1. 21st Century Challenges for California Water Law Stefanie Hedlund Best Best & Krieger LLP

2. Why do water lawyers love California?

3. “In California, whiskey is for drinking, and water is for fighting.” -- Mark Twain

4. Water Supplies Surface Water Groundwater Recycled Water

5. State Water Project Development delayed by Depression, then WWII 1959 - California Water Resources Development Bond Act, aka the Burns-Porter Act –Authorized $1.75 billion in bonds to assist in financing the construction of the state water facilities. 1960 – voters approved the Act & the bonds Met contracts w/ SWP Water permits granted to DWR

6. State Water Project (SWP) Never fully built out – paper water v. wet water dilemma Contracted to deliver 4.2 MAFY D-1485 estimated dependable supplies @ 2.3 MAFY That # may go down, depending on effects of other environmental laws

7. State Water Project About 1/2 of the SWP supply comes from Lake Oroville in Butte County Rest is developed from the Sacramento-San Joaquin Delta Pumped south from Tracy into the California Aqueduct Some of the flows are re- regulated in San Luis Reservoir, a joint-use facility

8. Themes in California Water Law Connection Between Property Ownership and Right to Use Water All Water Rights Are Usufructuary (“Use”), No Private Ownership

9. California has most complex water law in the United States Surface water - riparian, appropriate, prescriptive Groundwater – overlying, appropriative, prescriptive

10. “And you may ask yourself – Well … how did I get here” – The Talking Heads

11. The California Legislature 1850 Probably late in the afternoon

12. In California, water is located where the people aren’t –Northern California water supplies –Southern California water demand Concurrent growth of population, agriculture, and industry New (post-facilities) environmental concerns Supply and Demand Problems

14. Riparian Rights –Right of landowner next to surface water to use enough water to meet needs of that land –Correlative and of equal priority –Runs with land, not lost by non-use –Not quantified –Not regulated or permitted by State

15. Independence & Statehood Inherited U.S. legal system – based on English common law principles Riparian rights –Right of landowner adjacent to a watercourse to flow sufficient to meet needs of that land –Correlative & equal –Works well in wet environments like England –Also applied to owners of land overlying groundwater basins

17. Riverside County Early 1900’s

18. Riparian rights do not work well in arid lands By 1887, Colorado, Utah, Idaho, Montana, Wyoming, New Mexico, the Dakotas and Arizona had legislatively eliminated them in favor of appropriative rights What was happening in California?

19. The Gold Rush Mining – large-scale irrigation diversions in mining ditches Miners didn’t own land Prior appropriation

20. Appropriative Water Right Right to divert specific quantity to specific location for specific purpose(s) Does not depend on ownership of land “First in time, first in right” “Use it or Lose it” May be used on lands away from streams or outside a watershed

21. All other western states eliminate riparian rights In 1886 California Supreme Court writes 100 page decision keeping both riparian and appropriative rights Now there are a small number of riparian rights but…

22. Groundwater Law Early 1900’s - groundwater starts to emerge as a source of water Percolating Groundwater English law is Rule of Capture

24. Groundwater Law California Supreme Court rejects rule of capture Effectively adopts riparian right for groundwater (“overlying right”)

25. Overlying Right To use percolating groundwater must own overlying property Must be used on overlying property Not quantified Correlative Not lost by non-use Not regulated or permitted

26. Appropriative Right Right to pump specific quantity Does not depend on land ownership “First in time, first in right” Not permitted or regulated Lost by non-use Must be surplus to overlying uses Almost all municipal and industrial uses are appropriative

27. California has no statewide regulation of groundwater Texas is only other State that doesn’t have some type of comprehensive groundwater regulation

28. Where are We Now? Surface Water Riparian rights unregulated Appropriative rights regulated and prioritized based on time use began, not on economic value or current societal values

29. Where Are We Now? Underground Water Largely unregulated, agricultural uses (overlying uses) generally have priority

30. Where Are We Now? Old Rule of Ground Water Law: “Pump Until You Get Sued”

31. Where Are We Now? Revised Rule of Groundwater Law: “Pump Until a Judge Tells You Not To”

32. Current Challenges Groundwater Regulation Unquantified overlying rights Conjunctive Use in unregulated groundwater basins Ownership of stored underground water Overlying priority

33. Current Challenges Recycled Water Water Code Section 1210 states that owner of treatment plant holds exclusive right as against suppliers After water enters ground? After water transported in river? Must it be used directly?

34. Current Challenges Environmental Uses Water rights for instream uses? Endangered Species Act

35. Current Challenges Land/Water Rights Connection Should it be severed? Chile (privatized resource) Australia (public resource) – freely transferrable Pros – economically efficient, promote reallocation Cons – social and environmental costs

36. Water Planning

37. Relevant statutes related to water supply In 2001 the Legislature enacted two statutes related to the water supply planning process –“SB 610” (Water Code, § 10910 et seq.) –“SB 221” (Gov’t Code, § 66493 et seq.) These statutes apply to large scale development projects at the initial stage of environmental review (SB 610), and also at the subdivision map stage (SB 221), to ensure that water will actually be available when projects are built.

38. Under SB 610 the city or county (i.e., the land use authority) must request a “water supply assessment” (WSA) from the applicable public water system provider. If there is no water provider, the city or county must prepare the WSA. Water Code, §10912 defines “Project” as any of the following: –Residential development of more than 500 dwelling units. –Shopping center or business employing more than 1,000 persons or with more than 500,000 square feet of floor space. –Commercial office building employing more than 1,000 persons or with at least 250,000 square feet. –Hotel or motel, or both, having more than 500 rooms. –Industrial, manufacturing, or processing plants, or industrial parks planned to house more than 1,000 persons, occupying more than 40 acres of land, or having more than 650,000 square feet of floor area. –A mixed-use project that includes one or more of the above. –A project that would demand an amount of water equivalent to, or greater than, the amount of water required by a 500 dwelling unit project.

39. If a public water system has fewer than 5,000 service connections, then "project" means any proposed development that would represent an increase of 10 % or more in the number of the public water system's existing service connections (or call for an equivalent amount of water). The WSA must describe whether the project has an adequate water supply under existing and future conditions. More specifically, the WSA must evaluate whether the water supplier’s “projected water supplies” will meet the “projected water demand” for the project, when considered in light of “existing and planned future uses” that are or will be dependent on such supplies, “including agricultural and manufacturing uses.” (Water Code, at § 10910(c)(4).)

40. Summary of SB610 and SB221 If a public water system has fewer than 5,000 service connections, then "project" means any proposed development that would represent an increase of 10 % or more in the number of the public water system's existing service connections (or call for an equivalent amount of water). The WSA must describe whether the project has an adequate water supply under existing and future conditions. More specifically, the WSA must evaluate whether the water supplier’s “projected water supplies” will meet the “projected water demand” for the project, when considered in light of “existing and planned future uses” that are or will be dependent on such supplies, “including agricultural and manufacturing uses.” (Water Code, at § 10910(c)(4).)

41. Conclusions