Drought & Water Management

• Title: What the Current Drought Means for the Future of Water Management in Colorado
• Date: 1/1/2003
• Description: 2002 Drought Impact Report
• Basin: Statewide
• Drought Mitigation - Doc Type: Reports

The sod industry estimates that at least half of its business was lost for this year due to the
restrictions. Some of the loss will be made up after the drought is over. Similar
problems affected the whole landscaping industry, although to a somewhat lesser extent.
The landscape industry estimates its impact on the Colorado economy at $2.2 billion per
year, although that seems high. If business were down in this larger industry by 25 %,
then the loss would be $500 million. As some of this will be made up after the end of the
drought and more business will be generated if people convert to more drought tolerant
landscaping, the net loss may be more like $200 million.
Adding the municipal water and landscape costs together suggests a cost in this sector of
$330 million. The two main components of this loss are the value of water not used by
consumers and the loss of landscaping sales in the landscape industry. These may
overlap and are both very uncertain numbers.
F. Total Cost and Avoidable Cost
Some of the estimates for some sectors are only educated guesses. Adding the costs for
each of the above sectors: $500 -$600 million in agriculture, $250 million in tourism,
$100 -$150 million in forest fires, and $330 million in municipal and landscaping; gives a
total of $1.2 -$1.3 billion cost for the drought of 2002. That, of course, assumes that there
is no con inua ion in o 2003. That amount is roughly 0.7 percent of our state's income.
While this estimate is actually higher than the published estimate of $1.1 billion, the
increase stems from a more complete inventory of the damage and is still a very small
fraction of state income.
Table 111.1. Economic Impact Total Costs and Avoidable Costs of Drought,
by Sector
In the West, drought is inevitable and some of its costs are too. However, some could be
avoided. As one looks through the costs of this drought, it is apparent that most of the
costs incurred would be difficult to avoid.
In agriculture, nearly all of the effects come not from lack of water, but from lack of very
cheap or free water. Dry land farmers are not going to irrigate their crops unless the
water can be delivered to the crop more cheaply than the loss of product. The big
agricultural loss is from loss of pasture and that would be almost impossible to irrigate
M