The crisis, experts say, is a beetle epidemic that has killed more than 17 million acres of national forest, The Denver Post reported Wednesday.
The Forest Service spends nearly $1 billion a year to clear and treat beetle-ravaged forests, but it is looking for help, the newspaper said.
"The federal government doesn't have enough resources to deal with this," said Harris Sherman, the U.S. Department of Agriculture's undersecretary for natural resources and environment.
The problem is erosion and sediment, which can clog reservoirs and water delivery systems, the Post said.
But enlisting the aid of local water utilities like Denver Water in funding the removal of infested trees could mean higher water rates for consumers, utility officials say.
Denver Water is considering the government's request for help.
"It's in our self-interest," said Penfield Tate, president of Denver's Board of Water Commissioners. "It will be far more cost-effective to manage the watershed than it would be to wait for another forest fire to occur."
Dealing with erosion after a 2002 forest fire is expected cost Denver Water $41 million, and contractors are still dredging reservoirs and clearing pipes, the Post said.