Groundwater and Groundwater Rights in Texas: Legal Issues

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1 Environmental Seminar September 12-13, 2013 Groundwater and Groundwater Rights in Texas: Legal Issues presented by Mike Gershon San Antonio, Texas

2 Priorities/Issues for TACA Membership and Stakeholders Firming up groundwater supply Challenges Uncertainty in quantifying water availability (at the site vs. region vs. aquifer-wide) Increasing demand Competition for a limited resource and uncertainty about allocation Drought and mining the aquifer Changing laws and regulations Marketability?

3 Business Objective: Putting the Resource to Use a resource necessary for operations (e.g., dust suppression, cooling) a resource necessary for development of a product (e.g., quarrying rock, polishing, cement) an asset that can be sold or leased

4 Defining the Resource and Property Right in the Resource Groundwater: water percolating below the surface of the earth - Tex. Water Code (5) Groundwater in Place: In our state the landowner is regarded as having absolute title in severalty to the [water] in place beneath his land. The only qualification of that rule of ownership is that it must be considered in connection with the law of capture and is subject to police regulations. The [water] beneath the soil [is] considered a part of the realty. Each owner of land owns separately, distinctly and exclusively all the [water] under his land and is accorded the usual remedies against trespassers who appropriate the [water] or destroy [its] market value. We now hold that this correctly states the common law regarding the ownership of groundwater in place. - EAA v. Day/McDaniel (Tex. S. Ct. 2012)

5 When Groundwater Rights Regulated by a GCD Note that GCDs are the state s preferred method of groundwater management - Tex. Water Code And there are opportunities to be proactive and to lobby your GCD: Participate in GCD s rulemaking to influence development of the regulatory approach Participate in GCD s development of management plan Participate in GCD s development and Groundwater Management Area s adoption of Desired Future Conditions Protect your rights by accounting for use, registering and permitting Learn about your resources from your GCD

6 GCDs (97 confirmed) within GMAs (16)

7 This is done: Quantifying the Resource and Access to It on a site-by-site basis at the local level during the groundwater district permitting process which factors in policy decisions made at the local/regional level (Groundwater Management Area/Desired Future Conditions) and which must consider Texas Water Development Board s modeling (MAG) and other scientific information

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11 MONITOR AND CONSIDER PARTICIPATING IN POLICY DECISIONS: (REGIONAL/STATEWIDE DECISIONS: IT S ALL ABOUT ADOPTING DFCs (Tex. Water Code )) GCDs/GMAs must consider nine (9) factors: 1) aquifer uses or conditions within the GMA, including conditions that differ substantially from one geographic area to another 2) water supply needs and water management strategies included in the state water plan 3) hydrological conditions, including the Total Estimated Recoverable Storage, average annual recharge, inflows, and discharge 4) other environmental impacts, including impacts on spring flow and other interactions between groundwater and surface water

12 ADOPTING DFCs (continued) 5) impact on subsidence 6) socioeconomic impacts reasonably expected to occur 7) impact on private property rights in groundwater 8) feasibility of achieving the Desired Future Condition 9) any other information relevant to the DFC

13 PARTICIPATING IN POLICY DECISIONS: SITE-SPECIFIC DECISIONS: IT S ALL ABOUT (1) GCD RULES AND (2) PERMITTING (Tex. Water Code , et seq.) GCDs have regulatory options: - well spacing - correlative rights - historic use - management zones Permitting mandatory (drilling permits, operating permits): Each GCD, to the extent possible, shall issue permits up to the point that exempt and permitted withdrawals will achieve the DFC.

14 SITE-SPECIFIC DECISIONS: IT S ALL ABOUT GCD RULES AND PERMITTING (Tex. Water Code , et seq.) GCDs must consider following criteria during permitting: (1) the annual Modeled Available Groundwater values (2) amount authorized under previously issued permits (3) amount actually produced under permits (4) amount of exempt use (5) precipitation and production patterns (6) whether the proposed use unreasonably affects existing groundwater and surface water resources or existing permit holders (7) whether proposed use is a beneficial use (8) consistency with GCD s management plan ** Texas Supreme Court s holding in EAA v. Day/McDaniel

15 When Groundwater Rights Are Limited by a GCD There are remedies: Petition for rulemaking to request a change in the regulatory approach Petition for mandamus and declaratory relief in state court Administrative appeal of GCD s decision to GCD then state court Takings claim in state court Constitutional claims (e.g., due process, equal protection) in federal or state court DFC appeals Legislation

16 When Access to Your Groundwater Is Denied and Courts Affirm the GCD s Decision to Deny Consider a takings claim. Talk to a lawyer about the facts of your case. A takings is not always compensable. Edwards Aquifer Authority v. Day/McDaniel (Tex. S. Ct. 2012) (permit application partially denied)(remanded, then settled) Edwards Aquifer Authority v. Bragg (S.A. Ct. of App. 2013) (one permit application denied and second application partially denied)(the taking IS compensable in this case; reversed and rendered to recalculate damages; possible appeal to Tex. S. Ct.)

17 TAKEAWAYS Inventory your groundwater supplies on site and within local area; consider impacts from other users and options to protect your interests. GCDs are a good resource for this information Review your GCD s rules, management plan, DFCs, MAG report Engage with your GCD s leadership and management Stay up to speed with developments (get on distribution lists, check notices) Be proactive with rulemaking and DFC development

18 Environmental Seminar September 12-13, 2013 Groundwater and Groundwater Rights in Texas presented by Mike Gershon 816 Congress Avenue, Suite 1900 Austin, Texas (512)