiner article is available here.