Proposed legislation paves the way for investment firm to sell water in McMullen Valley aquifer

PHOENIX — State Democrats are opposing a potential law that would allow a New York City hedge fund to sell water from western Arizona’s McMullen Valley aquifer.

Last week, HB 2758 passed out of the state House Natural Resources, Energy and Water Committee, with support from Republicans.

The McMullen Valley aquifer is a transfer aquifer, which means the water can be sold to more urban areas.

The hedge fund, Water Asset Management (WAM), purchased nearly 13,000 acres of land in the McMullen Valley Basin from the International Farming Corporation in 2024 for $100 million.

This price was about 10 times higher than what International Farming had paid for it, according to Gary Saiter, the head of the Wenden Water Improvement District.

“I think the assessed value in the Valley is somewhere around $2 or $3 million,” Saiter told KTAR News 92.3 FM.

How would McMullen Valley legislation impact locals?

He said the communities of Salome, Wenden and Aguila also rely on the aquifer, using about 40,000 acre‑feet of water each year. Residents worry the supply will be further depleted if HB 2758 comes to pass.

“It changes the people who are qualified and makes it possible for WAM to sell our water and transfer it to the suburbs of Phoenix,” Saiter said. “It also modifies and increases the amount they can actually pull out of the aquifer.”

As the statute stands now, WAM cannot sell water from the McMullen Valley aquifer. If the bill passes, it would allow WAM to pump the aquifer down to 1,200 feet — double the current average well depth of about 600 feet.

“Looking at the numbers, selling water in addition to the water that is used here will accelerate the depletion of the aquifer,” Saiter said.

Advocate says out-of-state hedge fund wants to extend aquifer’s life

Stan Barnes with Copper State Consulting spoke on behalf of WAM at the committee meeting. He said WAM has plans to extend the life of the aquifer, but didn’t get into specifics.

Barnes compared the legislation to the Harquahala bill, which allowed that aquifer to transfer water to Buckeye and Queen Creek. He said that passing this law could help prevent domestic wells in McMullen Valley from running dry.

“And there will be water security for the first time for people living in Salome and Wenden because of the revenue from the project and the willingness of the owner to do so,” Barnes said.

However, Saiter said WAM has presented no plans to preserve the aquifer.

“We’ve always been concerned about the amount of water we use because the McMullen Valley aquifer is under distress. Not that we’re going to run out of water tomorrow or the day after, but it is like a train coming down the tracks,” Saiter said.

He added this isn’t the solution they were looking for.

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