A federal freeze on spending for Southwestern water conservation projects called vital to protecting Lake Mead and the Colorado River appears to be over, two months after it began, many state, local and tribal officials say.
Officials from Arizona and California water agencies have said in the past week that the money appears to be flowing again. It is considered crucial for compensating cities and farms for leaving Colorado River water in Lake Mead. The U.S. Bureau of Reclamation confirmed Wednesday that it has approved elease of previously frozen money to the Gila River Indian Community, which which owns Arizona’s largest share of river water rights.
Reclamation said it “will continue to engage” with other entities “as we work together to efficiently use water in the Colorado River Basin.”
Reclamation had signed contracts with many cities, farms and other water agencies in Arizona, Nevada and California from summer 2024 into January 2025 to pay at least a billion dollars total for water conservation contracts, but the Trump administration had frozen that money.
Now, a number of officials say the feds have agreed to lift the freeze, although money hasn’t actually started flowing to recipients in many cases.
Here are some prime examples:
— Tucson Water’s planned $86.6 million plant to purify wastewater to drinking quality went on hold after news broke in January of the federal funding freeze. Now, “It is our understanding that the funding is available,” City Manager Tim Thomure told the Arizona Daily Star late Tuesday.
“We are in the planning and design phase (of the water treatment plant) and will keep close tabs on receiving payments as we submit for reimbursement” from the federal government for city-incurred expenses on the project, he said.
— Jennifer Neuwerth, acting director of the Colorado River Water Conservation Board of California, told a board meeting last week that “the green light” is on once again for the funding, meaning the contracts will now be honored, said Bart Fisher, a board member who attended.
“What I’ve heard is it’s the intent of the government to honor all conservation contracts on the river,” said Fisher, a longtime official of the Palo Verde Irrigation District in Blythe, California.
— The Gila River Indian Community says its previously approved $105 million federal grant for water conservation has been restored. That happened in mid-February, said tribal attorney Jason Hauter, after tribal officials announced they would stash away nearly 14% of the water they previously planned to leave in Lake Mead into an underground storage reservoir on their reservation. The tribe has already started drawing upon the funds, he said.
Lake Mead along the Upper Colorado River Basin at the Utah and Arizona border.
Arizona Department of Water Resources Director Tom Buschatzke told a Phoenix TV station last week, “Our current intel is that the money has been unfrozen and it’s going to the projects that it was intended to go to.”
In a statement Wednesday, the bureau said, ““Under President Donald J. Trump’s leadership, the Department of the Interior is working to cut bureaucratic waste and ensure taxpayer dollars are spent efficiently. This includes ensuring Bureau of Reclamation funding for individual water efficiency projects and actions in the Lower Colorado River Basin align with administration priorities. Projects are being individually assessed by period of performance, criticality, and other criteria.”
“Reclamation will continue to engage with the Gila River Indian Community, other tribes, the states, irrigation districts and other stakeholders as we work together to efficiently use water in the Lower Colorado River Basin,” the bureau said.
David Wegner, a retired congressional aide and U.S. Bureau of Reclamation official, had a guarded reaction to state and local water officials’ comments that the federal money was again available.
“To the best of my knowledge, except for the Gilas, nobody has paper that shows (anyone has) actually transferred money,” said Wegner, now a National Academy of Sciences board member who still closely monitors the Colorado River’s condition and the politics behind it.
The Gila community is in a unique situation now because it complained directly to Interior about its money being frozen and kept some of the water it had planned to keep in Lake Mead, Wegner said, citing the tribe as a case of “the squeaky wheel getting the grease.”
What Wegner says is probably the correct approach, said Southern California desert farmer Fisher: “Don’t count on the money until you see it.”
Often in these compensated water conservation programs, Reclamation reimburses cities and irrigation districts after they have carried out their water conservation commitments or after they’ve drawn up plans or signed contracts to detail the commitments.
The federal money was coming from appropriations made by two laws enacted by Congress and signed by former President Joe Biden in 2021 and 2022, respectively: the Infrastructure Investment and Jobs Act, and the Inflation Reduction Act, which has supplied the vast majority of water conservation-related funding.
Inflation Reduction Act money has since 2022 been doled out to farmers, cities, irrigation districts and other entities in the Lower Colorado River Basin states of Arizona, California and Nevada.
At least $1 billion of that money was awarded to Lower Basin entities — including Tucson Water’s $86.6 million award for the wastewater purification plant — since last summer. That’s the money that appears to have been frozen. In all, Congress appropriated $4 billion from that act to be spent exclusively on drought relief in the West.
Farmers across the basin, many cities including Tucson, Phoenix, Gilbert and Scottsdale, and tribes had previously received tens of millions of dollars apiece to leave some of their Central Arizona Project supplies in Lake Mead. The feds have generally paid about $400 an acre-foot — well above what Arizona cities pay to receive CAP water from the Colorado River — to parties that leave the water in Mead.
The White House announced the funding freeze for all money appropriated by the Inflation Reduction Act right after President Trump’s Jan. 20 inauguration. White House budget officials the next day issued a clarifying statement saying the freeze was meant to apply mainly to energy-related expenses. But Lower Basin cities and irrigation districts said even after that statement was issued, they couldn’t access their federal funds for water conservation.
Colorado River water board member Fisher was relieved by the apparent lifting of the federal funding freeze.
“As a farmer, we make crop plans well in advance and we modified our cropping plans to account for conserved water, which means a reversed level of farming,” Fisher said. “So we were on this yo-yo. First, we’re conserving water, then we’re not.
“It makes it very difficult to plan crops if you don’t know. The knowledge that money will be approved and distributed is a very good thing as far as the certainty of our farms is concerned.”
As for the Gilas, now that the tribe has been assured of its federal money, it still plans to keep 10,000 acre-feet stored underground rather than put it in the lake, tribal attorney Hauter said.
He stressed that the community doesn’t plan to use that water. By storing it, the tribe will build up what’s known as long-term storage credits that it can sell to other parties, which give them the right to pump groundwater elsewhere.
“Storing it underground, the water becomes more valuable to the community,” Hauter said. “The value of long-term storage credits is increasing now because of shortage conditions on the river.
“it’s an asset the community gets to keep. If you so chose, you could sell that asset later. The future value of credits is probably worth more than the $400 we’re being paid not to use river water.”
