WATER SECUERITYState Pension Fund is Helping a Middle Eastern Firm Export Arizona’s Precious Groundwater
As rural Arizonans face the prospect of wells running dry, foreign firms are sucking up vast amounts of the state’s groundwater to grow hay for Saudi Arabia and other wealthy nations. The state’s retirement system invested heavily in a private land deal that allowed a foreign company to effectively ship Arizona’s scarce water supply overseas.
As rural Arizonans face the prospect of wells running dry, foreign firms are sucking up vast amounts of the state’s groundwater to grow hay for Saudi Arabia and other wealthy nations. Now it turns out that a key investor in this water transfer scheme is Arizona’s own employee retirement fund.
In La Paz County, a rural community about 100 miles west of Phoenix, Al Dahra Farms USA has been running a 3,000-acre farming operation in the Sonoran desert, draining down the same groundwater that the county’s residents rely on to fill their wells. The Emirati-owned farming company tapped into a former public water supply in 2013 to grow hay that gets shipped to countries in Asia and the Middle East.
The state of Arizona helped fund the land deal that allowed Al Dahra to tap into the groundwater in La Paz County, according to records obtained by Reveal from The Center for Investigative Reporting. The state’s retirement system invested $175 million in 2012 into an East Coast company that bought about 20 square miles of land that had previously been set aside as a public water source. The company, International Farming Corp., then leased some of the land to Al Dahra.
Al Dahra is now a key player in the booming business of tapping into Arizona’s limited water to grow hay that gets shipped overseas, which economists say is the equivalent of exporting the state’s scarce water. A Saudi-owned farm, which is also in La Paz County, has made international news for growing hay in the parched Sonoran Desert even as Saudi Arabia has severely restricted its own hay production due to its water scarcity. But in Arizona, hay exports have increased nearly 100-fold in the last 10 years. The water used to grow the exported hay last year was equivalent to the water used by about 1 million people in the state, according to a recent paper from researchers at the University of Arizona.
The state’s investment into exporting its own water comes as the region faces ongoing water shortages. Arizona Gov. Katie Hobbs announced this year that parts of the metro Phoenix area don’t have enough water to continue building new houses amid ongoing groundwater depletion. The state also faces the likelihood of further reductions in water supplied from the dwindling Colorado River.
