Staci Matlock has a nice story in the New Mexican about water problems in the San Luis Valley, on the upper Rio Grande in Colorado:

Until five years ago, most people thought water in the upper one-third of the San Luis Valley was hydrologically disconnected from the river. It was called a closed basin — no surface or groundwater flowed to the Rio Grande. Farmers and ranchers pumped away while fighting off recent attempts by wealthy investors to sell millions of gallons of water from the valley across the mountains to Denver and downstream to Santa Fe and Albuquerque.

Then came the crushing drought of 2002, Whitten said. Water began flowing from the Rio Grande backward, into the underground aquifer, and river flows decreased. In the basin, surface water from streams and creeks dried up as producers kept pumping. “North of the river, it became a losing system, and the aquifer declined,” said Whitten, a board member of the Rio Grande Water Conservation District.