Colorado Considers $20 Billion Water Security Plan Fueled by New Revenue Streams
A task force report suggests that Colorado could raise $20 billion to protect its water supply through measures like data center fees, a special trust, and a "sod tax." The report indicates that severance tax revenue from energy production is…
Denver, CO, July 31, 2026 —
A new task force report outlines a potential $20 billion strategy for Colorado to secure its water future, proposing a diverse range of revenue sources beyond traditional energy extraction taxes. The recommendations aim to create a stable funding mechanism for critical water infrastructure and access initiatives across the state.
The report highlights the inadequacy of severance tax revenue from energy production to consistently fund water projects, citing its inherent volatility. To address this, the task force suggests implementing several new financial measures. These include imposing fees on data centers, establishing a special trust fund, and introducing a “sod tax,” which would apply to the removal or conversion of natural turf grass.
The proposed $20 billion would be allocated to protect and enhance Colorado’s water supply, a resource increasingly strained by climate change and population growth. The report indicates that these new revenue streams are intended to provide a more reliable and substantial financial foundation for long-term water management and conservation efforts.
Specific details regarding the implementation timeline, the precise structure of the proposed trust, and the exact rates for the data center fees and sod tax were not immediately available in the summary provided.
Story summarized from the original created by Jerd Smith on coloradosun.com, see more information here.
