Implementation of HB 51

Rural Water Association of UtahWater Rights Conference

April 29, 2008

Jerry Olds

Division of Water Rights

Water – Our Most Important Resources

• “Water is the very life blood…of the arid west.” Deseret Livestock Co. v. Hooppiania, 239 P. 479, 481 (Utah 1925)

• In this arid state, “a drop of water is [like] a drop of gold.” Carbon Canal Co. v. Sanpete Water Users Assoc’n, 425 P.2d 405, 407 (Utah 1967).

• “In this arid region water is precious, and it is the undoubted policy of the law to … promote its largest beneficial use.” Little Cottonwood Water Co. v. Kimball, 289 P.116, 118 (Utah 1930).

Why are Water Rights Subject to Forfeiture?• To encourage maximum use of water and to

waste no water through nonuse• Given the scarcity of water (which belongs to

the public), only those who are diligent in its use should retain the right to use it. Use it, or get out of the way and let someone else.

• The purpose of the forfeiture statue is to benefit the public generally by promoting the beneficial and efficient use of water.” Washington County Water Cons. Dist. V. Morgan, 82 P.3d 1125, 1129 (Utah 2003).

HB 51 – Overview• VERY COMPLEX • Forfeiture requires a judicial action

Operation of lawSubject to

• Statutory forfeiture period changed from 5 years to 7 years

• Nonuse application process• Shareholders may file nonuse applications• Forfeiture exemptions• Change application protects water right• Examples

Nonuse Application

• All water rights can be protected – file nonuse application

• Requirement to file before expiration of nonuse period – deleted

• Don’t have to declare under oath when water last used (Don’t Ask, Don’t Tell)

• Advertise – Notice to Water Users

• Protests – Judicial action & the courts are available to present your claims

Nonuse Application (cont’d)

• SE shall approve – if applicant shows a reasonable cause for nonuse

• Approved – protects from filing date to expiration data

• SE will give 60 day notice

Nonuse Applications (cont’d)• No proof of resumption of use

• Do not have to file another nonuse application

• Protects prospectively from forfeiture

• DOES NOT cure prior nonuse

20081998 2015Time Line

(c) (i) A water right or a portion of the water right may not be forfeited unless a judicial action to declare the right forfeited is commenced within 15 years from the end of the latest period of nonuse of at least seven years.

Example: 15 years Lazarus Provision• Acquire a water right• Not used for over 12 years (1996)• File a nonuse application• 1st Appl Approved for 7 years• Notice of expiration, wait a year file another

nonuse application• 2nd Appl approved for 7 years• Total 15 years protection• BEFORE THE END OF 15 YEARS WATER

RIGHTS STILL SUBJECT TO CHALLENGE

Shares in Mutual Water Company

• Expressly authorized shareholders to file nonuse application

• Must give notice to company

• To file on sharesShareholder must show gave notice

Or signature from company repShare certificate

Public Water SuppliersSupplies water, directly or indirectly, to the

public for municipal, domestic, or industrial use; and

• Public Entity - United States or agency, State of Utah, agency / political subdivision;

• Water corporation (54-2-1) regulated by PSC;

Public Water Suppliers (cont’d)

Community water system• Supplies 100 connections year-round• Regularly serves at least 200 year-round

residents; and• Voting members own share;• Receive proportionate share water; and• Pay based on the water the member receives• OR

Public Water Suppliers (cont’d)

Water users association

• 1 or more public entities own 70% shares

• Local sponsor of project

• Constructed by US Bureau of Rec

Public Water Suppliers

• Hold water rights for reasonable future requirements of the public

• Amount of water needed - next 40 yrs

• Projected service area (Expands)

• PWS may want to perform studies to justify reasonable future requirements

Forfeiture does not apply to …

• 9 exemptions, including

• When water is unavailable, drought/priority

• Stored in reservoir / aquifer

• PWS held for the reasonable future requirements

• Supplemental water rights

• Approved change application

Change Application - Protection• Perfected water rights – Change

Application

• Diligently pursuing certification

• 10 years to complete the change – protected

• If the change application lapses – subject to forfeiture

Water Rights Acquired by PWS after May 5, 2008

• To be included under the reasonable future requirement

• Need to file change application

• Approval - to municipal or domestic use

• Protected under the 40 years

Thank You

Questions?