On a cloudless day in late January, G. W. Franzen gazed at a vast field of dirt and wondered what would grow there. Machines had leveled and tilled the earth and made it ready for rice, a crop that Franzen and his family had grown in Matagorda County for more than half a century. He had hoped to sow in March, so that by mid-May the field would be full of lush, green rice plants, higher than a man’s knee and waving in the wind. It was a hope that grew fainter by the day.

The problem was simple: the thing most needed to grow rice was water, and Franzen was unlikely to get any. Every spring and fall for as long as he could remember, engineers had opened the gates to a chain of lakes in the Hill Country, lowering two key reservoirs, Lake Buchanan and Lake Travis, and sending vast amounts of water flowing more than one hundred miles down the Colorado River toward the Gulf. Pumping plants, installed along the river before World War II, diverted the water into canals and toward tens of thousands of acres of rice fields across Wharton, Matagorda, and Colorado counties. Franzen, a kindly 54-year-old of Swedish heritage with bright blue eyes, could recall learning to swim in the canals as a child. In the forties his father, like his father before him, had taken up rice farming, and after he died, G.W. and his two brothers, together with their mother, had kept the farm; they now worked about 2,600 acres. Every year they worried about the cost of diesel, the market price of rice, and, of course, the weather.

But they had never worried much about water. Now the most intense drought in recorded state history had ravaged Lake Travis and Lake Buchanan, and despite several winter downpours, the forecasts seemed to indicate that the brown, barren rings around the reservoirs’ edges would only be expanding. These predictions, Franzen knew, held implications for others besides farmers. The lakes were also the main source of water for towns and cities across the Hill Country, whose populations had exploded; according to the recent census, Travis County alone had grown more than any other county in the state. Rice farmers had accounted for about 60 percent of the water used in 2011, which, combined with the drought, had caused the lake levels to drop to 37 percent of capacity. If the farmers got the same allotment this year and it didn’t rain, the lake levels would plunge well below 20 percent—a terrifying scenario for everyone else who depended on the reservoirs.

The specter of this shortage had ignited fierce debates and lent urgency to efforts by the Lower Colorado River Authority, the state organization that oversees the lakes, to create a new plan to manage the water. For nearly two years, the LCRA had been calling meetings in the Austin area with farmers, city residents, lakeside dwellers, and environmentalists to discuss the shared future of the lakes. But as water levels dropped, the negotiations became more contentious, leading to tense exchanges. (I helped report a series on these fights last summer for the Texas Tribune and NPR’s Austin affiliate.) The squabbling signaled the difficulty of hanging on to Texas’s farming heritage in an era of fast-growing cities and economic diversity, and this tension between old and new, rural and urban, reverberated not just along the Colorado River but through every corner of the dried-out state.

Franzen hoped to drill two test wells to see if he and his family had enough groundwater to grow at least some rice. But the drillers he’d contacted, in high demand around the state, couldn’t get to his farm until May or June. Still, groundwater was probably a good idea: the LCRA’s new water-management plan was being put to a vote in a few weeks, and one of its provisions was to cap, for the first time ever, the amount of water sent downriver to the rice farms. The plan’s basic idea was to keep the lakes fuller for cities and lake communities; it would now require reservoir levels to be assessed two times a year rather than just one, to determine how much water, if any, farmers could obtain. Though the LCRA said it hoped to increase its water supply by 100,000 acre-feet by means of reservoirs or aquifer storage and aid the farmers, Franzen knew this would be years away.

“This is uncharted territory for us,” Franzen told me before we hopped into his white pickup for a tour of the rice fields. We were joined by his brother Derril and 79-year-old Haskell Simon, a Matagorda County farmer who works 150 acres with a business partner, and together we surveyed Simon’s land from the road. Rice farmers across southeast Texas were split on the announced plan: some saw it as an inevitable compromise, while many in Matagorda County, like the Franzens and Simon, felt that the farmers were losing too much. Water conservation was a tough sell here, perhaps more so than in nearby counties, because many farmers rented their land, meaning they were reluctant to pay for measures such as laser-leveling fields to make less water drain off.

