Water Rights Ruling a Setback for California Drought Regulators

July 10, 2015

The Sacramento Bee

Downey Brand Managing Partner, Scott Shapiro comments in a Sacramento Bee article on the temporary restraining order issued by Sacramento Superior Court Judge Shelleyanne Chang preventing the State Water Resources Control Board from enforcing curtailment notices against four water agencies.

See full article below or view it online at The Sacramento Bee.

By Dale Kasler and Ryan Sabalow for the Sacramento Bee

In a significant ruling that could hinder California’s ability to order mass water cutbacks, a judge told state drought regulators Friday they can’t slash the water rights of four Central Valley irrigation districts until each had a chance to defend itself.

A Sacramento Superior Court judge issued a temporary restraining order preventing the State Water Resources Control Board from enforcing a curtailment notice against the West Side Irrigation District, Central Delta Water Agency, South Delta Water Agency and Woods Irrigation Co. The judge said the four agencies, all primarily agricultural, weren’t given the chance to defend their rights in front of the water board.

While the ruling by Judge Shelleyanne Chang affects only those four agencies, experts said the decision could have statewide implications. The case goes to the heart of what regulators say is a critical tool for allocating supplies in the fourth year of drought.

Gov. Jerry Brown in April issued an executive order saying the board can “bring enforcement actions against illegal diverters and those engaging in the wasteful and unreasonable use of water.” Since then, the board has curtailed the rights of dozens of senior water rights holders in the Sacramento and San Joaquin valleys in a series of mass notices, telling them to stop diverting water from California’s rivers and streams.

It is the first time since 1977 that the state has curtailed senior rights, those that existed before 1914, when the state formally set up its complex water rights system. Rights to more than 1.2 million acre-feet of water have been curtailed.

Chang’s ruling could affect “everybody that received a curtailment order,” said Stuart Somach, a Sacramento water-law attorney not involved in the case.

Beyond that, experts said the decision could grind the state’s drought-management machinery to a halt as regulators are desperate to stretch dwindling supplies through the hot summer months. Instead of issuing curtailment notices to dozens of farmers and other water users en masse, as it has done in recent weeks, the state might have to hold hearings first to sort out their water rights.

“It definitely shows that the legal process probably can’t respond as quickly as nature requires it to respond,” said Scott Shapiro, a water rights lawyer at the Downey Brand law firm in Sacramento who isn’t connected to the case.

A lawyer for one of the plaintiffs said it’s crucial that water users have the ability to plead their case before the water board.

“The court is sending the state board a message that the water users have been trying to send for a few months,” said Jennifer Spaletta, a lawyer for the Central Delta agency, which is based in Stockton and supplies water to 120,000 acres of land. “Water rights are complicated. They cannot send out these broad orders.”

Water board officials maintained Friday that the ruling isn’t all that significant. Board staff counsel David Rose said the curtailment notices are “informational” in nature, intended to tell water users that supplies aren’t available to support their water rights. The board would hold a hearing before issuing any fines or taking other enforcement actions against diversions it considered unauthorized.

“Before anyone is penalized or deprived of anything, there would be a process,” he said.

As a result, the board doesn’t feel hobbled by the judge’s ruling, Rose said. “I don’t think, from the board’s perspective, there is a practical impact” from the judge’s ruling, he said.

The judge, however, said the board’s curtailment notices have “coercive” language that goes beyond informational. The notices tell users to “immediately stop diverting water,” she said. Recipients of the notices have to go online within seven days and declare “under penalty of perjury that they are no longer diverting water,” she said.

Other experts said the ruling presents a potentially major stumbling block for regulators. “This is very challenging” for the board, said Shapiro, whose firm represents north Delta farmers. “In order for the board to be able to curtail the water rights, it has to go through a more full process.

Somach, whose firm is representing a Delta-area water district pursuing its own lawsuit over curtailed rights, agreed. The state should have held “due process hearings to make sure there is no water available,” he said. “None of that stuff happened.”

Close to a dozen water districts have sued the state in response to curtailment notices, arguing that the water board doesn’t have jurisdiction over pre-1914 rights.

Chang didn’t address that issue. Rather, the judge’s five-page ruling took issue with the state board’s decision to curtail the four agencies’ water rights “without any sort of pre-deprivation hearing.” She ordered further court hearings on the matter July 30.

However the court rules, the dispute highlights the urgent need to determine just how much water is being diverted and how much is actually available during certain times of year, said Jennifer Harder, who teaches water law at University of the Pacific’s McGeorge School of Law. Better data, she said, would allow regulators to make a stronger case when they issue a cutback order.

Such studies are underway, but compounding the challenge for state regulators is that very few senior rights holders who pull water directly from streams and rivers precisely track and report how much they use.