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Water rights prove valuable assets for Washington farmers

Consolidation of public resource fuels worries

By Evan Bush, The Seattle Times
Published: October 28, 2019, 7:02pm

COLUMBIA COUNTY — Decades ago, John Andrews’ late father went broke farming potatoes. He lost the family farm, and never wanted was his son in the same business.

And yet, there Andrews stood this spring on a scrabbly hill near Starbuck, looking over his family’s dominion — a 9,700-acre farm and ranch at the edge of the Palouse prairie.

Andrews and his wife, Sandy Conklin, pointed with pride to the meandering Tucannon River at the valley bottom, the towering bales of straw the local pulp company had arranged on their land and their grain silo.

“I’m 71. We enjoy it here so much,” Andrews said. “Right now, we’re a little on edge. We need the rain.”

More than ever, the couple relies on it. This spring, Andrews and other members of their farm partnership sold their water rights for more than $2 million to the Crown Columbia Water Resources company, a private-equity backed firm investing in Washington water and aiming to build a huge private water market for the Columbia River basin.

For investors like Crown, water rights are seen as an increasingly scarce and valuable commodity.

But critics worry investment by private interests could promote speculation and consolidation of a public resource as the climate warms and the state’s population booms.

Crown’s interest in water comes as many of Washington’s farmers approach retirement age, their industry consolidates and development threatens rural landscapes.

For farmers, water rights are valuable assets as they grapple with an agricultural economy shifting beneath their feet. Andrews and Conklin say the sale to Crown will allow them to live out their years on the land they love.

The average age of a Washington farmer is 58.1 years, up from 56.8 in 2012, according to the Census of Agriculture. Meanwhile, farmers under age 44 make up less than 18 percent of those in the business.

The years ahead will be defined by “high transition,” said Marcia Ostrom, an associate professor in the School of the Environment at Washington State University.

That represents an opportunity for investors in farms, land and water.

Older farmers often don’t have relatives interested in farming, Ostrom said. Their retirements are often tied to farm assets. Younger farmers often find it difficult to build capital to enter a high-cost industry.

Meanwhile, developers are hungry for land, farms are consolidating and conservation programs aiming to retain the state’s farmland only do so much.

Water rights offer farmers another option.

“It’s a way to generate some revenue without selling their land outright,” said Alan Kottwitz, chair of the Walla Walla County Water Conservancy Board, which approved the Tucannon water transfer. “Water is a finite commodity, just like land. God’s not making any more of it.”

Crown Columbia envisions the water could aid fish habitat projects on the river and could be sold or leased downstream in the Snake and Columbia rivers for a profit, said its water lawyer, Mark Peterson.