A well permit on your Colorado land looks like a selling point. In many cases it is. But buyers, lenders, and title companies all have questions about that permit — and the wrong answers can kill a deal fast. Is the permit exempt or adjudicated? Is the well in the Denver Basin non-tributary aquifer, or is it drawing from a tributary that requires an augmentation plan? Did the prior owner abandon it under C.R.S. § 37-92-402.5? We've bought Colorado rural land with wells on the Eastern Plains, the Western Slope, and up in the mountains. We know how DWR water rights interact with a land sale. Call 970-478-1022 and we'll walk through your permit situation before you list or negotiate anything.
In Colorado, every groundwater well requires a permit from the Colorado Division of Water Resources (DWR) under C.R.S. § 37-90-105. The permit specifies what the well can legally be used for, how much water it can withdraw, and from which aquifer. Selling land with a well means transferring that permit — or confirming the water right attached to the permit — to the buyer.
There are two fundamentally different types of well rights in Colorado. A permitted well under C.R.S. § 37-90-105 has DWR approval to drill and use groundwater within defined limits. An adjudicated water right is a decreed right confirmed by the Water Court under C.R.S. § 37-92-302 with a specific priority date and diversion amount. Most rural domestic wells are permitted; irrigated agricultural wells often carry adjudicated rights. Both can transfer with land sale, but they transfer differently.
Colorado law at C.R.S. § 37-92-602 creates a category of "exempt" wells for household, domestic, or small-scale uses that do not require Water Court adjudication. The most common is the "household use only" (HSU) well, which is limited under C.R.S. § 37-92-602(3) to: indoor domestic use in one single-family dwelling, watering a home garden under one acre, and watering livestock in small numbers. Exempt wells cannot irrigate crops, fill ponds, or serve commercial uses. If a buyer wants to use the well beyond HSU limits, they need a new or modified permit — and possibly Water Court approval.
Beneath most of the Eastern Plains lies the Denver Basin — a sequence of aquifers including the Dawson, Denver, Arapahoe, and Laramie-Fox Hills formations. These are designated non-tributary aquifers under C.R.S. § 37-90-137(4) in most of their extent. Non-tributary groundwater is not legally connected to surface streams — withdrawing it doesn't reduce streamflows and doesn't require an augmentation plan. The State Engineer allocates a tract's Denver Basin water based on acreage: approximately 1% of the estimated aquifer water underlying your parcel per year over 100 years.
The critical distinction: tributary groundwater is legally connected to a surface stream. Pumping tributary groundwater reduces streamflow and must be accounted for through the prior appropriation system. If your Eastern Plains well draws from a shallow tributary formation rather than the deep Denver Basin, it is subject to priority calls and may require an augmentation plan under C.R.S. § 37-92-302.
If a well pumps tributary groundwater out of priority — meaning more senior water rights holders have a call — the pumper must replace the depletions to the stream system through an augmentation plan approved by the Water Court. Augmentation plans are complex, expensive, and essential on some parcels. Buying or selling land with an augmentation plan requires confirming the plan is current, funded, and adequately covers the well's current use. An unfunded or lapsed augmentation plan can result in the State Engineer ordering the well shut down.
On irrigated agricultural land, surface water delivered via irrigation ditches under decreed ditch rights is generally more reliable and valuable than groundwater. Ditch shares — ownership interests in a mutual ditch company — are transferable personal property that must be explicitly addressed in the purchase agreement. Don't assume ditch shares transfer automatically with the land; they often require a separate assignment and approval by the ditch company's board.
The well permit itself is tied to the parcel — it follows the land automatically. But if the underlying water right is adjudicated and separately recorded, that right must be conveyed explicitly in the deed or a separate water rights deed. Under C.R.S. § 37-92-501, water rights are real property and must be conveyed in writing. Forgetting this step is one of the most common errors in rural Colorado land transactions.
Our simple 3-step process makes selling your land fast and easy
Fill out our simple form or give us a call. Tell us about your property and what you're looking for.
We'll evaluate your property and present you with a fair, no-obligation cash offer within 24 hours.
Choose your closing date. We handle all the paperwork and cover closing costs. Get paid in as little as 7 days.
Eastern Plains (Elbert, Lincoln, Cheyenne counties): Denver Basin wells are the norm. Non-tributary Dawson and Denver Formation wells on 35-acre parcels are highly marketable — buyers know they have a legal, long-term water supply independent of stream administration. We see these regularly in Elbert County near Kiowa and Elizabeth. A functioning Denver Basin well adds $8,000–$25,000 to parcel value depending on formation depth and yield.
Teller and Park counties (mountain parcels): Shallow wells in mountain valleys frequently draw from tributary groundwater. Many were permitted decades ago when administration was loose. Modern buyers — and their lenders — want to know the well's legal status. We've bought parcels here where the original well permit was technically for tributary water with no augmentation plan; we price the water risk into the offer.
San Luis Valley: The most heavily administered water region in the state. Closed basin designation under C.R.S. § 37-90-137 applies to most of the Valley's shallow unconfined aquifer. New well permits are essentially unavailable. Existing permitted wells are valuable assets. If you're selling San Luis Valley land, the well permit status is more important than acreage in many cases.
For related reading, see Colorado water rights overview, Colorado agricultural land sales, 35-acre exemption parcels, and selling raw land in Colorado.
Serving all 64 counties across the state
Get answers to common questions about selling your land
The permit follows the parcel automatically when land changes hands — you don't file a separate DWR transfer. But if the well also carries an adjudicated water right decreed by the Water Court, that right must be explicitly conveyed in the deed or a separate water rights deed under C.R.S. § 37-92-501. Missing this step leaves the buyer with a well but no legal right to the water it draws.
The Denver Basin underlies most of Colorado's Eastern Plains, comprising four aquifer formations: Dawson, Denver, Arapahoe, and Laramie-Fox Hills. Under C.R.S. § 37-90-137(4), most Denver Basin groundwater is designated non-tributary — legally disconnected from surface streams. The State Engineer allocates each parcel's Denver Basin water based on acreage, approximately 1% per year over 100 years. Non-tributary wells don't require augmentation plans.
Under C.R.S. § 37-92-602(3), exempt wells are limited to indoor domestic use in one single-family dwelling, a home garden under one acre, and small livestock watering. They don't require Water Court adjudication. Exempt wells cannot irrigate crops, fill stock ponds, or serve commercial uses. Expanding use beyond the exempt categories requires a new or modified permit and potentially Water Court approval.
Tributary groundwater is legally connected to a surface stream — pumping it reduces streamflows and subjects it to the prior appropriation system. Non-tributary groundwater (like most Denver Basin water) is legally independent of surface streams. Tributary wells can be subject to priority calls and may require an expensive augmentation plan under C.R.S. § 37-92-302. This distinction directly affects well reliability and land value.
Non-use alone doesn't automatically void a Colorado well permit. However, under C.R.S. § 37-92-402.5, a water right may be subject to abandonment proceedings if it has not been used for 10 or more years without a finding of intent to continue use. DWR conducts periodic abandonment list proceedings. If your permit has adjudicated rights that appear on an abandonment list, contest the listing immediately or the right may be extinguished.
No. Ditch shares in a mutual ditch company are personal property, not real property. They must be explicitly assigned in the purchase agreement and often require approval from the ditch company's board of directors. Many Colorado rural land transactions fail to address this — the land transfers but the water shares don't. The purchase agreement should list all ditch company shares by company name, certificate number, and share count.
Fill out the form below or call us at 970-478-1022
970-478-1022
info@coloradowesternland.com
Monday-Friday
9AM-5PM MT