This story is part of the Grist series Parched, an in-depth look at how climate change-fueled drought is reshaping communities, economies, and ecosystems.

Late last year, Leigh Harris logged onto a local Facebook group and learned that she and her neighbors were about to lose their water — for good. 

Harris lives in an area called Rio Verde Foothills, an unincorporated expanse of dirt roads and horse farms on the outskirts of Scottsdale, Arizona, a city that is itself on the outskirts of Phoenix. The neighborhood sprung up during the housing boom of the early 2000s, but it lacked robust water access, so residents like Harris relied on private “water haulers” to bring them water from nearby Scottsdale. Every few days a truck bearing a shipment of water from a city facility drove to Harris’ house and pumped water into a four-thousand-gallon tank behind her property. She tapped the tank until it ran out, then paid to get more. 

This time, though, her water hauler was the one tapping out: The company posted on Facebook to say it would stop serving Rio Verde Foothills at the end of 2022. The other haulers in the area are quitting as well, because Scottsdale decided to stop allowing haulers to bring water to customers who live outside the city limits, including the hundreds of people in Rio Verde Foothills. 

Grist thanks its sponsors. Become one.

The city’s decision was a direct result of the federal government declaring what’s known as a Tier 1 water shortage on the Colorado River last year. The Colorado is hundreds of miles away from Scottsdale, but the city relies on the river for around 70 percent of its water, which travels across the width of the state on the 336-mile Central Arizona Project canal. The federal government financed the construction of the canal, and in return Arizona agreed to have the most junior rights of any state that uses the river, which means now the state is taking an 18 percent reduction in water deliveries to accommodate the ongoing drought. Cities that rely on Colorado water are scrambling to retrench their water usage so their own residents don’t suffer during future cuts. In Scottsdale, that means cutting off the haulers who brought water to Rio Verde.

The city had been warning about the shutoff for years, but the formal announcement set off a neighborhood-wide scramble to find an alternate water source. If the issue isn’t resolved before the end of the year, hundreds of residents in the area will lose their water access altogether, making their brand-new ranch homes both unlivable and virtually impossible to sell. The neighborhood’s water shutoff portends a much larger crisis caused by the climate change-enhanced megadrought in the American West, which experts say has no precedent in the past 1200 years. 

Grist thanks its sponsors. Become one.

Arizona and other states across the West have built millions of new homes over the past few decades on the assumption that they could find enough water to support them. Now both surface water and groundwater sources are proving less reliable than earlier generations had assumed, and this longtime growth spurt may be faltering in its tracks.

“We have no water rights whatsoever, except to the aquifer beneath our home, which is highly stressed,” said Harris, a retired TV news producer who moved out to the area with her husband so they could be close to their favorite hiking trails.

“Our little corner,” she added, “is the canary in the coal mine.”

Like many places on the outskirts of Phoenix, the Rio Verde Foothills area occupies a no-man’s-land between rural and urban. Development in the area has proceeded in a piecemeal fashion for decades, with new owners expanding a checkerboard street grid in every direction, but the area isn’t an incorporated city of its own, and it isn’t a part of neighboring Scottsdale.

In the early days of the neighborhood, most residents got water from groundwater wells on their own property. As time went on, though, the neighborhood continued to drain the subterranean aquifer, and some residents started to pay water haulers to bring them water from Scottsdale, which in turn got the water from the Colorado River. Water hauling is more common in remote rural areas than in big cities, but it has also become a linchpin for fast-developing exurbs like Rio Verde and New River north of Phoenix, which swelled 40 percent to house over 15,000 people over the last two decades.

Now that hauling is no longer an option, Rio Verde residents are now scrambling to find an alternative water source, except no one can agree on what that source should be. One group of residents has proposed the creation of a “domestic water improvement district,” a quasi-governmental authority that would raise money to build a smaller water facility in the neighborhood and connect it to Scottsdale’s water pipeline, giving them priority access to Colorado water; that process would require the commitment of the Maricopa County Board of Supervisors, who haven’t yet made a decision on the issue. Other residents don’t want to form such a district and instead hope to contract with other water haulers who don’t use Scottsdale water; in that case, though, the water would come from the far side of Phoenix, dozens of miles away, and likely cost much more.

