cdn.ymaws.com · web viewon appeal, the 5th circuit reversed the judgment of the district court,...

30
Water Rights And Water Wars: Changes in Water Rights in the United States Denise V. Cheney, Bickerstaff Health Delgado Acosta LLP Water rights is a complex and growing area of the law. Old cases establishing water rights in the late 19 th and early 20 th centuries are being re-examined by state courts in light of advances in science and technology and in response to new pressures. Increased population growth, commercial agriculture, aquaculture, oil & gas production, energy needs, recreational uses and changing climatic conditions all have exerted pressure on this precious resource. 1 States that once thought of themselves as having an abundance of water are now questioning the sustainability of their water supplies, and the dry western and southern states, which have endured years of punishing drought, are looking to greater water development, increased regulation, and conservation to address shortages. Added to this mix is a new appreciation for biodiversity and the preservation of plant and animal species. As man’s use of water increases through damming, diversion and withdrawal, and as the drought shrinks surface water, the habitats of many plants and animals, including endangered species, are being adversely affected, and conservation groups are challenging regulatory policies that permit uses detrimental to them. With so much competition between users, prioritization of use is becoming a critical issue. States are moving away from traditional riparian and appropriative systems to respond to new pressures for water. The selection criteria established by regulators, and the priorities established by courts and legislators, will decide the winners and the losers in the water wars. The purpose of this paper is to examine changing theories of surface and groundwater rights among the states, and to look briefly at some of the ways in which eastern states and western 1 See Joseph W. Dellapenna, Climate Disruption, the Washington Consensus, and Water Law Reform, 81 Temp.L.Rev. 383, 386-89 (2008).

Upload: others

Post on 15-Mar-2020

2 views

Category:

Documents


0 download

TRANSCRIPT

Page 1: cdn.ymaws.com · Web viewOn appeal, the 5th Circuit reversed the judgment of the district court, finding that the lower court had misapplied proximate cause analysis in determining

Water Rights And Water Wars:Changes in Water Rights in the United States

Denise V. Cheney, Bickerstaff Health Delgado Acosta LLP

Water rights is a complex and growing area of the law. Old cases establishing water rights in the late 19th and early 20th centuries are being re-examined by state courts in light of advances in science and technology and in response to new pressures. Increased population growth, commercial agriculture, aquaculture, oil & gas production, energy needs, recreational uses and changing climatic conditions all have exerted pressure on this precious resource.1

States that once thought of themselves as having an abundance of water are now questioning the sustainability of their water supplies, and the dry western and southern states, which have endured years of punishing drought, are looking to greater water development, increased regulation, and conservation to address shortages. Added to this mix is a new appreciation for biodiversity and the preservation of plant and animal species. As man’s use of water increases through damming, diversion and withdrawal, and as the drought shrinks surface water, the habitats of many plants and animals, including endangered species, are being adversely affected, and conservation groups are challenging regulatory policies that permit uses detrimental to them.

With so much competition between users, prioritization of use is becoming a critical issue. States are moving away from traditional riparian and appropriative systems to respond to new pressures for water. The selection criteria established by regulators, and the priorities established by courts and legislators, will decide the winners and the losers in the water wars.

The purpose of this paper is to examine changing theories of surface and groundwater rights among the states, and to look briefly at some of the ways in which eastern states and western states have experienced substantial changes in their prevailing systems of water rights. It also looks at the effect of drought conditions in Texas and recent litigation as a possible catalyst for change in Texas water law similar to the changes undergone by other states.

I. Introduction

According to hydrologists, the “total volume of water in the atmosphere is fixed and invariable.”2 Only the form of water (solid, liquid or gas) and its location changes. Surface water and groundwater are both part of the hydrological cycle: the continuous circulation of water on earth. Water falls to the earth in liquid form as rain, or in solid form as snow or sleet. Water from rain and melted snow travels over the surface of the earth into streams and rivers. As it travels, water seeps into the ground and becomes groundwater or evaporates into the atmosphere to begin the cycle again. In many watersheds, surface water and groundwater are hydraulically connected. A stream can contribute to groundwater recharge or can gain water from the aquifer, depending on the level of water in the aquifer. This interconnectedness between groundwater and surface water can be seen by the effects of pumping on surface water3. Pumping near a stream can draw large quantities of water from the river toward the bottom of the 1 See Joseph W. Dellapenna, Climate Disruption, the Washington Consensus, and Water Law Reform, 81 Temp.L.Rev. 383, 386-89 (2008).2 David Keith Todd, Groundwater Hydrology (John Wiley 2d Ed. 1980).3 Peter N. Davis, Wells and Streams: Relationship at Law, 37 Mo.L.Rev. 189 (1972).

Page 2: cdn.ymaws.com · Web viewOn appeal, the 5th Circuit reversed the judgment of the district court, finding that the lower court had misapplied proximate cause analysis in determining

well. Pumping at a greater distance or at a lesser rate can slow the rate at which groundwater feeds into the stream. Pumping groundwater from an aquifer can substantially reduce flows in a nearby stream. In a case involving groundwater produced for bottled water, for example, the court determined that groundwater pumping of 400 gallons per minute reduced the flow of the water in a nearby stream by 345 gallons per minute. 4

Despite the interconnection between groundwater and surface water, the law has long treated them as being separate and distinct water bodies. Definitions of surface and groundwater vary, but in general surface water is defined to consist of water within lakes, streams, rivers, bays and estuaries, oceans, wetlands, marshes, canals, and rainwater once it reaches a bed or channel. The underflow of rivers and streams, and underground streams, although located underground, are considered to be surface water. Groundwater is water percolating under the surface of the earth, other than underflow or underground streams. It is generally the water located within the saturated zone of a porous geological formation.

Ownership rights in surface and groundwater have also been treated differently. At common law, groundwater has been treated as a part of the land overlying it, so that the landowner owns the water in fee. By contrast, surface water has been treated as separate from the land, so that riparian owners only have usufructuary rights5 in it, that is, a right to use the water, but not ownership of the water. In addition, the English common law accorded correlative rights to riparian landowners, but gave landowners absolute rights in groundwater, allowing them to withdraw unlimited amounts of water from their lands, even if such withdrawal depleted the groundwater (or surface water) available to neighboring landowners, provided the water being withdrawn was not wasted. This distinction between surface and groundwater was based in part on the fact that the obscure nature of underground water made it difficult to measure or manage the quantity available for use, and in part on the public policy of promoting the rights of persons who were withdrawing water to devote it to productive use.

