There is a serious and growing water crisis in Colorado and six other states, which promises to dominate headlines in the coming months. As BHGR’s own Peter Nichols, a water law lawyer and special counsel to the Lower Arkansas Valley Water Conservancy District and multiple other districts, recently said to CPR, things are dire this year. “You can’t create more water. All you can do is try and use what you’ve got more efficiently,” Nichols said. “We’re so far behind we can’t catch up.”[1] This blog answers three frequently asked questions about the Colorado River Basin, the Colorado River Crisis, and how the crisis may impact those with Colorado water rights.
What is the Colorado River Basin?
The Colorado River flows for approximately 1,450 miles.[2] It originates in Colorado, flows through seven states, and terminates in Mexico. This area is known as the “Colorado River Basin” and is divided into two regions in the U.S. called the “Upper Basin” and the “Lower Basin.” The Upper Basin includes Colorado, New Mexico, Utah, and Wyoming. The Lower Basin includes Arizona, California, and Nevada. Thirty Tribal Nations also hold water rights within the Basin. The Colorado River Basin provides drinking water for 40 million people, irrigates 5.5 million acres of agricultural land, and flows through 11 national parks.[3] It is a critical water resource for “agriculture, municipalities, outdoor recreation, hydropower generation, Tribal Nations, and drinking water for several of the country’s largest cities, including Denver, Phoenix, and Los Angeles.”[4]
What is the Colorado River Crisis?
The Colorado River originates in the Colorado Rocky Mountains and is filled by snow, rain, and winter snowpack. Since 2000, historically dry conditions have added stress to the Colorado River’s water resources. To make matters worse, over the last year, Colorado has experienced unprecedentedly low snowpack and high temperatures, creating severe drought conditions.[5] This presents a problem for Colorado, which receives “40% of its water supply from the Colorado River.”[6] This also presents a problem for the other Basin states and Tribes dependent on water from the Colorado River. The Bureau of Reclamation is projecting that water levels in Lake Powell and Lake Mead, which store Colorado River Basin water for use in the Lower Basin, will hit historic and critical lows in the coming months.[7]
Use of Colorado River water is governed by a complex set of laws, court decisions, decrees, contracts, treaties, and interstate compacts, most of which harken back to the Colorado River Compact of 1922. Among other things, the Colorado River Compact divided the Colorado River Basin into two, apportioned water between the Upper and Lower Basins for beneficial use on an annual basis, and prohibited the Upper Basin states from causing the flow of the river to be depleted below a specified, aggregate amount of water for any period of ten consecutive years. The calculations which formed the basis for the Colorado River Compact, however, were based on wetter conditions and incorrect estimates of how much water the Colorado River holds and can deliver to the Basin states.[8] Adding further complexity, the Tribal Nations, excluded from past agreements and negotiations among the Basin states, are participating in discussions about the Basin’s future and seeking to have their senior water rights quantified and allocated.
For a variety of debated reasons, not the least of which is the aridification of the American West, the Basin states have been concerned for years that the demand for water from the river exceeds the amount of available water and that the parties to the 1922 Colorado River Compact will be unable to comply with its terms. The results of a failure to comply with the compact’s allocation requirements are anticipated to be catastrophic. For example, should Lake Powell drop below the level required to generate hydropower, economic livelihoods, cultural and religious activities, ecological systems, and natural resources of communities in the Lower Basin would be significantly affected.[9]
To address these concerns, the federal government and the Basin states have entered into several modern agreements to address the management and allocation of Colorado River water. In 2007, stakeholders developed the Colorado River Basin Interim Guidelines (the “2007 Guidelines”). The 2007 Guidelines coordinate the release of water from Lake Powell and Lake Mead to provide more certainty for Colorado River water users and to avoid mandatory curtailments and conflicts among Upper and Lower Basin states.[10] The 2007 Guidelines also address curtailment of Lower Basin allocations based on Lake Mead water levels.[11] However, the 2007 Guidelines expire on December 31, 2026.
