Gov. Katie Hobbs announced this week that a controversial Saudi Arabian company has stopped using groundwater storage on some federal land it leases in western Arizona.
Last year, Hobbs and the Arizona Land Department canceled or nonrenewed Fondomonte Arizona's four leases on state-run trust land in the Butler Valley, a groundwater basin designated as a future water supply source for metro Phoenix. announced.
She said this week that an inspection of the land as of Feb. 15 found that Fondomonte was not using irrigation, and that “Fondomonte is beginning to take steps to vacate the land.”
“Today marks the beginning of a new chapter for Arizona's water future,” Hobbs said in a statement. “I'm not afraid to hold people accountable, maximize the value of our national land trusts, and protect Arizona's water security.”
Fondomonte response
Fondomonte is one of the largest leasing companies of land held in trust by the government for agricultural purposes.according to Audit earlier this year, Fondomonte also cultivates and utilizes groundwater on 2,682 acres of state land elsewhere in La Paz County near Vicksburg. The company is appealing the Hobbs government's termination of its lease on four roads near Bowes.
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Fondomonte confirmed in a statement that it has ceased farming on its Butler Valley property in accordance with the National Land Service's actions.
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“The company remains committed to working with the state to resolve outstanding issues as it removes equipment and infrastructure pursuant to the terms of the lease,” the statement said.
Fondomonte is based in Saudi Arabia, which also has water issues. They rent land here and grow alfalfa. Crops are exported as feed for the kingdom's dairy cows.
When the Fondomonte problem became a problem
Butler Valley's lease became a pressing political issue after the Arizona Republic revealed interest rates well below market rates and cuts to public education and other programs. The lease also allows the company to pump unlimited groundwater, which could serve as a future water source.
The attention to Fondo Monte has raised questions about groundwater monitoring and regulation in the desert state, as well as lease policies and interest rates on state lands, prompting a major audit. The scrutiny comes as lawmakers from both major political parties grapple with water issues amid a historic drought and dwindling supplies from the Colorado River.
private company lease approximately 153,000 acres of state trust land; Agriculture and cattle grazing are common activities around Arizona. The land itself was dedicated to fund public purposes when Arizona became a state, and approximately 9 million acres of trust land remain. Profits from land leases and sales generate revenue for state services such as K-12 education.
Contact reporter Stacy Birchanger. stacey.barchenger@arizonarepublic.com or 480-416-5669.