In 1861, the Supreme Court of Ohio recognized these principles in applying the common law doctrine of absolute ownership of groundwater to resolve a conflict between adjoining landowners on the withdrawal of percolating groundwater:

In the absence of express contract, and of positive authorized legislation, as between proprietors of adjoining lands, the law recognizes no correlative rights in respect to underground waters, percolating, oozing, or filtrating through the earth; and this mainly from considerations from public policy. 1. Because the existence, origin, movement and course of such waters, and the causes which govern and direct their movements, are so secret, occult and concealed, that an attempt to administer any set of legal rules in respect to them would be involved in hopeless uncertainty, and would be, therefore, practically impossible. 2. Because any such

4 Michigan Citizens for Water Conserv. v. Nestle Waters North America, Inc., 709 N.W. 2d 174 (Mich. Ct. App. 2005) rev'd on other grounds, 737 N.W. 2d 447 (Mich. 2007).5 A usufructuary right has been described as “the right of enjoying anything in which one has no property, of enjoying a thing the property of which is invested in another, and of drawing from the same all of the profit, utility, and advantage which it may produce, provided that it is done without altering the substance of the thing or of using and enjoying and receiving the profits which belong to another.” Kelly v. Landsford, 572 S.W.2d 369, 372 (Tex. Civ. App. 1978).

2

Page 3: cdn.ymaws.com · Web viewOn appeal, the 5th Circuit reversed the judgment of the district court, finding that the lower court had misapplied proximate cause analysis in determining

recognition of correlative rights, would interfere, to the material detriment of the common wealth, with drainage and agriculture, mining, the construction of highways and roadways, with sanitary regulations, building and the general progress of improvement in works of embellishment and utility. Frazier v. Brown (1861), 12 Ohio St. 294.

Twentieth century advances in acquiring geological and hydrological information and in computer modeling techniques have enabled hydrologists to develop modeling systems for determining water availability in rivers, basins and reservoirs. State regulatory agencies use these modeling techniques in determining whether there is sufficient water availability to support issuing new surface water permits. Similarly, scientific and management models of aquifers have helped hydrologists understand water flows in aquifers. Management models have enabled them to make predictions on the amount of groundwater available for use, and how water levels and spring flows may respond to future pumping and drought. State and local agencies use groundwater availability models to develop regional groundwater plans and to establish limits on groundwater production.

One hundred and twenty years after Frazier, the Ohio Supreme Court recognized that “the advancement of scientific knowledge can insure the protection of a landowner’s property rights in ground water to the same degree that the riparian doctrine protects the interests of landowners adjacent to a stream,” in deciding to replace the absolute ownership doctrine with the doctrine of reasonable use. Cline v. American Aggregates Corporation, 15 Ohio St. 384, 474 N.E.2d 324 (Ohio 1984).

If advances in technology have provided some governmental entities with assurance that they can adequately protect the interests of water rights owners, however, these advances have led other governmental entities and conservation groups to question whether regulatory policies and procedures are adequately protecting available water resources. Increasingly, states have shown new concern for the reasonable use of water, the rights of users of the same water body to enjoy reasonable use, and the interest of the public in conserving a natural resource. This can be seen in the movement away from the absolute ownership theory of groundwater in most states, and in modifications of riparian and appropriative water law systems to doctrines that recognize the interests of other water rights owners and users.

II. Ownership and Use of Surface Water – Riparian Rights vs. Prior Appropriation

Ownership systems are a means of allocating water between users. In the United States, the two principal systems of allocation of surface water are riparian rights and prior appropriation. There is a distinct geographical demarcation between the states that have adopted the riparian system and those that have adopted an appropriative system. All of the states east of the Mississippi River, together with Minnesota, Iowa, Missouri and Arkansas recognize riparian rights. The remaining states have adopted the system of prior appropriation.

A. Riparian Rights

3

Page 4: cdn.ymaws.com · Web viewOn appeal, the 5th Circuit reversed the judgment of the district court, finding that the lower court had misapplied proximate cause analysis in determining

The states that adopted the English common law doctrine of riparian rights, or a modified version of it, are largely characterized by abundant rainfall and plentiful surface water in the form of rivers, streams, creeks and lakes. The riparian system was well-suited to the development of agriculture and manufacturing on lands with ready access to surface water.

Under the common law doctrine of riparian rights, a landowner whose property abuts a natural water body6 has the right to withdraw water for use on his land for agricultural, domestic, manufacturing and other purposes. Riparian rights include the right to access and use the water bodies for fishing, boating, and recreational use, to construct boat docks, marinas and other improvements related to such uses, and to acquire a property interest in additions to the shore from natural processes (accretion). Riparian rights, including the right to withdraw water, are property rights that run with the abutting land or, if such property is subdivided, any portion of the land that abuts the water body. Non-use does not extinguish the right. A riparian right cannot be sold or conveyed apart from the land. At common law, a landowner’s right to use withdrawn water was limited to uses that did not disrupt the “natural flow” of the water body, because every riparian landowner had an equal right to have the river or stream flow through his land in its natural state without reduction in quantity or impairment in quality. Because each riparian owner is entitled to an equal right to use common waters, each owner is required to use less water in times of shortage7.

States have adapted the common law doctrine to meet their needs. In order to facilitate the development of power through waterwheels and subsequently hydroelectric plants, for example, virtually all of the states replaced the “natural flow” limitation with “reasonable use” restrictions. The riparian landowner has the right to make reasonable use of the water provided that the use does not unreasonably interfere with the rights of other riparian owners. Reasonableness is a question of fact, and is generally determined in relation to the other uses being made of the water.

Modifications to the common law doctrine vary from state to state, but may include one or more of the following:

• Replacement of “the natural flow” limitation on use with “reasonable use” requirements;

• Public use of navigable waterways;• Right to use withdrawn water on non-riparian lands;• Usage reporting requirements and permitting requirements; or• Right to convey some riparian rights, particularly the right of access to water

bodies for recreational use.

Virtually all of the states have recognized a public trust for tidal waters and navigable waterways, allowing public use for fishing, boating, swimming and recreation.

6 Technically, riparian rights are those that relate to the use of abutting streams or rivers, while littoral rights are those that pertain to the use of abutting lakes or ponds. However, the term “riparian rights” is generally used to refer to both.7 For a discussion of riparian rights and changes to them, see generally, Joseph W. Dellapenna, The Evolution of Riparianism in the United States, 95 Marq. L. Rev. 53 2011-2012.

4

Page 5: cdn.ymaws.com · Web viewOn appeal, the 5th Circuit reversed the judgment of the district court, finding that the lower court had misapplied proximate cause analysis in determining

B. Regulated Riparianism

Regulated Riparianism8 is a doctrine of water regulation and management for both surface and groundwater as described in the Regulated Riparian Model Water Code published in 1997 under the auspices of the American Society of Civil Engineers.9 Under Regulated Riparianism both surface and groundwater are the property of the state that is held in trust for the public. Usufructuary rights are granted by permit for specific quantities of water, for specific uses, and for limited durations. The integration of surface and groundwater regulation allows fuller utilization of both. Applications for permits are evaluated based on the reasonableness of the proposed use, the state of the water source, the effect of the proposed use on other users, and the protection of the water source. The limited duration of the permit provides regulators with the opportunity to reassess use with reference to the current conditions of the water source, and to reallocate water usage. Unlike the riparian system, water can be transported and used beyond riparian or overlying land.

