Fondomonte well rejection will have limited impact

The Arizona Department of Water Resources has revoked a pair of well-drilling permits it issued last year to a controversial Saudi-owned farming company that operates in western Arizona.

But it’s not clear what, if any, impact the move will have on the alfalfa-growing operations of the company, Fondomonte Arizona, and high-level officials squabbled this week over who deserved credit for making it happen.

In a news release on Friday, Attorney General Kris Mayes made the case that her work was behind the revocation.

“The approval of the drill permits just eight months ago has now been revoked thanks to the Attorney General raising the issue in recent weeks with the Arizona State Land Department and ADWR,” the AG’s office wrote in the statement.

But on Monday, Gov. Katie Hobbs’ office implied that the governor was the one responsible for ADWR’s move.

“Governor Hobbs promised to take action to crack down on foreign governments profiting off Arizona groundwater and she did,” Christian Slater, the governor’s communications director, said in response to questions about the permits, in an email provided by another spokesperson.

ADWR revoked the drilling permits in an April 13 letter that said the decision was made “because ASLD’s (Arizona State Land Department’s) approval of the Application to Place Improvements on State Land by Fondomonte Arizona LLC has expired.” The letter was provided to The Arizona Capitol Times following a public records request.

The company applied for the permits in August 2022 and approval was initially granted that same month, according to the documents provided by ADWR. The permits would have allowed the company to drill two 1,200-foot wells, each capable of pumping 3,000 gallons of water per minute.

Fondomonte Arizona is just one of many farming operations around the state that pumps groundwater for crop irrigation, but the business has drawn negative attention for growing water-intensive crops later used to feed cattle in Saudi Arabia, and for the low price it pays to lease thousands of acres of land from the state. A 2022 investigation by The Arizona Republic found the company pays well below market rates for the land and is likely pumping significant amounts of groundwater – though the company doesn’t have to report how much water it’s using.

It’s been the subject of harsh criticism from elected officials, who say Arizona’s diminishing water supply shouldn’t go to feeding cattle in other countries. And both Republican and Democratic lawmakers have advanced bills aimed at preventing the company from continuing to operate in the state.

But withdrawing permits for those new wells won’t cut Fondomonte off from pumping Arizona groundwater. The company owns 32 drilling permits, according to information provided by ADWR. Those wells might not all be in service – some date back to the 1970s – but others were drilled as recently as 2021, indicating the company likely has plenty of working wells.

Sarah Porter, a professor at Arizona State University who works in the Kyl Center for Water Policy, cautioned against viewing ADWR’s recent move as a major development for groundwater issues in the state.

“In the big picture, not having two new wells drilled at this (farm) won’t make a material difference in terms of the state’s challenges with respect to rural groundwater,” she said.

The State Land Department estimates the company could be pumping 18,000 acre-feet of water per year, the Republic reported last year. One acre-foot is enough water for about three Phoenix-area households for one year, according to ADWR.

The two wells detailed in the now-revoked permit would have gone to 1,200 feet underground, making them deep wells but not the company’s deepest. In 2019 and 2021, the company sought and received approval to drill two separate wells to a depth of 1,510 feet.

Kathy Ferris, a water attorney and former director of ADWR, emphasized that Arizona’s groundwater problems are bigger than one company.

“The real issue is that we are allowing big industrial agriculture – not just Fondomonte, and not just foreign corporations, but American corporations – to move into these unregulated areas and pump as much groundwater as they want for commercial, industrial agriculture,” Ferris said.

A lawyer who represents Fondomonte declined to speak on the record about the permit revocation.

The confusing messages from the AG’s and governor’s offices over the past week aren’t the first time that the two officials – both Democrats elected last year – have butted heads over the Fondomonte deal.

Mayes criticized the deal during her campaign, and in a February TV interview said she was planning to take action, indicating that her office would announce concrete action soon.

“I can do something about it,” Mayes said on Feb. 19.

But less than two weeks later, Hobbs appeared to throw cold water on the idea.

“It’s a very complex issue and not something that the AG has the authority to, frankly, do on her own,” the governor told reporters on Feb. 28.

In a letter made public last week, Mayes highlighted what she called discrepancies in the well permit applications.

At some points in the application, Fondomonte representative David Kelly listed himself as the landowner, when in fact the land is owned by the state and leased to Fondomonte, the AG wrote. Plus, she added, some documents described the permits as being for “replacement” wells while others described the proposal as being for new wells.

A spokesperson for the AG implied that the AG’s research led to the revocation, but the ADWR revocation letter didn’t mention the AG’s work.

This week, spokespersons for both officials declined to directly contradict the other’s version of events, but both offices implied that they’d been behind the move. A spokeswoman for the governor indicated that the date of the ADWR letter – which was sent before Mayes’ public letters – meant the AG hadn’t been involved.

A spokesman for the AG, for his part, said that Mayes had met with the ADWR director on April 4, before ADWR’s April 13 letter.