Headwaters Magazine (April 9,2025)—The best way to handle water transactions in Colorado looks different depending on where you sit. We asked four people from a variety of walks of life about their thoughts, values and wishes regarding investment water speculation.
1. The Water Attorney, James Eklund
James Eklund knows both the public and private sides of water policy. As a water attorney at Taft/Sherman & Howard, he advises clients across the spectrum — from private sector stakeholders with assets in water and agriculture, including Water Asset Management, to public agencies navigating complex regulatory landscapes. He recently launched WaterCard, a tool designed to crowdsource private funding to compensate farmers and ranchers for water conservation efforts. Prior to this, Eklund served as director of the Colorado Water Conservation Board. A fifth-generation cattle rancher, his family has been ranching near the Grand Mesa since 1888. “On a working cattle ranch, water is always part of the conversation around the dinner table,” Eklund says. “Those discussions primed the pump, so to speak, for my career in water law.”
On Why Villainizing Speculation Misses the Mark
“When you buy an asset, no matter what that is — whether it’s a house, land or water rights — you generally hope that it appreciates in value. If I buy a house, I hope it’s worth more when I sell it. Does that make me a speculator? Of course not. That’s not illegal conduct, nor should it be discouraged. Yet, that’s what people are doing in the water context — similar intent is often framed as problematic, which oversimplifies the issue.”
On Water and Property Rights
“If you have the ability to put water to a legally recognized beneficial use, that use should be protected from unnecessary government interference. If I’m uncertain about planting a crop this year, I should at least have the option to lease that water to someone who needs it. If I decide to take land out of production or shift to more water-efficient crops, I may have a chunk of my water right that I no longer need and I should be able to sell it. That requires access to a market that extends beyond just my immediate neighbors.”
Betting on Farmers
“When you invest in stock, you’re placing a bet — that your investment will grow in value. The vast majority of consumptive water use in the West is tied to agriculture. I want people to bet on us. I want people to recognize that water rights in Colorado are investment-grade assets. What I don’t want is for those assets to be so heavily manipulated by government policies that investors take their capital
to other states or industries. Supporting agriculture and water rights as sound investments strengthens our communities and our economy.”
2. The Conservationist, Kate Ryan
As executive director of the nonprofit Colorado Water Trust, “It’s almost like I get to represent the interests of rivers,” says Kate Ryan. The group works to restore water to the state’s rivers through Colorado’s Instream Flow Program, non-diversion agreements, and strategic reservoir releases. Ryan started her career as a scientist, then became a water rights attorney in 2006, joining Colorado Water Trust in 2018 as staff attorney. By 2020, she had risen to the top job. “I’ve been very passionate about working toward solutions to address climate change and to protect natural resources more generally,” she says.
A Part of the System
“Investment speculation has been part of our system of water rights in the state since the outset. We’ve always had, as a
state, a prior appropriation system. That system relies on transfers of water from one place to another in order to make it
possible for cities and industries to grow. I also recognize that private interests have built a lot of the ditches that transfer water from streams and rivers to their place of use. Without that private investment, we wouldn’t have the communities built around water for agriculture and other beneficial uses that we have today.”
On Speculation Vs. the Environment
“It is hard, in theory, for the environment to compete with high-moneyed interests. There is a tension between investment-based speculation today and what the drafters of Colorado’s constitution saw in the early days, that water could be transferred from one use to another. It’s hard for that flow to happen freely when public-interest values like environmental flows are underfunded in comparison
with investment-based speculation.”
On Leveling the Playing Field
“I would not want to see changes that place constraints on the prior appropriation system, because it does function pretty well in Colorado. I would like to see incentives in place, whether policy-based or otherwise, that make transactions for public-interest purposes easier. Whether that’s more funding for in-stream acquisitions by the state, or incentives for water users to engage in water-sharing projects with the environment or other public-interest purposes. I think that would help to level the playing field.”
3. The City Utility, Alex Davis
In her role as the assistant general manager of water supply and demand at public utility Aurora Water, Alex Davis oversees a spectrum of city water-related activities. Her teams handle everything from water rights acquisition to conservation to helping protect the ecological health of the area’s watershed and wetlands. Before joining the utility, she spent most of her career working for several state agencies with a minor stint in private practice. “I came to Aurora Water in part because I realized that water utilities in Colorado were and are in the forefront of finding and implementing solutions for really difficult issues,” she says. “Being part of that motivates me every day.”
On the Special Nature of Water
“You can’t do anything without water. Every single thing, every computer, every chair, every car, everything we use, do and eat, has water in it. You can’t substitute it. So the idea that a small group of people or an individual could control access through pricing, or make huge amounts of profit off of this vital resource, is concerning to me. Which is not to say that the tenets of capitalism shouldn’t apply to resource allocation. But it is to say that there’s a point at which this resource should be treated as a public resource and preserved.”
Is Taxation the Solution?
“Thinking about how to change this system is extraordinarily difficult. We have invested so much into it. How would you allocate water in a way that does not open the door for firms from New York and Chicago coming in and flipping water? That’s basically what they’re doing. That money doesn’t stay in the state, it doesn’t contribute to economic growth in this state. I would explore a tax. Let’s say Aurora pays someone $20 million for water rights, and that someone is a New York hedge fund. How would you fashion a tax to ensure that the state sees the benefit of transactions involving this critical resource? You could create a tax that could go to fund water projects in Colorado.”
4. The Farmer, Matt Heimerich
Matt Heimerich married into the agricultural life. Originally from New York, he was working as a civil engineer when he met his wife, Karen, who came from a line of Colorado farmers. Fate soon brought them back to her home region, where they bought a 100-acre farm in 1988. Ever since, they’ve been growing crops like corn, oats, alfalfa and forage sorghum. Heimerich has also represented Crowley County on the Southeastern Colorado Water Conservancy District board since 2021. (Editor’s note: Heimerich also serves on the Water Education Colorado Board of Trustees.)
On the Value of Water
“Let’s say your house is worth a quarter-million dollars. But down the block, somebody sold a house for $350,000. Are you happy? Yes, because your asset grew. What if you wanted to move into a bigger house? But instead of the house you want being worth $275,000, now it’s worth $490,000. And you can’t get that out of your house. How do you feel now?
“The ease with which we change water from agriculture to municipality has completely disrupted the agriculture water market. How can somebody farming in Berthoud or Johnstown or Rocky Ford expand their farm or buy a farm for their children, when all of a sudden the farms are trading for tens of thousands of dollars above [what they would if they were] purely agriculture?”
On Supporting Farmers
“Can we, should we come up with ways to identify the most essential and critical agricultural areas so that we can remove them out of this aura of speculation, selling, drying up and transferring? People are always saying to me, ‘Everybody’s selling because nobody wants to farm.’ I don’t believe that. There are plenty of people who want to farm. I know them. I know their kids. If this is important to us as Coloradans, I think we should and we must do a better job of sitting down with our agricultural community and finding out what they want.
“Things are changing. What does that mean for us as farmers and ranchers? We’re pretty adaptable, but I have yet to figure out how to grow a crop in a place that only gets 10 inches of rain without irrigating.”
Headwaters Magazine
Elisabeth Kwak-Hefferan is a freelance writer and editor who specializes in climate and the environment. Her work appears in The New York Times, Sierra, National Geographic and more.
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