Beneath the surface of long-standing legal arrangements and interstate compacts, a political impasse over the Colorado River has placed Arizona squarely in the crosshairs. Federal officials have warned that if the seven states that rely on the river cannot agree on how to allocate shrinking supplies, the Department of the Interior will enact its own reallocation plan for the period after 2026. That “no deal” scenario contains a draft federal proposal that could cut Arizona’s share by as much as 77% over the coming decade — reductions far larger than those on any other state in the basin.
Water managers in Phoenix and beyond have scrambled in response. On May 1, Arizona, California and Nevada submitted a joint proposal that would stagger reductions across the Lower Basin over three years, prioritizing voluntary conservation and offering federal compensation for participating entities. Tom Buschatzke, director of the Arizona Department of Water Resources, said the plan was designed to respect the statutes and compacts that have governed the river while also accounting for contemporary hydrology. "We looked at how Lake Powell and Lake Mead would be impacted from an elevation standpoint and tried to cover as many hydrologic scenarios as possible," Buschatzke said. "It’s not a guarantee, but it’s a robust level of protection."
Low water levels at Lake Mead behind Hoover Dam, showing the ‘bathtub ring’ as prolonged drought and rising demand strain Colorado River supplies and threaten steep cuts to Arizona’s allocation.
That proposal, however, did not win backing from the Upper Basin states — Colorado, Utah, New Mexico and Wyoming. Officials there have rejected the Lower Basin plan, arguing it does not reflect actual snowpack and hydrologic reality. Leaders of the Upper Basin have warned that both federal alternatives and the Lower Basin proposal would place reservoirs at risk and could drive Lake Mead and Lake Powell toward catastrophic failure. "We … have depleted the storage in those reservoirs to the brink of being empty," Chuck Cullom, executive director of the Upper Colorado River Commission, wrote in a May 22 letter. "We are overspending our bank account and the bank account is almost empty. So, legal theories, everyone has one. Math is indisputable."
The stalemate comes as the two largest reservoirs on the system have sunk to levels unseen in decades, prompting federal investments in retrofits and sparking renewed concern about electricity generation and downstream water deliveries. On May 21, the Bureau of Reclamation announced it would spend $52 million to install turbines at Hoover Dam better suited to historically low Lake Mead elevations. Lake Mead, which stood at roughly 1,041 feet above sea level in 2022 — the lowest since the reservoir first filled in the 1940s — measured about 1,048 feet as of June. By contrast, the lake once rose to 1,225 feet during a massive snowmelt event in 1983. If Lake Mead were to fall to 895 feet, it would reach “dead pool” status, meaning water could no longer flow downstream under the dam and power generation would cease. Lake Powell has followed a similar trajectory: its surface elevation was about 3,680 feet in 2000, dipped to a record low of 3,522 feet in February 2023, and stood near 3,527 feet more recently. Dead pool for Lake Powell is defined at 3,370 feet.
Dam infrastructure and exposed shoreline on the Colorado River, illustrating shrinking reservoir storage and the stakes for Arizona as interstate negotiations over water allocations remain deadlocked.
Arizona’s exposure is compounded by the makeup of its water portfolio and the parallel decline of its underground supplies. The state receives about 36% of its water from the Colorado River, 41% from groundwater, 18% from in-state rivers and 5% from reclaimed water. Arizona’s share of the river is delivered via releases from Glen Canyon and Hoover dams, and state officials have raised concerns about upstream diversions in the Upper Basin that can reduce flow before water reaches those reservoirs. At the same time, NASA satellite observations show that groundwater in the Colorado River Basin has fallen dramatically: from 2002 through 2024, aquifers in the basin lost about 27.8 million acre-feet of water — an amount equivalent to covering 27.8 million acres with one foot of water. That ongoing depletion of underground reserves, paired with the prospect of deep cuts to river deliveries, has heightened warnings about the state’s water security and capacity to sustain food production.
The present crisis is rooted in agreements and usage patterns that trace back nearly a century. The allocation framework known as the Colorado River Compact, adopted in 1922, originally apportioned 7.5 million acre-feet annually to both the Upper and Lower basins, a central element of the broader legal regime sometimes called the Law of the River. A century ago, roughly 18 million acre-feet flowed on average; by contrast, last year’s supply measured approximately 8.5 million acre-feet, Bureau of Reclamation figures show. The interim guidelines negotiated in 2007 — a 19-year arrangement that included the federal government — are set to expire at the end of 2026. The Bureau of Reclamation gave the basin states a deadline of November 2025 to present an updated deal; when the states failed to reach consensus, the bureau issued five alternative plans in January and has signaled it will release an updated allocation plan by mid-July, with final guidelines expected in August.
As negotiations continue, legal action looms as one of the likely next steps. Upper Basin officials maintain they are not required to deliver as much water as Lower Basin users now demand under century-old interpretations of the compact, and both sides have publicly acknowledged the possibility of litigation. "I believe Tom and I believe Governor Hobbs when they threaten litigation," Cullom said of Arizona’s leadership, adding that the threat of court battles may reduce incentives to negotiate operational compromises. Meanwhile, environmental and conservation advocates underscore that the region is confronting a decades-long megadrought and a new hydrology that the existing legal framework was not designed to handle. "In my 25 years on the Colorado River, I haven’t seen things this bad," said Jennifer Pitt, director of the Colorado River program for the National Audubon Society. "We have 19th century law, 20th century infrastructure and 21st century hydrology and water demand — and it’s not lining up very well."
With a Senate Energy and Natural Resources Committee oversight hearing scheduled to review the status of talks, and with federal deadlines and engineering adaptations moving in parallel, basin states face a compressed calendar. Officials in Arizona and other Lower Basin jurisdictions stress voluntary, compensated conservation as the preferred route to avoid unilateral federal action and the steep cuts a “no deal” outcome could impose. Upper Basin leaders counter that broader protections for reservoirs and a realistic accounting of snowpack and runoff must guide any long-term blueprint. For now, the deadlock persists, reservoirs remain well below historic averages, and the prospects for litigation and federally imposed allocations are part of the ledger that water managers and state capitals must weigh as the 2026 deadline approaches.