A number of eastern states that followed the riparian system for surface water rights have enacted legislation for surface water and/or groundwater that reflects, in varying degrees, the core principals of the Regulated Riparian Model Water Code. Alabama, Arkansas, Connecticut, Delaware, Georgia, Kentucky, Illinois, Maryland, South Carolina, Virginia, and Wisconsin are among the states that have adopted the Regulated Riparianism system.10 Arkansas, Georgia, South Carolina, Virginia and Wisconsin have regulated riparian systems for both groundwater and surface water.11 Arizona and Nebraska have regulated riparian systems for groundwater only and appropriative rights for surface water.

Florida discarded common law doctrines and adopted a regulatory system in 1972 based on a Model Water Code published in 1972 that had been developed by law faculty from the University of Florida.12

C. Prior Appropriation

The western states, with dryer climates and less abundant surface water than the eastern states, were not well suited to the riparian system. Many of these states were settled by miners who needed water to develop their mining claims, but whose activities were conducted on land that was not adjacent to a water course, and which they did not legally own. In California, for

8 The term "Regulated Riparianism" has been attributed to Joseph W. Dellapenna, Professor of Law at the Villanova School of Law, who has served as Director of the Model Water Code Project of the American Society of Civil Engineers since 1996.9 The Regulated Riparian Model Water Code: Final Report of the Water Laws Committee of the Water Resources Planning and Management Division of the American Society of Civil Engineers (Joseph W. Dellapenna ed., 1997) The Society has also published an Appropriative Rights Model Water Code.10 There is not complete consistency between scholars as to which states have adopted a regulated riparian system, possibly because the regulatory system in some states, such as Alabama, are not extensive, and in others, applies only to critical management areas. See Joseph W. Dellapenna, A Primer on Groundwater Law, 49 Idaho L. Rev. 265, 302 (2013).11 Id. at 308.12 Christine A. Kline, Mary Jane Angelo, and Richard Hamann, Modernizing Water Law: The Example of Florida, 61 Fl. L. Rev. 3 (July 2009).

5

Page 6: cdn.ymaws.com · Web viewOn appeal, the 5th Circuit reversed the judgment of the district court, finding that the lower court had misapplied proximate cause analysis in determining

example, gold miners known as the “49ers”13 built extensive systems of flumes and waterways to transport water from rivers and streams in order to work their claims. Miners could spend years developing their networks of water,14 and extensive amounts of water were used to blast gold out of the Sierras. To mark their water claims, miners would post notice of their claim to water from specific sources, as did Will S. Green, who in December, 1883 nailed a notice to an oak tree announcing that he was diverting 500,000 miner’s inches of flow (the equivalent of several million gallons per minute) from the Sacramento River.15 Others were allowed to divert water from the same stream or river, but only in accordance with a hierarchy based on seniority. The most senior water users could obtain water to the exclusion of junior water users. This “first in time, first in right” system became the basis for the system of prior appropriation. States incorporated it into their constitutions16 and statutes, and courts adopted it in lieu of the riparian system. In Irwin v. Philips,17 for example, the California Supreme Court chose to apply the customary rules of mining camps, though “crude and undigested,” over riparian rights, in part because both of the parties were squatters.

By contrast, however, Alaska, which also has a mining history, has abundant surface water and had an early appropriation system that was riparian in nature. It wasn't until Alaska became a state in 1959 that it adopted the prior appropriation system into its constitution. Soon afterwards it enacted the Alaska Water Use Act, which gave further definition to the system of prior appropriation. Today this act is codified in Title 46, a Chapter 15 of the Alaska Statutes, and the Alaska Department of Natural Resources (DNR) is the regulatory agency charged with administering the act and developing the state’s water policy. In Alaska, the state owns all water, and all users of water rights, both surface and groundwater, including domestic users, must obtain a use permit. The permit protects the priority of the user’s claim to the water rights. The application for a permit requires the applicant to provide a map showing the location of its use. The DNR maintains a map of all permitted water use in the state, which can be seen at http://www.navmaps.alaska.gov/AlaskaLandStatus/.

Unlike the riparian system, the prior appropriation system does not require land ownership in order to obtain water rights. Water rights result from usage and permitting. The state is the owner of the water for the benefit of the people of the state, and the holder of a water right has a usufructuary right in the water, authorizing the holder to use water in accordance with the permit. These use rights are real property rights that may be freely sold and conveyed.

In order to obtain a water right, an appropriator must obtain a permit to use water in accordance with statutory requirements, but the permit holder does not obtain an appropriative right unless he diverts water from a natural water course, and applies it to a beneficial use in accordance with the terms of the permit.18 13 So called because of the large number of people who flocked to California in 1849 to mine for gold.14 California Gold Rush: True Tales of the 49ers, Ch. 19 "River Mining for Gold," available at nevada-outback-gems.com/gold_rush_tales/california_gold_rush1.htm.15 "Good Read: How California's 19th Century Water Law Feeds 21st Century Crises" by Dan Brekke, available at http://www2.kqed.org/news/2014/03/24/19th-century-california-water-law-feeds-21st-century-crisis.16 In her article. The Constitutional Mythology of Western Water Law, 14 Va. Envtl. L. J. 343 (1995), Christine A. Kline identified ten western states that had constitutional provisions regarding prior appropriation. 17 Irwin v. Phillips, 5 Cal. 140, 1855 WL 691 (Cal. 1855).18 Reed D. Benson, Alive But Irrelevant: The Prior Appropriation Doctrine in Today's Western Water Law, 83 U.Colo.L.Rev., 675 2011-2012.

6

Page 7: cdn.ymaws.com · Web viewOn appeal, the 5th Circuit reversed the judgment of the district court, finding that the lower court had misapplied proximate cause analysis in determining

Diversion and beneficial use are core principles of the appropriative system, along with priority of use. Under the traditional prior appropriation system, a person could not obtain a water right without first diverting the water from its natural course. This requirement was a disadvantage for persons who used water principally in its natural state, such as Native American Indians. As observed by Professor Reed Benson, it is one of the great ironies of western water law that “a system based on ‘first in time, first in right’ would cut against those people who had lived in the West for thousands of years before anyone thought of prior appropriation.”19

Once diverted, the water has to be beneficially used. A water right permit is ‘perfected” by beneficial use and becomes a vested property right. A “beneficial use” is any use recognized by the state as being an appropriate use for the water, such as domestic, industrial, municipal, agricultural, or mining. It was only during the last half of the 20th century that states began to recognize environmental and recreational uses as beneficial uses and to enact laws to protect instream flows20 in order to preserve rivers and streams in a healthy state for fishing, recreation, and the protection of wildlife and habitat.

Although permitting regulations differ, a permit issued by a regulatory agency generally entitles the holder to withdraw a specific quantity of water (e.g. a specified number of acre-feet21

of water per year, a specified number of gallons per day, or a specified number of gallons per minute), from a specific water body (e.g. Rio Grande river), at a specific diversion point or points (e.g. one or more identified locations along the river) to be used for a particular “beneficial” use (e.g. mining). The priority of the permitted water right is generally established by a priority date which is determined by the regulatory agency based on the state’s priority system.

