New Mexico allocates $150 million to buy and retire Lower Rio Grande groundwater rights
To meet the May 26, 2026 Supreme Court decree cutting Lower Rio Grande depletions by 18,200 acre feet a year, New Mexico stood up a $150 million purchase program. The per acre foot price is still under study; fallowing already pays $750 to $800 per acre.
- Required depletion cut
- 18,200 AF/yr
- Purchase program funding
- $150 million
- Fallowing payment
- $750 to $800 per acre
- 2026 fallowing contracts
- ~160 (~8,000 acres)
What happened
The Supreme Court adopted a final decree in *Texas v. New Mexico* on May 26, 2026, ending thirteen years of litigation. New Mexico must cut annual groundwater depletions in the Lower Rio Grande by 18,200 acre feet within ten years, half within five, and maintain the reduction permanently, roughly 5 to 7 percent of current groundwater use there.
In response the state created a Lower Rio Grande Water Rights Purchase Program to voluntarily buy and permanently retire groundwater rights, with $150 million allocated and a request for $50 million from the 2026 Legislature to begin. As of July 2026 a fair-market price study was still underway and no purchase price had been published. A separate Groundwater Conservation Program already pays $750 to $800 per acre to fallow previously irrigated land, with nearly 160 contracts covering roughly 8,000 acres in 2026.
What it means if you own water here
A court deadline plus a nine-figure appropriation is the strongest buyer signal an owner can get. The state has to acquire rights; the only open question is price.
The fallowing program is the interim income path while the purchase price is set, and it prices per acre of land rather than per acre foot of water. Owners should know both numbers, and the difference between them, before signing either.
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