House Committee Approves Bill to Help Improve Irrigation

News / FBNews June 25, 2018

A bill recently approved by the House Ways and Means Committee would help farmers and ranchers more efficiently operate mutual ditch, irrigation and water companies, according to the American Farm Bureau Federation.

The Water and Agriculture Tax Reform Act of 2017 (H.R. 519) would multiply the sources from which mutual ditch, irrigation and water companies can obtain capital to expand and improve their water systems. Current law requires mutual ditch, irrigation and water companies’ capital improvements be 85 percent shareholder financed, which can be limiting.

“Mutual ditch, irrigation and water companies are important to agriculture because they allow farmers, ranchers and others to form collaborative businesses to install and maintain vital infrastructure,” AFBF President Zippy Duvall said in a letter to the bill’s author, Rep. Ken Buck (R-Colo.). “The bill multiplies sources from which mutual ditch, irrigation and water companies can obtain capital to expand and improve their water systems.”

Specifically, the legislation would allow mutual water and storage delivery companies to retain their nonprofit status even if they receive more than 15 percent of their revenue from non-member sources. Additional non-member revenue raised must be used for maintenance, operations and infrastructure improvements.

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