Simon, who grew his first rice crop in 1947, had attended the LCRA meetings as a farmers’ representative, and he had been the lone dissenter on the plan when it was put to a preliminary vote. As we talked, he paused often, as if to keep his feelings in check. But looking out over the stubble of last year’s crop, he could not hide his passion.

“Are we wrong in supporting our historic access to Colorado River water?” he asked, peering intently at me through his glasses. “Are we obligated to sacrifice one-hundred-plus years of rice production because the city of Austin wants to maintain its accelerated growth?”

Rice is a notoriously thirsty crop, one that brings to mind images of monsoons and flooded fields. That Texas, a state with severely fluctuating weather, even grows rice has a lot to do with history. In the mid-nineteenth century, when farmers heading west settled along the lower Colorado near the Gulf, they began growing sugarcane, but they switched to rice when they found that it thrived in the intense heat and the clay layer under the topsoil. The farmers dug irrigation canals for their rice crop, but because the Colorado River carried too much water one year and too little the next, their harvests were erratic.

Some sort of surety was needed, and Texas farmers—who harvest two crops a year and now account for 7 percent of the nation’s rice production—saw their chance in 1935, when they used their rights to the Colorado River as political capital and helped galvanize the Legislature to create the LCRA to store water, generate electricity, and control floods. Throughout the late thirties and forties, the new agency began building the dams in Central Texas that would result in the six Highland Lakes, including Buchanan and Travis. Back then, fewer than 100,000 people lived in Austin, and the newly reliable water allowed people like Franzen’s father to grow rice where his grandfather, subject to the vagaries of the river, had struggled.

As more people moved to Central Texas, though, the demands on the lakes increased. And so, in 1989, after haggling by the City of Austin and others over water resulted in a court settlement, LCRA officials forged an arrangement. Towns and cities would have guaranteed water, and the farmers’ supply would be deemed “interruptible”: in a bad drought, it could slow or cease. To date, however, that has never actually happened. Thanks to varying formulas over the years, the gates have opened for the farmers for a few months every spring and fall, even during the height of the drought last year. In fact, rice farmers used more lake water in 2011—452,000 acre-feet—than at any other time since 1999, and nearly three times as much as Austin.

The LCRA did impose limits on how much water individual farmers could use starting in 2010, and the agency collected over $220,000 in charges last year from those who used too much. But the farmers nevertheless get their water cheaply, paying less than one-twentieth of what towns and cities do. That doesn’t count delivery costs, such as maintaining the canal system, but urban centers have delivery costs too, and factoring those in still leaves the farmers paying far cheaper rates.

So it is only natural that those who live in towns and cities, which have had to implement water restrictions upon the LCRA’s request, find the longtime arrangement unfair. The City of Austin limited lawn watering to once a week, and before the rains started last fall, officials had discussed banning outdoor watering altogether. In the halls of the LCRA headquarters one day in February, I caught up with Greg Meszaros, the director of Austin Water Utility, who has logged many hours at the meetings for a new water-management plan. Meszaros warned that the lake levels, which by then had risen to 41 percent of capacity, could easily drop again in a few months. The whole basis of the discussions, he told me, was that Austin and other cities needed to have guaranteed water. He supported the proposed plan, though in theory, he explained, “we shouldn’t be giving up anything.”

For the LCRA, brokering an agreement between competing interests has been not only a headache but also an occasion to examine its identity as an agency. “It’s emotional right now, because we are in such a serious drought,” said Becky Motal, the agency’s general manager, who works at the LCRA headquarters beside one of the mighty dams in the Highland Lakes chain. She did not sit in on the meetings, but she now spends about 80 percent of her time worrying about water, even though it is a minor part—3 percent—of the LCRA’s revenue, which mostly comes from electricity. She offered largely careful comments about the proposed plan and dodged my question about whether it made sense anymore to cultivate water-intensive rice when Texas cities are growing so quickly. She would say only that rice farmers “sense that there’s going to be less and less water available for them over the next several decades.” (Interestingly, environmentalists in the state have generally sided with the farmers in asking for more water, because the rice fields double as habitat for migrating waterfowl.)

