Colorado River States Strike a Historic Water Deal

In May 2023, the Biden administration and the three major Lower Basin states — California, Arizona, and Nevada — reached a landmark voluntary agreement to conserve 3 million acre-feet of water from the drought-stricken Colorado River through 2026. The deal, backed by $1.2 billion in federal Inflation Reduction Act funding, compensates cities, water districts, and farm operators for reducing their draws on the river by approximately 13% of their total allocation.

The agreement came after nearly a year of tense negotiations and was hailed as an unprecedented step to stabilize the river system, which serves 40 million people, seven states, and 30 Tribal Nations. Rather than forcing mandatory federal cuts, the deal allowed states to voluntarily reduce consumption in exchange for financial compensation, averting a deeper water crisis driven by prolonged drought and climate change.