In times of shortage, senior water rights holders are entitled to use water to the exclusion of junior water rights holders in the same water source. In general, if a senior water rights holder feels that its usage is being adversely affected by usage by junior water rights holders (or specifically upstream junior holders where the water source is a river or stream), the senior holder can make a “priority call” and ask the regulatory agency to enforce the senior holder’s rights. The regulatory authority will analyze water availability, and if it determines that suspending water usage by junior holders will increase availability to downstream users, it will issue an order temporarily suspending the right of upstream junior rights holders to withdraw water. By contrast, during periods when water levels are high, the regulatory agency may issue temporary permits to allow use of unappropriated water.

Because the prior appropriation system is based on usage rather than land ownership, water right holders can lose their rights through non-usage, abandonment or forfeiture. In California, for example, surface water rights can be lost if not beneficially used for a period of five years, although an extension of up to ten years is available for hardship.22

19 A Few Ironies of Western Water Law, 6 Wyo L. Rev. 331 2006.20 An instream flow is an amount of water running in a river or stream measured by volume running in a channel in a channel in a specified period. A variety of instream flows are required to create a healthy river.21 An acre foot of water is the quantity of water that would cover one acre of land to a depth of one foot, or 43,560 cubic feet.

7

Page 8: cdn.ymaws.com · Web viewOn appeal, the 5th Circuit reversed the judgment of the district court, finding that the lower court had misapplied proximate cause analysis in determining

D. Evolution of the Prior Appropriation System

Just as there have been changes in the riparian system over time toward Regulated Riparianism, there have been significant changes in the prior appropriation system that have led scholars to believe that the prior appropriation system in the west is dead23 or, if not dead, that it “has lost its force as the controlling doctrine of Western water law.”24 In a recent article,”25

Professor Benson contends that western water law has evolved away from a system based on beneficial use and priority – the most fundamental principles of the prior appropriation system, and into “a system of statutes and rules that are largely consistent with certain aspects of the prior appropriation system, but increasingly different from its core principles.”26

In support of his position, Professor Benson points to the regulation of instream flows by western states as one example of a divergence from the fundamental principles of prior appropriation. Instream flows in rivers, streams, and lakes, and fresh water inflows into bays and estuaries, sometimes referred to collectively as “environmental flows,” are important components of the ecological system. Rivers, lakes and estuaries with sufficient inflows help fertilize soil, recharge aquifers, and provided habitat and breeding sites for fish and wildlife. They are also a source of drinking water and recreational use. Some states, including Idaho and Alaska, have endeavored to regulate the level of flows in order to protect the habitat of fish and other wildlife and to preserve conditions suitable for fishing and recreational use. In order to do this, states using the appropriative system have had to reserve water from appropriation in order to maintain the water in the rivers. This reservation is inconsistent with state laws allowing the appropriation of unappropriated waters. In order to address this, some western states have enabled state agencies to appropriate water and maintain it in the water course.27 This is a departure from the fundamental requirement that water has to be diverted in order to be appropriated. Some courts have upheld the validity of such appropriations without diversion, even when the state constitution expressly required “diversion and appropriation.”28

Professor Benson also refers to two cases and a statute as evidence of the movement away from traditional prior appropriation principles. He indicates that the chosen examples are illustrative, and not unique. In Am. Falls Reservoir Dist. No. 2 v. Idaho Dep’t. of Water Res., 154 P.3d 433 (Idaho 2007), the Idaho Supreme Court upheld the validity of regulations adopted by the Idaho Department of Water Resources ( IDWR) that allowed the IDWR to consider a traditional policy of reasonable use in responding to senior priority calls. Specifically, the rules provided that the reasonable use policy “includes the concepts of priority in time and superiority

22 Wells A. Hutchins, Water Rights Laws in the Nineteen Western States, Ch. 14 Loss of Water Rights in Water Courses, available at https://books.google.com/books?id=WoKa8ZffE1gC&pg=RA1-PA318&lpg=RA1-PA318&dq =forfeiture+and+abandonment+of+water+rights&source=bl&ots=BXGfR5ysQH&sig=jQQiFDB2XlS_isKpegY3GlcwrsI&hl=en&sa=X&ei=MwuKVOaHIZGwyASV0YGIBA&ved=0CD0Q6AEwBQ#v=onepage&q=forfeiture%20and%20abandonment%20of%20water%20rights&f=false.23 Charles From Wilkinson, In Memorium, Prior Appropriation, 1848-1991, 21 Envtl L.Rev. at v (1991).24 Reed D. Benson, Alive But Irrelevant: The Prior Appropriation Doctrine in Today's Western Water Law , 83 U. Colo.L.Rev., 675 2011-2012.25 Id.26 Id.27 See Cynthia F. Covell, A Survey of State Instream Flow Programs in the Western United States , 1 U. Denv. Water L. Rev. 177, 179 (1998).28 Idaho Parks, 530 P2d 924 (Idaho 1974) as cited in the Article.

8

Page 9: cdn.ymaws.com · Web viewOn appeal, the 5th Circuit reversed the judgment of the district court, finding that the lower court had misapplied proximate cause analysis in determining

in right being subject to conditions of reasonable use as the legislature may prescribe.” The rules also exempted all domestic and livestock water rights from priority calls, thereby giving the holders of these rights priority over senior rights holders. In upholding the validity of regulations that exempted specific junior water rights holders from the priority call, the court observed that language in the Idaho Constitution allowed junior domestic users to continue to withdraw water in times of shortage, although these provisions required the junior users to compensate senior users for the water they used. The fact that the IDWR regulations did not require compensation to be paid did not make these regulations objectionable to the court, which found that although the regulations did not require compensation to be paid, they also did not preclude it.

Professor Benson’s second example is a Washington statute that modified the beneficial use requirement. The statute was adopted in response to a case that arose when the Washington regulatory agency refused to extend a 1973 water permit to a developer who had been issued the permit for water for 253 lots, and who had only extended water lines to ninety-three lots by the early 1990s. In doing so, the agency discontinued a long-standing policy of allowing the permit to continue until the water delivery system was complete. The developer sued, claiming it had a vested right to the full amount of permitted water, but the Washington Supreme Court upheld the decision of the regulatory agency on the ground that actual beneficial use was required in order for the right to be vested29. Five years later, the state legislature adopted a statute that validated existing permits issued under the old regulatory policy, even if the water had not been put to actual beneficial use.

In a final example, Professor Benson discusses a New Mexico case30 in which the New Mexico Court of Appeals upheld the validity of a state statute that required the State Engineer to issue permits to use groundwater for household or other domestic use without regard to the availability of unappropriated water or injury to existing water rights holders, even though issuing such permits in a fully appropriated basin resulted in new groundwater withdrawals that would reduce flows to senior users.