I wanted to see for myself what the lakes looked like, so while I was in Austin, I hopped in a 21-foot motorboat for a ride around Lake Travis with Janet Caylor, a former managing director at Merrill Lynch who now owns two marinas. (It was Caylor, along with Jo Karr Tedder, a resident near Lake Buchanan, who first approached me about covering the LCRA’s water issues.) As we rode, she pointed out the now grim trappings of lake life. There was a dock that had been moved so it could stay in the shrinking lake; there was a boat ramp that ended far above the water; there was a restaurant threatened with bankruptcy. At Carlos’n Charlie’s, a Tex-Mex and seafood joint, I was struck by a huge sign that read “Slow Your Boat.” It stood dozens of feet above the water line.

Had the farmers not been given water last fall, Lake Travis might be thirteen feet higher, and the public boat ramp at Mansfield Dam would still be open, Caylor figured. She was frustrated with the new LCRA plan, because even though it would help the lakes during a drought, it still allowed for levels to drop too low. The farmers could no longer be the dominant power brokers, she felt. Some of them “are telling the LCRA, ‘You need to dance with the one who brung you,’ ” she said. “But this is not a high school prom.”

On February 22, after two days of sometimes impassioned public testimony, the LCRA board voted ten to five to approve the new water-management plan. At the last minute, rice farmers tried to add an amendment that would remove the cap on the amount of lake water released to them, but a majority of board members rejected it. The plan now goes to the Texas Commission on Environmental Quality for final approval, which could take at least a year or two.

I caught up afterward with Simon, who was disappointed that the amendment had failed. The approved plan was “inequitable” for farmers, he told me, adding starkly, “I feel it doesn’t reflect the original intention of why the LCRA was created.” The lakes were reservoirs, after all. Weren’t they meant to be used?

Simon and his fellow farmers soon had another reason to be upset: on March 1, the LCRA—which is operating under an emergency drought plan—declared that the lake levels were so low that it could not spare any water this spring for most rice farmers. (The required benchmark for opening the gates was 850,000 acre-feet on March 1, and the unexpected rains had swelled the lakes to nearly this level, causing Simon and Franzen to obsessively check the numbers online every day.) Though farmers had been bracing for the announcement, it was nonetheless a blow. A force in the formation of the LCRA, they had clearly lost their historical foothold.

Most rice farmers, however, think they will survive the drought—at least for now. A few can switch to groundwater, and there are those like Franzen who are enrolled in federally subsidized crop insurance programs and can collect for their unplanted fields. They can also grow dryland crops, like sorghum, as a replacement. These crops, farmers say, are less suited to the soil, but they don’t need water from the lakes to grow. (Ironically, the recent rains have made it hard to plant a rice crop right now anyhow.) Many growers are also reassured by the money they are seeing from a $750 million settlement with the agribusiness giant Bayer CropScience, which they say caused turmoil in the rice market a few years ago by accidentally introducing a genetically modified strain. (Oddly, many Texas farmers have begun growing a hybrid rice funded by the prince of Liechtenstein. It’s supposed to result in higher yields.)

That’s not to say that rice farmers won’t soon see the effects on their communities. The businesses that supply the farmers, for one thing, are sure to feel the pain acutely. They have no crop insurance and few alternatives. Before I left Matagorda County, I drove by the huge rice driers belonging to BU Growers, in Bay City, a company that sells rice seeds and offers services like rice drying and trucking. The owner, Joe Crane, was out of town, but during a phone call later, he told me he felt “like a man on death row.” In his four decades in the rice business, he’d never seen growers cut off from irrigation water. He expected to lose 75 to 80 percent of his gross revenue this year. And while he figured that the lakes would fill up again next year, he was mindful of another possibility.

“What will be really catastrophic,” Crane said, “will be if we start stringing several of these drouthy years together.”