Sometimes water issues for ranchers and farmers aren’t about having enough but being able to improve the delivery systems for the water they do have.
Colorado’s U.S. senators reached across the aisle last week to introduce a bill to make that easier. It would reform tax provisions that hinder investment in water infrastructure improvements.
Ditch and irrigation companies are organized as nonprofits. Under that designation, their ability to raise capital to maintain and develop water-storage and delivery systems has been limited by a tax provision that required them to receive 85 percent of their income from shareholder investment to maintain their nonprofit status.
When they need to incur a large expense, for example, such as replacing a dam in disrepair, the companies are severely limited in how they can collect the needed funding under that proviso.
The Water and Agriculture Tax Reform Act would allow them to receive other income as long as its use is restricted to operations and maintenance.
“In the face of persistent drought conditions, water is an even more precious resource for Colorado’s farmers and ranchers,” said Sen. Michael Bennet, D-Colo. “Producers face challenges when it comes to distributing water across their land to keep it productive for agricultural uses. This bill updates the tax code to help Colorado’s ditch and irrigation businesses keep this infrastructure in good working condition.”
“Unfortunately, our outdated tax laws risk holding back the agriculture industry’s ability to innovate and make needed improvements,” said Sen. Cory Gardner, R-Colo.
“Many in the agriculture industry, for example, are looking to make improvements to water efficiency.”
The bill was introduced one day after the U.S. Department of Agriculture issued a disaster designation for 21 counties in Colorado because of the extended drought, including La Plata, Montezuma and Archuleta counties.
Sen. Mike Crapo, R-Idaho, also sponsored the bill.
The act next goes to a committee for study.
This week
Budget talks: The Democratic House and Republican Senate will continue a back-and-forth over small items in supplemental budget bills – especially GOP efforts to tackle state agency spending on gun background checks and driver’s licenses for immigrants in the country illegally.
Voting and photo ID: The GOP wants to require photo ID for same-day voter registration. Two bills in a House committee Wednesday tackle the issue, but they’re both likely doomed in the Democrat-led committee.
Juvenile shackling: Lawmakers worried about restraints used on juvenile offenders want to change such policies in judicial districts, such as when juveniles can be shackled in court.
Perks for veterans: Vets would get free admission to state parks for a three-day weekend before or after Veteran’s Day annually with a bill making its way through the Senate. It has its first hearing there in a committee Wednesday. The bill has cleared the House.