Other scholars have also detected a change in the prior appropriation system in western states.31 Robert Haskell Abrams, in his article “Legal Convergence of East and West in Contemporary American Water Law”32 discusses increasing similarities between the contemporary prior appropriation system in the west and Regulated Riparianism in the east (as represented by the Model Code). He identifies (1) the integration of surface and groundwater systems to obtain full utilization, (2) the elimination of site-of-use restrictions, and (3) protection of instream and other communitarian values, as being important points of similarity between the systems.33

29 State v. Theodoratus, 957 P.2d 1241 (Wash. 1998).30 Bounds v. State, 2011-NMCA-011, 149 N.M. 484, 252 P3d 708 (N.M. Ct. App. 2010), cert. granted sub nom. Bounds v. Dantonio, 2011-NMCERT-oo1, 263 P3d 902 (2011), and cert. granted sub nom. N.M. Livestock v. State Eng’r, 2011-NMCERT-001, 263 P3d 902 (2011).31 See generally Norman K. Johnson & Charles T. DuMars, A Survey of the Evolution of Western Water Law in Response to Changing Economic and Public Interest Demands, 29 NAT. RESOURCES J. 347 (1989); A. Dan Tarlock, The Changing Meaning of Water Conservation in the West, 66 NEB. L. REV. 145 (1987); Charles F. Wilkinson, Western Water Law in Transition, 56 U. COLO. L. REV. 317 (1985).32 42 ENVTL. L. 65 201233 Id. at 69

9

Page 10: cdn.ymaws.com · Web viewOn appeal, the 5th Circuit reversed the judgment of the district court, finding that the lower court had misapplied proximate cause analysis in determining

III. Ownership and Use of Groundwater

Groundwater has grown in importance over the years as a water supply for municipal, agriculture and energy uses. It always had a role in domestic and livestock use, as settlers, farmers, and ranchers used wells for their needs, but these were shallow domestic wells that could not produce large quantities of groundwater. The invention of the high-speed centrifugal (turbine) pump in 1937 enabled groundwater to be produced on a larger scale and to allow substantial surface irrigation. The over-appropriation of surface water and the dwindling supply due to drought and over-use have increased dependence on groundwater as a more reliable water source. This dependence undoubtedly will continue to grow because the greater part of fresh water on Earth is groundwater.34 The U.S. Geological Survey estimates that groundwater makes up about 90% of our freshwater supply, but less than 27% of the water used by Americans is groundwater.35

There are six main doctrines of groundwater rights among the states:

1. Absolute Ownership;2. Reasonable Use;3. Restatement Rule (Restatement (Second) of Torts, Section 858);4. Correlative Rights;5. Regulated Riparianism; and6. Prior Appropriation.

Note that these doctrines can be separated into two categories: those that rely on the theory that the groundwater is owned by the landowner as part of his overlying land (Absolute Ownership doctrine, Reasonable Use doctrine, Restatement Rule, and Correlative Rights doctrine), and those that treat the groundwater as being owned by the state in trust for the public, and in which the holder of the water right has only a usufructuary interest (Prior Appropriation Doctrine, Regulated Riparianism).

1. Absolute Ownership Doctrine

The absolute ownership doctrine, which is sometimes called the “English Rule,” is based on English common law. It is also sometimes referred to as the Rule of Capture, but possibly incorrectly, because as one court has pointed out, the Rule of Capture is a doctrine of non-liability, not of ownership.36

The first case to establish the doctrine of absolute ownership was Acton v. Blundell, 152 Eng. Rep. 1223 (Ex. Ch. 1843), in which the court wrote:

[T]he person who owns the surface may dig therein, and apply all that is found to his own purposes at his free will and pleasure and that if in the exercise of such

34 Sharlene Leurig, Ceres Report: Water Ripples: Expanding Risks for US Water Providers 7 (2012), available at http://www.ceres.org/resources/reports/water-ripples-expanding-risks-for-u.s.-water-providers35 Estimated use of Water in the United States in 2010, U.S. Geological Survey Circular 1405, 201436 Edwards Aquifer Authority v. Day, 369 S.W.3d 814 (Tex. 2012).

10

Page 11: cdn.ymaws.com · Web viewOn appeal, the 5th Circuit reversed the judgment of the district court, finding that the lower court had misapplied proximate cause analysis in determining

right, he intercepts or drains off the water collected from underground springs in his neighbor’s well, this inconvenience to his neighbor falls within the description of damnum absque injuria, which cannot be the ground of an action.

The absolute ownership doctrine is a doctrine of both ownership and non-liability. Under this doctrine, as applied to groundwater, the owner of land owns the groundwater beneath the surface of his land, and may withdraw unlimited quantities of groundwater without liability to neighboring landowners for depletion of their water sources, or other damage to their property, except in the event of waste or malicious harm. Texas and Massachusetts have also imposed liability for negligent pumping resulting in subsidence. Texas has also recognized that the landowner’s groundwater rights are subject to reasonable regulation by state and local regulatory bodies. Although the absolute ownership doctrine was once the most prevalent theory of groundwater rights among the states, only Indiana37, Maine,38 Massachusetts,39 and Texas40 still follow this rule.

2. Reasonable Use Doctrine

The reasonable use doctrine, which is sometimes called the “American Rule,” is a modification of the absolute ownership doctrine in that it recognizes a landowner’s liability for damage to a neighboring property if his use is not reasonable. The New Hampshire Supreme Court first made the break from the rule of absolute ownership in the case of Bassett v. Salisbury Manufacturing Co., which arose when a dam on a river drove up the water table causing Bassett’s land to become waterlogged and unusable for growing crops or digging peat. In deciding in Bassett’s favor, the court wrote:

We need not argue that some rights exist, that the owner of the land may make some use of the water in it, that he may do some acts that will affect drainage; that a well may be dug under some circumstances that will draw water, by percolation from a water-course, or even from the well of a neighbor . . . [T]he sole ground of the qualifications . . . is the rule of reasonable use –of a reasonable exercise of one’s own right. The rights of each landowner being similar, and his enjoyment dependent upon the action of the other landowners, these rights must be valueless unless exercised with reference to each other and are correlative. The maxim Sic utere &c, therefore applies, and . . . restricts each to a reasonable use of his own property, in view of the similar rights of others.

As so expressed, the doctrine implies that reasonableness is to be determined based on the fact that a neighboring property owner who was injured also has the right to the reasonable use of his property. Although some courts have interpreted the reasonable use doctrine in that way,41 others appear to have applied the rule to mean that a landowner can withdraw unlimited quantities of groundwater from beneath his land and remain free from liability if (i) he is using the groundwater on his land overlying the underground source, and (ii) his use is reasonable. 37 New Albany & Salem RR v. Peterson, 14 Ind. 112 (1860).38 See Maddox v. Giles, 728 A.2d 150 (Me. 1999).39 Garner v. Town of Milton, 195 N.E.2d 65 (Mass. 1964).40 Supra, fn. 33.41 Minnesota Loan &Trust Co. V. St. Anthony Falls Water-Power Co., 85 NW 520 (Minn. 1901).

