Rosie Burroughs did not set out to become a symbol. On her family's ground in eastern Merced County, an excavator spent the spring stacking almond trees that had been pulled out by the roots. About 170 acres of almond and walnut trees had already been removed over the past couple of years. Another 140 acres were slated to go. The family's acreage would shrink by about a fifth, not because the trees failed, but because the water beneath them had acquired a price and a limit.
Burroughs farms in the Turlock Subbasin, where growers are limited this year to 1.6 acre-feet of groundwater per acre, with steep fees on excess use. Almonds, the area's top crop, typically require 3 to 4 acre-feet per acre. The arithmetic does not close. Something has to give, and in the San Joaquin Valley in this decade, what gives is trees.
The force behind the arithmetic is California's Sustainable Groundwater Management Act, passed in 2014. SGMA created the first statewide framework for managing groundwater, which supplies roughly 40% of California's water in average years and 60% in drought years. Local Groundwater Sustainability Agencies were given years to write plans and until 2040 or 2042, depending on the basin, to reach sustainability — but since 2020 or 2022 they have been required to prevent "undesirable results" such as land subsidence and household wells running dry. In the most depleted basins, that requirement has already bitten.
The Public Policy Institute of California estimated in a June report that as much as 900,000 acres of irrigated farmland in the San Joaquin Valley could be taken out of production as a result of SGMA, with a commonly cited range of 500,000 to 900,000 acres. In the Turlock area alone, projections put expected fallowing near 22,000 acres. One regional account of the fallout cited a potential loss of 42,000 jobs and $1 billion in wages. Those are projections, not certainties, and they should be read as such. But the direction is not in doubt, and the mechanism is now visible on individual farms.
Stacie Ann Silva, principal at Altum Aqua Logic, a Fresno-based water consulting firm that monitors more than 90 groundwater agencies across California, described the present phase plainly: "We are truly in the difficult part of SGMA. As allocations continue to ramp down, landowners are going to have to make harder decisions." Mike Tietze, general manager of the Eastern Turlock Subbasin Groundwater Sustainability Agency, has made the same point from the agency side: economic conditions have necessitated leaving some land fallow.
The cost side is arriving just as fast as the quantity side. In Tulare County, Aaron Fukuda manages the Kaweah Subbasin Groundwater Sustainability Agency. In 2024, SGMA pumping costs in his district jumped from roughly $32 per acre to as high as $140, backed by a $5.8 million annual mitigation program that Kaweah partners signed with Self-Help Enterprises to keep domestic wells functioning as the water table dropped — all funded by pumping fees. California's Department of Water Resources, in its Bulletin 118 Update 2025, estimated the state's groundwater basins hold more than 1 billion acre-feet of storage capacity, roughly 25 times the combined capacity of all surface reservoirs. The resource is vast. The cheap, unmetered access to it is ending.
Farmers are adapting in ways that would have sounded fanciful a decade ago. Some are watering a few inches of soil for agave instead of a few feet of soil for an almond tree. James Hunt, a grower in the valley, planted agave a little over a year ago; Omar Ramirez, a grower in Le Grand in southeast Merced County, is among those exploring the crop. Researchers call agave and similar plantings "SGMA-ready crops": desert-type or winter crops that demand far less water than almonds or pistachios. Others are turning fallowed ground toward habitat restoration or solar energy, where large, interconnected parcels make those uses viable. None of these pivots is painless. All of them are rational responses to a new price.
The counterargument, again, is serious. Critics of the SGMA transition argue that fallowing on this scale will hollow out farm towns, strand packing and processing infrastructure built for a larger irrigated footprint, and shift production — and its water footprint — to other states or countries with weaker environmental rules. They argue that groundwater agencies, many of them new and thinly staffed, are being asked to reallocate a century of farming practice on a deadline, with fees that fall hardest on smaller operators. A valuation that treats fallowed land as simply "land minus water" will miss the second-order losses in communities and supply chains. That critique should temper any triumphal story about markets solving scarcity.
Still, the analysis cuts the other way on asset value. As groundwater becomes scarcer and more expensive, senior surface water rights — rights that predate SGMA's groundwater regime entirely — become disproportionately valuable, because they offer an alternative to a capped, fee-laden aquifer. Groundwater extraction credit trading platforms have already launched in several basins. The water freed by fallowing has three possible fates: it can stay in the ground with no buyer, go to higher-value crops with a limited buyer pool, or go to municipalities and industry, the highest-value buyers, where institutional infrastructure exists to transact. The firms that can diligence seniority, quantify a pumping allocation, and document a transfer path will set the price. Everyone else will take it.
The implication is not that California farming ends. It is that California farming reorganizes around water as a budgeted input with a market price, a cap, and a tradable allocation — the way energy and labor have long been budgeted. Land without a defensible water position will be repriced first and hardest. Land with senior surface rights, a documented allocation, and a lawful path to lease or transfer will hold value precisely because its neighbors cannot replicate it. That distinction, parcel by parcel, is the valuation work of the next fifteen years.
Sources: Public Policy Institute of California, June report on San Joaquin Valley fallowing under SGMA (500,000–900,000 acres; up to 900,000 acres cited in SJV Water coverage).; Mid Valley Times / NewsChunks reporting on Turlock Subbasin (Rosie Burroughs, 170 acres removed plus 140 slated; 1.6 acre-feet per acre allocation; almonds requiring 3–4 acre-feet; 22,000 acres projected fallowed in the region; 42,000 jobs and $1 billion in wages cited as potential impact).; Kaweah Subbasin reporting (Aaron Fukuda; pumping costs from about $32 to as high as $140 per acre in 2024; $5.8 million annual mitigation program with Self-Help Enterprises).; California Department of Water Resources, California's Groundwater: Bulletin 118 — Update 2025 (more than 1 billion acre-feet of basin storage capacity; groundwater about 40% of statewide supply in average years, 60% in drought years).; SJV Water reporting on SGMA-ready crops (James Hunt, Omar Ramirez, agave; Stacie Ann Silva, Altum Aqua Logic, monitoring more than 90 agencies; Mike Tietze, Eastern Turlock Subbasin).