The federal government has been pushing the Basin states and affected Tribes to negotiate new agreements and guidelines. The states missed two deadlines set by the federal government to submit a conceptual plan addressing these problems in November 2025 and most recently in February 2026. The different factions dispute the interpretation of the governing law and documents and disagree about which states should reduce their water use and invest in conservation efforts.
After missing the February 2026 deadline, negotiators took a two-week hiatus but resumed talks in March of 2026 and are continuing to negotiate potential stopgap measures as well as a long-term solution.[12] Because the Basin states and Tribes have not reached an agreement, the federal government is taking steps to intervene and implement a plan of its own before the 2007 Guidelines expire. The Basin states may also decide to litigate their disagreements in the United States Supreme Court, which has original jurisdiction over disputes between two or more states involving interstate waters.
How Might the Crisis Impact Those with Colorado Water Rights?
Under Colorado law, those with senior decreed water rights are entitled to take their water from the stream first and can stop or reduce water diversions to those with junior decreed water rights until the senior rights are satisfied. On March 16, 2026, Governor Polis activated the state’s Drought Task Force and Phase 2 of Colorado’s Drought Response Plan, triggering certain water restrictions.[13] And on April 9, 2026, the Governors of the Upper Basin states released a joint statement, providing:
The Upper Division States of Colorado, New Mexico, Utah, and Wyoming are actively and strictly regulating water uses. Because of such diminished runoff, existing state laws in the Upper Division States require water users to face cuts to water rights dating back to the 1800s – these cuts are mandatory, uncompensated, and will have significant impacts on water users, including Upper Basin Tribes, and local economies.[14]
Given current drought conditions, the Colorado River Basin crisis, and Colorado’s “first in time, first in right” water system, junior water right holders should prepare for the likelihood that senior users will be making calls on the stream, which may reduce or curtail junior users’ rights. Those with junior rights should also be aware that tribal calls on the stream may increase. Owners of decreed Colorado River Basin water rights should, therefore, consider reviewing their water right decrees and actively preparing for the likelihood that senior users will be making calls on the river, which may reduce or curtail junior users’ rights. In addition, everyone needs to plan for water restrictions and reductions.
Our Team
BHGR’s Water and Conservation Group represents commercial and industrial businesses, energy companies, private landowners, ranchers, farmers, developers, non-profit organizations, and a variety of public entities seeking to acquire, develop, protect, and sell water rights throughout Colorado. If you have questions about water rights and steps that may be taken to protect those rights when water is scarce, contact us today.
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[1] https://www.cpr.org/2026/04/28/colorado-water-shortage-drought-2026-questions-answered/
[2] See https://cwcb.colorado.gov/colorado-river-basin.
[3] See id.
[5] See https://cwcb.colorado.gov/drought.
[6] https://cwcb.colorado.gov/colorado-river-basin#:~:text=Colorado%20receives%2040%25%20of%20its%20water%20supply%20from%20the%20Colorado%20River.
[7] See https://www.usbr.gov/newsroom/news-release/5211.
[8] See https://udallcenter.arizona.edu/news/countdown-deadpool-colorado-river-crisis-looms-states-fail-reach-agreement-how-share-cuts.
[9] See https://www.drought.gov/colorado-river-drought-contingency-plan.
[10] See https://westernresourceadvocates.org/we-save-water-and-protect-rivers/colorado-river-basin-interim-guidelines/.
[11] See id.
[12] https://www.cpr.org/2026/03/21/colorado-river-negotiations-stopgap-measure/.
[13] See https://cwcb.colorado.gov/drought-task-force.
[14] https://governorsoffice.colorado.gov/governor/news/upper-colorado-river-basin-states-governors-release-statement-proposed-draw-down-flaming-gorge. The statement further addressed the proposed drawdown of Flaming Gorge and other upper basin reservoirs for the purpose of protecting Lake Powell, but stressed that releases from Upper Basin reservoirs must be consistent with existing law.