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A Test for California’s Groundwater Regulations in the Megadrought

Sept. 7, 2021, 8:01 AM

Record dry conditions once again in the West have led the federal and state governments to declare water supply shortages. California’s governor has declared that 50 counties, in which approximately 41% of the state’s population exists, are now under a drought state of emergency. This prompted the adoption of emergency regulations ordering water rights holders to curtail their water diversions on numerous northern California rivers.

The state and federal water projects, which together deliver water to approximately 30 million Californians and more than one-third of the state’s agricultural farmland, have reduced deliveries to 5% or less. As a result, agricultural, urban, and environmental water users are being forced to cut back with “devastating impacts on our communities, businesses and ecosystems.”

Drought may connote for some an anomalous occurrence. To be clear, paleoclimate records show that California’s water regime is in part defined by its droughts and sustained dry periods. What’s relatively new is the added layers of complexity hastened by climate change and increased demand.

Droughts Bring Water Disputes

Historically, droughts have agitated underlying disputes over the allocation of shared water resources. This drought, following so quickly on the heels of the last drought—hydrologists believe we’re in the midst of a megadrought—is likely no different.

While much is made of the propensity of water users to engage in “water wars,” litigation is the last resort. In the case of California, with its complex and nuanced water regulatory system overlaid by a climate that simultaneously makes it a highly desirable place to grow crops, work and live— but also a highly volatile place to do so—this drought presents the opportunity to finally implement management solutions that ensure sustainability of our water supplies.

Drought impacts in California are well documented. In dry years, snow pack is diminished and surface water sources run dry. Water users then increase their reliance on groundwater supplies, from one-third to more than one-half of total water used.

This increased competition may cause water levels to fall and groundwater wells to go dry in the short-term, or if sustained, result in long-term adverse impacts on the resource.

The Sustainable Groundwater Management Act

In 2014, after three consecutive dry years, then the worst in California history, the California legislature enacted the Sustainable Groundwater Management Act (SGMA), the state’s historic, first comprehensive regulation of groundwater, to address this problem. Until then, groundwater basins were unregulated and in many cases unmanaged, resulting in adverse or “undesirable results,” such as subsidence, seawater intrusion, and long-term supply depletion.

SGMA requires that local agencies—called “groundwater sustainability agencies”—manage the groundwater supplies within their jurisdictions sustainably. They must adopt “groundwater sustainability plans” that implement measures and actions to achieve sustainability within 20 years of the plan’s adoption.

To that end, SGMA empowers these agencies to limit or suspend well construction and even groundwater pumping, and to impose fees on groundwater producers to fund management actions. These include construction of supplemental water projects to replenish the basin and fallowing of agricultural lands to reduce demand, to mitigate for groundwater overdraft.

Yet these powers are expressly constrained in one important way—they may not abridge or impair water rights. Overlying water rights holders, farmers for example, are entitled to share in the available supply to meet their reasonable (not wasteful) and beneficial uses.

A pumping allocation or pumping assessment that does not equitably allocate the burden of groundwater management consistent with water rights is likely to draw a lawsuit, not only to invalidate the plan itself, but also to declare the rights of all users to the supply pursuant to a comprehensive adjudication. This is a procedural mechanism specifically designed to address the inherent complexities of litigation involving groundwater basins.

In some basins, where thousands of parties claim the right to use the basin, from small domestic well owners and family farms, to large cities and commercial agricultural operations, this is no small undertaking.

Lawsuits Seeking to Invalidate Plans

The first plans, for the 19 highest priority basins, were adopted in early 2020. Subsequently, lawsuits were filed pertaining to five of these basins. The most recent of these was filed on Aug. 17, 2021, after the state found the plan for the basin in question deficient.

Plaintiffs in these cases seek to invalidate plans that are alleged to violate their water rights and also a comprehensive adjudication of the basin’s supply—a declaration of each party’s right to use the resource and an allocation of the available supply, consistent with SGMA, the California Constitution’s mandate to maximize reasonable and beneficial use of the state’s water supply resources, and with common-law water rights.

The remaining 75 priority basins are required to adopt their plans by January 2022. Groundwater sustainability agencies are scrambling to complete adequate plans and to address both the short-term impacts of the drought and long-term sustainability. At the same time, the plans are being reviewed and vetted by groundwater users with a critical eye aimed at a plan’s impacts on their water rights.

If groundwater sustainability agencies and water rights holders are not able to strike the right balance, judicial resolution of their dispute may be appropriate to ensure resilience of the plan as this drought continues and when the (reliably inevitable) next one arrives.

This column does not necessarily reflect the opinion of The Bureau of National Affairs, Inc. or its owners.

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Stephanie Osler Hastings is a shareholder at Brownstein Hyatt Farber Schreck LLP. She has played a leading role in California’s most complex and precedent-setting water matters, and she brings more than 20 years of sophisticated legal skill and experience to the acquisition, maintenance and protection of water resources and rights.