11

Page 12: cdn.ymaws.com · Web viewOn appeal, the 5th Circuit reversed the judgment of the district court, finding that the lower court had misapplied proximate cause analysis in determining

However, a landowner who withdraws groundwater for use on other land not overlying the underground water is not relieved from liability, even if his use is reasonable.42 Not all scholars agree that courts have applied the doctrine “only to limit the use of groundwater to land overlying the aquifer or other underground source.”43

Many states, possibly even as many as twenty-six, once applied the reasonable use doctrine in place of the absolute ownership doctrine, but the number now using this doctrine has declined. States that currently use the reasonable use doctrine include Alabama, Missouri, Pennsylvania, Rhode Island, Tennessee, and West Virginia44.

3. Restatement Rule

The Restatement Rule is based on the factors set out in the American Law Institute Restatement (Second) of Torts Section 858 as being the factors that determine the liability of an owner of water rights resulting from the withdrawal of water. The following factors are to be considered in determining whether a particular use of water is reasonable:

(a) the purpose of the use;(b) the suitability of the uses to the watercourse, lake or aquifer;(c) the economic value of the use;(d) the social value of the use;(e) the extent and the amount of the harm it causes;(f) the practicability of avoiding the harm by adjusting the use or method of use of

one person or the other;(g) the practicability of adjusting the quantity of water used by each person;(h) the protection of existing values of water uses, land, investments and enterprises;

and(i) the justice of requiring the user causing harm to bear the loss.

Some courts have applied these factors in determining reasonableness under the reasonable use doctrine.45 Unlike the reasonable use doctrine, however, the Restatement Rule does not consider the location of water use as a factor in determining reasonableness. It also assumes that the groundwater right is owned by the landowner. Ohio and Wisconsin have expressly adopted the Restatement Rule, and the Ohio Constitution46 was amended in 2008 to provide that “[a] property owner has a property interest in the reasonable use of the ground water underlying the property owner’s land.”47

4. Correlative Rights

42 Barclay v. Abraham, 96 N.W. 1080 (Iowa 1903); Michigan Citizens for Water Conserv. v. Nestle Waters North America, Inc., 709 N.W. 2d 174 (Mich. Ct. App. 2005) rev'd on other grounds, 737 N.W. 2d 447 (Mich. 2007).43 See Joseph W. Dellapenna, A Primer on Groundwater Law, 49 Idaho L. Rev. 265 (2013).44 Id. at 29245 Michigan Citizens for Water Conserv v. Nestle Waters North America, Inc., supra fn.4.46 Supra, fn. 39 at 297.47 Id.

12

Page 13: cdn.ymaws.com · Web viewOn appeal, the 5th Circuit reversed the judgment of the district court, finding that the lower court had misapplied proximate cause analysis in determining

The system of correlative rights is based on the principle that owners of land overlying an aquifer have rights in the groundwater in proportion to the amount of their acreage in the overlying land. California adopted this doctrine in Katz v. Walkinshaw, 74 P. 766 (1903) in allocating groundwater between landowners for irrigation. Nebraska and Oklahoma have adopted the system of correlative rights based on proportionate interests.48 Other state courts have applied the doctrine to impose a shared or reasonable use, rather than a strictly proportional use of the water, leading to debate between scholars as to the actual number of states that have adopted the system of correlative rights.49

5. Regulated Riparianism

The system of Regulated Riparianism is discussed in Article II, Section B. Despite the use of the term riparianism, which traditionally applied only to rights of landowners whose land contained, or was adjacent to, surface water, the Regulated Riparianism system can apply to both surface and groundwater. Arkansas, Georgia, South Carolina, Virginia and Wisconsin have adopted regulated riparianism for both groundwater and surface water.50

6. Prior Appropriation

The prior appropriation system for surface water rights has been previously described in Article II, Section C. Many of the states that adopted prior appropriation for surface water rights subsequently legislatively adopted the appropriation system for groundwater rights. Idaho was the first state to do so in 1899. Other states followed at intervals: California, for example, in 1913, Nevada in 1913, Arizona in 1919; New Mexico in 1931; Utah in 1935; Kansas in 1945. Some states, such as Texas, do not have appropriative systems for both types of water rights. Texas recognizes absolute ownership for groundwater.

As in the case of prior appropriation for surface water rights, the establishment of a water right in groundwater is dependent on permitting (or in some states, a court determination) and beneficial use. The permit will not perfect the right without the water being put to a beneficial use. Water rights may be lost through non-use (abandonment or forfeiture) and in some states by prescription through adverse use.

Because in many states the appropriative system was adopted for groundwater rights long after the system was established for surface water rights, many of the water rights in groundwater are junior to water rights in surface water. In times of drought or where pumping of groundwater reduces stream flows, the surface water owner with seniority could make a priority call, resulting in the suspension of junior groundwater rights holders. Some states have attempted to address this through legislation. Colorado, for example, adopted a statute that provides three potential remedies for the senior water holders depending on the magnitude of the problem.51 First, the senior water holder is deemed entitled to both the surface water and the groundwater. The senior holder is required to follow the source and drill wells to provide sufficient water. Second, the junior water rights holder would be required to provide a substitute source of water to the senior 48 Supra fn. 39 at 277.49 Id. at 276 -7 and authorities cited therein.50 Joseph W. Dellapenna, A Primer on Groundwater Law, 49 Idaho L.Rev. 265, 308 (2013).51 Article by Harrison & Sandstrom, 43 U. Colo.L.Rev. 1 (1971).

13

Page 14: cdn.ymaws.com · Web viewOn appeal, the 5th Circuit reversed the judgment of the district court, finding that the lower court had misapplied proximate cause analysis in determining

water rights holder. Third, the parties could develop an augmentation plan which would be subject to approval by the state engineer and the court. A number of western states, including Colorado and New Mexico, have also endeavored to eliminate problems arising from separate surface water and groundwater regulations, including competing entitlements, and to maximize utilization of water by making groundwater and surface water part of a unified regulatory system.52

As discussed in Article II, Section D, a number of scholars believe that the prior appropriation system in the west has evolved away from the traditional core principles of diversion, beneficial use and priority, and towards a system that shares some important principles with Regulated Riparianism, including integration of groundwater and surface water rights, elimination of the requirement for use on riparian or overlying land, increased concern for the rights of other users, and recognition of the public’s interest in water as a natural resource and as a fundamental part of the ecological system.

IV. Texas During the Drought – New Pressures on Water Use and Water Rights

A. Water Rights in Texas

As discussed in Articles II and III, legal theories of surface and groundwater rights have changed over time in the United States. These changes include a movement away from the absolute ownership doctrine for groundwater rights, and toward systems that give greater recognition to the rights of all users within the same water source, and to the public’s interest in the preservation of this natural resource. Some states have also recognized the regulation of instream flows and environmental flows as beneficial uses.

Texas has not followed this movement away from traditional theories of ownership and rights. It still follows the absolute ownership doctrine for groundwater, as confirmed by the Texas Supreme Court53 in 2012. Groundwater rights are vested property rights, subject to reasonable regulation and compensable upon a physical or regulatory taking. Groundwater rights are regulated by groundwater conservation districts (“GCDs”), although there are still areas in Texas that are not subject to regulation because no GCD for that area has been created. GCDs have the authority to regulate the production of groundwater, subject to statutorily created exemptions. GCDs are prohibited from requiring production permits for wells used solely for domestic, livestock and poultry use, located on a tract of land larger than ten acres that are not capable of producing more than 25,000 gallons of groundwater per day54. GCDs are also prohibited from requiring production permits for water wells used solely to supply water for a rig that is actively engaged in drilling operations or exploration for oil and gas55. This means that there is no requirement for the owner of a well-used to supply water for fracking to go through a permitting process, and there are no production limits on such wells. They can use unlimited amounts of groundwater.