Just as water hauling from Scottsdale wasn’t a permanent solution, neither of these routes would provide permanent solutions either. The federal government could declare a Tier 2 or 3 shortage on the Colorado as early as next year, which would cut another 6 percent from Arizona’s water allocation, and other water sources like the San Carlos reservoir have also been at historic lows in recent years amid the west’s ongoing megadrought. Even if the neighborhood does manage to tap a long-term water source, the water will get more expensive as demand continues to grow. 

Further cuts will bolster the importance of the seniority scheme that governs usage of water from the Colorado River, which stretches from the Rocky Mountains down to Mexico and provides water for some 40 million people. A century-old agreement between seven states grants each state the right to draw a certain amount of water per year, but priority within Arizona depends in large part on how long a given user has been around. This means tribal nations that have settled with the federal government for their water rights have some of the strongest protections in the state, followed by cities and industrial users, with agriculture at the bottom of the hierarchy

As Arizona scrambles to adapt to the first cuts, the various parties who receive Colorado water are starting to swap and sell water rights: The Gila River Indian Community, for instance, has sold water to the city of Chandler, another suburb like Scottsdale that needs to secure more water in order to grow. (Some tribes, like the Navajo Nation, have never reached a settlement with the government and thus have no guaranteed water access; other tribes suffer from outdated infrastructure that makes it impossible for members to tap their water rights.)

The situation in Rio Verde Foothills is unique, but the water shutoff there is just the most vivid consequence of a larger dynamic, according to Sarah Porter, director of the Kyl Center for Water Policy at Arizona State University. 

 “Rio Verde is just one of many measures that [Scottsdale] has taken to ensure that they’re going to be able to ride through this time of less Colorado River water,” Porter told Grist.

In Pinal County, south of Phoenix, state officials have said new developers can’t rely on groundwater for new subdivisions, which places a de facto cap on new building projects. The fast-growing town of Fountain, Colorado, has begun to tell new developers that they will have to pay for their own water infrastructure if they want to build; meanwhile, the town of Oakley, in central Utah, has halted new construction permits altogether until it can find new water sources. 

In the short term, though, most towns and cities will keep building. Local leaders have every incentive to approve future development, since new population growth helps shore up tax revenue and also brings new jobs. The cuts on the Colorado River will fall hardest on agricultural users, and a decrease in overall farming could free up more water for residential use. Arizona remains one of the fastest-growing states in the country, and in the most recent Census Phoenix leapfrogged Philadelphia to become the nation’s fifth-largest city.

All these new arrivals will be competing for a water supply that is not getting any larger. If the megadrought continues, cities like Scottsdale will have to keep reducing their water usage, saving supplies for the densest residential areas and cutting off everyone else. The specific nature of the cuts will be different in every place, but the effect will be the same: Outward expansion will slow down or stop altogether.

In the meantime, Rio Verde Foothills is in limbo. The process of development hasn’t slowed down, and new homes in the area are still going up, but the future value of those homes is uncertain. If the neighborhood doesn’t figure out an alternative water source, residents like Harris will be stuck with assets that are worth nothing, forced to walk away from their houses or default on their mortgages. Even if the neighborhood does find a resolution to the water issue, future buyers might be wary of future supply gaps, and property values in the neighborhood could fall. 

Going back to groundwater, meanwhile, is not an option, because the neighborhood’s aquifers are already tapped out. Many residents’ wells have started to spit up mud, and those who do get actual water often find that it’s turbid and laden with arsenic. Harris knows one neighbor who’s tried to punch six different wells on his property and come up dry each time.

If the worst comes to pass, residents will have no choice but to cut their losses and leave.

“Our houses will be unlivable,” says Harris. “We won’t be able to sell them, we won’t be able to live. It will really be a Hunger Games type of deal.”