Texas Tourist, Boating Business Hit By Drought

Austin, Texas — In the heart of Texas, an extended drought is draining the bottom line of business owners frustrated by the lack of water. From marine shop owners to the folks running lake shore businesses, two years with below average rainfall shows the drought is impacting more than just farmers and ranchers in central Texas.

Meghan Reeder for CNBC

"We lost 50 percent of our revenue last year and probably 50 to 60 percent this year and that is equal to several million dollars," said Pete Clark, owner of Carlos and Charlie's restaurant on Lake Travis in Austin, Texas. (Related: With Drought, Rising Food Prices Hit Small Businesses.

The view from Clark's outdoor patio shows an empty dock and dry lake bed. With water levels down there are fewer people boating on the lake and those who are on the water cannot ride up to Carlos and Charlie's dock for lunch or dinner.

"On your typical Saturday night we might have 200 boats parked in this area that are all up in the restaurant enjoying their time," Clark said. "Right now we can get zero into this area."

The water level of Lake Travis has dropped to 637 feet, 28 feet below its historic average. June was the fourth driest June ever in Austin. Just .06 inches of rain fell in the Texas state capital and the lake system for the Austin is now just half full.

At the Sail and Ski Center in Austin, owner Buzz Watkins said business is down 30 percent over the last four years due to the extended drought.

Watkins blames some of the slowdown on fewer people having access to the lake with levels down. As a result, there are fewer first-time boaters getting out on the water and thinking about buying a boat.

"We've been in business 30 years and we'll get through this," Watkins said. "The challenge is to focus on how great boating can be instead of dwelling on these challenges."

The longer the drought goes on, the greater the debate over who uses the water in Lake Travis and how much they use. Local media have termed it "The Water Wars". (Related: Obama Announces Measures to Soothe Drought Pain.)

Ranchers and farmers have tapped Lake Travis as a water source for decades. But with the lake now half full and other industries like boating and tourism being impacted, business owners in those industries are calling for a new water plan for the use of Lake Travis..

Laura Mitchell with the Lake Travis Chamber of Commerce said the drought has the potential to have a fiscal impact of up to $21 million.

"We're a very resilient community but this certainly has an impact. It's grand," Mitchell said.

-By CNBC's Phil LeBeau