Fighting drought, potato farmers in northern Minnesota overdrew their water permits by tens of millions of gallons

During the 2021 drought, nearly 800 Minnesota farmers with high-capacity wells pumped 6.5 billion more gallons of water than their permits allowed, state records show.

Farms on land owned or operated by R.D. Offutt Co., a potato-growing giant that has become one of the biggest water users in the state, were responsible for 23% of the excessive pumping.

"That's quite a bit of overuse," said Randall Doneen, a section manager for the Minnesota Department of Natural Resources. "We're trying to get people back into compliance."

The overpumping in 2021 put more stress on already depleted aquifers, lakes and streams and raised the risk that neighboring wells would run dry.

A Star Tribune review of water permit data reported each year to the DNR found more than three of four water users who violated their permits were agricultural irrigators. But they are unlikely to face fines or other consequences because of laws that the DNR says are too lenient. Many irrigators may not even have to pay for the extra water they used, based on the tiered fee system the state charges heavy users.

In some cases, farmers needed to go over their permits to keep their crops alive, said Jake Wildman, president of the Irrigators Association of Minnesota.

"Nobody wants to have to pump as much we did," Wildman said. "We all understand rules and regulations are there for a reason. We all want to follow them. I truly believe we did the best we could with the tools we had and climate we were given."

The permit violations on R.D. Offutt farms is particularly concerning to neighbors and water quality advocates because many of them arein the Pineland Sands region of central Minnesota. The same sandy porous soil that makes the land attractive for growing potatoes also makes it vulnerable to pollution.

When too much water is drawn from the ground for crops, it allows pollutants to seep into the soil, potentially contaminating drinking water.

Based in Fargo and founded 60 years ago, R.D. Offutt is one of the largest potato growing operations in the world. Much of their produce is cut into French fries, and the company is a major supplier to McDonalds restaurants.

It rapidly expanded in Minnesota in the past two decades. Many forests and timberlands in the Pineland Sands area, which covers parts of Hubbard, Wadena, Cass and Becker counties, were cleared and turned into irrigated cropland.

By 2018, the company's growth concerned DNR officials to the point that the agency stopped approving its well permit applications. The DNR said a comprehensive study was needed to find out whether increased water use was drying up lakes and streams or hurting water quality in wells in the region. R.D. Offutt had dozens of pending well applications at the time.

Rather than fund the study, the company reached a deal with the DNR that withdrew all but five permit applications. The DNR asked lawmakers to fund the study. They did not, and it was never done.

By 2021, R.D. Offutt was the registered landowner or agent of more than 650 high-capacity well permits in the state. Together, those farms pumped 22 billion gallons of water — about 2.5 billion more than was used by the entire city of Minneapolis' water treatment plant, which serves about 500,000 people.

The overuse was a result of just how bad the 2021 drought was, R.D. Offutt spokeswoman Jennifer Maleitzke said. It was the state's most severe dry spell since at least 1988.

"Without measurable rainfall, farmers like us relied on irrigation to make sure crops across the state survived and there were no disruptions to the food supply chain," she said.

In the years before the drought, R.D. Offutt farms complied with their permits. Less than 1% of the company's permit holders went over their limit in 2020 and 2019.

"Every single growing season is different," Maleitzke said. "We take our responsibility seriously to preserve the water supply in Minnesota, and we've made significant investments during our 60 years of farming potatoes to do just that."

The overuse shows how irrigators and high-capacity water users face few repercussions if they violate a permit, said Mike Tauber, who lives in the Pineland Sands region in Backus, Minn., and has helped organize petitions demanding in-depth water quality studies.

"They're thumbing their nose at the agencies," Tauber said.

Everyone with a permit to draw more than 1 million gallons of water a year is required to report how much water they use. But that reporting is largely done on the honor system. There are no compliance checks.

The city of Blaine opened three new wells and pumped millions of gallons in 2021 and 2022 without getting permits. The DNR learned about it only after 141 nearby private well owners complained about running dry.

Blaine, too, likely won't face any fines. Lawmakers have given the DNR few ways to penalize anyone that violates the permits.

The DNR could issue an "administrative penalty" ranging up to $20,000, depending on the severity of the breach. But the fine would be forgiven as soon as the user comes into compliance, Doneen said.

The DNR only typically issues a penalty in the most egregious cases, Doneen said. He doesn't except any fines to be issued for farmers who overpumped during the drought.

But dry spells are precisely when the state should be more aggressive in protecting water supplies, said Carrie Jennings, research and policy director at the St. Paul-based Freshwater Society.

"That's the critical time when you would want to do it," she said.

DNR administrators have asked lawmakers in each of the last two years to allow them to increase the fines they can impose on permit violations. A bill in the House would let the agency fine up to $40,000. The agency also would get more discretion over whether fines are forgiven.

"The tools we have aren't what we need," said Bob Meier, assistant DNR commissioner.

Permit holders that exceeded the limits still would need to pay the same tiered water-use rates as everyone else. All permit holders pay $140 a year to pump up to 50 million gallons of water. They're charged $3.50 for every million gallons after that. The price rises again after 100 million.

The average R.D. Offutt permit violation allowed 43 million gallons in 2021. Those that went over, but still pumped less than 50 million gallons, wouldn't have to pay any more than the $140 minimum. The users that exceeded the permits did so by an average of 10 million gallons. If they were only permitted to pump 43 million gallons, those users would need to pay an extra $10.50 — roughly the cost of a Big Mac with large fries.