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ARIZONA: An Introduction to Environment: Water Rights

Contributors:
Daniel B. Jones
Michael K. Foy
Salmon Lewis & Weldon
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By: Michael K. Foy and Daniel B. Jones, Salmon Lewis & Weldon, PLC

Distinct bodies of law control groundwater and surface water use in Arizona. Arizona’s general stream adjudications have been the primary driver of recent developments in surface water law, while groundwater law has been shaped by the development of an updated plan to implement the Groundwater Code.

Surface Water Developments 

In Arizona, the direction of surface water law—or, more accurately, appropriable water law—is shaped primarily by new developments in the Gila River and Little Colorado River Adjudications, which collectively encompass the majority of Arizona’s geographic area and water uses. The Gila Adjudication Court is in the process of deciding two issues that will have broad implications for Arizona water users.

The first issue is whether appropriative rights that were perfected before the enactment of Arizona’s modern Water Code are immune from “forfeiture” based solely on non-use. Arizona’s Water Code, which was originally enacted in 1919, provides that water rights can be lost if not used for five consecutive years. The longstanding consensus among Arizona water attorneys was that rights perfected before the Code came into existence were immune from the “use it or lose it” rule. The Special Master in the Gila Adjudication recently held that pre-1919 rights are not necessarily immune from statutory forfeiture. The Adjudication Court will review the Special Master’s decision and, regardless of its ruling, the issue almost certainly will wind its way through a lengthy appeals process. The present uncertainty surrounding pre-1919 forfeiture means that additional diligence is required for those wishing to acquire or protect Arizona water rights. A pre-1919 priority date might no longer offer enough protection on its own.

Arizona water users also are awaiting a ruling from the Adjudication Court regarding the procedures for acquiring a right to use underground water that is hydrologically connected to a stream. This water, which is known as “subflow,” is treated as appropriable water in Arizona notwithstanding the fact that it is nominally underground. A statutory permitting process has provided the exclusive means of obtaining a surface water right since 1919. Because subflow is governed by the same rules as surface water, many parties contend that the permitting process is the sole method for acquiring a right to pump subflow after 1919. Others disagree, contending that the permitting process was not intended to apply to subflow and that its application to subflow would cause inequitable results. Any party that uses water withdrawn from a well near a river will need to closely follow and understand the implications of the Adjudication Court’s eventual decision on this issue. Moreover, the stakes are high for all users of appropriable water because the extent to which subflow pumpers are allowed to continue operating without an appropriative right will affect the amount of surface water that remains available for downstream appropriators.

The other primary Adjudication development stems from the geographic focus of the proceedings, rather than any particular substantive issue. For many years, the Gila Adjudication has focused on claims in the San Pedro River Watershed. The San Pedro proceedings have led to the resolution of various important legal issues. In absolute terms, however, the San Pedro is geographically isolated from Arizona’s population centers and includes relatively smaller water uses. The upcoming pivot from the San Pedro to the Verde Watershed will change this dynamic because appropriable water use in the Verde is exponentially larger and involves a more diverse array of water users. Moreover, the adjudication of claims in the Verde Watershed will directly impact the legal and physical availability of water in the Phoenix metropolitan area because the Verde River is one of the primary sources of water supply for downstream users in the Salt River Valley.

Groundwater Management Developments 

Arizona’s 1980 Groundwater Management Act (“Groundwater Code”) created a framework of groundwater rights and regulations that govern groundwater use within Active Management Areas (“AMAs”), which encompass the most populous portions of central and southern Arizona. The Groundwater Code established management goals for each AMA, and directed the Arizona Department of Water Resources (“ADWR”) to promulgate five successive management plans containing mandatory conservation requirements for groundwater users. Achieving or maintaining “safe-yield,” defined as a long-term balance between groundwater withdrawals and recharge, is the management goal for the Phoenix, Prescott, Tucson, and Santa Cruz AMAs. The management goal for the predominantly agricultural Pinal AMA, however, balances the development of non-irrigation uses with the preservation of agricultural economies for as long as feasible.

Each management plan prescribes specific conservation requirements for agricultural, municipal, and industrial uses. Although there are important differences among the conservation requirements for each particular water use category, existing conservation programs generally include a water allotment or gallons-per-capita-per-day (“GPCPD”) limit, requiring users to implement defined best management practices (“BMP”) to maximize efficiency and conservation, or some combination thereof. Water users also must comply with reporting, monitoring, and audit provisions specified in each management plan.

ADWR recently convened a work group with stakeholders to develop each AMA’s fifth management plan. The work group covers a variety of issues, with particular emphasis on the proper interpretation of statutory management goals, analyzing progress toward achieving those goals, and updating conservation programs. ADWR interprets the Groundwater Code to require ADWR to design conservation programs to achieve reductions in groundwater withdrawals in each successive management plan. Therefore, proposals to update conservation programs for the fifth management plans generally seek to reduce groundwater use by modifying allotment or GPCPD calculations and bolstering BMP requirements.

ADWR also has discretion to adopt alternative conservation programs that are designed to achieve water conservation at least equivalent to that required under default mandatory programs. Although most regulatory changes in the fifth management plans likely will take the form of modifications to existing programs, ADWR may adopt one or more new alternative conservation programs, such as a proposed “integrated farm program” that would allow agricultural users to combine and manage different groundwater rights as a single farm unit for purposes of calculating allotments and reporting water use.

ADWR currently is in the process of reviewing data, vetting new regulatory proposals, and drafting the fifth management plans. On its current trajectory, ADWR expects to finish drafting and adopt each AMA’s fifth management plan in 2022, with new conservation requirements becoming effective on January 1, 2025. The Groundwater Code does not require ADWR to promulgate a subsequent management plan, but rather directs water users to remain in compliance with fifth management plan conservation requirements until the Arizona Legislature determines otherwise. Thus, it is important for all existing and prospective new users of water within an AMA to ensure that they fully understand upcoming regulatory changes in the fifth management plans, which will control their groundwater use for the foreseeable future.