52 Robert Haskell Abrams, Legal Convergence of East and West in Contemporary American Water Law, 42 Envtl. L. 65 2012.53 Edwards Aquifer Authority v. Day, 369 S.W.3d 814 (Tex. 2012).54 Section 36.117(b) (1), Tex. Water Code.55 Section 36.117 (b) (2), Tex. Water Code.

14

Page 15: cdn.ymaws.com · Web viewOn appeal, the 5th Circuit reversed the judgment of the district court, finding that the lower court had misapplied proximate cause analysis in determining

Texas has adopted the system of prior appropriation for surface water, and this system is both alive and relevant. Surface water rights are regulated by the Texas Commission on Environmental Quality (“TCEQ”). Texas has not attempted to unify regulation of groundwater and surface water, and Texas has only given limited protection to environmental flows by allowing TCEQ to establish minimum standards for environmental flows for basins and bays and to establish an amount of unappropriated water, if available, for environmental flows on a case by case basis56. TCEQ is expressly prohibited by statute from granting water rights for instream flows dedicated to environmental needs or bay and estuary inflows, although such use may be allowed on amendments to existing permits.57

B. Current Drought Conditions

According to the U.S. Geological Survey, water withdrawals from four states – California, Texas, Idaho and Florida – account for more than one-quarter of all fresh and saline water withdrawn in the United States.58 Total water usage in Texas is between 20,001 to 38,000 million gallons per day.59 About 45% of the withdrawals are for thermoelectric power, and 28% for irrigation, with the next largest category of water use being public supply. The Texas Water Development Board, the State agency that maintains a centralized data bank of information on the state’s water resources, predicts that between 2010 and 2060, the population in Texas will increase 82%, and municipal water use will be a larger component of water use in Texas than irrigation.60

Population growth in Texas accounts for a substantial strain on available water supplies. Coupled with this is the drought that has continued for over three years, causing surface water supplies to shrink dramatically. Lake Travis and Lake Buchanan, two of the main water supply reservoirs for central Texas cities, are down to 34% of capacity. These lakes provide drinking water to more than a million people, water to industries, businesses, and the environment, and when sufficient water is available, for agriculture in the Lower Colorado River basin61. Some Texas lakes that are reservoirs for a public water supply are virtually dry. Lake Meredith in the Panhandle, for example, measured 5.1% of capacity on December 9, 201462. Flows in Texas rivers have been so reduced that TCEQ has made fifteen suspensions of junior water rights since 2011 in response to priority calls.

Texas water supply systems are being depleted. TCEQ maintains a list of Texas public water supply systems that are limiting water use to avoid shortages. As of December 3, 2014, the list was 40 pages long,63 and 56 public water systems were at risk of running out of water within 180 days or less.64 Of these, 23 were at risk of running out of water within 90 days or less,

56 Section 11.1471, Tex. Water Code.57 Section 11.0235 (d), Tex. Water Code.58 Estimated Use of Water in the United States in 2010, U.S.G.S. Circular 1405, 2014.59 Id.60 Water for Texas 2012 State Water Plan, available at www.twdb.state.tx.us/publications/state_water_pland/2012/ 2012_SWP.pdf.61 www.lcra.org/water/water-supply/drought-update/Pages/default. aspx.62 waterdatafortexas.org/reservoirs/individual/meredith.63 www.tceq.texas.gov/drinkingwater/trot/droughtw.html.64 www.texastribune.org/library/data/public-water-system-shortages/ .

15

Page 16: cdn.ymaws.com · Web viewOn appeal, the 5th Circuit reversed the judgment of the district court, finding that the lower court had misapplied proximate cause analysis in determining

and 7 were at risk of running out of water within 45 days or less. The City of Wichita Falls has recently begun to use treated wastewater for its drinking water supply, due to extreme water shortages.

Adding to the water woes have been conflicts with Oklahoma, New Mexico and Mexico for water delivery under water compacts. Texas lost its suit against Oklahoma for retrieval of water under the Red River Compact under a U.S. Supreme Court decision issued in June of 2013.65 Texas filed a complaint against New Mexico with the U.S. Supreme Court in 2013, accusing New Mexico of illegally diverting water apportioned to Texas under the 1938 Rio Grande Compact. Mexico has continued to retain water that should have been apportioned and delivered to Texas under a treaty with the United States, causing increased hardship for farmers and domestic users in the lower Rio Grande basin and prompting a Texas delegation to write to President Obama requesting that the United State take action to enforce the treaty.66

In response to the serious drought conditions, Texas voters in 2013 approved a state constitutional amendment that transferred $2 billion from the state’s rainy day fund to the Texas Water Development Board to be used to finance public water development projects.

On October 25, 2014, Texas Governor Rick Perry issued a disaster proclamation for counties in Texas due to the drought conditions.

C. New Pressures and New Disputes

The drought conditions in Texas are exerting new pressures on water use that may be a catalyst for change. The following two Texas cases deal with priority rights and environmental flows, and both are still pending before the courts. Similar issues have arisen in other states, and have resulted in changes in the law. Whether water scarcity will result in a change in Texas law is yet to be decided.

1. Texas Farm Bureau et al. v. Texas Comm’n on Envtl. Quality, No. D-1-GN-12-3937, 53rd Dist. Court of Travis County (filed Dec. 14, 2012)

The facts in in this case are very similar to those in the Idaho case discussed in Article II, Section D. The legal issue arose from regulations adopted by TCEQ that circumvented the priority system.

In 2011, TCEQ received senior water right priority calls in the Brazos, Guadalupe, Colorado, Sabine and Neches Rivers Basins from municipal, industrial, irrigation, recreation, and domestic and livestock users.67 TCEQ had never before received senior water right calls from municipalities and domestic and livestock users. Increased pressure from drought conditions led TCEQ to adopt new regulations for temporary suspension of water rights during drought conditions, known as the Drought Curtailment Rules (“Rules”). While the draft Rules were still out for public comment, TCEQ received objections on the ground that the Rules appeared to 65 Tarrant Regional Water District v. Herrmann, 133 S.Ct. 2120 (2013).66 http://www.tceq.state.tx.us/assets/public/border/letter-from-Texas-delegation-to-Obama.pdf.67 Freese and Nichols, Recent Priority Calls for Texas Water Rights, January 10, 2013 at www.freese.com/resources/blog/recent-priority-calls-texas-water-rights .

