Silver v. Pueblo Del Sol Water Co. – 11/8/2016

December 6, 2016

The Arizona Court of Appeals Division One holds that A.R.S. § 45-108 requires that the Arizona Department of Water Resources consider prior federal claims to groundwater rights, but not the impact of pumping.

A company filed an application for an Adequate Water Supply Designation (“AWSD”)—a designation needed to pump groundwater for use in development projects.  The company sought approval to access groundwater in an area that included a section of a river basin previously designated by Congress as a national conservation area.  Several entities, including the Bureau of Land Management opposed the application.  The Arizona Department of Water Resources (“ADWR”) approved the application.  The superior court vacated the decision and held that the ADWR did not meet the obligations set forth in A.R.S. § 45-108, which governs Arizona’s groundwater. 

The Court of Appeals affirmed in part and reversed in part.  A.R.S. § 45-108 requires a developer to show that there is an “adequate water supply” to approve an application for an AWSD.  The statute defines “adequate water supply” to mean water that is “continuously, legally and physically available.”  A.R.S. § 45-108(I).  The Court held that the ADWR properly found that the “legal availability” and “continuous availability” conditions were met.  In so holding, the Court upheld the ADWR’s regulatory provision defining “legal availability” as consistent with § 45-108.  That regulatory provision, AAC R12-15-718(C), defines “legal availability” to mean a private company that has obtained a certificate of convenience and necessity from the Corporation Commission.  As to “physical availability,” the Court held that the ADWR must consider prior claims by the BLM in the area governed by the application.  ADWR could not avoid considering such prior claims just because doing so could require significant time and effort.  Finally, the Court rejected the BLM’s argument that the ADWR must also consider the effects of pumping, as that requirement is not found in A.R.S. § 45-108. 

Presiding Judge Thompson authored the opinion; Judge Portley and Judge Norris concurred.