SAN FRANCISCO (AP) — Throughout California's desperately dry Central Valley, those with water to spare are cashing in.
As a third parched summer forces farmers to fallow fields and lay off workers, two water districts and a pair of landowners in the heart of the state's farmland are making millions of dollars by auctioning off their private caches.
Nearly 40 others also are seeking to sell their surplus water this year, according to state and federal records.
Economists say it's been decades since the water market has been this hot. In the last five years alone, the price has grown tenfold to as much as $2,200 an acre-foot — enough to cover a football field with a foot of water.
Unlike the previous drought in 2009, the state has been hands-off, letting the market set the price even though severe shortages prompted a statewide drought emergency declaration this year.
The price spike comes after repeated calls from scientists that global warming will worsen droughts and increase the cost of maintaining California's strained water supply systems.
Some water economists have called for more regulations to keep aquifers from being depleted and ensure the market is not subject to manipulation such as that seen in the energy crisis of summer 2001, when the state was besieged by rolling blackouts.
"If you have a really scarce natural resource that the state's economy depends on, it would be nice to have it run efficiently and transparently," said Richard Howitt, professor emeritus at the University of California, Davis.
Private water sales are becoming more common in states that have been hit by drought, including Texas and Colorado.
In California, the sellers include those who hold claims on water that date back a century, private firms who are extracting groundwater and landowners who stored water when it was plentiful in underground caverns known as water banks.
"This year the market is unbelievable," said Thomas Greci, the general manager of the Madera Irrigation District, which recently made nearly $7 million from selling about 3,200 acre-feet. "And this is a way to pay our bills."
All of the district's water went to farms; the city of Santa Barbara, which has its own water shortages, was outbid.
The prices are so high in some rural pockets that water auctions have become a spectacle.
One agricultural water district amid the almond orchards and derrick fields northwest of Bakersfield recently announced it would sell off extra water it acquired through a more than century-old right to use flows from the Kern River.
Local TV crews and journalists flocked to the district's office in February to watch as manager Maurice Etchechury unveiled bids enclosed in about 50 sealed envelopes before the cameras.
"Now everyone's mad at me saying I increased the price of water. I didn't do it, the weather did it," said Etchechury, who manages the Buena Vista Water Storage District, which netted about $13.5 million from the auction of 12,000 acre-feet of water.
Competition for water in California is heightened by the state's geography: The north has the water resources but the biggest water consumers are to the south, including most of the country's produce crops.