16

Page 17: cdn.ymaws.com · Web viewOn appeal, the 5th Circuit reversed the judgment of the district court, finding that the lower court had misapplied proximate cause analysis in determining

allow exemptions of municipal and power generation junior water rights holders, in violation of the prior appropriation system. TCEQ nevertheless adopted the Rules, which went into effect in May 2012.68

In November 2012, Dow Chemical Company made a priority call on water in the Brazos River. Implementing the Rules, TCEQ ordered a suspension of rights junior to February 14, 1942 but excluded junior municipal and power generation water right holders on the ground of public health and safety. The curtailment order suspended 845 water rights, and identified 66 water rights that were exempted. The total authorized annual use under the rights suspended in the curtailment order was 141,090 acre-feet per year, while the total authorized annual use of the exempted rights for municipal and power generation was 3,076,056 acre-feet per year.69

The Texas Farm Bureau, and several of its members who were rice farmers whose rights had been curtailed, sued for a declaratory judgment that the Rules violated state law, which mandated suspension based on priority of rights. They also alleged that instead of curtailing use with an exemption for specific junior rights holders, TCEQ was authorized under an existing statute to require the senior water rights holder to transfer water rights to the junior municipal and power generation users to enable them to continue their water usage, but the junior holders would have to pay the senior holders the fair market value of the water transferred.

The district court granted summary judgment for the plaintiffs, finding that the curtailment order was not in accordance with the priority of water rights established by state law, and that the exemption of junior water rights holders from the priority call was not authorized by TCEQ’s police power or any general authority to protect the public health, safety or welfare. An appeal is pending before the Corpus Christi Court of Appeals.

2. Aransas Project v. Shaw, 756 F.3d 801 (5th Cir. 2014) (the whooping crane case)

This case arose out of events occurring at the Aransas National Wildlife Refuge (“Refuge”) located on the Texas Gulf coast along San Antonio Bay in Austwell, Texas. The Refuge is the winter home of the Aransas-Wood Buffalo whooping crane, a large migratory bird that travels over 2,400 miles each year from the Wood Buffalo National Park in Canada to the Refuge. In 1941, the flock consisted of only 15 individuals, and in the 1960s, the Department of Interior listed this crane as threatened with extinction. Because of recovery efforts conducted in part at the Refuge, the flock had grown to almost 300 individuals in recent years.

During the winter of 2008-2009, when Texas was suffering from a severe drought, the bodies of four cranes were recovered in the Refuge. The cause of death for two of the four was determined to be emaciation. Using aerial surveys, the Refuge’s biologist concluded that nineteen other cranes had died during the season.

The Aransas Project (TAP), an environmental group whose focus is water management of the Guadalupe and San Antonio River basins and their bays and estuaries, filed suit in U.S. 68 30 TEX. ADMIN. CODE §§ 36.1-36.8 (the “Drought Curtailment Rules”).69 Tex. Commission on Environmental Quality, Order Affirming and Modifying the Executive Director’s Order Suspending Water Rights on the Brazos River, Docket No. 2012-2421-WR (Dec. 5, 2012), available at http://www7.tceq.state.tx.us/uploads/eagendas/Agendas/2013/1-30-2013/2012-2421-WR.pdf.(“ curtailment order”).

17

Page 18: cdn.ymaws.com · Web viewOn appeal, the 5th Circuit reversed the judgment of the district court, finding that the lower court had misapplied proximate cause analysis in determining

District Court against several state officials, including three commissioners of TCEQ, seeking declaratory and injunctive relief under § 9 of the Endangered Species Act (ESA),16 U.S.C. §§ 1531 to 1544, on the grounds that their failure to adequately regulate the use of surface water in the Guadalupe and San Antonio River basins resulted in degradation of habitat and a “taking” of whooping cranes.70 Relief sought included enjoining the defendants from (i) allowing water diversion and use under existing state water rights that would have the effect of altering or destroying crane habitat, and (ii) approving new or pending water permits.

TAP’s argument was that TCEQ issued water rights permits in the Guadalupe and San Antonio River when water levels were low due to the drought, thereby reducing freshwater inflows into San Antonio Bay. The reduction of freshwater resulted in increased salinity in the bay, which caused a reduction in the amount of blue crabs and wolfberries, which are the primary source of food for the cranes. Due to this reduction in food, the birds became emaciated and engaged in stress behavior, such as denying food to juveniles and flying farther afield to find food.

The district court granted an injunction prohibiting TCEQ from issuing new permits to withdraw water from the rivers, except as necessary to protect the public health and safety, until the state provided reasonable assurances to the court that such permits would not take whooping cranes in violation of the ESA. It also required TCEQ to seek an incidental‐take permit from the U.S. Fish and Wildlife Service. As part of the process of making an application for an incidental‐take permit, the applicant is required to design, implement, and secure funding for a habitat conservation plan that minimizes and mitigates harm to the impacted species. The habitat conservation plan, when approved by U.S. Fish and Wildlife, becomes an agreement between the permit holder and the U.S. Fish and Wildlife Service.

On appeal, the 5th Circuit reversed the judgment of the district court, finding that the lower court had misapplied proximate cause analysis in determining that there was a proximate cause between the issuance of permits and the death of the whooping cranes. Relying on Babbitt v. Sweet Home Chapter of Communities for a Great Oregon, 515 U.S. 687 (1995), the court held that proximate cause and foreseeability are required to affix liability for ESA violations. The 5th Circuit stated that “[n]owhere does the [district] court explain why the remote connection between water licensing, decisions to draw river water by hundreds of users, whooping crane habitat, and crane deaths that occurred during a year of extraordinary drought compels ESA liability.” It found that “[c]ontingencies concerning permittees’ and others’ water use, the forces of nature, and the availability of particular foods to whooping cranes demonstrate that only a fortuitous confluence of adverse factors caused the unexpected 2008‐2009 die‐off found by the district court. This is the essence of unforeseeability.” The court also distinguished the facts in this case from those in Strahan v. Coxe, 127 F.3d 155 (1st Cir. 1997), and other cited cases in which courts had found regulatory agencies vicariously liable for issuing permits to third parties that authorized such parties to take actions that resulted in a taking, finding that in those cases, the regulation or licensing concerned actions that directly killed or injured endangered species or eliminated their habitat. The court further determined that issuance of the injunction was an abuse of discretion because the lower court had issued it based on a finding of “a reasonably

70 Aransas Project v. Shaw, 930 F. Supp.2d 716 (S.D. Tex. 2013).

18

Page 19: cdn.ymaws.com · Web viewOn appeal, the 5th Circuit reversed the judgment of the district court, finding that the lower court had misapplied proximate cause analysis in determining

certain threat of imminent harm to a protected species,” whereas the standard, according to the 5th Circuit, was a determination that the future injury is “certainly impending.”

A petition for rehearing is pending at the time of writing.

D. The Future

To the extent that the laws governing water rights have changed over time, they have changed because of a greater knowledge of the interconnection between surface and groundwater, and also because of a greater understanding of the connection between water and life on earth. As pressures on our water resources continue to mount due to population growth, increased agricultural, commercial and energy demands, and climatic change, our system of allocation will be increasingly important. It has to be based on sound scientific principles, and on the belief that water has to be equitably shared and reasonably used.

19