Nate Halverson, the reporter from the Center for Investigative Reporting, is talking with Sarah Porter, Director of the Kyle Center for Water Policy at Arizona State University. The subject is foreign companies buying up square miles of La Paz County, Arizona, so they can grow alfalfa and ship it overseas. Arizona’s lack of regulation regarding groundwater, and the existence of a sizable underground aquifer in La Paz County, makes this a profitable business. The water is essentially free, once you drill your deep-water well.
Alfalfa is one of the more water-thirsty crops grown in America. Essentially, the companies from Saudi Arabia and the United Arab Emirates (UAE) are extracting water from one desert and shipping it to another desert.
The story was broadcast last week on radio station KSUT. You can listen to the audio of the broadcast here.
Nate Halverson: Sarah and I talk nitty-gritty about the Arizona Groundwater Management Act. It’s legislation from the 1980s that governs much of what happens with Arizona’s water today. It was a fight to get the law passed. Cities, agriculture and mining companies were all competing for what they wanted it to say. Ultimately, groundwater ends up being regulated in urban areas like Phoenix, but not in rural areas like La Paz. They essentially remain free-for-alls. This lack of regulation created a business opportunity for farm investors to come in from around the world. I have a newspaper ad that I clipped; it’s a color ad, and it says, “Water problems? Come to Arizona, we have unregulated water”…
…Sarah now sits on Arizona governor Katie Hobbs’s Water Policy Council, which was created in 2023 to tackle the issues of groundwater in rural areas. She says, if state lawmakers aren’t going to rein this in, they should at least be upfront about what’s happening.
Sarah Porter: If it’s going to be the policy of the state to allow landowners to mine out all of the groundwater in an aquifer, then we should also talk about having better public consumer protections. We need to make sure that people don’t invest their treasure in their own little acreage and then discover that a giant industrial scale agricultural operation has moved in next door and is going to be causing their wells to go dry.
Nate Halverson: But that’s already happening in places like La Paz.
Sarah Porter: I also think we have to live with the possibility that it may be the choice of some rural areas to simply manage their groundwater in a way that I think we could call unsustainable and use up all the water in their aquifers. That may be the will of some rural areas.
Nate Halverson: I talked to supervisors in those counties like Holly Irwin, and she says she doesn’t have the power to stop people from pumping her water.
Sarah Porter: She doesn’t, and one of the big problems is that once the big water user is there, it is much, much harder to solve the problem.
Nate Halverson: So what happens to people in La Paz County?
Sarah Porter: The reality is that the water demand is the water demand.
Nate Halverson: So the people’s wells are going to go dry and that’s the future?
Sarah Porter: It could be, yeah. That’s the reality. We’re really talking about an existential situation for some of those places.
Nate Halverson: Existential, meaning like they’re going to lose their well and they’re going to lose their life savings.
Sarah Porter: Yeah, no water, no town.
During his research into the La Paz water situation, Mr. Halverson finds documents indicating that the Arizona public employees pension fund has invested in the UAE alfalfa farming company that’s selling hay — grown with precious Arizona water — to foreign countries.
He meets up with Arizona Attorney General Kris Mayes at her office in downtown Phoenix. In 2022, Mayes, a Democrat, narrowly won election as the state’s top law enforcement officer. Her campaign was about voting rights, public safety, and water.
Nate Halverson: If you look here on page 77 of the report, I was able to definitively show that state pension fund money went into lands being leased by another Middle Eastern company that’s shipping, growing the alfalfa and shipping it overseas to China, the Middle East, anywhere. Presumably that’ll pay top dollar for it.
Kris Mayes: Is this the Emirati farm? Oh my God.
Nate Halverson: Mayes squints her eyes and starts taking notes. This isn’t the Saudi-owned farm that she campaigned against. This is the farm company from the United Arab Emirates. The Emirati farm is actually state pension fund money.
Kris Mayes: State pension fund money?
Nate Halverson: So all of you are presumably pension funds.
Kris Mayes: Correct, we’re all in that pension fund, yes. As individuals, every state employee is. Yeah.
Nate Halverson: So the state employee money has gone into exporting the state’s water.
Kris Mayes: I think Arizonans are going to be outraged about this. It just exacerbates an already terrible situation and shows again the abject failure of our government to protect our people and to protect our future. As an Arizonan and as the attorney general, this is obviously really shocking and hard to believe, but in a way maybe not, given what’s gone on in the past…
Nate Halverson: I ask Mayes if it’s a conflict of interest that state employees who are in charge of managing the aquifers are also financially benefiting from letting IFC pump as much water as it wants in La Paz County.
Kris Mayes: That’s a tough one. I think I’ll not comment on that because then you really need to think it through and we really need to get to the bottom of it. And obviously your reporting is going to kickstart that process.
Nate Halverson: Mayes tells me the state can’t keep making these mistakes with its water.
Kris Mayes: Water in Arizona is life. Our very survival as a state depends on our doing better when it comes to water.